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S 2776Public Services

Public Utilities and Carriers - Public Utilities Commission

This bill requires large data centers to pay for their own electrical infrastructure upgrades and report water usage annually.

Held for study
Population
Affected
15
Email Legislator
Introduced Mar 4, 2026Committee Senate Commerce

Plain-English Summary

This legislation establishes specific regulations for large data centers, defined as facilities with an electric demand of 50 megawatts or more. It mandates that these data centers must pay 100% of the costs for any necessary electrical infrastructure upgrades, prohibiting utility companies from passing these costs on to residential or other commercial customers. Additionally, the bill requires these facilities to report their annual water usage, cooling methods, and recycling practices to the Department of Environmental Management. State regulators are also empowered to require water efficiency plans and financial bonds to cover site cleanup costs.

For younger readers

This law creates new rules for giant computer buildings called data centers. These buildings use a huge amount of electricity and water. The law says that if a data center needs new power lines or equipment to run, the data center must pay for it all by itself. This makes sure that regular families don't have to pay extra on their electric bills to help a big company. The law also says these buildings must tell the government how much water they use every year and might have to set aside money to clean up the building if they ever close.

Who & Where It Applies

Impacted groups
Data center operatorsResidential electric ratepayersCommercial electric ratepayersDepartment of Environmental ManagementPublic Utilities Commission
Impacted communities
All

Constitutional & Fiscal Check

None Likely

Estimated cost
None
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Protects residential ratepayers and small businesses from subsidizing the massive infrastructure costs required by large corporate data centers, ensuring that utility bills do not rise due to private profit-seeking ventures.
  • Mandates transparency regarding water usage and grants the state authority to require water efficiency plans, promoting environmental stewardship and resource conservation in the face of climate change.
  • Empowers the state to require financial assurance for site restoration, preventing corporations from abandoning facilities and leaving the community with the financial burden of environmental cleanup.
  • Sets the regulatory threshold at fifty megawatts, potentially allowing slightly smaller but still resource-intensive data centers to evade these financial and environmental responsibilities.
  • Focuses primarily on cost allocation and reporting rather than mandating that these high-energy facilities utilize renewable energy sources to mitigate their carbon footprint.
  • Does not explicitly require community benefit agreements or local hiring mandates, missing an opportunity to ensure these developments provide direct economic support to the surrounding neighborhoods.
For Conservatives
  • Enforces free-market principles by requiring private businesses to pay for their own infrastructure needs rather than relying on subsidies funded by other ratepayers.
  • Protects existing businesses and homeowners from inherent electricity rate hikes that would otherwise result from the massive demand of new data centers.
  • Ensures that site restoration costs are covered by the business owner through financial assurance, protecting taxpayers from liability if a private venture fails.
  • Imposes significant new regulatory burdens and reporting requirements on private industry, potentially stifling economic development and discouraging tech investment in the state.
  • Grants the Department of Environmental Management broad discretionary power to mandate efficiency plans and financial assurances, expanding the reach of the administrative state.
  • Singles out a specific industry for unique cost structures and regulations, which could be viewed as the government picking winners and losers rather than maintaining a neutral business environment.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 47 additions

SECTION 1. Chapter 39-1 of the General Laws entitled "Public Utilities Commission" is hereby amended by adding thereto the following section: 39-1-64. Data centers -- Electric cost allocation.

(a) As used in this section, “data center” means a facility, or portion of a facility, primarily engaged in the storage, processing, or transmission of digital information using computer servers and related equipment, and having a projected or actual electric demand of fifty megawatts (50 MW) or greater at a single site.

(b) The public utilities commission shall require that any costs reasonably attributable to the planning, construction, expansion, operation, or maintenance of electric generation, transmission, or distribution facilities necessary to serve a data center shall be borne exclusively by that data center.

(c) No such costs shall be recovered from residential customers or from commercial customers that are not data centers as defined in this section.

(d) The commission shall require electric distribution companies to establish one or more dedicated rate classes, tariffs, contracts, or other cost recovery mechanisms applicable to data centers to ensure compliance with this section.

