Senate investigation challenges data-center developers on power costs and transparency

Seven major data-center developers declined to endorse a standard making them pay for new power infrastructure that would not be needed without their facilities, according to a yearlong Senate investigation reported by TIME on October 8. The findings challenge the companies’ case for public support, questioning both who pays and what communities receive.

Democratic Senators Elizabeth Warren, Chris Van Hollen and Richard Blumenthal led the inquiry into Amazon, Google, Meta, Microsoft, CoreWeave, Digital Realty and Equinix. Their staff requested information from each company and interviewed employees. The findings cover electricity costs, permanent employment, tax incentives and restrictions on public disclosure.

Direct service costs versus a bigger grid

The companies generally said they would cover the direct costs of serving their facilities. Their objection concerned larger investments, such as new power plants and transmission lines. They argued that those additions can benefit other electricity customers, so the company driving the demand should not automatically receive the entire bill.

The investigators proposed a different dividing line: whether the infrastructure would have been needed without the data center. None of the seven companies agreed to that standard. The disagreement is therefore not simply whether developers should pay, but which investments count as their responsibility.

Congress must hold Big Tech accountable so these companies pay their fair share

Senator Elizabeth Warren, speaking to TIME

The local bargain is hard to inspect

Amazon, Google, Meta and Microsoft routinely sought nondisclosure agreements during development, the report says. These agreements restrict what signers can reveal. Negotiations can involve commercially sensitive information, but investigators argued that secrecy also limited scrutiny of deals involving tax dollars, utility rates and public infrastructure.

Microsoft told investigators it would stop seeking these agreements with local governments, while retaining them with state agencies, public utility commissions and utilities. Amazon announced a similar policy. Google and Meta declined to commit to ending the practice with local governments.

Employment disclosures were another gap. Developers routinely cite construction jobs when seeking incentives, but several declined to provide comprehensive permanent-employment information. Some told investigators that ongoing staffing was roughly one worker per megawatt of power demand—a measure of electricity required, not the number of construction workers.

Investigators also identified equipment sales-tax exemptions as potentially more lucrative than property-tax breaks. The report estimates that GPUs, the computing hardware used in AI facilities, account for 39% of spending at an average one-gigawatt AI data center.

Congress has already split over enforcement

In September, the House passed the bipartisan Ratepayer Protection Act 417–3. It would direct states to consider requiring large electricity users to cover added infrastructure costs. The Senate voted 57–43 against advancing it; Democrats objected that states would not have to assign those costs to companies. Much of the authority over electricity rates remains with state regulators.