- Senators Whitehouse and Fetterman propose a Clean Cloud Act requiring data centers and crypto miners to cut emissions by 11% annually.
- The EPA would enforce emissions standards, imposing fines starting at $20 per ton of CO₂e. Revenue would fund clean energy and assist with electricity costs.
- Supporters emphasize sustainability, while critics argue it targets specific industries. The bill may clash with President Trump’s pro-tech agenda as miners shift to AI.
Senators Sheldon Whitehouse and John Fetterman have introduced a new legislative proposal to curb the growing environmental impact of data centers and cryptocurrency mining operations. The proposed legislation, titled the Clean Cloud Act, seeks to address the escalating energy demands of these facilities by establishing strict emissions standards.
Clean Cloud Act Introduces Carbon Penalties and Grid Emission Accounting
The bill would mandate the Environmental Protection Agency (EPA) to implement a performance standard aimed at 11% per year reductions. If emissions exceed the permitted threshold, they would be penalized at $20 per ton of carbon dioxide equivalent (CO₂e) per facility unit above the threshold. This increases by a $10 increment annually, adjusted for inflation and supplemented by an increase in this fee as it is payable. Significantly, the legislation also includes a structure for accounting for indirect emissions from the power grid to discourage having the environmental benefit of existing clean electric sources be relied on by the facility alone.
Some of those penalties would be funneled to the families to help pay their electricity bills, while the rest would be invested into the technologies and infrastructure to store energy. As proponents of such an investment, they argue it would mean a decrease in fossil fuel dependence and an increase in grid stability. Additionally, they say that this would enable energy-intensive industries to take responsibility and assist in temporarily or permanently reducing the burden on the power grid and lowering consumer electricity prices in the long term.
Mixed Reactions from Industry Stakeholders
The Clean Cloud Act has resulted in various reactions amongst industries. As noted in a statement on the U.S. Senate Committee on Environment and Public Works website, data center and crypto mining power consumption are outpacing the growth of carbon-free energy sources. Approximately 4 percent of the nation’s electricity is used by data centers, which may reach up to 12 percent by 2028. In some instances, such as the need to provide energy under pressure, decommissioned coal-fired power plants are put back in service and will contribute to increased greenhouse gas emissions.
Morgan Stanley research estimates that global data center emissions could reach 2.5 billion metric tons by the decade’s end. Proponents of the bill assert that such projections indicate the urgency of taking immediate regulatory measures. However, opponents have opposed the measure, arguing that it disproportionately targets particular sectors. Social media dismissed the bill, with the head of research at VanEck, Matthew Sigel, saying it was a “losing ‘blame the server racks’ strategy.”
Clean Cloud Act May Clash with Federal Tech Priorities Under Trump Administration
As Senate lawmakers focus on adopting the Clean Cloud Act, questions are developing about whether the proposal fits other federal aims. The legislation may not go well with the current administration’s stance, whose president, Donald Trump, has emphasized innovation in artificial intelligence and cryptocurrency.
Last week, the president overturned an executive order that previously set similar standards for the development of AI and moved towards deregulation to speed technological development. Noting how Trump has also signaled his intent for the US to be a global leader in AI and digital assets, others have feared that new regulatory mechanisms could interfere with progress in these fields.
