South Dakota data center and energy laws

What it would do: Modifies the reinvestment payment program to require direct payment permit eligibility, allow combined reinvestment payments covering sales and use tax on initial project costs and future equipment upgrades for up to thirty years, and extend the eligibility period to four years for initial project costs.

What it would do: Clarifies that backup electric generation means electric generation not interconnected with the grid and generated temporarily to replace primary source generation when unavailable, and excludes backup electric generation from the definition of energy conversion facility.

What it would do: Prohibits state agencies and political subdivisions from entering into agreements with nongovernmental entities, private persons, or public-private businesses concerning data center construction, development, or location that require confidentiality or nondisclosure, and designates such agreements as public records.

What it would do: Imposes a moratorium on new construction or expansion of large data centers (peak demand of 20+ megawatts) through June 30, 2027, and requires data centers to pay full service costs, submit annual reports, obtain private power alternatives, and post decommissioning bonds.

What it would do: Effective July 1, 2026, prohibits data center facilities within one mile of residential areas, limits continuous noise to 45 decibels at residential property lines, and allows state's attorneys and citizens to sue operators and building owners for violations as nuisances.

What it would do: Establishes requirements for large-use data center customers regarding water consumption, including closed-loop cooling technology and quarterly reporting. Creates separate utility service classifications for large-use customers with incremental cost allocation and allows negotiated contracts with electric utilities.

What it would do: Imposes a one-year moratorium on new construction or expansion of hyperscale data centers in South Dakota through June 30, 2027, including expansion of non-hyperscale data centers that would become hyperscale. Defines hyperscale data center as a centralized repository for electronic data with peak electrical demand of fifty megawatts or greater.

What it would do: Exempts sales of enterprise information technology equipment and computer software used in qualified data centers from sales and use taxes, and requires qualified businesses to submit documentation to the Department of Revenue and comply with electric utility cost-sharing and water provider notification requirements.

What it would do: Exempts data center purchases from sales taxes, requires data center operators to pay all electricity costs without passing them to residential customers, allows local governments to regulate data centers, and requires data centers to notify water providers of projected consumption and comply with water allocation limits set by the Board of Water Management.

What it would do: Requires operators of high energy use facilities (20+ megawatts average electrical power) to obtain conditional use permits from adjacent counties if within one mile of the boundary and the county has adopted zoning ordinances, and from adjacent municipalities under similar conditions.

What it would do: Exempts qualified businesses from South Dakota sales and use taxes on enterprise information technology equipment and computer software used in qualified data centers for fifty years after the building permit is issued, subject to verification by the Department of Revenue and compliance with electric utility and water provider requirements.

What it would do: Provides a sales and use tax refund for qualified businesses purchasing enterprise information technology equipment and computer software for initial furnishment and substantial refurbishment of qualified data centers in South Dakota through July 1, 2029, excluding municipal taxes.