Given the daily media coverage–and entirely appropriate citizen alarm–over the corruption and craziness coming from Washington, local issues tend to get sidelined, minimized or buried. One exception to that phenomenon has been the extent and growth of local opposition to proposed data centers. I will confess that the uproar over those centers caught me unawares; I knew absolutely nothing about them other than the fact that they tended to be both big and ugly.
So–nerd that I am–I did some research.
Much of the objection to data centers focuses on environmental concerns. Data centers are massive electricity consumers, accounting for an astonishing 1–2% of global electricity use. The growth of AI is actually accelerating this — because AI requires enormous computational power, often 24/7.
Then there are the carbon emissions. When data centers draw power from fossil-fuel-heavy grids, their carbon footprint is substantial. Water usage is another issue: cooling is essential to prevent servers from overheating, and many facilities use evaporative cooling systems that consume millions of gallons of water a day. (That’s an especially serious concern in drought-prone regions like the American Southwest.) Data centers also generate enormous waste heat, most of which is simply expelled into the surrounding environment.
And there’s the strain on local grids, which drives up energy costs for local residents.
There can also be what I think of as the architectural and infrastructure issues. To say that these structures are blots on the landscape is an understatement; moreover, huge data center campuses require significant amounts of land, so they are often proposed for areas where the infrastructure doesn’t exist and must be built out at considerable cost–a cost often borne by local taxpayers.
Another concern is the limited lifespan of hardware. Servers, cooling equipment, and networking gear must be regularly replaced, and a substantial amount of this electronic waste ends up in landfills or is exported to (okay, “dumped on”) developing countries with limited recycling capacities.
Those are not insignificant concerns, and one would expect state and local governments to insist that those proposing to build these data centers explain how they plan to cover the considerable expenses and ameliorate the environmental impacts. But I discovered that–far from demanding accountability for these entirely foreseeable issues, state and local governments are providing fiscal incentives for their construction.
Here in Indiana, our dreadful legislature passed HB 1405 and expanded it via HB 1601, granting a sales and use tax exemption for qualifying data center equipment. The exemptions range from 25 million to 150 million, depending upon the population of the county where the data center is located. The original measure exempted personal property “essential to data center operations” from taxation–an exemption that lasts for 25 years for investments under $750 million, but may extend to $50 million for larger investments. That exemption was then broadened to include a number of other costs, and there is still an additional exemption for construction costs if at least 75% of the materials, services and labor used are sourced from Indiana vendors.
In addition to the state-level benefits conferred by the legislation, the Indiana Economic Development Corporation (IEDC) is authorized to approve additional tax incentives on a case-by-case basis. In the middle of last year, the IEDC approved $168 million dollars of incentives for four data center projects. And the state law allows local jurisdictions to award still other incentives if they choose to do so.
What I found particularly offensive is the fact that these tax breaks are largely going to tech giants like Amazon, Google and Microsoft, companies that already escape paying their fair share of federal taxes. (Perhaps in recognition of the likely negative PR, these giants don’t always apply for the goodies under their own name. In 2023, a company named Hatchworks applied for Indiana’s sales tax exemption; after it was awarded, it turned out that Hatchworks was a subsidiary of Google…)
Bottom line: I now completely understand the anger of local residents who are protesting the construction of these data centers.
But the eruption–and saliency–of this issue also points to yet another consequence of our criminal and dysfunctional federal government. While We the People are focused upon the multiple disasters of the Trump administration and its MAGA enablers, we simply don’t have the additional bandwidth needed to analyze and/or debate important public policies at any government level.
That’s a loss we will feel in a number of policy arenas, not just data centers.
Sheila, for a firsthand look at the destruction of local farmland you only have to travel up I-65 north of Whiteland to see the LEAP Project in Boone County which will house Eli Lilly, a META data center, and several other as yet unnamed projects. The plan calls for piping millions of gallons of water from Eagle Creek Reservoir and other sites and then pumping millions of gallons of “treated” wastewater back to the Eagle Creek watershed. The plan was hatched in secret after stealing water from the Wabash River was foiled by Lafayette residents. Why Boone County, one of the most water-poor countries in Indiana, was chosen is only known to Indiana politicians and manufacturers. The LEAP Project will cause untold damage to the ecosystem at Indianapolis’ Eagle Creek Park. In addition, it will raise electricity and water rates to residents of Marion County. Thankfully the Indianapolis City County Council has voiced opposition to this project, but our mayor has still not offered his position. Thank you for bringing this issue to the forefront.
“we simply don’t have the additional bandwidth needed to analyze and/or debate important public policies at any government level.”
Maybe if we had real journalists and news outlets we would have had some notice and debate over these issues. Instead what we got in rural Indiana was done deals, paid off local officials, and citizens only learning of these data centers after construction began. In the big cities, despite the barest of notification, the locals have been able to stall such projects, but are up against long ago deals made behind closed doors and an unresponsive government… and also a totally inept news media.
