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Washington’s House Bill 2515 did not become law. The measure passed the House, but the Senate Ways and Means Committee took no action before a legislative deadline. The bill’s failure came after opposition from Microsoft and other technology and business interests, although the public record does not establish that lobbying was the sole cause.
For Washington utility customers, the important question is what happens next: the bill’s proposed protections against shifting data-center costs onto ratepayers are not in effect, but the state did separately narrow some data-center tax exemptions through a different law.
Which Washington data-center bill failed?
The failed measure was House Bill 2515, formally titled “Addressing emerging large energy use facilities.” Its Senate companion was SB 6171.
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1Repair Windows errors before they cause bigger problems2Fix the driver behind crashes, sound loss and screen glitches3Clear out junk files and repair common Windows errorsSponsored by Rep. Beth Doglio and other Democratic lawmakers, HB 2515 passed the House by a 51–41 vote on February 14, 2026. It later moved through the Senate Environment, Energy & Technology Committee with amendments and was referred to Ways and Means.
The Senate committee held a public hearing on February 27 and scheduled executive action for March 2. It did not vote. The bill missed the applicable legislative deadline and was returned to the House Rules Committee on March 12 without becoming law.
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What HB 2515 would have changed
The proposal addressed the rapid growth of large electricity users, including data centers supporting cloud computing and artificial intelligence. Its stated concerns included electricity affordability, grid reliability, public transparency, water use, and environmental protection.
The version under consideration would have included measures such as:
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- Ratepayer protections: Utilities would have been directed to create tariffs, policies, or agreements intended to prevent existing customers from bearing costs caused by new large data-center loads.
- Utility coordination: Data centers and utilities would have coordinated on load forecasts and the system requirements associated with new facilities.
- Resource reporting: Facilities could have been required to report electricity, water, refrigerant, and air-pollution information.
- Sustainability reporting: Operators would have periodically disclosed information about environmental performance.
- Clean-energy requirements: The version described in contemporaneous coverage included a path toward 80% clean power by 2030 and 100% clean energy by 2045 for facilities opening or expanding after July 1, 2026.
- Carbon-credit limits: The bill would have limited the use of free carbon credits for compliance with state requirements.
Proposals for emergency curtailment or shutdowns during periods of grid stress were discussed during the legislative process, but contemporaneous coverage indicated that this provision was not part of the House-passed version. It is therefore inaccurate to say that the failed bill simply required all data centers to shut down during emergencies.
The exact requirements changed through amendments. Descriptions should distinguish between the original proposal, amended Senate language, and the House-passed text rather than treating every provision discussed during the session as final.
Why Microsoft and other technology interests objected
Microsoft publicly opposed advancing HB 2515 without significant changes on February 27–28. The company described the proposal as “uniquely anti-competitive,” according to GeekWire’s reporting.
Microsoft’s objections included concerns that:
- Some requirements could apply unevenly to facilities and make Washington less attractive for investment.
- Clean-energy rules could affect facilities that had already been built or were already planned, including a data center in Malaga.
- Curtailment requirements could interfere with facilities supporting essential digital services.
- Additional reporting, energy, and equipment requirements could raise operating and replacement costs.
GeekWire reported that Microsoft operates approximately 30 data centers in Washington. That is a company footprint reported by the publication, not an official state inventory.
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Amazon was reported as publicly neutral while working behind the scenes to weaken the measure. Other opposition or concern came from the Data Center Coalition, utilities including Avista, labor organizations, the Washington Technology Industry Association, construction and contractor groups, chambers of commerce, and the Alliance of Western Energy Consumers.
Their arguments focused on construction and skilled-trade employment, property-tax revenue, local economic activity, Washington’s competition with other states, and the possibility that higher equipment costs or abrupt policy changes could discourage development.
Why supporters wanted stronger rules
Supporters—including environmental organizations, tribal nations, ratepayer advocates, and lawmakers—argued that Washington should establish enforceable safeguards before AI-related electricity demand expands further.
Their concerns were principally financial and infrastructure-related:
- Large new loads may require generation, transmission, distribution, and backup-capacity investments.
- Without special tariffs or long-term commitments, some of those costs could be recovered from households and small businesses.
- Residents and regulators may not have enough facility-level information about electricity, water, refrigerant, and pollution impacts.
- Corporate climate commitments are voluntary and may not substitute for enforceable state requirements.
- Water use can be significant, depending on cooling technology, climate, server density, and whether facilities use potable, reclaimed, evaporative, or closed-loop systems.
Rep. Doglio presented the proposal as a way to protect affordability, grid reliability, water resources, and Washington’s clean-energy commitments. The NW Energy Coalition characterized it as a set of basic guardrails. Those are supporters’ positions, not findings that every data center has already caused substantial harm to utility customers.
Did technology lobbying kill the bill?
The most accurate answer is narrower than the political slogan.
