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House approves data-center 'bill of rights' to limit consumer impacts
Summary
The South Dakota House passed Senate Bill 135 to require cost-causation for large data centers, strengthen local input and add water protections for communities; supporters cited consumer protections and grid risk, opponents warned the measure could deter economic growth.
Representative John Hansen presented Senate Bill 135 as a "data center bill of rights," saying the measure would require large, hyperscale data centers to bear additional costs they impose on local utilities, guarantee local governments more input and add safeguards for water resources. "If you're causing the increase in cost to that electric provider, then you're going to be on the hook for that cost," Hansen said in explanation of the bill.
Supporters framed the bill as consumer protection. Hansen and other backers cited examples in other states where utility bills rose markedly after large data-center development and warned of potential grid strain: "One of these hyperscale data centers can take more electricity than that," Hansen said, noting peak demand comparisons. They also said added notice and water protections would help local officials and ratepayers.
Opponents argued the state already has cost-causation rules at the Public Utilities Commission and expressed concern that the bill represented protectionism that could chill economic opportunity. Representative Mortonson said a regulation-first approach could block growth and jobs, arguing the proposals could drive projects across state lines without protecting residents. Other members urged caution but noted some provisions were reasonable in advance of potential hyperscale projects.
After floor debate that focused on balancing local control, consumer protection and economic development, the House voted to pass SB135. The clerk announced the bill had received the affirmative vote of the majority, and the Speaker declared it passed.
The bill now returns to the Senate for any further action or to the governor, depending on the enrolled-file process. The House discussion emphasized two central tensions: how to protect ratepayers and water resources from concentrated industrial demand, and whether state-level conditions should be imposed before a significant wave of data-center development occurs.
