Secrecy Is Backfiring on Data Center Developers

It’s time to call it like it is: Many data center developers seem to be moving too fast to build trust in the communities where they’re siting projects.

One of the chief complaints raised by data center opponents across the country is that companies aren’t transparent about their plans, which often becomes the original sin that makes winning debates over energy or water use near-impossible. In too many cases, towns and cities neighboring a proposed data center won’t know who will wind up using the project, either because a tech giant is behind it and keeping plans secret or a real estate firm refuses to disclose to them which company it’ll be sold to.

Making matters worse, developers large and small are requiring city and county officials to be tight-lipped through non-disclosure agreements. It’s safe to say these secrecy contracts betray a basic sense of public transparency Americans expect from their elected representatives and they become a core problem that lets activists critical of the data center boom fill in gaps for the public. I mean, why trust facts and figures about energy and water if the corporations won’t be up front about their plans?

“When a developer comes in and there’s going to be a project that has a huge impact on a community and the environment – a place they call home – and you’re not getting any kind of answers, you can tell they’re not being transparent with you,” Ginny Marcille-Kerslake, an organizer for Food and Water Watch in Pennsylvania, told me in an interview this week. “There’s an automatic lack of trust there. And then that extends to their own government.”

Let’s break down an example Marcille-Kerslake pointed me to, where Talen Energy is seeking to rezone hundreds of acres of agricultural land in Montour County, Pennsylvania, for industrial facilities. Montour County is already a high risk area for any kind of energy or data center development, ranking in the 86th percentile nationally for withdrawn renewable energy projects (more than 10 solar facilities have been canceled here for various reasons). So it didn’t help when individuals living in the area began questioning if this was for Amazon Web Services, similar to other nearby Talen-powered data center projects in the area?

Officials wouldn’t – or couldn’t – say if the project was for Amazon, in part because one of the county commissioners signed a non-disclosure agreement binding them to silence. Subsequently, a Facebook video from an activist fighting the rezoning went viral, using emails he claimed were obtained through public records requests to declare Amazon “is likely behind the scenes” of the zoning request.

Amazon did not respond to my requests for comment. But this is a very familiar pattern to us now. Heatmap Pro data shows that a lack of transparency consistently ranks in the top five concerns people raise when they oppose data center projects, regardless of whether they are approved or canceled. Heatmap researcher Charlie Clynes explained to me that the issue routinely crops up in the myriad projects he’s tracked, down to the first data center ever logged into the platform – a $100 million proposal by a startup in Hood County, Oregon, that was pulled after a community uproar.

“At a high level, I have seen a lack of transparency become more of an issue. It makes people angry in a very unique way that other issues don’t. Not only will they think a project is going to be bad for a community, but you’re not even telling them, the key stakeholder, what is going on,” Clynes said. “It’s not a matter of, are data centers good or bad necessarily, but whether people feel like they’re being heard and considered. And transparency issues make that much more difficult.”

My interview with Marcille-Kerslake exemplified this situation. Her organization is opposed to the current rapid pace of data center build-out and is supporting opposition in various localities. When we spoke, her arguments felt archetypal and representative of how easily those who fight projects can turn secrecy into a cudgel. After addressing the trust issues with me, she immediately pivoted to saying that those exist because “at the root of it, this lack of transparency to the community” comes from “the fact that what they have planned, people don’t want.”

“The answer isn’t for these developers to come in and be fully transparent in what they want to do, which is what you’d see with other kinds of developments in your community. That doesn’t help them because what they’re building is not wanted.”

I’m not entirely convinced by her point, that the only reason data center developers are staying quiet is because of a likelihood of community opposition. In fairness, the tech sector has long operated with a “move fast, break things” approach, and Silicon Valley companies long worked in privacy in order to closely guard trade secrets in a competitive marketplace. I also know from my previous reporting that before AI, data center developers were simply focused on building projects with easy access to cheap energy.

However, in fairness to opponents, I’m also not convinced the industry is adequately addressing its trust deficit with the public. Last week, I asked Data Center Coalition vice president of state policy Dan Diorio if there was a set of “best practices” that his large data center trade organization is pointing to for community relations and transparency. His answer? People are certainly trying their best as they move quickly to build out infrastructure for AI, but no, there is no standard for such a thing.

“Each developer is different. Each company is different. There’s different sizes, different structures,” he said. “There’s common themes of open and public meetings, sharing information about water use in particular, helping put it in the proper context as well.”

He added: “I wouldn’t categorize that as industry best practice, [but] I think you’re seeing common themes emerge in developments around the country.”