California tightens rules on AI data center energy and water use

# California tightens rules on AI data center energy and water use Source: [https://www.theverge.com/ai-artificial-intelligence/998453/california-ai-data-center-bills](https://www.theverge.com/ai-artificial-intelligence/998453/california-ai-data-center-bills) [Skip to main content](https://www.theverge.com/ai-artificial-intelligence/998453/california-ai-data-center-bills#content) Gavin Newsom signed a package of bills requiring AI data centers to pay for upgrades to the local energy grid\. Gavin Newsom signed a package of bills requiring AI data centers to pay for upgrades to the local energy grid\. by Sep 21, 2026, 8:29 PM UTC   Image: Sandy Huffaker / AFP via Getty Images [](https://www.theverge.com/authors/emma-roth) Emma Roth is a news writer who covers the streaming wars, consumer tech, crypto, social media, and much more\. Previously, she was a writer and editor at MUO\. California Gov\. Gavin Newsom[has signed seven bills](https://www.gov.ca.gov/2026/09/21/governor-newsom-signs-most-comprehensive-data-center-laws-in-the-nation-providing-communities-more-control-on-water-electricity-and-land-use/)designed to prevent AI data centers from passing utility costs onto residents, as reported earlier by[the*Los Angeles Times*](https://www.latimes.com/california/story/2026-09-21/newsom-signs-bills-to-regulate-data-center-industry-criticizes-trump-for-inaction)\. The package of laws requires the California Public Utilities Commission to introduce a new rate classification for data centers, while forcing them to pay for upgrades to local power grids and water systems\. Other bills included in the package will require proposed data centers to disclose their estimated water use to local governments, along with information about energy efficiency and drought planning\. They must also meet certain energy, water, and fuel consumption requirements before qualifying for a streamlined approval process\. Last week, Newsom[signed an executive order to speed up the creation](https://www.theverge.com/policy/997516/california-governor-newsom-ai-kill-switch)of an AI “kill switch\.” “While the Trump administration moves toward deregulation, communities are left to deal with the consequences — higher electricity demand, grid constraints, water use, and pollution,” Newsom says in the press release\. “With these laws, we are ensuring that Californians remain in the driver’s seat — and that those profiting from data centers aren’t doing so at our expense\.” **Follow topics and authors**from this story to see more like this in your personalized homepage feed and to receive email updates\. - Emma Roth ## The Verge Daily A free daily digest of the news that matters most\.