South Carolina Lawmakers Propose Regulations on Data Centers

New legislation aims to protect utility costs, water usage, and tax incentives for data centers

Jan. 30, 2026 at 10:15pm

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State lawmakers in South Carolina are moving to impose new regulations on data centers in order to protect residents, utilities, and natural resources. The proposed legislation, sponsored by Sen. Ed Sutton, would require data centers to cover infrastructure costs, report water usage, and eliminate tax incentives. The push for regulation comes as communities raise concerns about the impact of large data centers on energy demands, water usage, and the environment.

Why it matters

As data centers continue to expand across South Carolina's Lowcountry, there are growing concerns about the strain they place on the state's natural resources and utility infrastructure. This legislation aims to address those concerns by imposing new requirements on data centers to ensure they are not negatively impacting residents and the environment.

The details

The proposed legislation, Senate Bill 784, would do three main things: 1) require data centers to pay for any additional infrastructure costs needed to connect them to the power grid and sign minimum 15-year utility contracts, 2) mandate public reporting of surface and groundwater usage by data centers, and 3) eliminate tax incentives currently available to data centers. The bill also calls for data center developers to notify nearby landowners and hold public hearings as part of the permitting process.

  • Senate Bill 784 has been referred to the Senate Judiciary Committee and Sutton hopes it will reach the Senate floor within the next month.

The players

Sen. Ed Sutton

A Democratic state senator representing District 20 who is sponsoring the legislation to regulate data centers in South Carolina.

Eagle Rock Partners

A developer planning an 859-acre data center campus in Colleton County, South Carolina, which has faced opposition from local residents.

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What they’re saying

“[Data centers are] a big energy hog, a big water usage. It's imperative that the General Assembly step in here and put these guardrails in place.”

— Sen. Ed Sutton

“Our environment here is very, very fragile. When we're pulling massive amounts of groundwater out, look at the Edisto River. It's already low due to agricultural demands. How much lower can we go? And we don't even know at this point because they aren't required to disclose their water usage.”

— Sen. Ed Sutton

What’s next

Senate Bill 784 has been referred to the Senate Judiciary Committee and Sutton hopes it will reach the Senate floor for a vote within the next month.

The takeaway

This proposed legislation highlights the growing concerns over the impact of data centers on local communities in South Carolina. By requiring data centers to cover infrastructure costs, report water usage, and eliminate tax incentives, the state aims to better protect its natural resources and utility customers from the strain of these large, energy-intensive facilities.