Clean Cloud Act of 2025
- Sponsor
- Sen. Whitehouse, Sheldon [D-RI]
- Committees
- Environment and Public Works Committee (primary)
- Last action
- Apr 10, 2025
Bottom line
The "Clean Cloud Act of 2025" aims to significantly reduce the carbon footprint of data centers and cryptocurrency mining operations in the U.S. by imposing fees on high-emissions electricity consumption and incentivizing clean energy development.
What it actually does
The bill amends the Clean Air Act to establish a comprehensive framework for monitoring and regulating electricity consumption and greenhouse gas emissions from data centers and cryptocurrency mining facilities. It mandates annual data collection on energy use and sources from these facilities and the electric utilities serving them. Crucially, it imposes a fee on electricity consumed above a regional greenhouse gas emissions baseline, with the baseline becoming zero by 2035. Funds collected are allocated to administration, lowering residential energy costs, and grants for zero-carbon electricity generation and long-duration energy storage.
Proponents argue
Proponents argue that the bill addresses the rapidly growing energy consumption and associated carbon emissions of data centers and cryptocurrency mining, which are increasingly powered by fossil fuels, sometimes bringing retired plants back online. They contend it promotes transparency in energy sourcing, drives investment in clean, firm power, and protects consumers from potential electricity cost increases due to increased data center demand.
Opponents contend
Opponents might argue that the bill imposes undue financial burdens on a nascent and innovative industry, potentially driving cryptocurrency mining operations out of the United States. They may also contend that the fee structure is overly complex or punitive, could stifle technological innovation, and that the strict criteria for "zero-carbon" electricity generation are too narrow, potentially disadvantaging certain renewable energy procurement strategies.
The bill is moderately complex due to technical definitions and detailed fee mechanisms, requiring careful reading to understand its full implications.
Section 3, adding new Clean Air Act Section 139(b)
Annual Data Collection of Energy Consumption of Data Centers and Cryptomining Facilities
This provision requires the EPA Administrator, in conjunction with the Energy Information Administration, to annually collect detailed information from owners of "covered facilities" (data centers or cryptomining facilities over 100 kW) and the electric utilities serving them. This includes location, facility type, owner, utility, total annual electricity consumption, behind-the-meter generation, power purchase agreements, and the resource mix of electricity consumed from the grid and behind-the-meter.
Supporters argue
Supporters argue this data collection is essential for understanding the true energy footprint of these industries, identifying energy sources, and informing policy decisions to mitigate environmental impacts. It promotes transparency in a sector often criticized for its opaque energy practices.
Critics contend
Critics might argue that this imposes an unnecessary administrative burden on businesses, potentially revealing proprietary information, and that existing reporting mechanisms might suffice or could be expanded with less complexity.
Tradeoffs
Balances the need for transparency and data-driven policy against potential administrative burdens and concerns about data privacy for businesses.
Section 3, adding new Clean Air Act Section 139(b)(6)-(7)
Determination and Public Disclosure of Greenhouse Gas Emissions Intensity
Based on the collected data, the Administrator must determine the greenhouse gas emissions intensity (metric tons of CO2-equivalent per kilowatt-hour) for electricity consumed by each covered facility, both from the grid and behind-the-meter. This information, along with facility location, type, owner, utility, and percentage of electricity from various sources, will be made publicly available annually. Aggregate annual consumption for each owner will also be public.
Section 3, adding new Clean Air Act Section 139(c)(2)
Regional Greenhouse Gas Emissions Baselines
The Administrator must determine and publish regional greenhouse gas emissions intensities for the electric grid by December 31, 2025. These baselines will apply to calendar year 2026. For 2027-2034, the baseline for each region will be reduced by 11% of the 2026 baseline annually. By 2035 and thereafter, the baseline for all regions will be 0 metric tons of CO2-equivalent per kilowatt-hour.
Section 3, adding new Clean Air Act Section 139(c)(3)(A)
Fee on Electric Utilities for Grid Emissions Above Baseline
Beginning January 1, 2026, electric utilities providing power to covered facilities will be assessed a fee if the greenhouse gas emissions intensity of the electricity consumed from the electric grid by those facilities exceeds the regional baseline. The fee is calculated by multiplying total electricity consumed (kWh) by $20 (adjusted annually for inflation plus an additional $10) and by the amount the emissions intensity exceeds the baseline. Utilities are prohibited from passing this cost onto non-covered facility customers, with a penalty for non-compliance.
