As out-of-state tech companies continue to advance data center projects across New Mexico, local governments are grappling with how to adapt.
Two Southern New Mexico counties on Thursday diverged in their responses to proposals in their backyards. While Grant County commissioners approved the first step toward a moratorium on such developments, Lea County commissioners voted to consider the next steps for a new hyperscale Google data center funded in part with $134 billion in industrial revenue bonds.
The incentives would put the proposal in the realm of Doña Ana County’s massive Project Jupiter, which received $165 billion worth of industrial revenue bonds, which are tax-exempt bonds issued to finance private business projects. Repayment is secured by the business’s revenue.
Representatives from Google and its partner, Excelsior Energy Capital, shared details Thursday about the data center with Lea County commissioners. Excelsior Energy Capital would be responsible for constructing a 2-gigawatt solar field 3 miles away to help power the data center, a fueling decision few data centers have turned to thus far.
Data centers are sprouting up around the country, spurring protests, lawsuits and fierce pushback over concerns about their environmental impact and transparency.
Lea County project
The specs of Google’s project: 1,890 acres of Lea County land for two 900,000-square-foot facilities, with construction estimated to generate about 1,700 jobs, and annual operations providing 125 permanent jobs.
The companies are also promising to cover 100% of new electricity generation costs.
“We’ll do our very best to be responsive to not just the questions but the emotion we experienced here today, to take seriously that this is your home, this is your kids’ future, and we have no business doing anything here today for short-term gain that would mortgage the future,” Excelsior co-founder Anne Marie Denman told commissioners.
When it comes to water, the companies said they are taking those concerns seriously.
The proposed “one-time fill” for the data center’s closed-loop cooling system would use 9.6 million gallons of water. Once the facility is fully staffed, the companies estimate the data center would use about 42,000 gallons a day of municipal water. Construction would require nearly 1 million gallons of water a day that Google says it wouldn’t be taking from the city.
“What we would not be pursuing, at all, if we can avoid it, is a city connection for that construction water,” said Google representative Chris Adams.
Instead, he said, the company hopes to use alternative water sources, purchasing effluent, or treated wastewater, from the city.
Commissioners signaled their support by agreeing to consider over $134 billion in industrial revenue bonds. Commissioners argued by negotiating terms with the companies through these agreements, they can better direct capital generated by the projects into their communities.
“Our school districts up north and our municipalities are severely crippled. … We’re hurting badly,” said Commissioner Dee Ann Kimbro. “If the county can have that money and reroute it to the school districts, then there would be a chance we could lower our property taxes because we would not hurt the school districts and municipalities.”
Members of the public were divided on the project, with many attendees expressing concerns over project transparency and the legitimacy of the company’s promises on water use.
Grant County pushback
To the west, meanwhile, developers of a secretive data center in Grant County are hitting roadblocks.
State Environment Secretary James Kenney wrote a letter Sept. 18 to the developers, expressing his “disappointment” with their lack of communication and failure to engage with the community.
Grant County commissioners on Thursday approved a notice of intent to consider a one-year moratorium on data centers. The text, modeled after Socorro County’s resolution and proposed by Commissioner Nancy Stephens, will be weighed at an Oct. 8 meeting.
“It’s a very wise, cautious, and responsible course of action for the Commission to implement a temporary pause to gather information from independent experts, legal counsel, and others on the pros and cons of adopting county regulations for data centers to ensure that our water resources, air quality, and public health are protected and that county residents don’t bear the economic cost of data center development,” Allyson Siwik, executive director of the Gila Resource Center, said in a statement.
Commissioner Tom Shelley was the sole dissenter, arguing a moratorium could infringe on private property rights granted in the U.S. Constitution.
“That kills business opportunity,” Shelley said. “Maybe we should consider asking [developers] if they want to meet with us. … To me, that’s a friendlier approach.”
Commissioner Eddie Flores countered: “We’re not talking about a hotel. We’re not talking about a truck stop on the interstate. We’re talking about something that I think, across the nation, we don’t know a whole lot about. This company has not come forth to this commission and explained their intent.”
Stephens agreed.
“These people are multibillion-dollar investment companies,” she said. “They should be doing all kinds of outreach.”
Grant County residents found out about the data center in a legal notice in the Silver City Daily Press on Aug. 27. Upon reading about Site Layer 1 LLC’s plans to build a data center on the rural southern edge of Grant County, near Hachita and Playas, the community rapidly took action, sending letters to Kenney and announcing their intent to introduce a data center moratorium.
The notice provided scant information, listing pollutants and noting that Site Layer 1 planned to submit an air quality permit application to the state Environment Department by Oct. 1. It said the facility could consume about 2.3 million cubic feet of natural gas every hour — enough gas to power 900 homes for a year. Its annual carbon emissions would be equivalent to those of about 282,600 cars.
The Oct. 1 timeline could shift, however.
“They’re welcome to apply, but NMED does not plan on acting on it until they perform an acceptable level of community engagement as outlined in the Secretary’s letter,” Drew Goretzka, a spokesperson for the department, wrote in an email.
Oly Perez, a community organizer and paramedic, echoed concerns about transparency in a statement to The New Mexican.
“How do they expect to gain any trust within our community when communication from them has started and ended with a notice in the paper?” he wrote.
After calling, leaving voicemails and emailing, Kenney wrote that he has yet to hear from Granite Renewables, the company behind the data center. The company did not respond to repeated requests for comment from The New Mexican, either, and the developer’s only public point of contact is an empty floor of an office tower in midtown Manhattan.
“It’s insulting to the community to just act like they can do whatever they want in our county and not have any interaction [with the community],” Todd Schulke, co-founder and senior staff member of the Center for Biological Diversity, said in an interview. “So, hopefully the moratorium, if it passes, and the pushback from Secretary Kenney will sort of force them to engage and be public.”
Schulke added that Ian and Blake Marcus, who are behind Granite Renewables, have provided presentations on their data center proposals in other states — Site Layer 2 in Logan County, Colo., and Site Layer 4 in Platte County, Wyo.
“What’s curious about this is they’ve been public in other areas,” Schulke said. “I don’t know why they’re doing it differently here. The Marcus brothers, they’re going to become infamous in Grant County.”
Julia Gentin is a reporter for The Las Cruces New Mexican, The Santa Fe New Mexican and Searchlight New Mexico through a partnership with Report for America, a national service program that places journalists into local newsrooms. She covers the Southern New Mexico region. Learn more about Report for America at reportforamerica.org.
