Ratepayer Bill of Rights Act of 2026
- Sponsor
- Rep. Cuellar, Henry [D-TX-28]
- Committees
- Education and Workforce Committee (primary)
- Last action
- Aug 24, 2026
Bottom line
The bill seeks to shift the financial and environmental burden of large data center operations from local ratepayers and communities to the data center companies themselves through comprehensive disclosure and cost-recovery mandates.
What it actually does
This bill establishes a "Ratepayer Bill of Rights" to increase transparency and accountability for large data centers' electricity and water consumption. It mandates public disclosure of resource use, infrastructure costs, rate impacts, and public financial assistance associated with data centers. It also aims to ensure data centers bear their full project-driven costs, protect community water and electricity reliability, and provide enforcement mechanisms for ratepayers.
Proponents argue
Supporters argue that the rapid growth of large data centers places undue strain on local utilities and natural resources, often with hidden costs borne by ordinary ratepayers. They contend this bill will protect households, farmers, and small businesses from subsidizing these energy-intensive operations, ensure reliable service, and promote responsible resource management by requiring transparency and direct cost recovery.
Opponents contend
Opponents might argue that these stringent disclosure and cost-recovery requirements could deter data center development, stifle technological innovation, and lead to higher operational costs that are ultimately passed on to consumers of digital services. They may also contend that existing regulatory frameworks are sufficient or that the bill creates an overly burdensome administrative process.
The bill is concise and clearly structured, making it relatively easy for an informed reader to understand its core provisions and implications within a short timeframe.
Section 2(b)(1)
Disclosure of Electricity and Water Use
This provision grants ratepayers the right to know how much electricity and water a covered data center is projected to use and actually uses, including its sources and wastewater discharge. This information must be disclosed before operations begin, reported regularly (every six months for electricity, every three months for water), and updated promptly if there are significant changes.
Supporters argue
Supporters argue that this transparency is crucial for communities to understand the true impact of data centers on local resources and to hold companies accountable for their environmental footprint.
Critics contend
Critics might argue that such frequent and detailed disclosures could reveal proprietary operational information, creating a competitive disadvantage or administrative burden without proportional public benefit.
Tradeoffs
Balances public right-to-know and environmental oversight against potential concerns about corporate privacy and administrative costs for data center operators.
Section 2(b)(2)
Transparency of Infrastructure, Costs, and Public Assistance
This right ensures ratepayers are informed about the infrastructure built for a covered data center, its cost, who pays for it, and its impact on utility bills for households, farms, and small businesses. It also requires disclosure of any public assistance, permits, and agreements the data center company receives, all published in plain language before final approval.
Section 2(b)(3)
Prohibition on Ratepayer Subsidies for Data Centers
This provision explicitly states that "protected ratepayers" (households, farmers, ranchers, small businesses, schools, and hospitals) should not subsidize covered data centers. Data centers must pay all project-driven costs, sign a binding cost-recovery agreement, and post adequate financial security before construction. Any improper charges shifted to ratepayers must be refunded with interest within 90 days.
Section 2(b)(4)
Water Resource Protection and Prioritization
Before a covered data center receives a final water-service commitment, an independent assessment must confirm that enough water will remain for households, agriculture, and existing businesses, even during droughts. Data centers must pay all project-driven water costs and cannot receive priority over households, hospitals, or schools during a water emergency.
Section 2(b)(5)
Safeguarding Rural Water Systems and Aquifers
This right protects private wells, rural water systems, farmers, and ranchers by requiring monitoring, notice, and fair compensation if a covered data center harms their water supply. Data centers are prohibited from drawing from already-overdrawn aquifers without an independent assessment showing no further harm and must fund enforceable conservation measures linked to their water use.
Section 2(b)(6)
Electricity Reliability and On-Site Power Transparency
Before a covered data center receives a final electric-service commitment, an independent assessment must confirm it can be served without significantly reducing reliability for existing customers. Communities also have the right to know the capacity, fuel source, and emissions of any on-site power generation used by the data center, which cannot be used to bypass cost, reliability, or emissions requirements.
Section 2(b)(7)
Community Engagement and Public Official Disclosure
This right guarantees affected residents and ratepayers at least 60 days' notice and a local public meeting before a final decision on a data center project. Cost, water, and reliability studies must be available at least 30 days in advance, in plain language, and in English and Spanish where required. Public officials and their families involved in these decisions must also disclose relevant financial interests in the project.
Section 2(b)(8)
Non-Disclosure of Public Information
This provision states that no contract or confidentiality claim can prevent the disclosure of information required to be public by this Act. Aggregate electricity and water use, costs, public assistance, and emissions cannot be withheld as trade secrets and must be posted to a searchable public database within 30 days.
Section 2(b)(9)
Anti-Evasion Measures for Data Center Regulation
This right prevents companies from using tactics like separate entities, meters, tenants, parcels, or project phases to evade the Act's requirements. Related or affiliated projects sharing infrastructure or developed together are treated as one for coverage purposes. Material expansions of existing data centers trigger a reopening of their cost, water, and reliability reviews.
Section 2(b)(10)
Enforcement, Penalties, and Whistleblower Protection
This right establishes a simple complaint process for ratepayers. Federal and State regulators are authorized to audit compliance, order refunds, and assess civil penalties for violations. Employees who report violations are protected from retaliation, and Federal agencies must publish an annual public accounting of complaints, penalties, and refunds.
This subsection assigns enforcement responsibilities to the Federal Energy Regulatory Commission (FERC) for transmission and reliability, the Department of Energy (DOE) for energy data, the Environmental Protection Agency (EPA) for environmental and water-quality requirements, and the Department of Labor (DOL) for worker retaliation protections. It also clarifies that State, Tribal, and local authorities retain existing jurisdiction and can adopt stronger protections.
Section 2(c)
Why it matters:This is standard legislative practice to delineate agency responsibilities, but the practical challenges of multi-agency enforcement and federal-state coordination are often understated.
Case for: Supporters argue that leveraging existing agency expertise and jurisdiction ensures efficient enforcement without creating new, redundant bureaucracies. It also respects federalism by preserving state and local authority to implement stronger protections.
Case against: Critics might argue that distributing enforcement across multiple agencies could lead to fragmented oversight, jurisdictional disputes, and inconsistent application of the Act, potentially creating regulatory gaps or overlaps.
Estimated impact: Establishes the regulatory framework for the entire Act, impacting how effectively its provisions are implemented and enforced across various sectors.