North Carolina Bill Targets Large Data Centers, Mandating Full Infrastructure Cost Coverage and Clean Energy Requirements
April 29, 2026
North Carolina Bill Targets Large Data Centers, Mandating Full Infrastructure Cost Coverage and Clean Energy Requirements
A new bill introduced in the North Carolina House of Representatives seeks to fundamentally reshape how large data centers are regulated and taxed in the state. Proposed by Representative Lindsey Prather, a Democrat from Buncombe County, the "Ratepayer and Resource Protection Act" would bar data centers from receiving state and local tax incentives and require facilities with significant energy and water footprints to bear the full cost of the new energy and water infrastructure needed to serve them. The legislation represents the latest effort by a US state to prevent utility costs from being shifted onto residential and small-business ratepayers as data center demand surges.
The bill specifically targets facilities with a projected peak energy demand of 40 megawatts or more, and those expected to consume more than one billion liters of water annually. Under the proposed law, these large-load data centers would be mandated to deploy on-site "clean energy generation capacity" sufficient to offset at least 25 percent of their peak electricity demand. Furthermore, all data center operators within the state would be required to file an annual report detailing their total electricity consumption, water usage, and the effectiveness of their cooling systems. The legislation also grants the state commission authority to increase the minimum on-site clean generation percentage if it finds that additional capacity is necessary to maintain grid reliability and protect other customers from rate increases.
Formally filed on April 27, 2026, the bill is in the early stages of the legislative process. Given that it was sponsored by Democratic lawmakers, who are a minority in the House, the legislation is expected to face significant opposition and would likely need to be amended to advance. This bill is part of a broader trend across the US, where state legislatures are seeking to enforce new utility rate structures on large data centers. Ohio was among the first to act, with the Public Utilities Commission of Ohio approving a new rate class in July that requires new data center customers to pay for a portion of their energy requests regardless of usage to cover infrastructure costs. Virginia’s main utility, Dominion Energy, followed in September with a proposed rate class for customers consuming over 25 megawatts, and in January, the Wisconsin State Assembly passed a bill setting out protections for ratepayers.
Source: datacenterdynamics
