What 2027 Holds for Data Centers in Utah

Stratos changed the politics. In May, Box Elder County commissioners approved Kevin O'Leary's campus, planned at up to 40,000 acres, through the Military Installation Development Authority. Outrage over the project was a key factor in Senate President Stuart Adams' loss in the June Republican primary. Adams had long chaired MIDA. In August, Gov. Spencer Cox said the process "was not good, and the MIDA process especially." On Nov. 9, House Speaker Mike Schultz told the Deseret News editorial board that MIDA's involvement was "a huge mistake."

Lawmakers return Jan. 19. Several of the data center laws they have already passed take hold in 2027, and more are coming.

The rules already written

Power came first. The 2025 Large Load Act requires the Public Service Commission to review contracts between a utility and a customer that needs a large block of power, and it bars shifting the cost of serving that customer onto everyone else. Rocky Mountain Power filed the first contract under the law in February, for an unnamed customer that had asked for more than 100 megawatts, and the commission approved a settlement in April. State officials announced it as the first deal of Operation Gigawatt. The same law lets companies that need 100 megawatts or more build their own generation off the public grid, which is how the biggest Utah projects are being powered.

Water came this year. The new reporting law covers a new large data center, one that uses at least 75 acre-feet of water a year and starts operating on or after July 1, 2026. Between 90 and 360 days before construction begins, the operator has to tell the local water provider how much water it expects to need and report its estimated withdrawals to the Division of Water Rights. Once it is running, it reports actual withdrawals every year by July 1, and the division has to post the figures for each facility, not just a statewide total, by Sept. 1. That makes Sept. 1, 2027, the first deadline for public, facility-by-facility numbers. The fine for not reporting is up to $100 a day after a warning. The bill as first proposed carried a $10,000 daily fine.

Local incentives end next spring. Beginning May 6, 2027, a city or county generally may not give an incentive to a large load data center. The exceptions are narrow. A city or county may still offer one inside a regionally significant development zone, paid from that zone's funds, and a regional economic development authority has a capped version of the same option. A county that levies a new energy excise tax may hand back up to 80 percent of that tax to a data center, and cities have a similar option with their energy tax. Agreements signed before May 6, 2027, can be honored, but they cannot be extended or enlarged. The state's sales tax exemption for data centers does not count as an incentive and is not affected.

That grandfather clause works as a deadline. Expect cities and counties that want a data center to sign incentive agreements, or adopt the survey area resolutions the law also protects, before May 6.

The energy tax itself is new. A county may now tax the energy delivered to a large load customer or qualifying data center on unincorporated land, at up to 6 percent of the energy's delivered value, collected by the power supplier on top of sales tax. A county has to give the Tax Commission 90 days' notice, and the tax starts on the first day of a calendar quarter.

Two more pieces round it out. A 2026 law focuses the state engineer's "public welfare" review of water right applications on water quality, quantity and availability. And Cox's executive order of May 29 tells state agencies to hold large data centers to a higher bar, starting with the Great Salt Lake and water use. On Nov. 9 he said a bill would write many of the order's restrictions into law.

What lawmakers are drafting

MIDA comes first. Cox has said he will push for "major reform." Rep. Jason Thompson, R-River Heights, has a bill file that would limit MIDA to supporting troops and base security and keep it out of data centers. MIDA's new executive director, Dan Hemmert, told a legislative committee in October he expects numerous bills aimed at the agency. With the speaker saying "MIDA should never be doing data centers," a limit along Thompson's lines has a clear path in the House.

Cooling and power are next. Senate President Evan Vickers has said data centers should supply their own energy and use closed-loop cooling, and Cox has said he would support requiring closed-loop systems. Rep. Doug Owens, D-Millcreek, has filed a bill to require an environmental assessment whenever a data center is proposed, and he and Rep. Paul Cutler, R-Centerville, are working on environmental legislation. A legislative committee opened a bill file to define a large-scale data center in state law, and the Natural Resources Interim Committee has been studying effects on water and wildlife, and on air quality, since May.

Taxes could come up too. Data centers of at least 150,000 square feet get a sales and use tax exemption, and Rep. Jim Dunnigan, R-Taylorsville, used an August hearing to press on how much revenue the state gives up. A 2026 bill that would have required large data centers to report projected energy use to their utility was never considered. Something like it could come back.

Schultz has framed the year this way: "we do not want a state full of data centers." He also asked what "the appropriate amount" is. Nobody at the Capitol has put a number on it yet.

