Press Release

Nation-Leading Data Center Regulations Signed Into Law

SACRAMENTO – Today, California Governor Gavin Newsom signed into law Senate Bills 886 and 887, both authored by State Senator Steve Padilla (D-San Diego). This data center legislative package contains some of the strongest rate payer protections and environmental protections from data center costs in the country.

“These are some of the nation’s strongest data center ratepayer protections – stopping Big Tech from sticking California families with the bill for their data centers while ensuring all local voices have a say on these projects and they comply with our air, water, and climate standards,” said Senator Padilla. “Big Tech keeps promising to be good neighbors and these laws now make those promises legally enforceable. No more saying one thing in the White House and doing the opposite in our local communities.”

After years of critical discussions with regulators, clean energy advocates, and community voices, Senate Bill 886, authored by Senator Padilla, and Assembly Bill 2383, authored by Assemblymember Zbur, form a comprehensive legislative package with some of the strongest ratepayer protections from data center costs.

The bill package ensures that data centers:

  • Pay all transmission infrastructure upgrade costs required to connect them to the grid
  • Cover all generation costs needed to serve them
  • Bear a larger share of wildfire mitigation and liability costs than they do today.

These protections prevent data center electricity and grid costs from being foisted on other customers while keeping California’s commitment to its aggressive clean energy and climate targets.

Senator Padilla is also the author of Senate Bill 887, which ensures local communities have a say in data center projects and requires that all projects undergo environmental review to protect local water and air quality. These protections and requirements to include local voices are proving critical as data centers across the country are facing pushback from the communities they are proposed to be built in. Recently, the Trump Administration announced it plans to eliminate requirements for public input for new data centers and the power plants needed to run them. Additionally, the largest data center project in California has been proposed to be built in Senator Padilla’s district, with the developer cutting a backroom deal to circumvent critical environmental review without any community input.

These ratepayer protections and community empowerment bills are supported by a broad coalition of consumer advocates.

“Collectively these measures protect ratepayers from subsidizing the significant energy consumption of data centers, ensuring that the data centers pay upfront for the extra infrastructure that must be built to operate them, and pay their fair share for wildfire mitigation and other ratepayer funded programs,” said Mark W. Toney, Ph.D., Executive Director at TURN—The Utility Reform Network. “We are grateful for the Governor's leadership to hold these data centers accountable.”

“Managing data center-driven load growth is one of the most consequential energy issues facing the nation today,” said Sam Uden, Co-Founder and Managing Director at Net Zero California. “California policymakers have met the moment with a robust set of protections that first and foremost prevent data centers from shifting costs onto ratepayers. These bills also lay a foundation to turn data center growth into an opportunity--bringing new energy supply onto the grid and strengthening reliability. This package represents a sophisticated response to a critical public issue: we don’t need moratoriums if we have the leadership to put strong protections in place while capturing the broader economic and technological benefits of data centers.”

The Senate approved SB 886 by a vote of 28 to 10 and the Assembly 62 to 7. SB 887 passed the Senate 30 to 8 and the Assembly 59 to 11.

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Steve Padilla represents the 18th Senate District, which includes the communities of Chula Vista, the Coachella Valley, Imperial Beach, the Imperial Valley, National City, and San Diego. Prior to his election to the Senate in 2022, Senator Padilla was the first person of color ever elected to city office in Chula Vista, the first Latino Mayor, and the first openly LGBT person to serve or be elected to city office. Website of Senator Steve Padilla: https://sd18.senate.ca.gov/