[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 9419 Introduced in House (IH)]
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119th CONGRESS
2d Session
H. R. 9419
To facilitate the responsible development of data centers and related
infrastructure, to protect existing ratepayers from the shifting of
incremental infrastructure costs attributable to large-load facilities,
to encourage investment in water reuse, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
June 24, 2026
Mr. Baumgartner introduced the following bill; which was referred to
the Committee on Ways and Means, and in addition to the Committee on
Energy and Commerce, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To facilitate the responsible development of data centers and related
infrastructure, to protect existing ratepayers from the shifting of
incremental infrastructure costs attributable to large-load facilities,
to encourage investment in water reuse, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Power and Water for Families Act of
2026''.
SEC. 2. FINDINGS.
Congress finds the following:
(1) Artificial intelligence has the potential to drive
economic growth, accelerate scientific and medical innovation,
strengthen American competitiveness, and enhance the national
security of the United States.
(2) Maintaining American leadership in artificial
intelligence over the Chinese Communist Party will require the
responsible development of data centers and advanced computing
infrastructure; and to do so, the United States is experiencing
rapid growth in large electrical loads, including data centers
and advanced computing facilities, some of which require power
at a scale comparable to that of major metropolitan areas.
(3) The effects of new large electrical loads on
electricity costs are not uniform across the United States and
depend on regional resources, market structure, utility
regulation, and the allocation of costs associated with serving
such loads. Absent appropriate safeguards, such loads may place
upward pressure on power costs, reduce access to Federal
resources, and create risks to regional electric reliability.
(4) The electric-power sector of the United States is
characterized by diverse regional markets, resource mixes,
utility structures, regulatory systems, and reliability needs.
State regulatory authorities, nonregulated electric utilities,
regional transmission organizations, and other relevant
entities should retain flexibility to implement solutions
appropriate to the communities they serve.
(5) Water reuse projects, including onsite water recycling
systems within data center facilities and municipal water
recycling systems, can protect aquifers by replacing the use of
freshwater, such as rivers, streams and groundwater, with
recycled water and support the responsible development of data
centers and other industrial facilities.
SEC. 3. POLICY OF CONGRESS.
It is the policy of Congress that--
(1) the United States should pursue an all-of-the-above
strategy to develop the energy and water infrastructure
required to maintain global leadership in artificial
intelligence;
(2) the United States should address demonstrated and
localized infrastructure impacts through targeted, evidence-
based measures rather than broad restrictions, blanket
moratoria, or policies that impede responsible development;
(3) large-load customers should be encouraged to build,
bring, or buy new and additive generation resources and should
bear the full incremental cost of the infrastructure required
primarily to serve their facilities;
(4) the development of data centers and advanced computing
facilities should be addressed through regionally appropriate
policies that protect affordability and reliability while
allowing responsible economic development; and
(5) water reuse should be encouraged through investment in
projects that install, replace, or modify onsite water
recycling systems, replace the use of freshwater with recycled
water from a municipal water provider, or build or expand
municipal water recycling systems.
TITLE I--POWER FOR FAMILIES
SEC. 101. FEDERAL STANDARD RELATING TO LARGE-LOAD CUSTOMERS.
Section 111(d) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2621(d)) is amended by adding at the end the following:
``(22) Standards for large-load customers.--
``(A) Recovery of full, incremental cost of
upgrades.--A rate charged, or entered into, by an
electric utility for providing electric service to a
large-load customer shall be designed to recover from
the large-load customer the full, incremental cost of
any generation, transmission, or distribution upgrade
necessary to serve the load of such large-load
customer, including in the event of such large-load
customer terminating a contract with the electric
utility pertaining to the sale of electric energy, or
otherwise ceasing the purchase of electric energy from
the electric utility.
``(B) Financial assurances and contributions.--
Before making any generation, transmission, or
distribution upgrade that is necessary to serve the
load of a large-load customer, an electric utility
shall require the large-load customer provide to the
electric utility financial assurances or contributions
to cover the cost of such upgrade.
``(C) Large-load customer defined.--In this
paragraph, the term `large-load customer' means a non-
residential retail electric customer that, on or after
the date of the enactment of this paragraph, requests
to enter into, or enters into, a contract pertaining to
the sale of electric energy for one or more facilities
that--
``(i) are behind a single point of
interconnection; and
``(ii) have, in the aggregate, a peak
electric demand of 100 megawatts or more at a
single site or campus.''.
