Massachusetts has passed a ruling requiring data centers to ensure clean energy for their own use
Projects that fall short of the clean power requirement will be required to pay towards ratepayer protection
Developers will also need to clear local and state requirements before large projects can move through permitting
Massachusetts is setting new energy rules for large data centers in the state. Under an executive order signed by Governor Maura Healey, facilities with peak electricity demand above 25 MW must procure sufficient new clean electricity generation to meet their annual electricity consumption.
The rules build on a data center framework the Healey administration released in June 2026. The framework called on new data centers to bring or fund clean energy generation sufficient to meet 100% of their demand, while prioritizing on-site clean energy where possible.
Under Executive Order 658, signed on September 8, 2026, data centers with peak electricity demand above 25 MW are required to procure sufficient new clean electricity generation to meet their annual electricity consumption. The power must meet the eligibility requirements of Massachusetts’ Clean Energy Standard.
The Department of Environmental Protection (MassDEP) must also establish an alternative compliance payment mechanism by December 31, 2026, for projects that fall short of the requirement. Payments will go into a Ratepayer Protection Fund to help mitigate electricity supply costs for customers.
It requires both MassDEP and the Executive Office of Energy and Environmental Affairs (EEA) to evaluate GHG emissions from such data center projects as part of the Clean Energy and Climate Plan (CECP).
Data centers that do not bring their own clean energy will have to pay towards the Ratepayer Protection Fund to ensure accountability to the ratepayers, according to the new rules. This will also protect people from higher energy costs, said Healey.
Under Healey’s executive order, data centers must demonstrate compliance with the clean energy mandate before they can secure state permits. “Data centers can afford to pay for their own clean energy and infrastructure, and we’re going to make sure they do. A data center should invest in Massachusetts – bringing new clean energy and paying for the infrastructure to get it there,” added Energy and Environmental Affairs Secretary Rebecca Tepper.
The state's Department of Public Utilities (DPU) will also develop large-load rate schedules that ensure other ratepayers do not pay for distribution grid upgrades or related infrastructure required to serve data center demand.
Under the rules, community approval and protections for water and air resources are also required for data centers. The administration said the idea is to protect communities from ‘irresponsible’ data center development and higher energy bills. State permitting agencies will not advance a data center project without local approval.
Healey said, “Unless a community says yes to a data center, we are saying no.”
The US is among the regions seeing a major surge in AI data centers, which will affect its energy use. The Electric Power Research Institute (EPRI) estimates data centers to consume up to 9% of the country’s electricity generation annually by 2030, up from 4% of total load in 2023. The US Department of Energy (DOE) believes this is an opportunity to accelerate the build-out of clean energy solutions, including solar energy, and improve demand flexibility with battery storage.
The push to link data center growth with clean power is also gaining ground elsewhere, with Australia preparing a framework linking data center growth with additional renewable energy generation. Spain, on the other hand, is considering hourly renewable energy consumption requirements for the sector (see Spain Pushes For Hourly RE Consumption For Data Centers).
