The Fight

Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Spotlight

The Most Important Data Center Election You’ve Never Heard Of

The race for the top job in McCracken County, Kentucky, might hinge on the importance of a community benefit agreement.

•
Paducah, Kentucky figures.
Heatmap Illustration/Library of Congress, U.S. Department of Energy

An election-season battle is brewing over what could be the nation’s first massive data center operating on federal land. And you almost certainly have never heard of it.

Come with me to McCracken County, Kentucky, just outside its largest city, Paducah, where the Energy Department is allowing new development at a large brownfield property. First constructed in the 1950s, the Paducah Gaseous Diffusion Plant was once the country’s only uranium enrichment facility, but it closed in 2010. Since then, and after years of cleanup, Paducah city officials and the McCracken County government have sought to revitalize and reindustrialize the site.

In July, the Energy Department announced plans for a data center at the site, one with enough power to provide excess electricity to the surrounding community. Brookfield would develop and operate the data center and NextEra Energy would build the power infrastructure — a roughly 2.5 gigawatt natural gas plant — while local and regional electricity companies and co-ops would help provide wholesale and retail electricity. The project would be built alongside new uranium enrichment projects cropping up at the site, as federal officials and companies involved seek to transform the area into what they call an “American energy hub.”

Government officials at all levels welcomed the new project. An opposition group called Protect McCracken County exists and is active, but opposition has yet to manifest in the kind of dust-up or mass protest we’re seeing elsewhere in the country. Media reports indicate a likely reason for this is the longstanding history of industrial development in this specific area and that the project location was already contaminated as a brownfield site. The worst headlines about the data center news saw residents calling it “bittersweet” and a “necessary evil.”

But something important was missing because the project was on federal land: city officials say they never had a formal opportunity to deliberate it themselves — a step even local governments supportive of development often use to get assurances and benefits from developers.

The investment announcement also caught officials by surprise. Kentucky Governor Andy Beshear, a centrist Democrat with presidential ambitions, told Politico he was never briefed on it. Paducah City Councilor Dujuan Thomas told me this week that the first time he met with any individuals involved “was a week before the public announcement, or a few days before it.”

“At the end of the day, it’s already set in stone,” said Thomas, who supports the data center being built. “I don’t think there’s anything that can be done aside from a federal intervention that could ever stop something like this from happening. And I’m trying to be a realist about it.”

“I’m more of a glass-half-full type of person,” Thomas added.

Now, the fight over asking for more is dominating the race for McCracken County judge/executive, which is the county’s top job. Paducah’s mayor, George Bray, a former Republican-turned-independent, is running to oust two-term Republican incumbent Craig Clymer. In recent weeks, Bray has called for negotiating a community benefit agreement with the developers and says Brookfield already expressed willingness to do so. “Data center developers, knowing how sensitive communities are about electrical usage, water usage, and noise … have been open to embracing the community and saying they want to be good citizens,” he told me in an interview.

Specifically, Bray wants a community benefit agreement to potentially include an economic development fund to help jumpstart new housing in the area, knowing there’ll be an influx of labor. The county will also need to support volunteer fire districts, especially if there’s a blaze at the site. Those are only two ideas he offered, acknowledging the subject of data centers is new to him and that he believes the agreement “should be something the community itself comes up with.”

“I would not approach it as, What do I want? I would be talking with others,” he told me. “There are many things that a project of this size is going to drive in our community. I think we just need to be open-minded and practical about it.”

Bray’s push came up at public debates during the campaign for county judge executive and has since spilled over into social media spats between Bray and Clymer. Bray claims the only official who can adequately negotiate this kind of agreement with the developer is the county judge/executive because the project is not within the Paducah city limits. Clymer, meanwhile, denies everything Bray is claiming.

Clymer says a community benefit agreement is unnecessary, would indicate hostility towards the business community, and is only being brought up so Bray can differentiate himself in the election. He also told me the county will receive incredible levels of tax revenue from the project, and this in and of itself will mean lots of benefits.

The developers “have not asked for one thing from the community. They haven’t asked for a property tax abatement — I told them early on we’d send them a tax bill and they said they understood that’s what I intend to do. No payback on anything; they’re going to build their own infrastructure there within the facility. They’re going to provide their own power through NextEra,” Clymer said. “The bottom line is, it’s not going to cost the community a penny to have this $100 billion investment in our community, and the benefit from it is just going to be enormous through the property tax and occupational tax.”