SEC. 102. FEDERAL STANDARD RELATING TO ADDITIVE GENERATION FOR LARGE-
LOAD CUSTOMERS.
Section 111(d) of the Public Utility Regulatory Policies Act of
1978 (16 U.S.C. 2621(d)), as amended by section 101 of this Title, is
further amended by adding at the end the following:
``(23) Additive generation for large-load customers.--
``(A) In general.--Each electric utility shall
consider the establishment of rates, contracts,
tariffs, service agreements, or other mechanisms under
which service to a large-load customer is encouraged or
required to develop, acquire, finance, or contractually
dedicate new or incremental generation resources
sufficient to serve the projected load of such large-
load customer and, where feasible, to provide
additional capacity, energy, capacity attributes, or
other resource benefits for the benefit of other
customers.
``(B) Additive generation incentive.--In carrying
out subparagraph (A), including as a means of
satisfying or supplementing the standard described in
paragraph (22), each electric utility shall consider
mechanisms under which any capacity, energy, capacity
attributes, or other resource benefits in excess of the
projected load of such large-load customer may be made
available, through long-term contracts or other market-
based mechanisms, to load-serving entities serving
residential, agricultural, small business, or other
existing customers.
``(C) Flexible implementation.--A State regulatory
authority, with respect to each electric utility for
which the State regulatory authority has ratemaking
authority, and each nonregulated electric utility may
implement the standard under this paragraph through--
``(i) physical allocation of generating
capacity;
``(ii) long-term power purchase agreements;
``(iii) contractual or financial
arrangements;
``(iv) market-based mechanisms;
``(v) tariff conditions or special
contracts for large-load customers; or
``(vi) any other mechanism determined
appropriate by the State regulatory authority
or nonregulated electric utility.
``(E) No mandatory resource allocation.--Nothing in
this paragraph shall be construed to require a State
regulatory authority or nonregulated electric utility
to mandate the physical allocation of generating
capacity or to require a uniform percentage set-aside
of new or incremental generation resources.
``(F) Large-load customer defined.--In this
paragraph, the term `large-load customer' has the
meaning given such term in paragraph (22)(C).''.
SEC. 103. OBLIGATIONS TO CONSIDER AND DETERMINE.
Section 112 of the Public Utility Regulatory Policies Act of 1978
(16 U.S.C. 2622) is amended--
(1) in subsection (b), by adding at the end the following:
``(9)(A) Not later than 1 year after the date of enactment
of this paragraph, each State regulatory authority (with
respect to each electric utility for which the State has
ratemaking authority) and each nonregulated electric utility
shall commence consideration under section 111, or set a
hearing date for consideration, with respect to the standard
established by paragraph (22) of section 111(d).
``(B) Not later than 2 years after the date of enactment of
this paragraph, each State regulatory authority (with respect
to each electric utility for which the State has ratemaking
authority) and each nonregulated electric utility shall
complete the consideration and make the determination under
section 111 with respect to the standard established by
paragraphs (22) and (23) of section 111(d).'';
(2) in subsection (c)--
(A) by striking ``subsection (b)(2)'' and inserting
``subsection (b)''; and
(B) by inserting ``In the case of the standard
established by paragraphs (22) and (23) of section
111(d), the reference contained in this subsection to
the date of enactment of this Act shall be deemed to be
a reference to the date of enactment of that paragraph
(22) and (23).'' after ``paragraph (21).''; and
(3) by adding at the end the following:
``(i) Other Prior State Actions.--Subsections (b) and (c) shall not
apply to the standard established by paragraphs (22) and (23) of
section 111(d) in the case of any electric utility in a State if,
before the date of enactment of this subsection--
``(1) the State has implemented for the electric utility
the standard (or a comparable standard);
``(2) the State regulatory authority for the State or the
relevant nonregulated electric utility has conducted a
proceeding to consider implementation of the standard (or a
comparable standard) for the electric utility; or
``(3) the State legislature has voted on the implementation
of the standard (or a comparable standard) for the electric
utility.''.
SEC. 104. PRIOR AND PENDING PROCEEDINGS.
Section 124 of the Public Utility Regulatory Policies Act of 1978
(16 U.S.C. 2634) is amended by adding at the end the following: ``In
the case of the standard established by paragraph (22) of section
111(d), the reference contained in this section to the date of
enactment of this Act shall be deemed to be a reference to the date of
enactment of that paragraph (22).''.
