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SC — State Policy Updated 2026-07-17

South Carolina

State sales & use tax exemptions Property tax abatements Other incentives Statewide moratoriums Local zoning restrictions / by-right vs. conditional or s... Environmental constraints Water Constraints

1) Incentive programs

State sales & use tax exemptions (data center-specific)

  • Sales/use tax exemption for data centers (computers + electricity): South Carolina exempts computers, computer equipment, software, eligible business property, and electricity used at a qualifying data center under S.C. Code Section 12-36-2120(79). The exemption is facility-specific and does not extend to unrelated administrative offices or other off-site uses. Sources: South Carolina Department of Revenue, 2013-08-21; South Carolina Code, 2026-06-10.
  • Eligibility thresholds (investment + jobs + wages): To qualify, the taxpayer must invest $50 million or more in real or personal property over five years at a single-tenant data center, or $75 million or more in aggregate investment at a multi-tenant data center, and must create and maintain 25 or more full-time jobs at the facility with average cash compensation at least 150% of state or county per-capita income. Sources: South Carolina Department of Revenue, 2013-08-21; South Carolina Code, 2026-06-10.
  • Certification deadline / sunset: The data-center exemption only applies to data centers certified by the Department of Commerce before January 1, 2032; a data center certified by December 31, 2031 may continue to use the exemption for an additional ten-year period, after which the exemption is repealed. Source: South Carolina Department of Revenue, 2013-08-21.
  • Clean energy conditions: The statutory data-center exemption is tied to investment, jobs, wages, facility certification, and qualifying purchases; it does not impose a renewable-energy procurement or clean-energy condition. Source: South Carolina Code, 2026-06-10.

Property tax abatements (local, but state-authorized)

  • FILOT (Fee In Lieu of Property Taxes): South Carolina counties may negotiate FILOT agreements with qualifying projects, including data centers, to reduce the assessment ratio and stabilize millage. The Department of Commerce describes local FILOTs as discretionary county incentives available for companies investing as little as $2.5 million, with assessment ratios reduced from 10.5% to as low as 6% for up to 30 years. Source: South Carolina Department of Commerce, 2026-06-10.
  • County-level incentives remained active in 2026: Even as statewide moratorium bills were introduced, counties continued to consider data-center FILOTs. Union County tabled a proposed FILOT for Project Alpaca on April 28, 2026, for further review. Source: FOX Carolina, 2026-05-04.

Other incentives (data center-specific)

  • No enacted 2026 expansion of the data-center sales/use exemption found through July 17, 2026: H.5122 became Act 242 and created sales-tax relief for internet access and communications service providers, but the enacted text states that a data center may not claim or use those exemptions or refunds. H.4925, which would have extended the existing data-center exemption to certain related persons under Internal Revenue Code Section 267(b), remained in House Ways and Means and did not pass before the regular session adjourned sine die. Sources: South Carolina General Assembly, 2026-06-03; South Carolina General Assembly, 2026-01-14; South Carolina General Assembly, 2026-05-15.
  • H.5122/Act 242 created a new statutory definition relevant to future large-load policy: For purposes of the Act 242 exclusion, a “data center” means a facility, campus, or interconnected array under a single electric supply agreement used primarily for storing, retrieving, or transmitting data, with peak demand of 50 MW or greater, that becomes an electric-service customer after December 31, 2026. Source: South Carolina General Assembly, 2026-05-19.

2) Restrictions and moratoriums

Statewide moratoriums

  • No statewide moratorium was enacted as of July 17, 2026. H.5286 would have prohibited state and local final approvals, permits, and incentives for new data centers until January 1, 2028, while H.5526 would have prohibited acceptance or action on data-center permits until the General Assembly established a comprehensive oversight process. Both remained in House Ways and Means and failed to pass before the regular session adjourned sine die. Sources: South Carolina General Assembly, 2026-02-26; South Carolina General Assembly, 2026-04-14; South Carolina General Assembly, 2026-05-15.
  • Regular-session outcome: The 2026 regular annual session adjourned sine die on May 14, 2026. The governor’s May 15 extraordinary-session call was limited to specified matters and did not revive the general data-center bills, so the non-enacted bills listed below ended the two-year session without passage. Source: South Carolina General Assembly, 2026-05-15.

