The Daily Dig
California Governor Gavin Newsom signed seven bills on September 21, 2026, setting new rules for data centers across the state. The laws strengthen reporting requirements, giving communities more information on the water, electricity, and land use of proposed data centers. They also make data centers responsible for grid and water upgrade costs and end their eligibility for blanket environmental exemptions.
Plugged In, Paying Up
Data centers will have to pay their fair share of grid update costs, along with any upgrade costs. The state says the goal is to keep those costs off everyday ratepayers, including low-income customers.
Projects must also comply with California's energy procurement requirements. On top of that, they have to bring new clean energy supply onto the grid.
Well, Well, Well
Proposed data centers must give local governments and water suppliers information on water use, supply, efficiency, and drought planning.
If the water system needs upgrades to serve a site, the data center covers the cost.
No Free Pass
The laws make data centers ineligible for blanket environmental exemptions. Before any judicial streamlining can be approved, a project must show it won't shift costs to ratepayers. It also has to meet state standards on energy, water, and fuel consumption.
"Today we are once again laying the groundwork for a stronger approach, because we know that we don't have to sell out Californians or sacrifice our well-being to innovate and succeed," Newsom said.
Snapshot:
Jurisdiction: California
Signed By: Governor Gavin Newsom
Date Signed: September 21, 2026
Number of Bills: 7
Sector: Data centers
Focus Areas: Water, electricity, land use, reporting
Electricity Provisions: Data centers pay their fair share of grid update costs and any upgrade costs; must comply with state energy procurement requirements; must bring new clean energy supply onto the grid; no cost shifts to low-income customers or everyday ratepayers
Water Provisions: Disclosures to local governments and water suppliers on water use, supply, efficiency, and drought planning; data centers pay for any upgrades needed to supply water
Land Use Provisions: Ineligible for blanket environmental exemptions; judicial streamlining requires showing no cost shift to ratepayers and compliance with state energy, water, and fuel consumption standards
AB 1577: Asm. Rebecca Bauer-Kahan (D-Orinda), Data centers: reporting
AB 2383: Asm. Rick Chavez Zbur (D-Hollywood), Electricity: data centers
AB 2469: Asm. Diane Papan (D-San Mateo), Data centers: water use disclosures
AB 2619: Asm. Diane Papan (D-San Mateo), Water resources: data center
SB 886: Sen. Steve Padilla (D-San Diego) and Sen. Jerry McNerney (D-Pleasanton), California Technology Innovation and Ratepayer Protection Act
SB 887: Sen. Steve Padilla (D-San Diego), California Environmental Quality Act: environmental leadership development projects: data centers: geothermal power plant projects
SB 1168: Sen. Jerry McNerney (D-Pleasanton), Data centers: Rate structures
Stated Context: The Governor's office contrasts the laws with the Trump administration's move toward deregulation
TheJobWalk Thoughts
Under these laws, data centers carry their own grid and water upgrade costs. Someone still has to scope, price, and build that work. Expect utility coordination to start earlier in preconstruction.
Losing blanket exemptions could add time to environmental review for some projects. Forecasts for California data center work should allow for that. Check the bill texts for effective dates, since the announcement doesn't give them.
Cooling typically drives data center water use, so the new disclosures will likely touch it. Mechanical subs and suppliers should bring credible efficiency data to design talks. That could help a project clear local review.
🥾Want to advertise in TheJobWalk? Learn More🥾
