Data Center Community Reinvestment Act of 2026
- Sponsor
- Rep. Salinas, Andrea [D-OR-6]
- Committees
- Science, Space, and Technology Committee (primary)
- Last action
- Aug 13, 2026
Bottom line
The bill imposes a new excise tax on large data centers' electricity consumption to generate dedicated revenue for environmental conservation, affordable housing, hazardous waste cleanup, infrastructure, and clean energy technology development.
What it actually does
This bill establishes a new excise tax of 1 cent per kilowatt-hour on electricity consumed by data centers with a maximum rated power capacity or total peak power load exceeding 1 megawatt. The revenue generated from this tax is then equally distributed among five federal trust funds: the Land and Water Conservation Fund, the Housing Trust Fund, the Hazardous Substance Superfund, the Highway Trust Fund, and a newly created Energy Technology Trust Fund.
Proponents argue
Proponents would argue that this bill addresses the significant and growing energy consumption of data centers, internalizing an environmental cost and generating dedicated revenue streams for critical public services like conservation, affordable housing, hazardous waste cleanup, infrastructure, and clean energy technology development. They might frame it as a way for a rapidly expanding industry to contribute to the communities it impacts and to broader societal needs.
Opponents contend
Opponents would likely argue that this new excise tax would increase operational costs for data centers, potentially stifling innovation, increasing the cost of digital services, and making the U.S. less competitive for data center investment. They might also contend that it could disproportionately affect smaller data centers or those operating on thin margins, and that the allocation of funds to various unrelated trust funds is an inefficient or inappropriate use of a targeted industry tax.
The bill is very short and easy to read, allowing ample time for evaluation.
Section 2(a), new Subchapter D, Section 4286(a)
Establishment of Data Center Electricity Excise Tax
This provision amends the Internal Revenue Code to create a new excise tax. It imposes a tax of 1 cent per kilowatt-hour on electricity consumed by "data centers." A data center is defined as any facility primarily containing electronic equipment for processing, storing, or transmitting digital information, and having a maximum rated power capacity or total peak power load exceeding 1 megawatt.
Supporters argue
Supporters argue this tax internalizes the environmental and infrastructure costs associated with the high energy demands of data centers, ensuring the industry contributes to public goods.
Critics contend
Critics contend this tax will raise operational costs for data centers, potentially hindering technological growth and increasing costs for businesses and consumers reliant on digital infrastructure.
Tradeoffs
Balances the desire to generate revenue and address environmental concerns related to energy consumption against potential impacts on the digital economy and industry competitiveness.
Section 2(b)(1)
Allocation of Tax Revenue to Land and Water Conservation Fund
This provision directs one-fifth (20%) of the revenue collected from the new data center electricity excise tax to the Land and Water Conservation Fund (LWCF). The LWCF supports the protection of natural areas, water resources, and cultural heritage, and provides funding for state and local parks and recreation projects.
Section 2(b)(2)
Allocation of Tax Revenue to Housing Trust Fund
This provision appropriates one-fifth (20%) of the revenue from the data center electricity excise tax to the Housing Trust Fund. This fund provides grants to states for building, preserving, and rehabilitating affordable housing for extremely low-income and very low-income households.
Section 2(b)(3)
Allocation of Tax Revenue to Hazardous Substance Superfund
This provision amends Section 9507(b) of the Internal Revenue Code to direct one-fifth (20%) of the revenue from the data center electricity excise tax to the Hazardous Substance Superfund. This fund is used for cleaning up uncontrolled hazardous waste sites.
Section 2(b)(4)
Allocation of Tax Revenue to Highway Trust Fund
This provision amends Section 9503(b)(1) of the Internal Revenue Code to direct one-fifth (20%) of the revenue from the data center electricity excise tax to the Highway Trust Fund. This fund primarily finances federal highway and mass transit programs.
Section 2(b)(5)
Creation of Energy Technology Trust Fund and Funding
This provision establishes a new trust fund in the Treasury called the "Energy Technology Trust Fund." It appropriates one-fifth (20%) of the revenue from the data center electricity excise tax to this new fund. Amounts in this fund are to be used, as provided by appropriation Acts, to cover the cost of guarantees under Title XVII of the Energy Policy Act of 2005, which supports innovative clean energy technologies.