Local zoning restrictions / by-right vs. conditional or special exception

  • Local zoning authority: Counties and municipalities may adopt zoning ordinances and regulate the use of land, buildings, and structures, including conditional uses and performance zoning. This remains the baseline legal basis for local data-center siting controls unless state law expressly preempts them. Source: South Carolina Code, 2026-06-10.
  • Colleton County (2025 ordinance): Ordinance 25-O-10 defines “data center” and treats data centers as special exception uses in RD-1, RD-2, and light industrial districts and conditional uses in industrial and heavy industrial districts. The ordinance and related approvals remain the subject of litigation and local opposition in the ACE Basin area. Source: South Carolina Environmental Law Center, 2026-01-17.
  • Gaffney (Cherokee County) zoning updates: Gaffney adopted data-center-specific zoning requirements, including written verification of adequate power and water infrastructure and a noise study by a South Carolina-registered acoustical engineer, with post-construction testing possible. Source: South Carolina Public Radio, 2026-01-06.
  • York County (QTS and countywide rules): York County moved in February-March 2026 to tighten data-center zoning. The ordinance reported at second reading would move data centers from by-right use to special exception in Light Industrial and Industrial Development zones, apply pending-ordinance doctrine after the February 6 special meeting, require acoustical studies, require projected peak water/electric demand disclosure, add setbacks and screening, and require closed-loop or similar low-water cooling. Sources: WRHI, 2026-02-11; WRHI, 2026-03-20.
  • York County moratorium enacted: County Council gave final approval on July 13 to a nine-month moratorium, effective immediately in unincorporated York County, on new data-center special exceptions, conditional-use site plans, and related development approvals. The nine QTS buildings already in development are exempt because their approved site plans have vested rights. Source: York County, 2026-07-13.
  • Newberry County moratorium and project denial: After unanimously denying the Project Altair land-sale ordinance in June, County Council unanimously confirmed on July 15 a 12-month moratorium on accepting new data-center permits; the council may extend it. Residents had cited water-supply, electric-rate, noise, and rural-character concerns. Sources: WIS, 2026-06-03; WIS, 2026-07-16.
  • Chesterfield County moratorium: Chesterfield County adopted Ordinance 25-26-23 on June 1, 2026, imposing a temporary moratorium in unincorporated areas on zoning approvals, construction permits, site-plan approvals, and other county actions that would authorize data centers, data processing facilities, cryptocurrency mining operations, or related uses. The moratorium lasts until January 1, 2028 or until county regulations are adopted, whichever occurs first. Source: Chesterfield County, 2026-06-01.
  • Colleton County moratorium enacted: County Council unanimously adopted Ordinance 26-O-04 on July 7, imposing a six-month pause on special exceptions, conditional-use approvals, and other land-use or development approvals for data centers. The parties paused the lawsuit over Ordinance 25-O-10 for the moratorium period while the county updates its comprehensive plan and zoning rules. Sources: Colleton County, 2026-07-07; Live 5 News, 2026-07-07.
  • Additional county pauses pending as of July 17: Spartanburg County invoked the pending-ordinance doctrine after first reading on June 22, immediately freezing new applications while a proposed one-year moratorium proceeds; Chester County approved first reading of a six-month pause on June 15; Greenwood County approved second reading of a one-year moratorium 4-3 on July 7, with a third reading still required; and Laurens County unanimously approved first reading of a one-year moratorium on July 13, with final approval still required. Sources: FOX Carolina, 2026-06-22; Chester County, 2026-06-18; FOX Carolina, 2026-07-07; Laurens County Advertiser, 2026-07-15.

