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Q&A

Could Blocking Data Centers Raise Electricity Prices?

A conversation with Advanced Energy United’s Trish Demeter about a new report with Synapse Energy Economics.

Trish Demeter.
Heatmap Illustration

This week’s conversation is with Trish Demeter, a senior managing director at Advanced Energy United, a national trade group representing energy and transportation businesses. I spoke with Demeter about the group’s new report, produced by Synapse Energy Economics, which found that failing to address local moratoria and restrictive siting ordinances in Indiana could hinder efforts to reduce electricity prices in the state. Given Indiana is one of the fastest growing hubs for data center development, I wanted to talk about what policymakers could do to address this problem — and what it could mean for the rest of the country. Our conversation was edited for length and clarity.

Can you walk readers through what you found in your report on energy development in Indiana?

We started with, “What is the affordability crisis in Indiana?” And we found that between 2024 and 2025, residential consumers paid on average $28 more per month on their electric bill. Depending on their location within the state, those prices could be as much as $49 higher per month. This was a range based on all the different electric utilities in the state and how much residents’ bills are increasing. It’s pretty significant: 18% average across the state, and in some places, as high as 27% higher year over year.

Then Synapse looked into trends of energy deployment and made some assumptions. They used modeling to project what “business as usual” would look like if we continue on our current path and the challenges energy resources face in being built in Indiana. What if those challenges were reduced, streamlined, or alleviated to some degree, and we saw an acceleration in the deployment of wind, solar, and battery energy storage?

They found that over the next nine years, between now and 2035, consumers could save a total of $3.6 billion on their energy bills. We are truly in a supply-and-demand crunch. In the state of Indiana, there is a lot more demand for electricity than there is available electricity supply. And demand — some of it will come online, some of it won’t, depending on whose projections you’re looking at. But suffice it to say, if we’re able to reduce barriers to build new generation in the state — and the most available generation is wind, solar, and batteries — then we can actually alleviate some of the cost concerns that are falling on consumers.

How do cost concerns become a factor in local siting decisions when it comes to developing renewable energy at the utility scale?

We are focused on state decisionmakers in the legislature, the governor’s administration, and at the Indiana Utility Regulatory Commission, and there’s absolutely a conversation going on there about affordability and the trends that they’re seeing across the state in terms of how much more people are paying on their bills month to month.

But here lies the challenge with a state like Indiana. There are 92 counties in the state, and each has a different set of rules, a different process, and potentially different ways for the local community to weigh in. If you’re a wind, solar, or battery storage developer, you are tracking 92 different sets of rules and regulations. From a state law perspective, there’s little recourse for developers or folks who are proposing projects to work through appeals if their projects are denied. It’s a very risky place to propose a project because there are so many ways it can be rejected or not see action on an application for years at a time. From a business perspective, it’s a challenging place to show that bringing in supply for Indiana’s energy needs can help affordability.

To what extent do you think data centers are playing a role in these local siting conflicts over renewable energy, if any?

There are a lot of similarities with regard to the way that Indiana law is set up. It’s very much a home rule state. When development occurs, there is a complex matrix of decision-making at the local level, between a county council and municipalities with jurisdiction over data centers, renewable energy, and residential development. You also have the land planning commissions that are in every county, and then the boards of zoning appeals.

So in any given county, you have anywhere between three and four different boards or commissions or bodies that have some level of decision-making power over ordinances, over project applications and approvals, over public hearings, over imposing or setting conditions. That gives a local community a lot of levers by which a proposal can get consideration, and also be derailed or rejected.

You even have, in one instance recently, a municipality that disagreed with the county government: The municipality really wanted a solar project, and the county did not. So there can be tension between the local jurisdictions. We’re seeing the same with data centers and other types of development as well — we’ve heard of proposals such as carbon capture and sequestration for wells or test wells, or demonstration projects that have gotten caught up in the same local decision-making matrix.

Where are we at with unifying siting policy in Indiana?

At this time there is no legislative proposal to reform the process for wind, solar, and battery storage developers in Indiana. In the current legislative session, there is what we’re calling an affordability bill, House Bill 1002, that deals with how utilities set rates and how they’re incentivized to address affordability and service restoration. That bill is very much at the center of the state energy debate, and it’s likely to pass.

