Federal bill introduced requiring data centers to cover power, water infrastructure costs
Congressman Michael Baumgartner introduced the Power and Water for Families Act of 2026, a federal bill requiring large data centers to cover the full cost of new power and water infrastructure built to serve them. The legislation aims to protect ratepayers from subsidizing the energy and water demands of these facilities, which often strain local grids and resources. It also includes tax credits for new generation and water reuse systems.
Congressman Michael Baumgartner (R-Spokane) has introduced the Power and Water for Families Act of 2026 (H.R.9419), a federal bill aimed at requiring large data centers to bear the full cost of new power and water infrastructure built to accommodate their demands. The legislation mandates that facilities consuming 100 megawatts or more cover the incremental costs of generation, transmission, or distribution upgrades, and requires financial assurances from developers to prevent ratepayers from subsidizing these projects.
The bill addresses growing concerns over AI data centers straining power grids nationwide and the potential for increased energy rates for families and small businesses. Baumgartner emphasized that while America must lead in AI, working families should not be forced to subsidize it. He cited local actions in Washington state, where both Seattle and Spokane have voted to ban new data centers, as evidence of regional flashpoints regarding data center expansion.
The proposed act also includes tax credits for surplus new energy generation provided to other customers and for water reuse systems. It aligns with recent directives from the Federal Energy Regulatory Commission and pledges signed by major tech companies like Amazon, Google, and Microsoft to protect ratepayers, but allows states and utilities flexibility in implementation. Baumgartner highlighted Eastern Washington's abundant hydropower as attractive to investors but stressed that local communities deserve protection from higher bills due to industrial users.