MADISON, Wis. — The Wisconsin State Assembly passed Assembly Bill 840 on Jan. 20, aiming to regulate the state’s rapidly growing data center industry. The legislation, intended to address environmental concerns and utility costs, faced opposition from Democratic lawmakers and several construction unions.
Republicans approved the bill in a 53-44 vote, with Rep. Lindee Brill, R-Sheboygan Falls, voting “no” alongside Democrats, while two Democrats — Steve Doyle, D-Onalaska, and Jodi Emerson, D-Eau Claire — voted “yes.”
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The bill mandates data centers to implement closed-loop cooling systems, which recycle a fixed volume of water to remove heat from equipment. Additionally, operators must report annual water usage to the Department of Natural Resources (DNR) and post a bond to cover water reclamation costs. If construction is not completed, owners must restore the site to its pre-construction condition.
The legislation also instructs the Public Service Commission to ensure that costs for building or expanding the energy grid to support data centers are not shifted to other utility customers. Renewable energy facilities primarily serving data centers must also be located on the same site.
“It provides no guarantees that the jobs created will be safe and well-compensated, much less union. Wisconsin badly needs those good-paying, safe, union-protected jobs,” said Rep. Darrin Madison, D-Milwaukee, expressing concern over the bill’s lack of prevailing wage requirements and oversight of data center energy consumption.
The bill drew strong opposition from unions representing construction electricians, utility workers, ironworkers, carpenters, plumbers, sheet metal workers, and laborers across Wisconsin. They filed formal objections citing the absence of prevailing wage protections and the potential environmental impact of data center operations.
The debate comes amid a boom in Wisconsin’s renewable energy projects, many of which are partially funded through federal tax credits under the Inflation Reduction Act. Democratic lawmakers previously proposed an alternative bill that included prevailing wage requirements for laborers on data center sites, mandatory reporting of energy and water usage to state authorities, and green building certification.
“This legislation does not sufficiently address the massive energy demands of these facilities, which in some cases consume power comparable to a small city,” said Madison.
Supporters of the bill argue that it provides much-needed environmental safeguards and prevents ratepayers from absorbing the costs associated with large-scale energy projects for data centers.
With Wisconsin’s tech industry expanding rapidly, the legislation reflects growing tensions between economic development, union labor protections, and sustainable energy regulation.
Originally reported by Ethan Duran in The Daily Reporter.
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