Bill protects ratepayers, encourages new power generation, and supports water reuse for large data-center projects

WASHINGTON, D.C. — Today, Congressman Michael Baumgartner introduced the Power and Water for Families Act of 2026 (H.R.9419), legislation to ensure massive new data centers and other large-load facilities pay the full cost of the power and water infrastructure needed to serve them.

“America must win the AI race, but working families should not be forced to subsidize it,” said Congressman Baumgartner. “No data center should be forced on a local community. And if a massive new data center needs new power plants, transmission lines, grid upgrades, or water infrastructure, it should pay its own way. This bill protects ratepayers, encourages new generation, and helps communities conserve local water resources.”

Artificial intelligence can strengthen national security, improve health care, support agriculture, and drive economic growth. But the data centers needed to power AI can consume electricity on the scale of small cities and place major new demands on local utilities and water systems.

The Power and Water for Families Act creates a practical framework for responsible development. The bill directs the initiation of regional and state regulatory procedures to require: 

• The recovery of the full incremental cost of generation, transmission, and distribution upgrades from large-load customers;
• Deposits, guarantees, or other financial assurances before making major upgrades for large-load customers; and
• The adoption of incentives for large-load customers to build, bring, buy, finance, or dedicate new generation resources to serve their own demand.

The bill also provides tax incentives for responsible development: 

• A tax credit for the surplus portion of qualifying generation projects made available to other customers; and
• A tax credit for qualifying water reuse projects, including onsite recycling systems and projects that replace freshwater use with recycled municipal water.

“Eastern Washington has abundant, reliable hydropower, and that makes our region attractive for major new investments,” Baumgartner said. “But families, farmers, and small businesses should not pay higher bills because a massive new industrial user wants to plug into the grid. Communities that welcome these projects deserve clear protections, and communities that are concerned deserve to know Washington is listening.”

The bill preserves flexibility for states, utilities, and local regulators to tailor implementation to their own grids, customers, and resource needs. It does not impose a one-size-fits-all national mandate or block responsible economic development.

“AI should serve people, families, and communities — not the other way around,” Baumgartner said. “The Power and Water for Families Act makes sure America can build the infrastructure needed to compete with China while protecting the communities being asked to host it.”

Read the full bill text here. A summary and section by section explanation of the bill is here and here.