Republicans and Democrats agree data centers should not stick ordinary ratepayers with their big water bills, but agreeing on how to do it is another matter.
One idea on the drawing board is the Water Cost Accountability Act.
The legislation would require grant-funded states to prohibit public water systems from billing customers other than the large-scale data center for the incremental cost of connecting the data center or expanding capacity to serve it.
“Absolutely, data should be required [to pay] for what they use out of the system,” Neil Bradley, executive vice president of the U.S. Chamber of Commerce, told the House Energy and Commerce Committee’s environment subcommittee at a recent hearing about the bill.
“By the way, that provides them a very strong incentive to innovate to reduce their use,” Mr. Bradley added.
U.S. data centers directly consumed an estimated 17 billion gallons of water in 2023, according to a July Congressional Research Service report.
About 97% of that water comes from public water. A few data centers self-source their water, such as from surface water or groundwater.
Julie Moore, vice chair of the Water Committee for the Environmental Council of the States, said a data center’s water usage would “simply dwarf the water usage” of small communities.
“There is some amount of fixed costs, and so having a larger user base in a water system has value in bringing down the average cost to individual users,” she said.
The legislation garnered support from Microsoft.
Fred Humphries, the company’s vice president of U.S. government affairs, said the bill reinforces the principle that companies must “responsibly show up in communities.”
“Transparent, community-informed planning is essential to ensuring infrastructure investments deliver lasting benefits while responsibly managing natural resources,” he said in a statement. “This legislation represents an important step toward building the infrastructure needed for America’s future while strengthening trust with the communities that host it.”
The bill would require an EPA report to Congress within 18 months on data center water sourcing, but does not require that report be made public.
The U.S. does not currently have federal laws or nationwide standards requiring data centers to track or disclose their water consumption. The EPA has said it will not set nationwide environmental standards, leaving rules for data centers to states and local governments.
“If Congress fails to adopt strong federal guidelines, then a federal moratorium on data centers should be put in place,” said Rep. Frank Pallone, the top Democrat on the House Energy and Commerce Committee.
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