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AB-222 Data centers: energy usage reporting and modeling.(2025-2026)

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Date Published: 01/08/2025 09:00 PM
AB222:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION

Assembly Bill
No. 222

Introduced by Assembly Member Bauer-Kahan

January 08, 2025

An act to add Chapter 4.4 (commencing with Section 25345) to Division 15 of the Public Resources Code, and to add Section 451.10 to the Public Utilities Code, relating to energy.


LEGISLATIVE COUNSEL'S DIGEST


AB 222, as introduced, Bauer-Kahan. Data centers: energy usage reporting and modeling.
Existing law, on or before January 1, 2026, and before each time thereafter that a generative artificial intelligence system or service, as defined, or a substantial modification to a generative artificial intelligence system or service, released on or after January 1, 2022, is made available to Californians for use, regardless of whether the terms of that use include compensation, requires a developer of the system or service to post on the developer’s internet website documentation regarding the data used to train the generative artificial intelligence system or service.
This bill would require a data center that provides computing resources to a developer for the purpose of developing a covered model, as defined, to estimate the total energy used to develop the covered model and to report that information to the developer, as specified. The bill would require a developer, before using the computing resources of a data center to develop a covered model, to inform the data center of the developer’s intent to develop a covered model. The bill would require a developer, before using a covered model or covered system commercially or making a covered model or covered system available for use by a third party, to request its energy usage data from all data centers involved in developing the covered model and to estimate and publish on its internet website the total energy used to develop the covered model, as specified.
Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission) to biennially adopt an integrated energy policy report, as specified, and to make the reports accessible to state, local, and federal entities and to the general public.
This bill would require the Energy Commission to require operators of data centers to annually report energy consumption and performance data, as specified. The bill would require the Energy Commission to include energy consumption trends for data centers in its integrated energy policy reports. The bill would require the Energy Commission to adopt energy efficiency performance standards, as described, for data centers. The bill would require the Energy Commission to adopt regulations to implement these requirements on or before January 1, 2027.
Existing law vests the Public Utilities Commission (PUC) with regulatory authority over public utilities, including electrical corporations. Existing law authorizes the PUC to fix the rates and charges for every public utility, and requires that those rates and charges be just and reasonable.
This bill would require the PUC to determine whether those costs and expenses in an application by an electrical corporation to recover costs and expenses arising from, or incurred as a result of, the construction of a new data center or a substantial alteration to an existing data center are just and reasonable. The bill would require the PUC to minimize the shifting of costs attributable to the construction or alteration of the data center to ratepayers who do not directly benefit from the data center.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Chapter 4.4 (commencing with Section 25345) is added to Division 15 of the Public Resources Code, to read:
CHAPTER  4.4. Data Center Modeling and Energy-Usage Reporting

25345.
 For purposes of this chapter, the following definitions apply:
(a) “Artificial intelligence” or “AI” means an engineered or machine-based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.
(b) “Covered model” means an AI model developed using a quantity of computing power exceeding 10^25 integer or floating-point operations.
(c) “Covered system” means an AI system that incorporates a covered model.
(d) (1) “Data center” means a facility that houses computing infrastructure, including graphics and central processing units, servers, storage devices, networking equipment, and associated power and cooling systems, for the primary purpose of processing, storing, or distributing electronic data.
(2) “Data center” does not include a facility with an annual energy consumption of 10 megawatthours or less.
(e) “Developer” means a person, partnership, state or local government agency, or corporation that designs, codes, trains, or otherwise produces a covered model.

25345.1.
 A data center that provides computing resources to a developer for the purpose of developing a covered model shall do both of the following:
(a) Estimate the total energy, in megawatthours, used to develop the covered model.
(b) Report the estimated total energy used to develop the covered model to the developer under both of the following circumstances:
(1) Upon the termination of a contract facilitating the transfer of computing resources from the data center to the developer.
(2) Upon receiving a request from the developer pursuant to paragraph (1) of subdivision (b) of Section 25345.2.

25345.2.
 (a) Before using the computing resources of a data center to develop a covered model, a developer shall inform the data center of the developer’s intent to develop a covered model.
(b) Before using a covered model or covered system commercially, or before making a covered model or covered system available for use by a third party, a developer shall do both of the following:
(1) Request the developer’s energy usage data from all data centers involved in developing the covered model.
(2) Estimate and publish on the developer’s internet website the total energy, in megawatthours, used to develop the covered model.
(c) Energy data published pursuant to subdivision (b) shall be all of the following:
(1) Publicly available for as long as the developer continues to use the covered model or covered system, or continues to make the covered model or covered system available for use by a third party.
(2) Provided at no cost to a user of the developer’s internet website.
(3) Accessible and comprehensible to a natural person with ordinary cognitive abilities.

25345.3.
 (a) (1) The commission shall require operators of data centers to annually report energy consumption and performance data to the commission.
(2) Reports submitted to the commission pursuant to this subdivision shall include all of the following:
(A) Total annual energy consumption, including electricity usage from grid and nongrid sources, peak factors, and load profiles.
(B) Energy usage effectiveness or equivalent energy efficiency metrics.
(C) The percentage of energy supplied by renewable or carbon-free resources.
(D) Annual energy consumption resulting from the development of covered models.
(E) Any other information deemed necessary by the commission to assess grid impacts.
(3) Data centers reporting pursuant to this section shall submit data in a form and manner prescribed by the commission.
(b) The commission shall include energy consumption trends for data centers in its integrated energy policy report prepared pursuant to Section 25302.
(c) On or before January 1, 2027, the commission shall adopt regulations to implement this section.

25345.4.
 (a) The commission shall adopt energy efficiency performance standards for data centers.
(b) The standards adopted pursuant to this section shall do all of the following:
(1) Prioritize cost effectiveness, technological feasibility, and alignment with California’s greenhouse gas emission reduction targets.
(2) Consider best practices for energy usage effectiveness, energy management systems, and the use of renewable energy resources.
(3) Require new data centers and substantial alterations to existing data centers to incorporate load-management and load-shifting capabilities, including the ability to participate in demand response programs.
(c) (1) On or before January 1, 2027, the commission shall adopt regulations to implement this section.
(2) In adopting regulations pursuant to this subdivision, the commission shall consult with data center operators, utilities, technical experts, and other industry stakeholders.

SEC. 2.

 Section 451.10 is added to the Public Utilities Code, to read:

451.10.
 (a) For purposes of this section, “data center” has the same meaning as defined in Section 25345 of the Public Resources Code.
(b) In an application by an electrical corporation to recover costs and expenses arising from, or incurred as a result of, the construction of a new data center or a substantial alteration to an existing data center, the commission shall determine whether those costs and expenses are just and reasonable in accordance with Section 451.
(c) In determining whether costs and expenses are just and reasonable pursuant to subdivision (b), the commission shall minimize the shifting of costs attributable to the construction or alteration of the data center to ratepayers who do not directly benefit from the data center.