Warner proposes link of data center tax break to energy efficiency
U.S. Sen. Mark Warner has introduced federal legislation, the "Data Center Tax Accountability and Disclosure Act," to link data center tax breaks to energy efficiency, water conservation, and emissions disclosure. This proposal comes amid a policy debate in Virginia on how best to tax and regulate data centers, with environmental groups advocating for similar state-level standards and a moratorium on new approvals. Warner's bill aims to apply national standards for environmental performance, mirroring efforts by some Virginia lawmakers.
U.S. Sen. Mark Warner, D-Va., has introduced a legislative package that includes the "Data Center Tax Accountability and Disclosure Act," aimed at regulating the rapidly growing data center industry. The proposed federal bill would require data centers to publicly report their energy use, water consumption, and emissions. In exchange for federal tax breaks, data centers would need to meet high standards for energy efficiency and environmental protection, potentially aligning with LEED Platinum and Gold certifications.
Warner's initiative comes as Virginia lawmakers are divided on state-level taxation and regulation of data centers, an industry that has heavily concentrated in the state. Environmental groups, including the Virginia League of Conservation Voters, the Chesapeake Bay Foundation, and the Sierra Club, have expressed strong support for Warner's proposal. They advocate for similar state-level standards and a temporary moratorium on data center approvals in Virginia until such regulations are established.
The federal proposal touches on an ongoing policy debate within Virginia, where a joint subcommittee is set to consider tax policies for the data center industry. This includes discussions on whether to repeal a sales tax exemption or link it to environmental and energy efficiency requirements. Del. Rip Sullivan, D-Fairfax, whose similar state-level legislation failed previously, welcomed Warner's move to nationalize these efforts. Josh Levi, president and CEO of the Data Center Coalition, stated the organization is reviewing the proposed legislation and remains committed to engaging with officials on responsible and sustainable development practices.