The proposed "Data Center Water Regulation Act" aims to regulate water usage in data centers within Michigan. Under this act, no person may begin construction or operation of a data center unless it utilizes a closed-loop cooling system or sources its water exclusively from a municipal water system. Additionally, existing data centers that began construction or operation after the act's effective date must also comply with these requirements. If a data center is found to be using groundwater or surface water in violation of these regulations, the operator must immediately cease operations.

Violations of the act can result in significant civil penalties, with fines reaching up to $1,000,000 per day for each day of non-compliance. The enforcement of these penalties can be initiated by the county prosecutor or the attorney general, and any collected fines will be deposited into the state's general fund. The Michigan Public Service Commission is also granted the authority to promulgate rules to facilitate the implementation of this act. The act will only take effect if several related bills from the 103rd Legislature are enacted into law.