Environmental constraints (water use & permits)

3) Local governance & preemption

  • State law still largely defers to local zoning: Existing state law authorizes local governments to regulate land use, and no enacted 2026 data-center law broadly preempted local data-center zoning by July 17. The resulting county-by-county approach produced enacted pauses in Chesterfield, Colleton, Newberry, and York and pending measures in several other counties. Sources: South Carolina Code, 2026-07-17; York County, 2026-07-13; Colleton County, 2026-07-07; WIS, 2026-07-16.
  • Local incentives are negotiated by counties: FILOT agreements are county-level contracts, reinforcing county control over the incentive layer of data-center development. Source: South Carolina Department of Commerce, 2026-06-10.
  • Proposed legislation would partly centralize review while preserving some local authority: S.867 and S.902 would both create state-level data-center siting or development regimes, require state review of infrastructure adequacy and environmental impacts, and give the Public Service Commission a role in data-center rates, utility agreements, and cost allocation. S.902 would also require PSC certification before a data center begins operations. Sources: South Carolina General Assembly, 2026-04-28; South Carolina General Assembly, 2026-02-10.
  • Local-authority language in S.902: S.902 states that local governments retain zoning, land-use, building-code, and related authority and says the chapter does not preempt local land-use authority, but it would also let the PSC refuse to apply a local law or regulation if the PSC finds it unreasonably restrictive as applied to a proposed data center. Source: South Carolina General Assembly, 2026-02-10.
  • Community opposition produced formal land-use and legal outcomes: Newberry denied Project Altair and finalized a moratorium; York and Colleton enacted moratoriums; Stream canceled its Marion County project after opposition and a utility-power delay; and Spartanburg residents and conservation groups opened PSC and state-court challenges to the Valara project. Sources: WIS, 2026-07-16; York County, 2026-07-13; Live 5 News, 2026-07-07; Data Center Dynamics, 2026-06-18; Southern Environmental Law Center, 2026-07-07.

4) Legislative activity (2024-2026)

