Businesses: other; data center water usage requirements; provide for. TIE BAR WITH: HB 6135'26, HB 6140'26, HB 6141'26, HB 6137'26, HB 6142'26, HB 6139'26

2025-2026 Regular Session Introduced by Joey Andrews and 26 co-sponsors

Michigan HB 6138 requires data centers to use either closed-loop cooling or only municipal water, with heavy fines for noncompliance.

bill electronically reproduced 06/25/2026

#businesses:other #watersupply:other

Summary of HB 6138 (Michigan, 2025-2026)

Purpose and intent

Establishes the “data center water regulation act” to govern water use by data centers in Michigan.

Aims to limit freshwater withdrawals and discharges by requiring data centers to use water-efficient cooling or municipal water sources only.

Key provisions and changes

Definitions:

“Closed-loop cooling system”: A sealed cooling process where the same water/coolant circulates within a data center without withdrawing from or discharging to municipal water systems, groundwater, or surface water.
“Commission”: Michigan Public Service Commission.
“Data center”: Facility(s) in Michigan designed or used to house data center equipment for storage/processing of data.
“Person”: Any individual or legal entity.

Construction and operation requirements (Sec. 5):

Before construction or operation, a data center must meet at least one:
Use a closed-loop cooling system, or
Use only water sourced from a municipal water system.

Post-enactment operation requirements (Sec. 5):

Data centers constructed or operating after the act’s effective date must:
Use a closed-loop cooling system, or
Use only municipal water sources.

Enforcement and compliance (Sec. 7):

Violations subject to civil fines up to $1,000,000 per day of violation.
Prosecutor or the Attorney General may sue for civil fines or seek injunctions.
Fines must be deposited into the state general fund.

Implementation and rules (Sec. 9):

The Commission may promulgate rules to implement the act under the Administrative Procedures Act.

Effective date condition (Enacting section):

The act does not take effect unless a defined set of related bills (HB 6135, HB 6139, HB 6137, HB 6140, HB 6141, HB 6142) are enacted into law (a tie-bar provision requiring several other bills to pass for this act to become effective).

Parties affected

Data center operators and developers in Michigan.

Local governments and the Michigan Public Service Commission (for regulatory oversight and enforcement).

Potentially other state agencies involved in permitting, infrastructure planning, and utilities regulation.

Procedural and timeline aspects

Status: Introduced June 25, 2026; referred to Committee on Government Operations.

Tie-bar: The act’s effectiveness contingent on the enactment of six other related bills (HB 6135, 6139, 6137, 6140, 6141, 6142), indicating coordinated regulatory reform across multiple topics.

Penalties: Substantial civil fines up to $1 million per day, signaling a strong enforcement posture.

Practical impact and considerations

Encourages or requires data centers to adopt closed-loop cooling or municipal water sourcing, potentially increasing upfront costs for new facilities or retrofits but reducing freshwater withdrawals.

Establishes clear compliance framework and penalties, which may influence site selection and cooling technology decisions.

The tie-bar structure means stakeholders should monitor progress on related bills, as this act’s full implementation depends on their passage.

Notes for readers

The bill focuses narrowly on data center water usage and does not appear to regulate other industrial water uses.

Details on how “municipal water” sourcing is defined or verified, and any exemptions, are not specified in the provided text and would be clarified in enacted language or implementing rules.

If you’d like, I can compare this bill to existing Michigan water-use or data center regulations, or draft a brief Q&A for stakeholders (operators, local governments, utilities).