Computers and Electronic Processing

Plain English Breakdown

The bill summary and official text do not specify the exact nature of penalties beyond license suspension.

High Performance Computing Facilities Act

This bill requires high performance computing (HPC) facility operators to use at least half of their computing resources for public benefit projects and to submit annual reports on energy usage, carbon footprint, and efforts to reduce environmental impact.

What This Bill Does

• Requires HPC facility operators to devote not less than 50% of the computing and data processing output of the HPC facility for a public benefit.
• Requires annual reports from HPC facilities detailing energy consumption, carbon emissions, and efforts to reduce environmental impact.
• Specifies that these reports must be submitted no later than January 31 each year and made publicly available online by the department, comptroller, and council.
• Mandates an internal audit annually to ensure compliance with the bill's requirements.
• Imposes penalties for noncompliance, including suspension of operating licenses until issues are resolved.

Who It Names or Affects

• Operators of high performance computing facilities in Tennessee that use more than 50 megawatts per month on average.
• State and local government agencies responsible for oversight and enforcement.

Terms To Know

High Performance Computing (HPC) facility

A facility, other than a federal, state, or local governmental entity's facility, that houses or operates supercomputers, data centers, AI systems, etc., and uses more than 50 megawatts of power monthly.

Public benefit

Positive material effects on individuals, businesses, communities, society, academia, education, literacy, public health, environment, culture, and the economy in Tennessee.

Limits and Unknowns

• The bill does not specify what happens if an HPC facility operator cannot find enough public benefit projects to meet the 50% requirement.
• It is unclear how the costs of audits will be covered by HPC facilities that request them from government entities.

Official Summary Text

This bill requires a h
igh performance computing
("
HPC
")
facility operator
to
devote not less than 50% of the computing and data processing output of the HPC facility for a public benefit.
As used in this bill, an "HPC facility"
means a facility, other than a facility owned or operated by a federal, state, or local governmental entity, that houses or operates a supercomputer, data center, artificial intelligence (AI) data center, AI factory, AI-optimized computing facility, HPC o
r AI cluster or supercluste
r, or exascale computing system in this state that utilizes, on average, more than
50
megawatts per month for its operation and maintenance
.

ANNUAL REPORT

This bill requires an
HPC facility operator
to
annually report the source and amount of all energy utilized for its operation and maintenance to the department
of environment and conservation ("department")
,

state energy policy
council
("council")
, comptroller of the treasury
("comptroller")
, and executive head and governing body of each local government in which the facility is located. The annual report must
meet all of the following criteria:



Specify the HPC facility's carbon footprint in terms of total annual greenhouse gas emissions as the direct result of its operation and energy consumption, including, but not limited to, resource extraction, manufacturing, assembly, and transportation of materials and hardware
.


Summarize the HPC facility operator's efforts to reduce the energy consumption and carbon footprint of the HPC facility
.


Specify each public benefit to which output was devoted, including the amount of output and the manner in which such public benefit was augmented.

This bill requires the
annual report
to
be submitted no later than January 31, 2027, and each January 31 thereafter. The department, comptroller, and council
must
post the annual reports prominently on their respective websites.

ANNUAL INTERNAL AUDIT

This bill requires an
HPC facility operator
to
conduct an annual internal audit on its compliance with this
bill
, and upon request, permit such a compliance audit by the department, council, or comptroller, or a third party retained by the department, council, or comptroller to conduct the audit. The annual internal audit findings must be reported and posted in th
e same manner as the annual report.

NONCOMPLIANCE

If an HPC facility operator fails to submit an annual report or internal audit, or if a recipient of such report or audit finds that an HPC facility is not otherwise in compliance with this
bill
, then
this bill requires
the recipient
to
provide written notice to the HPC facility operator of noncompliance and that the HPC facility operator has 30 days to comply. If the HPC facility is not in compliance at the end of such period, the recipient
must
suspend any applicable operating license or permit of the HP
C facility, pending compliance. The comptroller
must
certify compliance to the department and each applicable local government for purposes of reinstating a license or permit of the HPC facility. If an HPC facility operator fails to timely comply after receiving notice of noncompliance,
then
such license and permit must remain suspended, and the department and each applicable local government
must
not renew such license or permit of the HPC facility until the comptroller certifies compliance.

Current Bill Text

HOUSE BILL 1461
By Clemmons

SENATE BILL 1832
By Yarbro
SB1832
010551
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 4;
Title 8 and Title 68, relative to high performance
computing facilities.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Title 68, Chapter 204, is amended by adding
the following new section:
(a) As used in this section:
(1) "Department" means the department of environment and
conservation;
(2) "High performance computing (HPC) facility" means a facility, other
than a facility owned or operated by a federal, state, or local governmental entity,
that houses or operates a supercomputer, data center, artificial intelligence (AI)
data center, AI factory, AI-optimized computing facility, HPC or AI cluster or
supercluster, or exascale computing system in this state that utilizes, on average,
more than fifty megawatts (50 MW) per month for its operation and maintenance;
and
(3) "Public benefit":
(A) Means a positive material effect or a reduction in negative
material effect on individuals, businesses, and communities in this state;
and
(B) Includes, but is not limited to, a positive material effect or a
reduction in negative material effect on society, academia and education,

- 2 - 010551

literacy, public health and benefits, environment, culture, and the
economy.
(b) An HPC facility operator shall devote not less than fifty percent (50%) of the
computing and data processing output of the HPC facility for a public benefit.
(c)
(1) An HPC facility operator shall annually report the source and amount
of all energy utilized for its operation and maintenance to the department,
council, comptroller of the treasury, and executive head and governing body of
each local government in which the facility is located.
(2) The annual report must:
(A) Specify the HPC facility's carbon footprint in terms of total
annual greenhouse gas emissions as the direct result of its operation and
energy consumption, including, but not limited to, resource extraction,
manufacturing, assembly, and transportation of materials and hardware;
(B) Summarize the HPC facility operator's efforts to reduce the
energy consumption and carbon footprint of the HPC facility; and
(C) Specify each public benefit to which output was devoted as
required pursuant to subsection (b), including the amount of output and
the manner in which such public benefit was augmented.
(3) The annual report must be submitted no later than January 31, 2027,
and each January 31 thereafter. The department, comptroller, and council shall
post the annual reports prominently on their respective websites.
(d) An HPC facility operator shall conduct an annual internal audit on its
compliance with this section, and upon request, permit such a compliance audit by the
department, council, or comptroller of the treasury, or a third party retained by the

- 3 - 010551

department, council, or comptroller to conduct the audit. The annual internal audit
findings must be reported and posted in the same manner as the annual report in
accordance with subdivision (c)(3).
(e) If an HPC facility operator fails to submit an annual report or internal audit in
compliance with this section, or if a recipient of such report or audit finds that an HPC
facility is not otherwise in compliance with this section, then the recipient shall provide
written notice to the HPC facility operator of noncompliance and that the HPC facility
operator has thirty (30) days to comply with this section. If the HPC facility is not in
compliance at the end of such period, the recipient shall suspend any applicable
operating license or permit of the HPC facility, pending compliance. The comptroller of
the treasury shall certify compliance to the department and each applicable local
government for purposes of reinstating a license or permit of the HPC facility. If an HPC
facility operator fails to timely comply with this section after receiving notice of
noncompliance under this subsection (e), such license and permit must remain
suspended, and the department and each applicable local government shall not renew
such license or permit of the HPC facility until the comptroller of the treasury certifies
compliance.
SECTION 2. This act takes effect upon becoming a law, the public welfare requiring it.