Senate Democrats block data centre energy bill as power and cooling costs mount

The vote in the Republican-controlled chamber came just before senators return home for the 3 November midterm elections. Four Democrats, Maggie Hassan of New Hampshire, Amy Klobuchar of Minnesota and both Georgia senators, Jon Ossoff and Raphael Warnock, joined Republicans in support, according to The Guardian.

"Americans are calling for real solutions, real guardrails, real solutions on AI. Republicans' toothless datacenter bill completely misses the mark," Senate Democratic leader Chuck Schumer said in a floor speech before the vote, The Guardian reported. The bill's backers argued the opposite. "It's clear that big tech should be paying their own way, not passing the cost on to local communities and states, and this bill does that," said Ohio Republican Jon Husted, who championed the Senate version.

The Ratepayer Protection Act would have required electric utilities to consider adopting standards so data centres pick up the cost of transmission, generation and distribution upgrades that can otherwise land on households and businesses. The House had approved it by an almost unanimous vote earlier in September. It now stalls, days before the chamber is scheduled to conclude work on Friday.

Texas regulators question a gas plant built for one tenant

The same cost-shifting question is playing out in Texas, where administrative law judges for the Public Utilities Commission released a proposed decision on Wednesday on El Paso Electric's application to build a 366-megawatt natural gas facility to power Meta's $10 billion, 1-gigawatt data centre in northeast El Paso. Inside Climate News reported that the judges found the utility failed to adequately consider alternatives to the gas plant, called McCloud, and failed to issue a request for proposals to contractors.

The judges recommended approval only on the condition that El Paso Electric does not pass capital and operating costs on to ratepayers. Without that condition, they recommended denial. The final decision rests with the five PUCT commissioners, and no vote has been scheduled. The McCloud facility, made up of 813 modular natural gas generators supplied by Enchanted Rock at a total estimated cost of $499 million, would exclusively supply Meta for the first five years before connecting to the broader transmission system, according to the same report.

El Paso Electric initially claimed solar would supply the data centre. It proposed contracting with Enchanted Rock after Meta recommended the company, and did not consider other contractors, the judges found. "The selection of the Project was driven by Wurldwide's prescribed timeline and preferences, and its agreement to pay the capital and operating costs," the judges wrote, referring to a Meta subsidiary named in the application. Krysti Shallenberger of the Energy & Policy Institute told Inside Climate News the application is notable because El Paso Electric is a privately held monopoly utility seeking to build a power plant solely for a data centre, a structure not seen in competitive markets.

Far West Texas sits outside the Electricity Reliability Council of Texas grid, where utilities are barred from owning power plants: the rule that lets El Paso Electric make the proposal at all.

The numbers behind the buildout

Bain and Company put a figure on the scale of the problem on Tuesday. The consultancy said the AI industry must generate $6 trillion in annual revenue by 2031 to justify surging capital investment in data centre infrastructure, with annual AI infrastructure spending potentially reaching $1.5 trillion by 2031, covering new facilities, GPU upgrades, memory and networking equipment.

"The economics of AI infrastructure demand trillions in new revenue beyond productivity gains," said David Crawford, chairman of Bain's global technology practice and lead author of the report, according to The National. Bain said data centre sizes and costs are doubling roughly every 12 to 16 months. Meta's Prometheus facility in Ohio had a capacity of 600MW at an estimated cost of $24 billion in 2025, according to research firm Epoch AI, with projections of up to 2GW and $80 billion by 2027 and 9GW at $200 billion by 2030.

"The unprecedented speed and scale of the AI buildout, with billions flowing into chips, data centres, networks and power systems, have focused attention on the challenge of building capacity. But the more important question may be whether enough economic value can be created to justify it."

The Bain report also lists the practical constraints: adding grid capacity, securing GPUs, finding and retaining a skilled workforce, and managing public opinion and regulation, including pushback on resource use and noise pollution. Those constraints are already visible in permitting fights from Texas to Sydney.

Transparency fights in Europe and Australia

In Europe, Lighthouse Reports filed a formal complaint on Monday against the European Commission, accusing it of building a "wall of silence" about data centre energy consumption, POLITICO reported. The complaint, lodged under the Aarhus Convention, argues that EU rules keep the public from seeing how much energy and water individual data centres use. According to the Commission's own figures, Europe's data centres used 20.7 terawatt-hours of electricity and more than 8 million cubic metres of water in 2025, a 26% increase in electricity use and 52% in water use from 2024. Those totals come from incomplete data and have only been published in aggregate, following a 2024 law that banned Brussels and EU capitals from disclosing information and key performance indicators for individual data centres amid lobbying from tech giants. The Aarhus Convention Compliance Committee meets in November to decide whether the complaint is admissible. The Commission did not respond to POLITICO's request for comment.

In Australia, Goodman Group confirmed on Monday it had told the NSW Department of Planning it would no longer proceed with its $1.2 billion Project Mars data centre in Sydney's Lane Cove, citing "changes in regulatory environment", ABC News reported. The three-storey project sat approximately 20 metres from the nearest house and 160 metres from Lane Cove West Public School. "During this time, the policy and regulatory environment for large-scale data centre development has evolved significantly," the developer said. The decision followed a federal senate inquiry hearing at which Liberal senator Sarah Henderson pressed Goodman's general manager of developments, Ben McGilp, to withdraw the proposal on the spot. Sweltering Cities senior campaigner Sanaa Shah told the ABC the shelving was evidence of large-scale community resistance forming across the country.

Cooling and power procurement are moving just as fast elsewhere. Google is set to launch an experimental satellite next week carrying four Tensor Processing Units and a single kilowatt of solar power, part of a project called Suncatcher, Tom's Hardware reported. The chips will only run for around 15 minutes before needing to shut down to cool off, and Google's James Manyika told The New York Times the company does not expect anything usefully operational in the next few years.

Back on the ground, the political arithmetic is simpler. The Senate bill is dead for this session, El Paso Electric's gas plant still needs a commission vote, and the EU's transparency complaint gets its first hearing in November. Every one of those decisions shapes who pays for the power and water that data centres consume, and none of them is settled.