Colorado's data center divide: tax breaks vs. tough rules
Airfind news item
By John Frank
Published on March 2, 2026.
Colorado lawmakers are debating how to handle the future of data-center construction, driven by the growing artificial intelligence boom. Two bills, one offering tax incentives to attract data center projects and another imposing stringent regulatory rules on them, are moving through the Legislature. The incentives offer sales-and-use tax exemptions for 20 years for data centers that invest at least $250 million in the first five years, and another requires them to meet energy-efficiency and water-cooling standards and coordinate with power providers. Critics argue this will increase utility bills and hinder Colorado's climate goals. The legislation is supported by environmental groups and supporters argue it gives Colorado the ability to compete with other states offering similar incentives.
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