AB 1095 California Assembly · 2025-2026 Regular Session

Data centers: waste heat energy.

Summary

The Bergeson-Peace Infrastructure and Economic Development Bank Act establishes the California Infrastructure and Economic Development Bank (I-Bank) in the Governor's Office of Business and Economic Development, governed by a board of directors. The act, among other things, authorizes the I-Bank to make loans, issue bonds, and provide financial assistance for various types of projects that qualify as economic development or public development facilities. The Climate Catalyst Revolving Loan Fund Act of 2020 authorizes the I-Bank, under the Climate Catalyst Revolving Loan Fund Program, to provide financial assistance to any eligible sponsor or participating party in connection with the financing or refinancing for eligible climate catalyst projects, as defined, either directly to the sponsor or participating party or to a lending or financial institution, as specified. The act, beginning in the 2021–22 fiscal year, requires the I-Bank to adopt a climate catalyst financing plan, as specified, after meeting and conferring with prescribed authorized consulting agencies concerning specific categories of climate catalyst projects. The act establishes the Climate Catalyst Revolving Loan Fund as a continuously appropriated fund for the purpose of implementing the objectives and provisions of the act. This bill would authorize the I-Bank to provide financial assistance in connection with the financing or refinancing of an additional category of climate catalyst projects, those projects that enable the capture and conversion of data centers' waste heat, with the State Energy Resources Conservation and Development Commission (Energy Commission) as the consulting agency. If multiple projects seek funding under this category of climate catalyst projects, the bill would require the consulting agencies to prioritize funding based on state policy and on financial considerations, as determined by the Energy Commission. By expanding the purposes for which moneys in the fund may be expended, the bill would make an appropriation.

Issues: ✓ Energy ✓ Environment

Bill status failed 1 of 4 stages cleared

Introduction

Feb 2025

Committee Review

Floor Vote

Governor

Introduced Feb 20, 2025 Last action Feb 2, 2026

Maddy AI version diff · 3 comparisons

What changed between versions

03/25/25 - Amended Assembly → 04/21/25 - Amended Assembly · 7 edits · Apr 21, 2025

MODERATE

AB 1095 was substantially expanded to add a new section amending Government Code Section 63048.93, authorizing the California Infrastructure and Economic Development Bank (I-Bank) to provide financial assistance under the Climate Catalyst Revolving Loan Fund Program for projects that enable the capture and conversion of data centers' waste heat. The bill also removed a previously included amendment to Public Resources Code Section 8817 (California Coordinate System for surveying and mapping), which was described as nonsubstantive. The appropriation designation changed from 'no' to 'yes' because the new provision expands purposes for which fund moneys may be expended.

FISCAL

Added a new section amending Government Code Section 63048.93 to authorize the I-Bank to provide financial assistance under the Climate Catalyst Revolving Loan Fund Program for climate catalyst projects that enable the capture and conversion of data centers' waste heat, with the Energy Commission as the consulting agency. If multiple projects seek funding, the Energy Commission determines prioritization based on state policy and financial considerations.

The bill now makes an appropriation by expanding the purposes for which moneys in the Climate Catalyst Revolving Loan Fund may be expended. The appropriation designation changed from 'no' to 'yes.'

SCOPE

The bill now covers the full Climate Catalyst Revolving Loan Fund Program structure, including six categories of eligible projects: sustainable vegetation management (Natural Resources Agency), agricultural improvements (Department of Food and Agriculture), clean energy transmission (Energy Commission and PUC), federal financing leverage for emissions reduction (Energy Commission or PUC), EPA Greenhouse Gas Reduction Fund projects (multiple agencies), and data center waste heat capture (Energy Commission).

Removed the amendment to Public Resources Code Section 8817, which made nonsubstantive changes to provisions about California Coordinate System usage for surveys and mapping projects (CCS27, CCS83, and CCS2022).

REQUIREMENT

Added requirements that the I-Bank shall not finance a clean energy transmission project unless the entity completing it has entered into a project labor agreement meeting Public Contract Code Section 2500, including prevailing wage provisions, targeted hiring for local and underrepresented workers, and apprenticeship utilization above state-mandated minimums.

TIMELINE

Added a deadline requiring the I-Bank to provide financial assistance only for climate catalyst projects approved by the bank board before July 1, 2025.

