State Legislatures Introduce Over 190 Data Center Bills in 2025, Focus on Incentives and Ratepayer Protection

In 2025, over 190 bills related to data centers were introduced in U.S. state legislatures, a significant increase from 2024. Key topics included locational incentives and ratepayer protection, with most enacted bills passed by Republican legislatures.

Approximately 50 bills proposed tax incentives for data centers, with states like Arkansas and Indiana enhancing tax exemptions and zoning laws. Legislative focus also shifted to the impact of data centers on electricity prices, resulting in over 40 bills addressing ratepayer protection, including Minnesota's HF 16, which mandates grid cost coverage by large customers.

Environmental concerns led to approximately 30 bills related to water use, but few were enacted. Texas SB 6 established disclosure requirements for energy use, while Iowa limited tax exemptions. Texas also became the first state to mandate remote disconnections for data centers during grid emergencies. This trend in data center legislation is expected to continue into 2026.