The legislation defines a "foreign company" as one that is either headquartered in or at least 50% owned by a government identified as a foreign adversary under federal regulations (15 CFR 791.2). This includes nations such as China, Russia, Iran, and North Korea.
These companies are now barred from building or operating data centers in Indiana unless the facility will rely solely on self-generated electricity. The law specifically prevents any such facility from drawing power from regional grid operators—namely the Midcontinent Independent System Operator (MISO) and PJM Interconnection—unless certified by state agencies.
Before any construction can begin, the Indiana Utility Regulatory Commission and the Indiana Economic Development Corporation must jointly conduct a review of the proposed data center’s anticipated electricity use. They must then certify to the governor and the General Assembly that the project’s electricity will be entirely self-supplied and will not burden the load capacity of MISO or PJM.
This measure comes amid broader national concerns regarding the role of foreign entities in U.S. infrastructure development, particularly in sectors involving sensitive digital operations and critical energy supply chains.
Data centers are among the fastest-growing energy consumers globally, and their placement and power sourcing have become central to discussions about both energy resilience and security. A single hyperscale data center can demand as much energy as tens of thousands of homes, making grid access a crucial factor in site selection and permitting.
Indiana’s move may have far-reaching implications. Not only does it signal an aggressive stance on national security, but it also could deter foreign investment in digital infrastructure unless developers pivot to on-site renewables, microgrids, or other forms of independent power generation.
