Relating to water efficiency of data centers, including requirements for water-efficient cooling technologies and encouragement for the use of nonpotable and recycled water sources, providing civil penalties, and including effective date and applicability provisions

This bill relates to the water efficiency of data centers, including requirements to implement water-efficient cooling technologies and encouragement for the use of nonpotable and recycled water sources. The bill defines “water usage effectiveness rating” as a metric that measures how efficiently water is used for cooling. The bill explains the rating is calculated by dividing annual water usage in liters by the energy consumption of information technology equipment in kilowatt hours.2 liters per kilowatt hour or less. 2 liters per kilowatt hour requirement. The bill encourages data centers to utilize air-based or hybrid cooling systems, source water from nonpotable supplies, and install water treatment systems that bring nonpotable water to the appropriate quality for cooling system use. The bill directs data centers using treated wastewater to coordinate with utilities to ensure the water is used prior to discharge and that all discharge is in compliance with environmental standards. The bill directs data centers subject to the requirements of the bill to submit a cooling and water sourcing plan to the department of natural resources (DNR) prior to construction, expansion, or renovation and an annual compliance report for five years following commissioning, expansion, or renovation. The bill directs DNR to adopt rules establishing monitoring, enforcement, and verification for provisions in the bill. The bill allows DNR to conduct inspections and audits, order the submission of water usage and sourcing documentation, and review treatment and cooling center operations. A data center found in violation of the bill is subject to a civil penalty of up to $10,000 per day of noncompliance, a corrective action order with a compliance timeline, or the suspension or revocation of construction or operating permits. The bill allows temporary exemptions of the bill’s requirements to be granted to data centers for demonstrated lack of feasible technology, water source access, or conditions that pose a risk to public safety. The exemptions may be granted for no longer than 12 months and must be supported by technical documentation and a proposed path to compliance. The bill takes effect upon enactment. The bill applies retroactively to January 1, 2026, for all new data center projects permitted on or after that date, any previously permitted project that has not broken ground by that date, and any data center expansion or renovation undertaken on or after that date.