SEC. 105. QUALIFYING ADDITIVE GENERATION PROJECT CREDIT.
(a) In General.--Subpart E of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 48F the following:
``SEC. 48G. QUALIFYING ADDITIVE GENERATION PROJECT CREDIT.
``(a) In General.--For purposes of section 46, the qualifying
additive generation project credit for any taxable year is an amount
equal to 30 percent of the qualified additive investment, as determined
under subsection (b), for such taxable year.
``(b) Qualified Additive Investment.--For purposes of this section,
the term `qualified additive investment' means the portion of the
qualified investment in qualified property placed in service during the
taxable year that is properly allocable to creditable excess capacity.
``(c) Creditable Excess Capacity.--For purposes of this section,
the term `creditable excess capacity' means the portion of new or
incremental electric generation capacity that--
``(1) exceeds the projected peak electric demand of a
covered large-load facility;
``(2) is made available to one or more eligible load-
serving entities pursuant to a long-term contract or other
binding written agreement; and
``(3) does not exceed 50 percent of the projected peak
electric demand of such covered large-load facility.
``(d) Qualifying Additive Generation Project.--For purposes of this
section, the term `qualifying additive generation project' means a
project that--
``(1) develops, constructs, acquires, finances, or
contractually dedicates new or incremental electric generation
resources to support a covered large-load facility;
``(2) makes creditable excess capacity available to one or
more eligible load-serving entities; and
``(3) does not shift generation, transmission,
distribution, interconnection, stranded, or other
infrastructure costs attributable to the covered large-load
facility to existing residential, agricultural, small business,
or other existing customers.
``(e) Verification and Recapture.--
``(1) Verification.--No credit shall be allowed under this
section unless the taxpayer certifies, in such form and manner
as the Secretary may require, that--
``(A) the projected peak electric demand of the
covered large-load facility is supported by an
engineering study, utility service agreement,
interconnection study, or other documentation
determined appropriate by the Secretary, in
consultation with the Secretary of Energy;
``(B) the creditable excess capacity is subject to
a long-term contract or other binding written agreement
with one or more eligible load-serving entities; and
``(C) such creditable excess capacity is reasonably
expected to be deliverable to such eligible load-
serving entities.
``(2) Recapture.--The Secretary shall provide rules for the
recapture of all or a portion of any credit allowed under this
section if, during such period as the Secretary determines
appropriate--
``(A) the taxpayer materially increases the
electric demand of the covered large-load facility in a
manner that reduces or eliminates the creditable excess
capacity;
``(B) the taxpayer terminates or materially reduces
the long-term contract or other binding written
agreement described in paragraph (1)(B); or
``(C) the Secretary determines that the projected
peak electric demand of the covered large-load facility
was materially understated.
``(f) Definitions.--For purposes of this section--
``(1) Covered large-load facility.--The term `covered
large-load facility' means one or more nonresidential
facilities behind a single point of interconnection that have,
in the aggregate, a peak electric demand of 100 megawatts or
more at a single site or campus.
``(2) Eligible load-serving entity.--The term `eligible
load-serving entity' means an electric utility, public power
utility, electric cooperative, municipal utility, investor-
owned utility, Federal power marketing administration customer
or preference customer, or any other load-serving entity
determined appropriate by the Secretary.
``(3) Long-term contract.--The term `long-term contract'
means a contract, tariff, service agreement, power purchase
agreement, capacity agreement, or other binding written
arrangement with a term of not less than 10 years.
``(4) Qualified property.--The term `qualified property'
means tangible property that is used as an integral part of a
qualifying additive generation project, with respect to which
depreciation or amortization is allowable, and the original use
of which begins with the taxpayer.
``(g) Guidance.--The Secretary, in consultation with the Secretary
of Energy and the Federal Energy Regulatory Commission, shall issue
such guidance as may be necessary to carry out this section, including
guidance for determining qualified additive investment, projected peak
electric demand, creditable excess capacity, deliverability, and
prevention of cost shifting.
``(h) Termination.--This section shall not apply to any qualifying
additive generation project placed in service more than 10 years after
the date of enactment of this section.''.
(b) Part of Investment Credit.--Section 46 of the Internal Revenue
Code of 1986 is amended by adding at the end the following:
``(8) the qualifying additive generation project credit.''.
