As developers eye Colorado for a wave of new data centers to power the AI boom, a new bill backed by environmental and consumer groups aims to shield residents from the impacts of the massive, energy-hungry facilities.
The legislation was introduced on Wednesday by state Sen. Cathy Kipp, a Democrat representing Fort Collins, and state Rep. Kyle Brown, a Democrat representing Louisville. It comes weeks after pro-business Democrats introduced a competing bill to lure more data centers to the state by exempting the developers from state sales and use tax, setting up an intraparty brawl over the hulking facilities.
“We tried to learn from what other states have experienced and build upon that,” Kipp said.
Colorado’s energy grid is already strained while demand for power continues to rise, and data centers require massive amounts of power.
If approved, the latest bill would require large data center operators to build or purchase enough renewable energy to cover their annual electricity usage beginning in 2031. By the same year, those developers must enter formal contracts with utilities lasting at least 15 years to cover the cost of any grid upgrades necessary to deliver reliable power to the facilities.
Other provisions would require developers to notify communities about their plans. Once a large data center opens, the operators will be required to report their annual energy and water usage to state health officials.
One goal of the legislation is to ensure Colorado holds onto the chance of meeting its climate goals. In states with far more data center development, utilities have delayed coal plant retirements or built new gas plants to power the facilities.
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