AB 222 adds a new reporting duty for data center owners and directs two state agencies to analyze how growing data center electricity demand affects the grid and other ratepayers. The bill defines which facilities count as data centers, requires owners to submit a power usage effectiveness (PUE) ratio to the California Energy Commission on a biannual schedule, and directs the Energy Commission to include an electrical load assessment for data centers in the 2027 Integrated Energy Policy Report (IEPR).
Separately, the bill requires the California Public Utilities Commission (CPUC) to analyze whether electrical corporation costs tied to new data center loads shift expenses onto other customers, to identify mitigation opportunities, and to deliver that assessment by January 1, 2027 (with the CPUC reporting requirement set to expire in 2031). The statute also includes a legislative finding protecting confidential, proprietary data center information from public disclosure when aggregation cannot prevent identification.
At a Glance
What It Does
Establishes a biannual reporting requirement for data centers to submit power usage effectiveness (PUE) ratios to the California Energy Commission and requires the Energy Commission to include a 2027 assessment of data center electrical load trends and mitigation recommendations in the IEPR. It also directs the CPUC to complete an assessment by January 1, 2027 on whether electrical corporation costs tied to new data center loads create cost shifts to other customers and to identify prevention or mitigation opportunities.
Who It Affects
Owners/operators of facilities that meet the bill’s data center definition (IT equipment load >10 kW and >20 W/sq ft conditioned floor area). The Energy Commission and CPUC gain new analytic duties. Investor-owned utilities and their ratepayers are the indirect focus of the CPUC assessment.
Why It Matters
Data centers are a rapidly growing electricity load; this bill forces public agencies to collect standardized PUE data and evaluate whether growth in that load imposes unfair costs on other customers. The reporting and assessments will influence grid planning, demand response and efficiency policy, and future allocation of transmission, distribution, and procurement costs.
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What This Bill Actually Does
AB 222 creates two distinct but related regulatory threads. First, it defines a ‘data center’ by a clear equipment-load threshold (greater than 10 kilowatts and 20 watts per square foot of conditioned floor area) and requires owners to report a facility-level power usage effectiveness (PUE) ratio to the California Energy Commission on a biannual schedule.
The Energy Commission must design the submission process and timeline, can report consumption in the aggregate, and must avoid disclosures that would reveal a specific utility customer’s energy use or personally identifiable information.
Second, the bill tasks the CPUC with producing a focused assessment of whether the costs electrical corporations incur to serve new or expanded data center loads result in cost shifts to other customers. The CPUC’s required analysis spans procurement costs to meet higher loads and the costs tied to installing new transmission and distribution assets for data centers.
If the CPUC finds substantial cost shifts, it must identify opportunities to prevent or mitigate those shifts.Timing is explicit and compressed: the Energy Commission’s load-trend assessment enters the 2027 edition of the Integrated Energy Policy Report, where it must include projections, potential net peak load identification, and mitigation recommendations such as efficiency or demand response measures. The CPUC must submit its cost-shift assessment by January 1, 2027 and publicly post it; that statutory duty sunsets on January 1, 2031 under the Government Code citation in the bill.Finally, the Legislature inserted an express finding that the PUE reporting obligation limits public access to certain agency writings and that protecting confidential, proprietary information justifies that limitation.
Practically, this means the Energy Commission has explicit authority to aggregate or withhold data to avoid revealing facility-specific consumption unless disclosure-safe options exist.
The Five Things You Need to Know
A facility counts as a data center and triggers the law if its IT equipment load exceeds 10 kilowatts and 20 watts per square foot of conditioned floor area.
Data center owners must submit a power usage effectiveness (PUE) ratio to the Energy Commission on a biannual basis, using the process and timing the commission establishes.
The Energy Commission must include, in the 2027 Integrated Energy Policy Report, a data center electrical load assessment with future load projections, potential net peak demands, and recommended mitigation measures (efficiency and demand response options).
The CPUC must analyze whether electrical corporation costs tied to new data center loads cause cost shifts to other customers (including procurement and new transmission/distribution costs) and publicly deliver that assessment by January 1, 2027.
The CPUC’s assessment mandate is temporary: the statutory section directing the analysis is set to be repealed on January 1, 2031, and the Energy Commission may report only in aggregate to protect proprietary or customer-specific data.