Just how many real reporters tied to local television are there in Indianapolis? One? Two? Is there even one television station here that is independent of political or business control?
It’s enough to make you weep.
Meanwhile… public school funding is cut, Indy streets are a tangle of potholes, decades past-prime above and below ground infrastructure is failing, etc., etc… I could go on, but y’all get the message. I don’t think anyone ‘in power’ has given any serious thought to problems of this rapid AI expansion – all over the country. All they see is $$$$$. It simply cannot come to a good end. Said it before: I pity anyone raising kids today, or who IS a kid right now; glad I’m on the downslope of life. 🙁
“In addition to the state-level benefits conferred by the legislation, the Indiana Economic Development Corporation (IEDC) is authorized to approve additional tax incentives on a case-by-case basis.”
Are the Data Centers the source for the proposed Marion County Wheel Tax?
Just askin’
“They cemented Paradise, and put up a parking lot…”
No mention of the escalating loss of green spaces, needed to cleanse the air naturally and the loss of Indiana’s productive farm lands which now lay bare, waiting for another form of “parking lot” construction destructing our environment.
So the data centers are given carte blanche essentially without planning for water and power. If you build a house, you have to have utilities planned before you break ground. Not so, apparently, with data centers -so here we are with the siphoning off of Eagle Creek as part of a data center “plan” where the public was “informed” ahead of time. I listened to the back pedaling of the water utility people assuaging the large crowd that Eagle Creek could “handle” it – potable water is more precious than gold so before the approval of any data center, the water issue needs to be settled – not like the current issue with ECP. I fear despite the resistance that the data center wins by some hair of an administrative loophole. And where are you Gov Braun? And state legislators can we drink those tax benefits which inure to data centers? You don’t have to argue “climate” change to see that natural resources are vulnerable. Or is that too woke to see the delicate balance
To address Theresa’s question, yes, there are a few journalists remaining in Indiana, but none of them cover the State House or the IEDC, the entity that gives away tax money like breath mints, issues these corporate welfare plans. IEDC does have a site to look up projects, but there is no place you can find lost revenues, which is an accounting error. The question is whether it’s intentional or just a misunderstanding of GAAP (generally accepted accounting principles). This opaque game-playing is part of the Republican SOP.
I wrote a story about the recent Good Jobs First report. The Good Jobs First report ranks Indiana poorly for disclosure. You cannot have rational conversations with the people unless we know that Indiana has now accumulated losses of more than $1 billion, and climbing.
I am sure that Eli Lilly, Trump, and the Big 3 moving into our state know what snooping citizen journalists look for when researching these centers across the country, so they hide those trails. Republicans are more aggressive in concealing facts from the people. We are on a “need to know” basis.
The data center explosion is part of the massive IPO surge that allows Big AI to fund its operations in cash, because not one single AI provider makes enough revenue to pay its bills. And on the customer side, corporate CEOs cannot justify the negative ROI generated by AI expenditures. They can’t measure profitability because all the metrics are negative. They’d better make it to breakeven soon, or the dominoes will start falling.
The good news is you have attracted Amazon, Google, and Microsoft to your state. The bad news is you have attracted Google, Microsoft, and Amazon to your state. These are giant extractors… if you hear a study hum coming from the facilities at night, that is the sound of Amazon sucking out our money. 😉
p.s. I first gave the Indiana Capital Chronicle support for its efforts in statehouse coverage, but I noticed they would get about five feet from the golden nugget and then would stop. They completely ignored Governor Braun’s connection to the Koch Dark Money web, among others. So, I checked who controls them and who finances them. I thought they were a locally funded independent news outlet covering the statehouse. Wrong! The Indiana Capital Chronicle is basically controlled by two people from the Hopewell Fund/Arabella Advisors dark network. The most amazing part is that they redact the two donor names. LOL You want transparency from the government, yet hide within the same dark networks financing politicians. REJECTED!
https://muncievoice.com/39359/indianas-data-center-boom/
I applaud these comments –
it is as heartening to read these as it is to follow the prof. THANK YOU ALL!
Linda Robb’ I didn’t get my AES power bill this month so copied May’s statement and sent a check with a note on the copy. AES is up for sale after years of billing problems and repeated long-term power outages here; is IPL getting rid of them or are they escaping this encroachment of Data Centers residents will have to pay for in many ways. Start with the newly proposed Wheel Tax. In the 1960s psychologist Alan Watts stated, “Man is going to computerize himself out of existence.” We are now fighting against being taxed out of existence as we struggle against the Fascism of Trump and his billionaire owners.
The data center that is going up in northern Indiana is supposed to use 1.5Gwh of electricity. I used to work for IPL. They supply all of Indianapolis with electricity. When I walked through the main control center, they had a big display showing how much electricity all of Indianapolis was using at the moment. On a pleasant spring day that number usually hovered around 1.8Gwh. One data center uses almost as much electricity as ALL OF INDIANAPOLIS!!!