  • H.4087 (2023-2024): Fiscal analysis for the prior-session H.4087 discussed the existing data-center exemption in Section 12-36-2120(79), including qualifying investments, jobs, and certification timing. This bill did not become a 2026 vehicle; the live 2025-2026 H.4087 number is unrelated liquor-liability legislation. Sources: South Carolina Revenue and Fiscal Affairs Office, 2024-04-16; South Carolina General Assembly, 2025-02-25.
  • S.784 (2025-2026): S.784 would have added commercial-data-center electric-service cost protections, water reporting, and changes to data-center tax-exemption eligibility and certification dates, including a proposed May 30, 2030 certification cutoff for certain exemptions. It remained in the Senate without passage when the regular session adjourned sine die. Sources: South Carolina General Assembly, 2026-01-13; South Carolina General Assembly, 2026-05-15.
  • S.867 (2025-2026), “Data Center Development Act”: S.867 would have created a Data Center Development Office in SCDES, required siting permits, set water and operational-efficiency standards, required infrastructure and environmental assessments, regulated noise/vibration/light, and given the PSC a role in rate agreements and cost allocation. It received a favorable Senate Agriculture and Natural Resources Committee report on April 28, but the full Senate did not pass it before sine die. Sources: South Carolina General Assembly, 2026-04-28; South Carolina General Assembly, 2026-05-15.
  • S.902 (2025-2026), “Data Center Siting Act”: S.902 would have required a PSC certificate before operations, created tiered review by connected load, required environmental and infrastructure review, set water and operational-efficiency standards, and required rate agreements protecting existing customers from cross-subsidization. It remained in Senate Judiciary without passage at sine die. Sources: South Carolina General Assembly, 2026-02-10; South Carolina General Assembly, 2026-05-15.
  • H.5286 and H.5526 (2025-2026), data-center moratoriums: H.5286 proposed a statewide pause on final approvals, permits, and incentives until January 1, 2028; H.5526 proposed a broader pause on accepting or acting on data-center permits pending a comprehensive state oversight process. Both remained in House Ways and Means and failed to pass before sine die. Sources: South Carolina General Assembly, 2026-02-26; South Carolina General Assembly, 2026-04-14; South Carolina General Assembly, 2026-05-15.
  • H.5122 / Act 242 (2026): Act 242 is the only 2026 enacted law identified in this update that directly references data centers. It creates sales-tax relief for internet access and communications service providers but expressly prohibits data centers from claiming or using the exemption or refund. Source: South Carolina General Assembly, 2026-05-19.
  • H.4583 (2025-2026), “Data Center Responsibility Act”: H.4583 would have required complete energy independence, prohibited incentives, required closed-loop water or liquid cooling with zero net water withdrawal and wastewater discharge, imposed strict environmental liability, required minimum on-site staffing, and required annual reporting. It remained in House Labor, Commerce and Industry and did not pass. Source: South Carolina General Assembly, 2026-01-13.
  • S.724 (2025-2026), “Commercial Data Center Water Usage Report”: S.724 would have required commercial data centers with at least 100 MW peak demand that consume 3 million gallons or more per month to report prior-year and anticipated water use to SCDES, with civil penalties for late or false reporting. It remained in Senate Judiciary and did not pass. Source: South Carolina General Assembly, 2026-01-13.
  • H.5215 (2025-2026), “South Carolina Ratepayer Protection and Large Load Customer Infrastructure Accountability Act”: H.5215 would have barred recovery of incremental large-load costs from other customer classes; required long-term utility contracts, incentive disclosures, public hearings, and local certifications; and required water-resource plans and drought contingencies. It remained in House Labor, Commerce and Industry and did not pass. Source: South Carolina General Assembly, 2026-02-19.
  • H.5484 (2025-2026), “Energy Affordability Act”: H.5484 would have required commercial data centers of 50 MW or more to bear substantially all service costs, use contracts of at least 15 years, report water use, and file funded decommissioning plans; it also would have restricted future eligibility for existing data-center sales-tax exemptions. It remained in House Labor, Commerce and Industry and did not pass. Source: South Carolina General Assembly, 2026-04-01.
  • H.4925 (2025-2026), related-person exemption expansion: H.4925 would have extended the existing data-center sales-tax exemption to certain related persons under IRC Section 267(b). Revenue and Fiscal Affairs expected no state or local revenue impact and reported that fewer than five data centers claimed the exemption, but the bill remained in House Ways and Means and did not pass. Sources: South Carolina General Assembly, 2026-01-14; South Carolina Revenue and Fiscal Affairs Office, 2026-01-27.
  • FY2026-27 budget provisos remained unresolved: The Senate-approved H.5126 included one-year provisos to bar specified state incentive funds for qualifying new data centers, require Commerce to report by January 15, 2027 on data-center projects that applied for or received incentives in prior fiscal years, require DOR to report the amount and number of claims under the data-center sales-tax exemption, and require water reporting from qualifying centers. Because the House and Senate had not agreed on a final budget by July 17, these provisions were proposals, not enacted policy. Sources: South Carolina General Assembly, 2026-04-23; SC Daily Gazette, 2026-07-14.

