Counties wrestle with data centers’ power consumption

The start of the new year means the start of new legislative sessions in state houses up and down the country, and Florida has turned heads by showing a certain reluctance to throw open its doors to new data center development.

State Rep. Philip Griffitts filed a bill imposing strict rules on data center developers, requiring projects to be discussed in a public hearing by the locality where it would be sited, while looking to prevent utilities from passing on associated costs to ratepayers through their electricity or water bills. Once a local government approves a data center project, it then would move to the state level for a final approval.

Griffitts’ effort comes on the heels of a new initiative from Florida Gov. Ron DeSantis, who late last year proposed an AI Bill of Rights that included various protections against consumers footing the bill for data centers.

Meanwhile, Virginia Gov.-elect Abigail Spanberger is soon to take office after promising during last year’s campaign to get energy bills under control and make data center operators pay their fair share.

While governments at all levels want to embrace artificial intelligence, they also are wrestling with the effects data centers could have on their communities’ power and water consumption, as well as their noise and impacts on neighborhoods. A recent survey by the National Association of Counties found that 57% of county leaders have spent at least some time discussing data centers and other energy-intensive projects.

NACo Chief Research Officer and Chief Economist Teryn Zmuda said during the organization’s State of America’s Counties Summit this week in Washington, D.C. that it shows leaders are “tracking emerging needs and emerging demands.” For local leaders themselves, managing the worries of their communities while trying to capitalize on data centers’ economic benefits is a constant challenge.

“What we learned in 2019 when I came on the [board of supervisors], was one of the issues was siting of data centers, so moving them away from homes became a real target issue,” said Prince William County, Virginia Supervisor Victor Angry during a panel discussion at the NACo summit. “More so because we had developed so many data centers, the issues of water, sound, siting, the appearance of the buildings and the main issue of power became what our base of non-supporters of data centers [disliked, and] their voices started getting bigger and bigger to these points. We were able to mitigate all the points they made. But what stuck was power.”

Data center providers have consistently defended their environmental records and said that new technology means the centers do not consume as much power or water as they used to. But recent research showed that utilities still struggle to cope with growing power demand and have called for a more proactive planning process to help ease those issues.

Angry noted that Prince William County started to lean into data centers to grow its economy and commercial tax base and ease the burden on residents. The county has also introduced new zoning rules to ensure they are sited further away from homes and schools, he added.

And Angry said data center providers have been good community partners and helped pay for benefits like parkland, trails or even anchor institutions like a new fire station or library. Through being good partners, the county was able to get data centers to lower their lights at night to mitigate light pollution and put backup generators in different places to reduce noise.

“Proffers are powerful,” Angry said.

It’s a similar story in Georgia, said Clinton Johnson, a member of the Dougherty County Commission in the southeast of the state. He said that, given the state’s plentiful sunshine and open land, it’s a matter of when data centers come in, rather than if. But there is a desire to learn from others and build data centers the right way so that counties and their residents can truly benefit, especially financially.

“I also want to see where these Fortune 200 companies can bring dollars to the table to pool money for rates that when they do increase, or put money into a fund to help pay lower income people's bills or help them with it, even though they're not the major contributor,” Johnson said. “[We've] got small counties who are struggling to make their budgets. A data center or digital campus could be everything for them. County government doesn't have a lot of ways to produce money.”

But the bills in Florida speak to an issue around local governments retaining their authority to reject data center developments. Angry said he is concerned that the state legislature in Virginia may look to “corral” or “hone in” what localities can do to prevent or allow data center construction. Johnson said the whole concept of data centers may need a rethink if they are to be successfully integrated into communities.

“My first view on this whole thing is we’ve got to rebrand this,” he said. “We’ve got to change from data centers to digital manufacturing, and we start back talking about manufacturing jobs and bringing back that topic to the table. It makes it easier to talk about because somebody has muddied the water on data centers. You’ve got to move to digital campuses, or some type of AI manufacturing in order to get it to be a product that people are seeing more as manufacturing for the next age, and not something that's a negative impact on my environment.”