Section 3, adding new Clean Air Act Section 139(c)(3)(B)
Fee on Covered Facilities for Behind-the-Meter Emissions Above Baseline
Also starting January 1, 2026, owners of covered facilities will be assessed a fee if the greenhouse gas emissions intensity of electricity generated by assets located behind their power meter exceeds the regional baseline. The fee calculation mirrors that for utilities: total behind-the-meter electricity consumed (kWh) multiplied by $20 (adjusted annually for inflation plus $10) and by the amount the emissions intensity exceeds the baseline.
Section 3, adding new Clean Air Act Section 139(c)(4)
Allocation of Collected Fees for Consumer Relief and Clean Energy Development
Funds collected from fees and penalties are appropriated starting FY2028: 3% for administration, 25% for grants to States, Tribes, municipalities, and electric utilities to lower residential electricity consumer energy costs (e.g., through savings programs or direct rebates), and 70% for "Clean Firm Grants." These grants, rebates, or low-interest loans support research, development, demonstration, and deployment of zero-carbon electricity generation assets capable of operating at >70% capacity factor year-round, or long-duration energy storage assets (10+ hours discharge). Grant recipients must certify that utilities selling power from these assets allow customers to voluntarily pay a higher rate for zero-carbon electricity, with those funds exclusively supporting further clean firm power or storage.
For electricity consumed from the electric grid via PPAs or energy attribute certificates (EACs, e.g., RECs), or from behind-the-meter assets, the bill sets very specific, stringent criteria for that electricity to be counted as "clean" (i.e., not subject to the average resource mix calculation). These criteria include requirements for new generation (commercial operations within 36 months of facility start), preventing retirement of existing assets, curtailment, uprates, pre-enactment agreements, or significant retrofits. Crucially, after December 31, 2027, grid-sourced electricity must be generated and consumed in the same hour or stored by an asset serving the facility, and the generation asset must be in the same region or physically delivered. Behind-the-meter assets also have strict criteria, including new operations or preventing retirement, unless their emissions intensity is higher than the grid average.
Section 3, adding new Clean Air Act Section 139(b)(4)(B) and (b)(5)(B)
Why it matters:This level of detail is typical for legislative language defining technical accounting rules for environmental compliance. It's standard legislative practice to place such specifics within the definitional or methodological sections.
Case for: Proponents would argue that these strict "additionality" and "temporal matching" requirements (same hour, new generation) are crucial to ensure that facilities are genuinely driving new clean energy development and consumption, rather than simply purchasing existing, already-committed renewable energy credits that don't lead to additional emissions reductions. The regional and physical delivery requirements prevent "greenwashing" by ensuring the clean energy is actually serving the facility's grid.
Case against: Opponents might argue that these criteria are overly restrictive and impractical, especially the "same hour" and "new generation" requirements, which could make it extremely difficult and expensive for facilities to procure qualifying clean energy, particularly for existing operations. This could lead to higher fees even for facilities actively trying to green their operations.
Estimated impact: Significantly impacts the ability of covered facilities to claim "clean" electricity, potentially increasing their fee liability and driving substantial changes in clean energy procurement strategies and grid infrastructure development.
Defines "greenhouse gas" to include carbon dioxide, hydrofluorocarbons, methane, nitrous oxide, perfluorocarbons, and sulfur hexafluoride. Crucially, for methane, the Administrator shall use the 20-year global warming potential as determined by the Sixth Assessment Report of the Intergovernmental Panel on Climate Change.
Section 3, adding new Clean Air Act Section 139(c)(1)(B)
Why it matters:Definitions are standard legislative practice. However, the specific GWP chosen for methane is a policy choice that could be more prominent given its impact.
Case for: Proponents argue that using the 20-year GWP for methane more accurately reflects its potent, short-term warming impact, providing a stronger incentive to reduce methane emissions quickly, which is critical for near-term climate goals.
Case against: Critics might argue that the 100-year GWP is more commonly used in climate policy and provides a more balanced view of methane's long-term impact, and that using the 20-year GWP could disproportionately penalize natural gas-fired power generation compared to other sources.
Estimated impact: Could significantly increase the calculated emissions intensity of electricity generated from natural gas, thereby increasing the fees assessed on utilities and facilities relying on such power.