United States: Water

Texas Governor Greg Abbott has directed state agencies to halt all data center permits until comprehensive audits assess the projects' impacts on electric infrastructure, residential ratepayers, and water resources. The directive requires data centers to fully fund necessary electric infrastructure and comply with enhanced reporting requirements, while the governor signals potential legislative action to codify new protections and phase out certain tax incentives.

California has enacted seven new laws that fundamentally reshape how data centers are approved, powered, and supplied with water. These regulations eliminate fast-track environmental approvals, impose mandatory water supply assessments regardless of facility size, and require data centers to bear full grid interconnection costs through special utility tariffs.

California Governor Newsom signed seven data center bills into law on September 21, 2026, establishing a comprehensive regulatory framework that takes effect January 1, 2027. These bills create new tariff regimes administered by the California Public Utilities Commission, impose extensive reporting requirements on data center operators, and establish water disclosure mandates and CEQA treatment protocols.

Louisiana's Department of Conservation and Energy has proposed significant rule changes for groundwater management that could reshape how legacy oilfield sites are investigated and monitored. The new regulations introduce stricter requirements for environmental well installation, including prohibitions on screens crossing multiple aquifer layers, and establish accelerated timelines for well plugging.

Industry stakeholders should anticipate multiple data center-related bills addressing water, power, local regulatory authority and tax incentives, with increased scrutiny of development practices and community engagement.

The U.S. Environmental Protection Agency (EPA) recently published its proposed 2027 National Pollutant Discharge Elimination System (NPDES) Construction General Permit (CGP) for public comment. The proposal would replace the current 2022 CGP, which will expire in February 2027, and includes targeted changes addressing (1) the Supreme Court’s decision in City and County of San Francisco v. EPA, (2) submission of Stormwater Pollution Prevention Plans (SWPPPs) when seeking coverage, (3) sediment basin stabilization measures, and (4) purported streamlining of certain permit requirements.

The EPA has proposed the Sixth Unregulated Contaminant Monitoring Rule (UCMR 6), requiring public water systems to collect data on 30 unregulated contaminants including certain PFAS from 2028 to 2030. Despite petitions from seven state governors and environmental groups, the agency declined to add microplastics to the monitoring list, citing the absence of validated testing methods, though microplastics remain on the draft Contaminant Candidate List 6 for potential future regulation.

While EPA has proposed modifications to certain PFAS drinking water regulations, the PFOA and PFOS limits remain firmly in place, and EPA has signaled that a restarted rulemaking process could yield additional requirements for the rescinded compounds in the future.

Given the deregulatory approach taken by the Trump administration on PFAS maximum contaminant levels (MCLs) (as detailed in Part I) and the money his administration is making available for states (as detailed in Part II), this Part III analyzes the other side of the Trump administration’s environmental federalism – what the states are doing. States have responded in varying ways to the reduced federal action for PFAS MCLs, including some acting directly in response to the Trump administration’s recent MCL changes.