(e) Nothing in this section shall be construed to alter participation in, or obligations under, regional transmission organizations, federally regulated wholesale electric markets, or federal reliability standards.

SECTION 2. Section 42-98-7 of the General Laws in Chapter 42-98 entitled "Energy Facility Siting Act" is hereby amended to read as follows: 42-98-7. Powers and duties. (a)(1) The siting board is the licensing and permitting authority for all licenses, permits, assents, or variances that, under any statute of the state or ordinance of any political subdivision of the state, would be required for siting, construction, or alteration of a major energy facility in the state.

(2) Any agency, board, council, or commission of the state or political subdivision of the state that, absent this chapter, would be required to issue a permit, license, assent, or variance in order for the siting, construction, or alteration of a major energy facility to proceed, shall sit and function at the direction of the siting board. These agencies shall follow the procedures established by statute, ordinance, and/or regulation provided for determining the permit, license, assent, or variance, but, instead of issuing the permit, license, assent, or variance, shall forward its findings from the proceeding, together with the record supporting the findings and a recommendation for final action, to the siting board.

(3) Notwithstanding any provision in this chapter to the contrary, in those instances in which the department of environmental management exercises a permitting or licensing function under the delegated authority of federal law, including, but not limited to, the federal Clean Water Act (33 U.S.C. § 1251 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), and those state laws and regulations that implement those federal laws, the department of environmental management shall be the licensing and permitting authority. Moreover, the authority to issue licenses and permits delegated to the department of environmental management pursuant to chapter 1 of title 2 and to the coastal resources management council pursuant to chapter 23 of title 46, shall remain with those agencies, but in all other respects the department of environmental management and the coastal resources management council shall follow the procedures set forth in this chapter.

(b) The siting board is authorized and empowered to summon and examine witnesses and to compel the production and examination of papers, books, accounts, documents, records, certificates, and other legal evidence that may be necessary for the determination of its jurisdiction and decision of any question before, or the discharge of any duty required by law of, the board.

(c) The siting board is empowered to issue any orders, rules, or regulations as may be required to effectuate the purposes of this chapter.

(d) The siting board shall, by regulation, determine the standards for intervention.

(e) The siting board’s proceedings shall in all respects comply with the requirements of the Administrative Procedures Act, chapter 35 of this title, except where otherwise explicitly provided.

(f) In the case of any application involving electric generation, transmission, or distribution facilities intended, in whole or in part, to serve a data center as defined in § 39-1-64, the energy facility siting board shall consult with the public utilities commission regarding ratepayer impacts and electric cost allocation.

(1) The board may condition approval of any such application upon a showing that the applicant has obtained approval from the public utilities commission for rates, tariffs, contracts, or other mechanisms ensuring compliance with § 39-1-64.

(2) Nothing in this section shall be construed to authorize the energy facility siting board to set electric rates or to exercise ratemaking authority.

SECTION 3. Title 46 of the General Laws entitled "WATERS AND NAVIGATION" is hereby amended by adding thereto the following chapter: 46-15.9-1. Definitions. As used in this chapter, “data center” means a facility, or portion of a facility, primarily engaged in the storage, processing, or transmission of digital information using computer servers and related equipment, and having a projected or actual electric demand of fifty megawatts (50 MW) or greater at a single site. 46-15.9-2. Water use disclosure.

(a) Each data center shall annually submit to the department of environmental management a report containing:

(1) Average daily water withdrawal;

(2) Peak daily water withdrawal;

(3) Cooling technologies utilized; and

(4) Water recycling or reuse practices.

(b) The department shall prescribe the form and manner of such reporting. 46-15.9-3. Water efficiency plans. The director of the department of environmental management may require a data center to submit a water efficiency, conservation, or recycling plan as a condition of any permit issued under this title. 46-15.9-4. Site restoration assurance. The director may require financial assurance, in a form acceptable to the department, to ensure site restoration in the event of abandonment or cessation of operations

SECTION 4. Severability. If any provision of this act or its application to any person or circumstance is held invalid, the remainder of the act and the application of its provisions to other persons or circumstances shall not be affected.

SECTION 5. This act shall take effect upon passage.