Section-by-Section Breakdown
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Data center definition and PUE reporting process
This section defines which facilities the law covers—those with IT equipment loads above 10 kW and 20 W per conditioned square foot—and defines PUE as total data center energy divided by energy used by the IT equipment. The Energy Commission must create the submission process and require owners to file PUE ratios every two years. For compliance teams, the practical implication is that owners must document how they calculate PUE and prepare to submit those calculations in the format the commission prescribes.
IEPR assessment of data center electrical load trends
The Energy Commission must fold a focused analysis of data center electricity consumption into the 2027 IEPR. That assessment must include projections of future load, identify potential net peak load impacts on the grid, and recommend mitigation measures (including energy efficiency and demand response). The commission may present consumption on an aggregate basis and is forbidden from publishing data in a way that would identify a specific utility customer—this creates a regulatory balancing act between useful granular data and protection of proprietary customer information.
CPUC assessment of cost shifts caused by new data center loads
The CPUC must analyze how costs electrical corporations may incur to serve new or expanded data center loads could shift onto other customers. The required analysis explicitly covers procurement costs to meet growing demand and capital costs to build new transmission and distribution assets. If the CPUC concludes substantial cost shifts will occur, it must identify opportunities to prevent or mitigate them. The CPUC must post the assessment publicly and deliver it to legislative policy committees by January 1, 2027; the requirement expires on January 1, 2031.
Confidentiality finding for proprietary data
The Legislature makes an express finding that Section 25302.9 limits public access to certain agency writings because those writings may contain confidential proprietary information. That finding authorizes the Energy Commission to withhold or aggregate data to prevent disclosure of sensitive commercial information while still complying with the reporting objectives of the statute.
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Explore Energy in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Grid planners and the Energy Commission — gain standardized PUE data and a mandated 2027 assessment to inform statewide forecasts, peak planning, and policy recommendations for efficiency and demand response.
- CPUC and legislative policymakers — receive a mandated, public CPUC assessment on cost shifts, giving them analytic grounding to consider future rate design or cost-allocation reforms.
- Ratepayers potentially at risk of cross-subsidies — if the CPUC identifies mitigation opportunities and regulators act, customers who do not directly benefit from data centers could avoid bearing disproportionate infrastructure or procurement costs.
Who Bears the Cost
- Data center owners/operators — must calculate and submit PUE ratios biannually and maintain documentation supporting those calculations; smaller facilities above the thresholds will bear compliance effort and potential consultant costs.
- Investor-owned utilities and electrical corporations — will face increased scrutiny as the CPUC analyzes cost allocation and may see limitations on cost recovery mechanisms or new mitigation requirements identified by the CPUC.
- State agencies (Energy Commission, CPUC) — must allocate staff time and analytic resources to develop submission processes, perform assessments, and produce the IEPR and CPUC reports; those are new administrative burdens without explicit funding in the text.
Key Issues
The Core Tension
The bill balances two legitimate goals that pull in opposite directions: regulators need precise, facility-level information to plan and prevent unfair cost shifting to other customers, but data centers treat operational energy and load profiles as commercially sensitive; protecting those secrets reduces the analytical granularity regulators can use to design targeted mitigation or cost-allocation measures.
The bill uses PUE as its primary metric. PUE is useful for benchmarking cooling and facility overheads against IT load, but it does not capture workload efficiency, on-site generation, time-varying demand characteristics, or carbon intensity of the electricity used.
Relying on PUE alone risks oversimplifying how data centers actually stress the grid — two facilities with similar PUEs can impose very different peak, ramp, or local distribution impacts depending on IT load profiles and on-site resources.
The statutory protections for confidentiality let the Energy Commission aggregate or withhold reporting to prevent identification of a utility customer. That preserves proprietary operations data but reduces the granularity available for local distribution planning.
The CPUC’s mandate to identify cost shifts is analytical, not prescriptive: the statute requires identification of mitigation opportunities but does not dictate specific cost-allocation remedies. That leaves open whether and how the CPUC or Legislature will translate findings into enforceable changes to rate design or developer cost responsibilities.
Finally, the CPUC’s requirement sunsets in 2031, which limits the statutory window for action; if data center growth remains material beyond that date, regulators will need new authorities or legislative direction to continue systematic reassessment.
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