(c) Clerical Amendment.--The table of sections for subpart E of
part IV of subchapter A of chapter 1 of such Code is amended by
inserting after the item relating to section 48F the following:
``Sec. 48G. Qualifying additive generation project credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to qualifying additive generation projects the construction of
which begins after the date of enactment of this Act.
TITLE II--ADVANCING WATER REUSE
SEC. 201. QUALIFYING WATER REUSE PROJECT CREDIT.
(a) In General.--Subpart E of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 is amended by inserting after
section 48E the following new section:
``SEC. 48F. QUALIFYING WATER REUSE PROJECT CREDIT.
``(a) In General.--For purposes of section 46, the qualifying water
reuse project credit for any taxable year is an amount equal to 30
percent of the qualified investment for such taxable year with respect
to any qualifying water reuse project of the taxpayer.
``(b) Qualified Investment.--
``(1) In general.--For purposes of subsection (a), the
qualified investment with respect to any qualifying water reuse
project for any taxable year is the basis of qualified property
placed in service by the taxpayer during such taxable year
which is part of such qualifying water reuse project.
``(2) Qualified property.--For purposes of this subsection,
the term `qualified property' means property--
``(A) which is tangible property,
``(B) with respect to which depreciation (or
amortization in lieu of depreciation) is allowable, and
``(C) which is--
``(i) constructed, reconstructed, or
erected by the taxpayer, or
``(ii) acquired by the taxpayer if the
original use of such property commences with
the taxpayer.
``(3) Certain qualified progress expenditures rules made
applicable.--Rules similar to the rules of subsections (c)(4)
and (d) of section 46 (as in effect on the day before the
enactment of the Revenue Reconciliation Act of 1990) shall
apply for purposes of this section.
``(c) Qualifying Water Reuse Project.--For purposes of this
section--
``(1) In general.--The term `qualifying water reuse
project' means a project which--
``(A) installs, replaces, or modifies an onsite
water recycling system within an industrial,
manufacturing, data center, or food processing
facility,
``(B) replaces the use of freshwater, such as
groundwater, with recycled water from a municipal water
provider for the production of goods or provision of
services by the taxpayer, or
``(C) builds or expands a municipal water recycling
system for the purpose of securing recycled water for
the production of goods or provision of services.
``(2) Water recycling system.--The term `water recycling
system' means infrastructure needed for the production,
storage, conveyance, and use of recycled water.
``(3) Recycled water.--The term `recycled water' means
former wastewater, including both industrial and municipal
wastewater, that has been treated and cleaned for a specific
beneficial use.
``(d) Special Rule for Certain Property Transferred to Utilities.--
``(1) In general.--In the case of any qualified transfer
property transferred from a person to a utility--
``(A) such property shall be treated as qualified
property with respect to such person,
``(B) such person shall be treated as having placed
such property in service at the time of such transfer,
``(C) the basis of such person in such property
which is taken into account under subsection (b)(1)
shall be the basis of such person in such property at
the time of such transfer, and
``(D) such property shall not be taken into account
for purposes of determining any credit allowed under
this section to such utility.
``(2) Qualified transfer property.--For purposes of this
subsection, the term `qualified transfer property' means
property transferred from a person to a utility if--
``(A) such property is qualified property with
respect to such utility, and
``(B) such person and such utility enter into a
binding written agreement under which such person is
treated as eligible for the credit allowed under this
section with respect to such property in lieu of such
utility.
``(e) Termination.--This section shall not apply to any qualified
investment with respect to any qualifying water reuse project unless
such project is placed in service not later than the date which is 10
years after the date of the enactment of this section.''.
(b) Part of Investment Credit.--Section 46 of such Code is amended
by striking ``and'' at the end of paragraph (7), by striking the period
at the end of paragraph (8) and inserting ``, and'', and by adding at
the end the following new paragraph:
``(9) the qualifying water reuse project credit.''.
(c) Clerical Amendment.--The table of sections for subpart D of
part IV of subchapter A of chapter 1 of such Code is amended by
inserting after the item relating to section 48E the following new
item:''.
(d) Effective Date.--The amendments made by this section shall
apply to qualifying water reuse projects (as defined in section 48F of
the Internal Revenue Code of 1986, as added by this section) the
construction of which begins after the date of the enactment of this
Act.
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