5) Notable projects and operators in South Carolina

Major announced / operating projects

  • Google (Berkeley + Dorchester counties): Google announced $3.3 billion for two new data center campuses in Dorchester County and expansion of its Berkeley County campus, with hundreds of new jobs including 200 new operational jobs in Dorchester County. Source: South Carolina Governor’s Office, 2024-09-26.
  • Google (statewide investment plan): Google announced a $9 billion investment in South Carolina through 2027 for Berkeley County expansion and two Dorchester County sites. Source: Google, 2024-09-26.
  • Meta (Aiken County): Meta selected Aiken County for its first South Carolina data center, an $800 million investment supporting 100 new operational jobs, with a 715,000-square-foot facility expected to be operational in spring 2027. Source: South Carolina Governor’s Office, 2024-08-29.
  • Cielo Digital Infrastructure (Cherokee County): Cielo announced a $2.1 billion data center campus in Cherokee County with four approximately 400,000-square-foot facilities and an associated substation; initial operations are expected by the end of 2028. Source: South Carolina Governor’s Office, 2025-06-24.
  • QTS (York County): QTS says its York County campus will include nine buildings over three phases, with a projected $8 billion investment, about 1,000 construction jobs, and about 200 permanent jobs. Construction reached a topping-out milestone for the first building on June 30; the project’s nine vested site plans are exempt from York County’s July moratorium. Sources: QTS, 2026-06-10; Gilbane, 2026-06-30; York County, 2026-07-13.
  • Colleton County / Eagle Rock Partners (proposed): The proposed 859-acre, 1,000 MW campus on Cooks Hill Road would include nine data-center buildings and two substations in the ACE Basin watershed. Seven members of the county’s legislative delegation formally opposed the location in February; County Council’s July 7 six-month moratorium paused further land-use approvals and the related zoning lawsuit. Sources: Live 5 News, 2026-02-05; Live 5 News, 2026-07-07.

February-July 2026 project changes

  • TigerDC Project Spero (Spartanburg County) announced, then withdrawn: TigerDC announced Project Spero on January 27, 2026 as a $3 billion AI-focused high-performance computing data center at Tyger River Industrial Park-North, with Phase I expected to support about 50 full-time positions and construction expected to begin in 2026. On February 27, 2026, TigerDC formally withdrew Project Spero from Spartanburg County consideration after local opposition and expected county action against tax incentives, and said it would evaluate alternative sites. Sources: Who’s On The Move, 2026-01-27; WYFF, 2026-02-27.
  • Project Alpaca (Union County) paused at the incentive stage: Project Alpaca was presented as a 49 MW AI data center in Midway Green Industrial Park with $410 million in fixed-asset investment, 50+ permanent jobs, and 500+ construction jobs; Union County later tabled the proposed FILOT first reading, canceled a May 12 public hearing, and said it would hold a public information forum if the project were reintroduced. Sources: Project Alpaca presentation, 2026-04; FOX Carolina, 2026-05-04.
  • Newberry County / Project Altair denied: Newberry County Council denied the ordinance that would have allowed a developer to purchase land for a potential data center at Mid-Carolina Commerce Park, then unanimously finalized a 12-month moratorium on accepting new data-center permits on July 15. Sources: WIS, 2026-06-03; WIS, 2026-07-16.
  • Stream Data Centers / Project Liberty (Marion County) canceled: Stream canceled its proposed $800 million Marion County campus on June 18 because utility power would not be available on the project’s required schedule. Plans had called for three 655,770-square-foot buildings, with room for at least three more; Stream said it would still distribute previously pledged community funds. Source: Data Center Dynamics, 2026-06-18.
  • Valara Holdings / NorthMark Strategies (Spartanburg County) contested while under development: County incentive records describe Project MOC-1 as approximately $2.76 billion with 27 expected but not required full-time jobs. In 2026 Valara sought an air permit for roughly 450 MW of on-site gas generation, up from the initial approximately 50 MW permit. SCDES held a June 25 public hearing and extended comments through July 31. Residents and the Southern Alliance for Clean Energy filed PSC Docket 2026-158-E, alleging that construction required state siting review, and a separate July 6 state-court action sought public planning-commission review of the project’s expansion. Sources: Spartanburg County, 2025-03-17; South Carolina Department of Environmental Services, 2026-06-25; Southern Environmental Law Center, 2026-06-19; Southern Environmental Law Center, 2026-07-07.