Congress mandates data centers go off-grid—or pay $1M daily
S. 3852 — GRID Act · Filed by Josh Hawley (R-MO) · 2 cosponsors · Introduced Feb 11, 2026 · Referred to committee
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What it does
This bill requires large data centers (20+ megawatts) to generate their own power or face a $1 million-per-day penalty, with a 10-year grace period for existing facilities if they can prove they won't raise residential electricity rates. New data centers must be completely off-grid immediately. The bill also mandates public disclosure of data center power usage, real estate deals, and utility agreements, with the Department of Energy studying whether existing data centers can stay grid-connected without harming residential ratepayers.
Why we flagged it
The bill's core mechanism is a mandatory off-grid power requirement for data centers paired with a residential ratepayer protection standard. While framed as consumer protection, it functions as a structural constraint on data center operations that may have unintended consequences for the very ratepayers it aims to shield.
What the text implies
- Off-grid mandate may incentivize data center relocation to regions with cheaper on-site power generation (fossil fuels, nuclear), potentially concentrating environmental externalities in rural or less-regulated areas rather than distributing them across the grid.
- The 10-year grace period for existing data centers creates a cliff: after 2036, all grid-connected facilities must immediately transition to captive power or shut down, potentially causing sudden supply shocks and stranded infrastructure.
The full analysis lists 5 implications of this text.
Who stands to gain
On-site power generation companies (solar, wind, battery, nuclear vendors); Project labor unions (construction labor agreements mandated); Utilities (new Rate Effect Credit revenue stream)