California lawmakers move to shield homeowners from Data Center utility hikes

California lawmakers, led by Senator Steve Padilla (D-San Diego), are advancing a legislative package, Senate Bills 886 and 887, aimed at regulating the rapid expansion of data center infrastructure within the state. The measures seek to prevent "Big Tech" companies from passing the substantial costs of their power-hungry operations and associated grid upgrades onto residential utility customers. SB 886 would mandate the California Public Utilities Commission (CPUC) to create a special tariff, ensuring tech companies fully cover the expenses for new transmission lines and electrical grid improvements required by data centers. Concurrently, SB 887 addresses environmental concerns, providing incentives for data centers that adopt water conservation and clean energy practices through "Environmental Leadership Development Project" (ELDP) certification, which offers an accelerated environmental review. The bill also clarifies that data center projects are not "ministerial" and thus remain subject to the California Environmental Quality Act (CEQA), safeguarding communities from potential environmental impacts. Both bills have garnered support from consumer and environmental groups, including The Utility Reform Network (TURN) and Net Zero California. SB 886 has passed the Senate Energy Committee and is moving to the Appropriations Committee, while SB 887 cleared the Senate Environmental Quality Committee and now proceeds to the Senate Energy Committee.