ELIGIBILITY

Added outreach and technical assistance provisions allowing the I-Bank to engage with disadvantaged sponsors and participating parties, offer reduced application fees, interest rate or fee subsidies, and enter into service contracts for technical assistance, exempt from certain Public Contract Code requirements.

02/20/25 - Introduced → 03/25/25 - Amended Assembly · 8 edits · Mar 25, 2025

MODERATE

AB 1095 was dramatically expanded from a nonsubstantive correction to a surveying statute into a major energy policy bill. The amended version adds new definitions and an entirely new section (399.34) to the Public Utilities Code that would make data centers eligible to earn renewable energy credits (RECs) by capturing and converting their waste heat into electricity or using it for building heating. This matters because it creates a new pathway for data centers to participate in California's Renewables Portfolio Standard program, potentially reducing their compliance costs while incentivizing waste heat recovery.

SCOPE

The bill now amends Section 399.12 of and adds Section 399.34 to the Public Utilities Code, relating to the California Renewables Portfolio Standard Program. The original bill only made a nonsubstantive change to a surveying statute (Section 8817, Public Resources Code).

DEFINITION

New definitions added for 'data center' (a facility housing computing infrastructure including servers, storage, networking equipment, and associated power and cooling systems), 'waste heat' (heat produced as a byproduct of a machine process or other energy-using process), 'waste heat energy' (electricity generated from capture and conversion of waste heat), and 'eligible end user' (defined as a data center).

Additional RPS-related definitions were added to Section 399.12 including 'conduit hydroelectric facility,' 'balancing authority,' 'California balancing authority,' 'eligible renewable energy resource' (with detailed rules on small hydro, municipal solid waste combustion, and de minimis nonrenewable fuel thresholds of 2% default and 5% maximum), 'procure,' 'procurement entity,' 'renewable energy credit,' 'renewables portfolio standard,' and 'retail seller.'

ELIGIBILITY

A data center that generates waste heat energy via thermoelectric, thermionic, or thermovoltaic conversion is eligible to receive renewable energy credits if it demonstrates the capture and conversion process AND the waste heat energy is used at the same facility or location where the waste heat was generated, captured, and converted.

A data center that uses waste heat to provide heating for buildings is eligible to receive RECs based on a metric the Energy Commission must develop, which awards credit based on the amount of energy usage avoided due to waste heat use for building heating.

REQUIREMENT

Data centers generating waste heat energy must report the amount of electricity produced, the method of generation, and relevant greenhouse gas emission reductions to the Public Utilities Commission and the Energy Commission as required under rules or regulations adopted under the RPS article.

FISCAL

Data centers may use RECs received under the new section to satisfy their own renewable energy procurement requirements or may sell or transfer the credits to utilities or other entities. Credits must be tracked and verified using the same systems as other eligible renewable energy resources to prevent double counting.

TECHNICAL

The fiscal committee designation changed from 'no' to 'yes,' indicating the amendment introduced a state fiscal impact that requires fiscal committee review.

Floor votes

How they voted

No floor votes recorded yet.

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Feb 2, 2026

Lower · Passed

From committee: Filed with the Chief Clerk pursuant to Joint Rule 56.

lower

May 23, 2025

Lower · Passed

In committee: Held under submission.

lower

May 14, 2025

Committee

In committee: Set, first hearing. Referred to APPR. suspense file.

lower

Apr 29, 2025

Lower · Passed

From committee: Do pass and re-refer to Com. on APPR. with recommendation: To Consent Calendar. (Ayes 14. Noes 0.) (April 28). Re-referred to Com. on APPR.

lower

Apr 24, 2025

Lower · Passed

From committee: Do pass and re-refer to Com. on NAT. RES. with recommendation: To Consent Calendar. (Ayes 18. Noes 0.) (April 23). Re-referred to Com. on NAT. RES.

lower

Apr 22, 2025

Committee

Re-referred to Com. on U. & E.

lower

Apr 21, 2025

Introduced

From committee chair, with author's amendments: Amend, and re-refer to Com. on U. & E. Read second time and amended.

lower

Mar 26, 2025

Committee

Re-referred to Com. on U. & E.

lower

Mar 25, 2025

Introduced

From committee chair, with author's amendments: Amend, and re-refer to Com. on U. & E. Read second time and amended.

lower

Mar 24, 2025

Committee

Referred to Coms. on U. & E. and NAT. RES.

lower

Feb 21, 2025

Lower · Passed

From printer. May be heard in committee March 23.

lower

1 primary · 0 co-sponsors