Wisconsin Lawmakers Introduce Bill to Shield Ratepayers from Data Center Infrastructure Costs

Wisconsin Lawmakers Introduce Bill to Shield Ratepayers from Data Center Infrastructure Costs January 8, 2026 A new legislative proposal in Wisconsin seeks to establish financial and environmental guardrails for the rapidly expanding data center industry, aiming to prevent existing utility customers from subsidizing the massive infrastructure demands of these facilities. The move reflects a growing national trend as states grapple with balancing economic development from the AI and cloud computing boom against the strain on local power grids and water resources. The bill, introduced by State Representative Shannon Zimmerman (R-River Falls) and State Senator Romaine Quinn (R-Birchwood), proposes creating a new utility rate class specifically for data centers. A core provision would prohibit utility companies from passing the costs associated with serving these high-energy consumers—such as new transmission lines or power generation—onto other residential and small business ratepayers. “When new growth in data centers indicated significant new electricity demands, I became concerned that costs could be shifted onto Wisconsin families and small businesses,” Senator Quinn stated. “The bill I am introducing will prevent utility companies from passing their electricity costs on to any other customer. Wisconsin is open for business -- just not at the expense of ratepayers already here.” Beyond electricity, the legislation includes stringent requirements for water usage, mandating that data centers utilize closed-loop cooling systems to minimize consumption. Operators would also be required to file annual water usage reports and post a bond to cover potential land reclamation costs. Furthermore, the bill stipulates that any renewable energy used to power a facility must be generated on-site, and it includes a clause requiring incomplete construction projects to restore the land to its original condition. Wisconsin joins several other states enacting similar measures. In July, Ohio regulators approved a settlement requiring new data center customers to pay for a significant portion of the infrastructure built to serve them, even if their actual consumption is lower. Following a bill passed by Oregon's House in April, Virginia's Dominion Energy proposed a new rate class in September for customers consuming over 25 megawatts, a threshold that would encompass many of the approximately 450 data centers in its service area. These actions signal a pivotal shift in how the economic burden of supporting critical digital infrastructure is allocated, potentially influencing site selection and operational models for hyperscale developers across the United States. Source: datacenterdynamics