COLUMBIA, S.C. — South Carolina lawmakers have taken their first significant step toward regulating the rapid spread of data centers across the state, with a Senate committee advancing a sweeping bill aimed at managing energy demand, water use and the cost burden on existing utility customers.
The Senate Agriculture and Natural Resources Committee voted Tuesday to send S. 867, the Data Center Development Act, to the full Senate after months of subcommittee testimony. The bill is sponsored by Sen. Tom Davis, R-Beaufort, and co-sponsored by Sens. Josh Kimbrell, Billy Garrett, Ed Sutton, Overture Walker, Allen Blackmon, Ross Turner, Jeffrey Zell, Carlisle Kennedy and Tameika Devine.
What the Bill Would Do
S. 867 would create a Data Center Development Office within the South Carolina Department of Environmental Services and require a state issued siting permit before any new data center could begin operations. That requirement would supersede the current system, in which counties exercise primary authority over data center development.
The legislation establishes a three tier classification system based on a facility’s electrical load. Tier 1 facilities of one to 10 megawatts would receive 60 day permit reviews. Tier 2 facilities of 11 to 50 megawatts would undergo 90 day reviews. Tier 3 facilities of more than 50 megawatts would face 120 day comprehensive assessments evaluating water supply, wastewater capacity, road access and overall site suitability.
The bill also directs the Public Service Commission to ensure data centers pay the full cost of new generation and transmission capacity needed to serve them, rather than passing those costs along to existing ratepayers. Operators would be required to meet performance based operational efficiency and water efficiency standards, submit annual reports, and adhere to mandatory light shielding, vibration reduction and sound limits intended to protect neighboring properties.
A 10 member Data Center Industry Advisory Committee would advise the new office. Membership would include representatives from the data center industry, utilities, ratepayer and environmental advocacy groups, water utilities, local government, the South Carolina Energy Office, the Office of Regulatory Staff and the Public Service Commission.
The bill further requires comprehensive decommissioning plans backed by financial assurances, so that operators rather than taxpayers bear the cost of cleaning up abandoned facilities. It also creates a targeted incentive structure to encourage data center development on brownfield sites, which the Department of Environmental Services estimates number more than 400 statewide.
Why It Matters Locally
The legislation arrives as York County Council weighs its own response to data center growth. At the council’s April 6 meeting, residents called for a local moratorium and stricter standards, citing noise, water use and proximity concerns connected to the QTS development near Rock Hill. One council member formally suggested a moratorium on new data center applications when use regulations come before the Planning and Zoning Committee, given the volume of activity at both the local and state level.
The Department of Commerce has told lawmakers it does not formally track data centers, but estimates put the current count in South Carolina at 20 to 30 facilities. That figure is dwarfed by neighboring states, with roughly 200 in Georgia and approximately 600 in Virginia. National tracking sites count more than 4,000 data centers across the country.
Path Forward
With the legislative session winding down, the bill faces a steep climb to reach Gov. Henry McMaster’s desk this year. Lawmakers conceded as much during Tuesday’s committee meeting but said advancing the measure now puts a marker down for future action.
Sen. Davis has argued that allowing the bill to stall would amount to a decision to let data center development continue largely unchecked, locking in long term strain on the state’s electrical grid, water supply and natural resources without adequate ratepayer protections.
If passed by the full Senate, the bill would move to the House for debate, with any amendments likely requiring reconciliation through a conference committee. Companion and competing measures, including S. 784, S. 902 and a House moratorium proposal filed as H. 5286, remain pending.
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