The biggest feature of a sound siting and permitting policy is a clear, predictable process from the outset for all involved. So whether or not a permit application for a particular project gets reviewed at a local or a state level, or even a combination of both — there should be predictability in what is required of that applicant. What do they need to disclose? When do they need to disclose it? And what is the process for reviewing that? Is there a public hearing that occurs at a certain period of time? And then, when is a decision made within a reasonable timeframe after the application is filed?

I will also mention the appeals processes: What are the steps by which a decision can be appealed, and what are the criteria under which that appeal can occur? What parameters are there around an appeal process? That's what we advocate for.

In Indiana, a tremendous step in the right direction would be to ensure predictability in how this process is handled county to county. If there is greater consistency across those jurisdictions and a way for decisions to at least explain why a proposal is rejected, that would be a great step.

It sounds like the answer, on some level, is that we don’t yet know enough. Is that right?

For us, what we’re looking for is: Let’s come up with a process that seems like it could work in terms of knowing when a community can weigh in, what the different authorities are for who gets to say yes or no to a project, and under what conditions and on what timelines. That will be a huge step in the right direction.

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Spotlight

Democrats’ Growing Divide Over Data Centers

It’s pause vs pause-nots.

Data center protests.
Heatmap Illustration/Getty Images

The American climate movement is beginning to look a lot like AI doomers versus the techno-optimists. It’s a dynamic that is winning local bans – and very little else for now.

On one side, you’ve got the left-leaning insurgent grassroots movement against data centers. In many cases this push is in the name of climate action and environmental justice, with activists citing the risks of pollution from gas-fired power and the potential for strain on existing electricity supplies. But in many, many other cases, this movement is decidedly not about climate action; instead it’s a movement addressing everything from energy prices and power over large corporations to AI use generally.

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Hotspots

Local Police Targeted Data Center Opponent, Law Firm Alleges

And more of the week’s top news around development fights.

The United States.
Heatmap Illustration/Getty Images

1. Jefferson County, Alabama – A law firm is alleging that police in the city of Birmingham retaliated against a woman for suing developers of a data center. It might just be a wake-up call for data center developers.

  • Earlier this month, two individuals each with homes next to a proposed 300-megawatt data center in Birmingham filed a class action lawsuit against developer Nebius and the city of Birmingham. The lawsuit alleges “multiple independently fatal zoning violations” rooted in the city’s decision to let Nebius’s project move forward while also finalizing a moratorium, and claims the city has granted approvals in violation of the existing moratorium.
  • On May 18, days after the lawsuit was filed, lawyers for one of the individuals – Madelyn Greene – wrote the Birmingham Police Department stating officers pulled her over while driving through the proposed project site without any lawful reason. According to the letter, which I obtained and was first reported by AL.com, the officers claimed she was harassing police and started filming her while in her car. When she took her own phone out, the officers “abruptly broke off contact, returned to their vehicles, and left the scene.”
  • The letter concludes the traffic stop “timing and location are not coincidental.” It warned that any additional attempts by city police to “stop, detain, surveil, follow, photograph, intimidate, or otherwise harass” people involved in the lawsuit will result in requests for restraining orders.
  • Situations like these vividly illustrate the problems around security forces and large infrastructure projects. Activists fighting the Thacker Pass lithium mine in Nevada were monitored for years. Conflicts between police and oil pipeline protestors are common and complaints about surveillance abound.
  • I feel compelled to say that data center developers and large tech firms would be wise to coordinate with local police on matters such as these – not just for their own benefit but for that of the public. It’s one thing when protesters are arrested at a hearing, but wholly another when members of the public are concerned voicing dissent will lead to retaliation. All that’ll do is aggravate the opposition further.
  • Nebius did not respond to a request for comment.

2. Mason County, Kentucky – This county is the site of yet another eminent domain debacle and I suggest you pay attention to it because it’s now represented by an outgoing congressman with nothing left to lose: Thomas Massie.

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Q&A

What’s Bothering a Free Market Wonk About the Data Center Boom

A conversation with Travis Fisher of the Cato Institute.

Travis Fisher.
Heatmap Illustration

This week’s conversation is with Travis Fisher, an energy policy analyst with the Cato Institute and one of my favorite people to chop it up with on Energy Twitter. I reached out to Fisher for a conversation about how he’s approaching the data center boom as a free market-minded wonk at a time when other figures on the so-called Right are calling for strict regulations on the sector. What I learned is that folks like Fisher are concerned about the scale of the buildout too, but their ideas and approaches wildly differ from the Tucker Carlsons of the world.

As always, our conversation was edited for length and clarity.

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