Colorado Data Center Accountability Bill Fails at Session End

The bill, sponsored by Sen. Cathy Kipp and Rep. Kyle Brown, would have applied a comprehensive regulatory framework to large-load data centers, defined as facilities drawing more than 30 megawatts or multiple co-located facilities with a collective load exceeding 60 megawatts. The bill required operators to achieve 100% annual renewable energy consumption by January 1, 2031 with hourly matching requirements to be determined by the Public Utilities Commission by June 30, 2030. It also required data centers to enter 15-year utility contracts covering all infrastructure costs and barred utilities from subsidizing data center interconnection through rates charged to other customers.

Kipp added a tax incentive provision in a last-minute rewrite over the weekend before the final legislative vote in an attempt to bring industry stakeholders and labor groups to a deal. The Senate Transportation and Energy committee voted the bill down unanimously on May 11, the second-to-last day of Colorado's legislative session. A competing industry-backed bill that would have offered 20- to 30-year tax exemptions for data centers investing at least $250 million in the state also failed in committee the prior week. Colorado enters the summer without data center incentives or industry-specific environmental protections in place.

What SB 102 Would Have Required and Why It Stalled

The introduced version of SB 102 set requirements across energy, water, emissions, and community engagement. On the energy side, operators would have been prohibited from receiving economic development utility rates, required to contribute to utility demand-side management programs scaled to their consumption, and restricted in their use of on-site combustion backup generators to emergency and testing use only, with diesel generators limited to 50 hours annually for testing and maintenance. Water reporting requirements would have included annual disclosure of total consumption, water sources by type, and water usage effectiveness ratios. Facilities sited in disproportionately impacted communities would have been required to complete third-party cumulative impact analyses and enter legally binding community benefit agreements before development could begin.

The bill's sponsors have said the legislation will be reintroduced in the next session. Sen. Kipp stated following the vote that data center companies "need to come to the table understanding the harms their operations can cause the communities and to our grid." Denver Mayor Mike Johnston announced in February that the city is considering a moratorium on data center development while the city develops its own regulatory framework, a move that reflects the difficulty of resolving these issues at the state level.

The Same Pattern Is Playing Out Across State Legislatures in 2026

Colorado's outcome is not an outlier. According to MultiState's 2026 data center policy tracker, 27 states are advancing legislation requiring developers to cover data center energy costs and report usage, but most bills are stalling before final passage. Moratorium proposals have been introduced in 11 states and 14 total bills, but as of May 2026, none has passed its originating chamber.

Maine came closest. The Maine Legislature passed L.D. 307 through both chambers, a bill that would have imposed an 18-month moratorium on new data centers drawing more than 20 megawatts. Governor Janet Mills vetoed the bill in April 2026, stating she would have signed it if it included an exemption for a proposed $550 million project at the former Androscoggin paper mill in Jay. In Virginia, a moratorium bill targeting Loudoun County was effectively killed in committee, though Virginia's budget conference is still debating whether to eliminate existing data center sales tax exemptions. In Georgia, lawmakers advanced several proposals including one that would have codified existing Public Service Commission regulations but failed to finalize any data center legislation before the session closed. Oklahoma and New York both have active moratorium proposals that missed key deadlines in their respective sessions.

Local Governments Are Moving Where State Capitols Have Not

With state legislatures stalling, local governments have accelerated their own actions. Good Jobs First, which tracks data center regulatory activity, counted at least 63 local moratorium actions introduced, considered, or adopted across municipalities as of May 2026, with 54 already passed. Cities including Denver, New Orleans, and Ypsilanti, Michigan have moved forward with construction pauses while developing zoning and utility impact rules. More than 140 local groups have collectively blocked or delayed more than $60 billion in data center investment in the past year, according to Data Center Watch.

The federal government is pushing in the opposite direction. A July 2025 executive order directed the acceleration of data center permitting for facilities requiring more than 100 MW, costing at least $500 million, or those tied to national security. A separate December 2025 order directed the Secretary of Commerce to publish a list of state AI laws deemed invalid, though that list has not been published. On March 4, 2026, several major data center developers signed the Ratepayer Protection Pledge, a voluntary commitment to cover the full cost of new electric generation resources required to meet their energy demands. California, Ohio, and Utah have each enacted laws going beyond that voluntary standard, according to MultiState's tracker.