Colorado Advocates: New “Data Center Handout Bill” Misses the Mark; Proactive Protections Needed for Energy Bills, Communities, and Environment

Denver, CO —

Conservation and community groups today called for policy solutions that deliver meaningful protections for Coloradans from massive data center developments, and warned that a data center bill introduced last week fails to deliver for Colorado taxpayers, utility customers, and the environment.

“As data center demand accelerates, policymakers must ensure growth is met with the principles of CARE — Clean, Affordable, and Reliable Electricity, by requiring data centers to pay their own way, invest in zero-emissions energy, and protect communities from harm,” said Alana Miller, Colorado policy director for Climate and Energy at NRDC (Natural Resources Defense Council). “Strong safeguards can prevent cost-shifting to existing customers and ensure these facilities create good jobs and real community benefits, especially in disproportionately impacted communities.”

A bill that establishes guidelines for responsible data center (and other large load facility) development will be introduced later this legislative session. In the bill, Colorado State Senator Cathy Kipp and Representative Kyle Brown will establish clear guidelines to address concerns about data centers’ energy demand, ratepayer and community protections, and climate goals, while supporting family-sustaining jobs.

“Across the country, we are seeing the negative impacts of large data center development without meaningful community and ratepayer protections in place,” said Megan Kemp, state legislative representative with Earthjustice’s Rocky Mountain Office. “Colorado has the opportunity to lead in ensuring that data centers develop without harm to our residents. Now is the time to advance legislation that truly puts Coloradans’ health, well-being, and wallets first.”

In contrast to groups’ concerns, a “data center handout bill” introduced last week would instead provide a 100% state sales and use tax exemption for data center companies for 20 years or more, forgoing substantial revenue at a time of budget constraints.

“Colorado can’t afford to be giving some of the wealthiest companies in the history of the world a major tax break at a time when our state is facing a nearly $1 billion budget shortfall and Coloradans are struggling with today’s high cost of living, said Kathy White, director of Colorado Fiscal Institute. “Other states with these incentives in place are now struggling to roll them back because they have been so costly. Data center companies should have to pay their fair share, just like the rest of us.”

“AARP Colorado opposes HB 26-1030 – Data Centers as it is introduced. The legislation lacks several consumer protections, and Coloradans 50-plus can’t afford their utility bills increasing yet again,” said Sara Schueneman, AARP Colorado State Director. “HB 26-1030 does not guarantee that Coloradans won’t see their rates increase. Furthermore, the legislation exempts data centers from paying sales tax. In a budget year that promises deep cuts and further jeopardizes funding for older Coloradans, such as the Senior Homestead Exemption and Area Agencies on Aging, our state can’t afford to let some of the world’s wealthiest corporations pass their bills onto consumers.”

Advocates agree that this is not the solution Colorado needs and look forward to advancing alternative legislation. Data centers present a number of risks to communities – creating massive new demand for electric power that drives the cost of electricity higher, increasing residential energy bills; creating new sources of air, noise, light, and waste pollution that impact public health and wellbeing; using large amounts of water for cooling; and more. Lack of reporting, transparency, and community engagement are also contributing to concerns about data center proliferation.

“Communities overburdened with pollution and industry, like ours here in Elyria-Swansea, are already feeling the impacts of big data center development,” said Harmony Cummings, founder of the community group Greenhouse Connection Center. “They’re already building near elderly assisted living, health clinics, and parks where our kids play. Neighbors are scared about the many unknowns and near and long term impacts to their health and communities.”

“Without proper protections, Coloradans could end up subsidizing Big Tech’s data center operations while breathing dirtier air and depleting critical water resources,” said Jamie Valdez, Colorado transportation and energy policy program Advocate with GreenLatinos.