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Thursday, Mar 05, 2026
Outside the box.
Washington Lawmakers Advance Bill to Regulate Growing Data Center Industry
State legislators push new rules to protect the power grid and ratepayers as data centers expand rapidly
Washington state legislators are advancing a bill aimed at regulating data centers amid concerns about their growing demands on the electrical grid and potential cost impacts for utility customers.
House Bill 2515, sponsored by Representative Beth Doglio, passed the House Appropriations Committee and now awaits a vote on the House floor before moving to the Senate.
The legislation responds to projections that data centers could become the largest source of electricity demand in the Pacific Northwest, straining utilities and raising concerns about grid reliability and rising energy costs for other ratepayers.
Proponents argue that new guardrails are needed so that data centers shoulder the infrastructure costs associated with their rapid growth rather than shifting those burdens to residential customers and small businesses.
Under the current draft, utilities would be required to establish tariffs or policies by 2027 to ensure data centers cover the costs utilities incur to serve them.
The bill would also require facilities to take steps to manage their energy demand when the grid is under strain and to provide data on water and energy use, emissions and sustainability practices.
Supporters say these measures would increase transparency and grid resilience, especially as data centers attract more artificial intelligence and cloud computing workloads to the state.
The bill has evolved during the legislative process.
An amendment from Republican lawmakers eliminated an annual state fee on data center energy use that was expected to generate tens of millions of dollars for weatherization and higher-education programs, and the clean-energy purchase requirements for data centers were loosened, with a deadline now aligned to 2045 in line with the state’s broader greenhouse gas goals.
Opponents argue the bill still unfairly singles out data centers and could dampen investment, especially given Washington’s existing tax incentives that helped make the state one of the top ten nationally for data center facilities.
Critics also contend that other large industrial power users should be subject to similar requirements rather than focusing solely on data centers.
The debate reflects long-standing tension in Olympia over how to balance technology sector growth with environmental targets and infrastructure costs.
A state workgroup established under an executive order has been studying the broader impacts of data centers on the economy, energy use, tribal resources and the environment, with findings expected to inform future policy.
As Washington continues to attract data center investment, lawmakers are seeking ways to ensure that expansion does not outpace energy supply or undermine affordability for residents and businesses.
House Bill 2515, sponsored by Representative Beth Doglio, passed the House Appropriations Committee and now awaits a vote on the House floor before moving to the Senate.
The legislation responds to projections that data centers could become the largest source of electricity demand in the Pacific Northwest, straining utilities and raising concerns about grid reliability and rising energy costs for other ratepayers.
Proponents argue that new guardrails are needed so that data centers shoulder the infrastructure costs associated with their rapid growth rather than shifting those burdens to residential customers and small businesses.
Under the current draft, utilities would be required to establish tariffs or policies by 2027 to ensure data centers cover the costs utilities incur to serve them.
The bill would also require facilities to take steps to manage their energy demand when the grid is under strain and to provide data on water and energy use, emissions and sustainability practices.
Supporters say these measures would increase transparency and grid resilience, especially as data centers attract more artificial intelligence and cloud computing workloads to the state.
The bill has evolved during the legislative process.
An amendment from Republican lawmakers eliminated an annual state fee on data center energy use that was expected to generate tens of millions of dollars for weatherization and higher-education programs, and the clean-energy purchase requirements for data centers were loosened, with a deadline now aligned to 2045 in line with the state’s broader greenhouse gas goals.
Opponents argue the bill still unfairly singles out data centers and could dampen investment, especially given Washington’s existing tax incentives that helped make the state one of the top ten nationally for data center facilities.
Critics also contend that other large industrial power users should be subject to similar requirements rather than focusing solely on data centers.
The debate reflects long-standing tension in Olympia over how to balance technology sector growth with environmental targets and infrastructure costs.
A state workgroup established under an executive order has been studying the broader impacts of data centers on the economy, energy use, tribal resources and the environment, with findings expected to inform future policy.
As Washington continues to attract data center investment, lawmakers are seeking ways to ensure that expansion does not outpace energy supply or undermine affordability for residents and businesses.
