As the demand for AI infrastructure continues to rise, data center operators are expanding their facilities to accommodate larger and denser setups. This growth in infrastructure is generating unprecedented heat loads, leading to new challenges that intersect technology with regulatory frameworks. The swift expansion in data center operations is now conflicting with longstanding chemical safety regulations, prompting crucial conversations on how to harmonize innovation with environmental and public safety considerations.
In September of 2025, the US Environmental Protection Agency (EPA) introduced a priority review track for chemicals utilized in data centers. This move aligned with the 2025 Executive Order issued by the Trump administration, titled “Accelerating Federal Permitting of Data Center Infrastructure.”
On January 16, 2026, House Republicans unveiled a draft legislation aimed at reforming the Toxic Substances Control Act (TSCA). Subsequent House Energy and Commerce hearings on January 22 delved into streamlining federal reviews of specialized cooling fluids, fire suppressants, and chemical additives. These initiatives seek to address potential bottlenecks that could impede the progress of AI infrastructure development.
Under TSCA Section 5, any new chemical intended for use in the US market must undergo evaluation by the EPA before its commercial introduction. This process involves a statutory 90-day window for premanufacture notifications (PMNs).
The EPA’s review pipeline is currently under strain, with 456 active submissions listed as of January 2026. According to a 2023 report by the Government Accountability Office, the EPA meets the 90-day deadline for review in less than 10% of cases. The introduction of a new priority lane for data centers aims to provide scheduling advantages for projects reliant on innovative substances.
The scope of TSCA encompasses chemicals not present on the EPA’s TSCA Chemical Substance inventory. Any new substance triggers a PMN requirement and undergoes EPA scrutiny prior to commercial utilization. In the context of data centers, this includes base cooling fluids for immersion and direct-contact applications, corrosion inhibitors, biocides safeguarding water-based loops, and additives enhancing thermal, flow, or materials-compatibility properties. Each chemical must secure regulatory approval before entering the market.
Diana Rasner, Group Lead for Materials & Chemicals and Waste and Recycling at Cleantech Group, commented, “The proposed revisions to the EPA and TSCA should expedite approvals for these chemical types to maintain competitiveness. The critical question revolves around determining the appropriate level of review and rigor to prevent potential environmental disasters in the future, akin to incidents involving Freon and PFAS.”
The shift towards liquid cooling in data centers is driven by the continuous operation of equipment at elevated temperatures, particularly in supporting AI workloads. Traditional air cooling systems struggle to dissipate heat at the densities demanded by AI, prompting a pivot towards liquid cooling methods offering higher heat removal rates through direct contact with heat-generating components. Common approaches include direct-to-chip cold plates, rear-door heat exchangers, and full-immersion tanks, each dependent on chemicals tailored for specific properties and subject to stringent regulatory oversight under TSCA.
The establishment of the EPA Priority Review Lane prioritizes data center-related chemicals in the agency’s review queue, providing developers with an expedited pathway to commercial deployment. Jeremy Greenhouse, an environmental attorney at Fredrikson & Byron, remarked, “The agency’s commitment to expediting the review of new chemicals for data center projects should enable these initiatives to bypass the traditional review process. This could significantly impact project timelines utilizing new chemicals or applications.”
Despite the benefits of accelerated chemical evaluations, Greenhouse highlighted that state-level regulations often present more immediate challenges for projects. He noted that while chemical review timelines may not be the primary regulatory hurdle for many projects, specific environmental obstacles, such as new legislation affecting water usage for data centers in states like Minnesota, pose significant barriers.
Environmental and safety considerations play a pivotal role in regulatory evaluations, with a focus on chemical persistence and environmental impact. While fluorinated compounds offer superior thermal stability and dielectric properties suitable for electronic component contact, their resistance to environmental degradation raises concerns. Rasner emphasized the importance of assessing the health and environmental impact of these chemicals upon exposure or release, alongside considerations for proper storage and disposal.
Bio-based alternatives present viable options, with companies like Primient Covation producing Susterra propanediol for heat-transfer applications. These alternatives necessitate distinct system designs and may not match the performance of fluorinated fluids across all applications.
Sean Gahan, Global Technical Services Manager at Primient Covation, cautioned that expedited federal timelines come with inherent risks. He noted, “The EPA’s decision to fast-track chemical reviews for data centers signifies a significant shift in federal chemical regulation. While this policy may expedite projects and support national AI infrastructure goals, it also poses risks to public health, environmental equity, and the integrity of TSCA.”