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Technology-industry opposition intensified shortly before the committee deadline. Microsoft publicly urged major changes, and industry groups and other opponents raised concerns during the legislative process. The Senate Ways and Means Committee then failed to take executive action on March 2, and the bill missed the deadline.
That sequence supports saying the bill failed amid technology-industry pushback. It does not prove that Microsoft alone, or lobbying alone, caused the procedural outcome. There was no recorded Senate vote formally identifying lobbying as the reason for the bill’s failure.
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What the available data say about ratepayer risk
The debate involves two different questions: what existing facilities are using today and how much future large-load growth could cost.
A Washington Joint Legislative Audit and Review Committee analysis examined four urban data centers eligible for the state’s tax preference. It estimated that they used approximately 427,000 megawatt-hours in 2024—about 1.4% of the combined electricity sales comparison for Puget Sound Energy and Seattle City Light to industrial, commercial, and residential customers.
JLARC said the impact on other customers’ costs was likely minimal for that specific group and period. That does not prove that data centers have caused major statewide rate increases, nor does it settle the question of future AI-related demand. Future costs depend on factors including:
- Whether a project requires new generation or transmission.
- Who pays for distribution and interconnection upgrades.
- Whether the facility signs a long-term, take-or-pay, or minimum-load agreement.
- Whether projected capacity is built before the facility reaches full operation.
- Whether the facility can reduce demand during emergencies.
- Whether the utility uses a special large-load tariff rather than spreading costs across customers.
For households, the relevant issue is not simply how much electricity a data center consumes. It is whether the utility can recover the incremental cost of serving that load from the project rather than from the broader customer base.
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Washington did not abandon all data-center policy changes
HB 2515’s failure should not be confused with the separate passage of ESSB 6231.
The governor signed ESSB 6231 on April 1, 2026. The law narrowed Washington’s rural and urban data-center sales-and-use tax preferences by removing eligibility for refurbishments and replacement server equipment. The changes took effect July 1, 2026, according to legislative materials and JLARC.
Qualifying new construction remained eligible under specified conditions and time windows. Washington therefore did not eliminate every data-center tax incentive; it narrowed the exemptions, particularly for existing facilities upgrading or replacing equipment.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What JLARC found about the tax incentives
JLARC reported that the urban preference applies in King, Pierce, and Snohomish counties. Eligible facilities generally must devote at least 20,000 square feet to servers and have at least 1.5 megawatts of available power.
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One free scan finds every outdated or missing driver and matches the right update for your exact hardware.Free scan · exact hardware matchFrom 2022 through 2025, eligible owners claimed four of 18 available urban exemption certificates. JLARC identified no new data-center construction under the urban preference during its review period; the claimed exemptions were for refurbishments. It recommended allowing the urban preference to expire.
That finding does not mean Washington’s entire data-center sector created no jobs or produced no economic activity. Industry participants argued that the exemption helped attract tenants, while JLARC’s finding concerns the results of the specific urban preference and review period.
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GeekWire, citing Baxtel data, reported approximately 126 data centers and related facilities in Washington. That is an industry-research estimate and may include different types of facilities; it should not be treated as an official state count.
What happens next?
The debate is likely to continue through several channels even without HB 2515.
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Utility tariffs and large-load agreements
Utilities can address some ratepayer concerns through special tariffs, interconnection requirements, minimum-load commitments, security deposits, and agreements assigning project-specific infrastructure costs to large customers. The practical challenge is determining which upgrades are caused by a data center and which serve broader system needs.
Local land-use and water decisions
Local governments may use zoning, development agreements, permitting conditions, water-use requirements, or temporary restrictions. These local decisions can affect a project even when statewide legislation does not pass.
Future state legislation
Lawmakers may revisit disclosure, clean-energy procurement, tax incentives, emergency demand reduction, and ratepayer protections. Any future proposal will have to balance environmental and affordability goals against reliability, security, critical digital services, construction employment, and Washington’s competition with other states.
Better public reporting
A workable disclosure system would need standardized definitions, consistent reporting dates, public access, and protections for legitimate security and trade-secret information. Without those features, residents may have difficulty comparing facilities or evaluating whether promised economic benefits justify public costs.
What Washington utility customers should watch
- Utility rate cases: Look for proposed recovery of generation, transmission, distribution, and backup-capacity costs associated with large new loads.
- Special data-center tariffs: Check whether large customers are paying charges that reflect the cost and risk of their interconnection.
- Load forecasts: Pay attention to whether projected AI and data-center demand is firm, speculative, delayed, or subject to cancellation.
- Local permits: Review water, zoning, noise, environmental, and development-agreement conditions for individual projects.
- Tax-preference performance: Compare claimed exemptions with measurable construction, jobs, wages, property-tax revenue, and energy or water impacts.
For now, Washington has no new statewide HB 2515 requirements protecting ratepayers or requiring the proposed data-center disclosures. The state’s separate tax changes are in effect, but they address tax preferences—not the broader grid, transparency, and environmental framework that HB 2515 sought to create.
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