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Senate labor committee advances Perez’s data-center accountability bill over industry objections
Summary
SB 978 would require data centers to prefund transmission upgrades, create separate CPUC rate structures and include construction labor standards; the committee advanced the bill despite industry warnings it may preempt ongoing CPUC proceedings.
Sen. Perez presented SB 978, the Data Center Community Accountability Act, telling the committee the bill aims to protect energy ratepayers from bearing costs for new transmission and distribution required by large data-center loads, ensure data centers pay their fair share for grid upgrades, and include skilled-labor construction standards. "SB 978 ensures that ratepayers are not responsible for these costs by requiring data centers to pay upfront for any new transmission or distribution infrastructure needed to serve their facilities," the author said.
Supporters, including climate and labor representatives, argued the bill can protect communities and create local clean-energy jobs. Will Breager (State Strategies for Climate Action California) called out a provision (proposed section 740.22(b)(3)) directing the CPUC to design rate structures that would prefund zero-carbon generation and prevent dirty generation from being added to power data centers.
Industry witnesses — including the Data Center Coalition and Silicon Valley Leadership Group — urged rejection or delay, saying the CPUC and ongoing proceedings (including work required by SB 57 and PG&E Rule 30 processes) are the appropriate venues for cost-allocation analysis. Kara Boender (Data Center Coalition) warned that singling out data centers for a special rate structure could push investment to neighboring states and undermine tax and job benefits.
Committee members discussed jurisdictional and labor standard elements; Senator Cortese voiced support for including construction and prevailing-wage protections while acknowledging economic benefits from data-center investment. The committee ultimately moved SB 978 to Appropriations for further review.
