WASHINGTON, July 7 — The figure that matters: a 20% potential reduction in copper thefts at AI data center sites within two years, according to the FBI, if the Copper Theft Prevention Act becomes law. That bill, introduced in February 2024 by U.S. Senators Mark Warner (D-VA) and John Cornyn (R-TX), remains in committee — and the clock is ticking for an industry that is losing millions to a surge in metal theft.
The bottom line: copper theft is not a new problem, but the explosive growth of AI data centers has turned it into a priority for the 118th Congress and the AI infrastructure industry. Thieves are targeting exposed wiring and copper piping at construction sites and operational facilities, drawn by high scrap prices and relatively low risk of detection.
The proposed federal legislation would require scrap metal dealers to verify seller identities and report any cash transaction over $500 to the IRS — a move designed to cut off the primary resale channel for stolen metal. By the numbers, the state-level approach is already showing results. Virginia passed a law in 2023 that requires scrap yards to maintain digital records of all copper purchases.
In Loudoun County — the heart of Northern Virginia’s data center alley — the sheriff’s office reports a 10% reduction in thefts since the law took effect. That is a concrete, measurable win, but it is localized.
The national picture remains far more challenging. Investors will note that the private sector is not waiting for Congress. In 2024, Cisco Systems launched a “smart wiring” system that uses fiber optics to detect cable cuts and alert security in real time.
The technology essentially turns the copper itself into a sensor network, providing immediate notification when a line is severed. The Department of Energy has funded a $5 million pilot program to test tamper-proof copper alloys that are difficult to recycle — a material-science approach that could make stolen copper far less valuable on the secondary market. The National Institute of Standards and Technology is developing a national database for tracking stolen copper, which would give law enforcement and scrap dealers a centralized tool to verify whether material is legitimate.
Industry groups, including the Data Center Coalition, are advocating for federal tax incentives for security upgrades — a push that reflects the reality that many data center operators are still relying on basic fencing and cameras. Enforcement remains the weak link.
The source material notes that thieves are adapting by using online marketplaces to sell stolen copper, bypassing traditional scrap yards entirely. This makes the proposed federal reporting requirements less effective if the transaction never touches a licensed dealer. The challenge for lawmakers is that the online resale ecosystem is fragmented, often cross-state, and difficult to monitor with existing resources.
The Copper Theft Prevention Act, if it passes, would represent the first major federal intervention in this space. But the bill’s status in committee as of the time of the source means that for now, the burden falls on states and private companies.
Virginia’s digital recordkeeping law provides a template, and the 10% theft reduction in Loudoun County is a data point that supporters will likely cite as evidence that the approach works.
What to watch next
The issue is expected to remain a priority for the 118th Congress and the AI infrastructure industry. The key variable is whether the Copper Theft Prevention Act moves out of committee before the end of the session. If it does, the FBI’s projected 20% reduction within two years would be a significant dent in a problem that is only growing as more data centers come online.
If it does not, the industry will continue to rely on a patchwork of state laws, private security investments, and technological fixes — none of which fully close the gap that thieves are exploiting. The bottom line for investors and policymakers alike: copper theft at AI data centers is not a niche crime problem.
It is a direct cost to the buildout of critical infrastructure, and the response so far has been fragmented. The next six months will determine whether federal action catches up to the scale of the problem.
