Papan Bill to Boost Renewable Energy from Data Centers Unanimously Approved by Assembly Natural Resources Committee

SACRAMENTO, CA — Legislation authored by Assemblymember Diane Papan (D–San Mateo) to unlock data center waste heat as a renewable energy resource was unanimously approved by the Assembly Committee on Natural Resources. Assembly Bill 1095 proposes to include waste heat recovery from data centers as an eligible project under the Climate Catalyst Revolving Loan Fund, enabling data centers to convert excess heat into renewable energy.​

“California has long been a leader in renewable energy, and now it’s time to harness every resource at our disposal,” said Assemblymember Papan. “By capturing and repurposing the waste heat from data centers, we can reduce emissions, lower energy costs, and make our energy grid more resilient.”​

Data centers are essential to the digital economy, supporting nearly all business and government operations. However, they are also among the state's most energy-intensive facilities, consuming approximately 4% of California's electricity. This figure is projected to rise to 12% by 2028, driven in part by the increasing demand for cloud services and artificial intelligence applications.​

Currently, much of the heat generated by data centers is released into the atmosphere, contributing to energy inefficiency and unnecessary emissions. Assembly Bill 1095 seeks to change that by incentivizing the capture and reuse of this waste heat.​

“This bill is a win-win for California,” Assemblymember Papan continued. “It supports innovation in the tech industry, reduces greenhouse gas emissions, and helps meet our state's ambitious climate goals.”​

The Climate Catalyst Revolving Loan Fund, established in 2020, is designed to provide flexible, low-cost financing for projects that advance climate solutions. By expanding the fund’s scope to include data center waste heat recovery, AB 1095 aims to accelerate the deployment of this underutilized renewable energy source.

“Repurposing waste heat from data centers not only conserves energy but also reduces operational costs and greenhouse gas emissions,” said Assemblymember Papan. “By integrating this practice into our renewable energy standards, we can make significant strides toward a more sustainable and resilient energy system.”​

Assembly Bill 1095 will be heard in the Assembly Committee on Appropriation sin the coming weeks.

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