I have no idea where Indiana utilities get extra city sized sources of electricity without spending billions of dollars or bringing online their oldest, dirtiest, most expensive reserve generation capacity, that by the way was being held in reserve for those extremely hot, high demand days in increasingly hot summer days.
One deal I did see details for outlined the sources as existing solar and wind farms and Battery storage units that were already online and was previously selling their electricity on the open market. What that means for the average ratepayer is that the open market supply of electricity just got smaller and if you remember your econ 101 supply and demand curve, you what that means for the rest of us. The supply just went down and prices will go up.
Important piece Sheila – KUDOS.
The corruption is blatant in Indiana to the point where even local, rural elected officials are complicit out of greed or opportunism.
Case in point, the land purchased for the LEAP center was owned by the father of the Boone County Republican chairman. The county is water poor, but right next to one with rivers and streams available to exploit. Marion County is the seat of the state’s capital and has come under the control of the corrupt state house and General Assembly due to the gerrymander and oppression of the GOP, WCN and play to pay officials.
Also, note that the light and noise pollution are constant. Homeowners within up to 2 miles away can be assaulted with low frequency hums from the cooling fans and chillers. You only have to drive north on 65 at night to see the light pollution.
It will be constant for as long as the facilities are active, 15 to 20 years.
When the facility become obsolete, what happens to the thousands of acres of space left abandoned and the vacant buildings and equipment in them, likely containing toxic waste at that? Another superfund site to be cleaned up at taxpayer expense when the owners declare bankruptcy under some shell company name?
The entire enterprise makes the wealthy even more so and screws the rest of us for decades to come. Thank you, Braun and company, perhaps the most corrupt administration since the 1920’s when the KKK controlled the state.
RESIST, any way you can.
the waste water is mixed with ethylene glycol. anti freeze. a former job wants me back due my haz-mat endorcement on my CDL. hes offered me $40 (plus OT)and hour to sit and pump on-off this stuff. seems this is a isssue. the cooling system in these data banks are prone to leaks due its size. hense, its a collection of spent and dumped into some water treatment plant. issue, many towns do not have waste water treatment tanks,only local waste. so many towns are skirting this and getting around regs.(minnkota,milton young power plant has a capacity of 705 mega watts. the two data centers in talking about here will use the total capacity of this one power plant. )NoDak is rural +. but as im told,its just dumped into the local system in town,this town of maybe pop 1000. there is no reuse of this stuff as im aware of. also, gas turbines,generators are the source of power now in the states oil fields. ive seen a few sites using them, they power off the methane from the oil well. seems they practically are maintence free. utility lines to these site cost big time. now the excuse to use gas turbines.. ill keep ya informed on my backyard where i live, theres a big one just getting the ground work started. im about 1 1/2 miles from it. thats like my backyard. the meeting that the lobbyists had for the locals was just that, a buncha lobbyists think tanking the locals. many are not o.k with this. i tell them ask the question, why do we need them. im sure everyones privacy no matter how small will be siloed under your name/social site and for sale to anyone. this private money gang wants a google windfall $$$ from your privacy. think dynamic pricing or what ever you want to call it. they want to see what your worth and what they can steal..
Don:
trump just gave the old coal plants $700 million to keep up with this scam,plus congress said more to come
I live in Northern Virginia and we have been subjected to the Data Center development for years now. Just in the last 3 years or so have citizens of counties where land is being sold for data centers begun to realize the damage these behemoths are doing. All of the commenters are correct. Sound and light pollution, electricity usage off the charts, water usage from local rivers and reserves, electric towers needing to be built through and over residential areas and rural farmland are costing the local ratepayer. Electric bills are rising. But, hey, the local counties and towns are getting big tax benefits and jobs for a few years. Once the data center is built, the jobs are done and only about 80 people are needed to run these great big rectangular buildings. They are just giant storage boxes for data. that require way to much of the precious energy and water available.
Thanks, will try and pass on this INFO Anywhere I can.
Thanks, for the excellent research and description of the negative impacts especially on environment. I wouldn’t be surprised if the Data centers find a way to tap into Indiana’s underground water sources(aquifers) and deplete and contaminate under the earth. No regard for the tax on citizens and negative impacts on health seem to concern our government officials.
It’s time to hook up a generator to our house or move to a state like Illinois, where the governor backs off the corruptness from big business and the trump regime. Hoosiers have no shield from all that negativity and corruption since Indiana officials are “Open for Business” trump style.
Another angle on the issues you mentioned are the NDA’s that our elected officials are asked, or coerced, into signing before the company begins building. What are they trying to hide? Many of these have been constructed under secretive non-disclosure agreements before the local population even knows they are being considered. Noise, lights, air pollution, and a host of other problems are part of the issue, and the corporations do not want people to know about this.
It seems to me that data centres are being marketed as though they were big manufacturing facilities (like an auto manufacturer, for example) which typically employ several thousand people from the area. THat’s not how data cnetres work. They will generally employ up to a couple of hundred people, but often less, even down to a few dozen, depending on size. If people understood this, even the few proponents might be less keen.