Clymer also claims key protections for the community, including ratepayer guardrails, are written into the lease agreement DOE struck with Brookfield for the data center. I asked Clymer if the lease agreement was public; he said no and that he personally hasn’t seen it.

“I’m telling you what they’re telling me and I don’t think anybody’s lying about it,” he said. “Let’s be satisfied it’s not going to cost us a penny and it’s going to create enormous wealth for us.”

Brookfield declined to comment for this story. The Energy Department and NextEra did not respond to requests for comment by publication time. We’ll update our story with answers from them when we hear back.

Yellow

This article is exclusively
for Heatmap Plus subscribers.

Go deeper inside the politics, projects, and personalities
shaping the energy transition.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Q&A

GoodPower Is Sussing Out What People Actually Want from Data Centers

Talking with Leah Qusba, the CEO of GoodPower.

•
Leah Qusba.
Heatmap Illustration

This week’s conversation is with Leah Qusba, CEO of GoodPower, which recently released a survey experiment you need to read. Conducted with Data for Progress, the project, published Monday, takes a unique approach to asking people why they opposed data centers for artificial intelligence and whether constructing renewable energy instead of gas power moves the needle at all in their support for AI infrastructure near them. Instead of just asking polling questions, they posed various hypothetical project designs to people — and the results were eye-popping. Turning to solar instead of gas? Might not be a panacea for gaining approval at the local level. Protecting electricity rates from going sky-high? Now that’s a way to get buy-in.

The following conversation was lightly edited for clarity.

Keep reading...Show less
Yellow
Hotspots

A First-Of-Its-Kind State of Emergency — Over a Permitting Pause

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

•
The United States.
Heatmap Illustration/Getty Images

1. Umatilla County, Oregon – A small town in Oregon this week declared a state of emergency over fears that a statewide pause on data center permits will harm its economy.

  • Five of the six people on the Umatilla city council voted to adopt a resolution formally calling for a state of emergency “due to the threat of widespread financial loss.” Umatilla City Manager Dave Stockdale told the council before the vote that the data center pause enacted by Governor Tina Kotek puts millions in tax revenue at risk. Other city staffers told the council that current budget reserves are healthy, but this could complicate a bond for a new police station and delay executing their city’s master plan.
  • Umatilla is home to more than 20 data center projects currently operating or under development, equal to roughly one-fifth of the state’s data center sector. Oregon law expressly grants cities and towns permission to declare a state of emergency over “financial loss.” And the Umatilla resolution is a clear legal threat; its text calls for “immediate reconsideration” of Governor Kotek’s directive pausing data center permits and “authorizes the city manager to coordinate with affected governments and legal counsel to pursue appropriate administrative and judicial remedies.”
  • To the best of our knowledge, this is the first time a municipal government has threatened legal action or declared a state of emergency over a state-wide permitting pause against data center development. It goes to show that what comes around goes around.

2. Saratoga County, New York – Is Trump’s country music superstar-turned-power-project combatant John Rich preparing to debut a new song about solar farms, or something more?

Keep reading...Show less
Yellow
Spotlight

A Giant Data Center Offers a Permitting Reform Test Case

What would happen to Project Jupiter if the Bipartisan American Affordability and Jobs Act is passed?

•
Project Jupiter.
Heatmap Illustration/Project Jupiter, Library of Congress

One of the nation’s largest data centers is struggling under permitting woes. So let’s play a game: would the bipartisan permitting bill in Congress make the path easier, or might the federal legislation be irrelevant to large hyperscalers under development today?

Meet Project Jupiter, a mega project in southern New Mexico in Dona Ana County under development by Oracle and OpenAI, with financial backing from SoftBank and political support from the Trump administration for being a part of Stargate, a major Trump administration public-private initiative boosting AI development. Project Jupiter would be one of the largest data centers in the country if completed and currently is expected to run on a microgrid powered by fuel cells converting gas to electricity, which the developers claim will burn much cleaner than a typical off-grid gas turbine power plant.

Keep reading...Show less
Yellow