May 6, 2027, is the date to watch. After it, most local incentives for data centers are gone.

The counties

County moratoriums are running out. State law caps them at 180 days. Iron County's pause, adopted May 26, ends in late November. Its planning commission has recommended rules for data centers above 50 megawatts of computing load, including a water cap of 50,000 gallons a day, a requirement for closed-loop or dry cooling, and a ban on developers requiring county staff to sign nondisclosure agreements. Box Elder County's pause, adopted June 10, ends in early December. County officials have described its draft rules as on the "very restrictive end." The draft was set for the planning commission on Nov. 19, with a county commission vote likely in December.

Stratos is in court. A residents' group, the Box Elder Accountability Referendum, is appealing the county attorney's refusal to let voters decide on the commission's approvals, and lawyers for the county and for O'Leary have asked 1st District Judge Spencer Walsh to dismiss the case. Alliance for a Better Utah has a separate suit in 3rd District Court challenging the MIDA arrangement itself. MIDA says it has paused work on Stratos, and Hemmert has said he will explain the project's military connection at the December board meeting. The state engineer, meanwhile, has the October application to move up to 1,712 acre-feet a year of ranch water to the project, and the protests filed against it.

The builds

While the politics play out, the largest projects in the state are going up in Millard County on their own power. Joule Capital Partners broke ground north of Fillmore in November 2025 and has applied for air permits for six natural gas power plants, more than 400 engines in all. Its applications show about 4,380 tons of air pollution a year, not counting carbon dioxide. Air permits like these require public notice and a 30-day comment period, which is where residents can weigh in. Creekstone Energy says it is building toward deliveries at its Delta Gigasite beginning in 2027.

Public opinion has moved too. A Utah State University study found 25 percent of Utahns oppose data centers in general, and 68 percent oppose one within three miles of their home. Nationally, 40 of 41 local ballot measures tightening data center rules passed on Nov. 3.

This analysis reflects Utah law and published reporting as of Nov. 14, 2026. The predictions are The Utah Docket's analysis. Project details change often; see the tracker for the latest. Corrections and tips: [email protected].

Sources

1. Stratos backlash leaves Gov. Cox, lawmakers open to more data center oversight KUER, Aug. 20, 2026
2. After data center debacle, Gov. Cox says MIDA has had 'mission creep' and needs 'major reform' Utah News Dispatch via TownLift, August 2026
3. Where midterm votes left data center developers Deseret News, Nov. 10, 2026
4. Utah Data Center Laws: Protecting Ratepayers, Water and Natural Resources Utah House of Representatives, Oct. 1, 2026
5. S.B. 132 (2025), Large Load Service Amendments Utah Legislature
6. Order approving settlement, Docket No. 26-035-05 Public Service Commission of Utah, April 10, 2026
7. Rocky Mountain Power advances Utah Operation Gigawatt with landmark energy agreement Utah Business, Feb. 6, 2026
8. Utah's data centers are building their own power Grist
9. Utah's data center water reporting law Utah Legislature
10. Thirsty data centers would have to report water use under Utah bill Utah News Dispatch via Standard-Examiner, Nov. 21, 2025
11. Utah's limit on local data center incentives Utah Legislature
12. Utah's county energy excise tax Utah Legislature
13. Utah data center fact sheet Utah Legislature interim materials, 2026
14. Utah governor issues order to protect the Great Salt Lake from data centers Salt Lake Tribune, May 29, 2026
15. The agency that pushed Kevin O'Leary's data center project gets grilled by Utah lawmakers Fox 13, Oct. 21, 2026
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20. Data centers' impact and regulation take center stage at the Legislature UPR, Aug. 21, 2026
21. H.B. 585 (2026), Data Center Amendments Breathe Utah
22. Box Elder and Iron have been busy as county data center pauses start to run out KUER, Oct. 9, 2026
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24. O'Leary, Box Elder County ask for dismissal of lawsuit over citizen referendum Fox 13
25. Non-profit sues MIDA, Utah lawmakers for 'unconstitutional' Box Elder data center plans KUTV
26. Kevin O'Leary's Utah data center files a new water application Salt Lake Tribune, Oct. 20, 2026
27. Company seeks permits for six gas power plants to run data center in western Utah Oil & Gas Watch, Aug. 20, 2026
28. Can a Utah data center solve water and power scarcity? Trellis
29. 1-GW solar project planned for Utah hyperscale data center Solar Power World, March 10, 2026