Briefing 05/08/2025
Weekly updates on the political risks American data center projects
This week’s roundup: In Virginia, Governor Glenn Youngkin vetoed a bipartisan bill that would have required stricter oversight of data center siting. In Indiana, Amazon’s plan to reroute streams and fill wetlands near New Carlisle drew sharp criticism at a public hearing. And in Memphis, Tennessee, xAI removed gas turbines from its Colossus data center after facing local backlash.
Virginia Governor Vetoes Bipartisan Bill for Stricter Data Center Oversight
On May 5, 2025, Virginia Governor Glenn Youngkin (R) vetoed HB 1601, a bipartisan bill that would have introduced new environmental and community impact assessments for proposed data centers. The bill, sponsored by Delegate Josh Thomas (D), sought to mandate studies on water use, farmland, forest impact, noise near schools and homes, and historic site preservation.
Community and Legislative Responses:
Kathryn Kulick, representing a Virginia homeowners association roundtable, expressed disappointment, stating that the veto disregards the disruptions caused by data centers to everyday life in affected communities.
Delegate Josh Thomas (D–Prince William), the bill's sponsor, criticized the governor arguing the veto prioritized corporate interests over community well-being, emphasizing the need for responsible data center growth that considers residents' health and the environment.
Senator Adam Ebbin (D–Alexandria) highlighted that the legislation was designed to provide localities with essential information to make informed decisions about data center projects, suggesting that the veto undermines local governance.
Why it matters:
Derailed Momentum: The veto halts an attempt to introduce stronger statewide oversight of data center siting in Virginia, despite growing political opposition at both local and state levels.
Local Action: The governor’s veto shows that data center regulation remains largely dependent on local politics rather than state-level intervention.
Amazon's New Carlisle, Indiana Data Center Plan Sparks Community Pushback Over Wetlands Impact
Amazon has requested state approval to permanently fill over 9 acres of wetlands and reroute 5,000 feet of streams near New Carlisle, Indiana, as part of a large-scale data center expansion. At a public hearing hosted by the Indiana Department of Environmental Management (IDEM), residents raised concerns about potential effects on flooding, water availability for local farms and homes, and environmental impact.
Opposition groups:
Just Transition Northwest Indiana: A regional organization, represented by Organizing Director Lisa Vallee, who criticized the potential long-term utility costs and environmental vulnerability tied to the project.
Local residents of New Carlisle: Voiced concerns during the public hearing about flooding risks, aquifer depletion, and environmental impacts.
Why it matters:
Permitting and Environmental Review Risks: The outcome of IDEM’s decision could influence future permitting timelines and site selection criteria, particularly in areas with sensitive water ecosystems.
Infrastructure and Siting Trade-offs: The case highlights the potential complexities of locating large-scale data infrastructure in rural areas where land and water use intersect with residential and agricultural needs.
Musk’s xAI Removes Gas Turbines From Memphis Data Center
xAI, Elon Musk’s artificial intelligence company, has removed some of the natural gas turbines powering its Colossus data center in Memphis, Tennessee, following community pushback. The turbines, which were reportedly operating without permits, drew criticism for potentially violating federal clean air standards.
Key Opposed Groups to xAI Colossus Memphis:
Why it matters:
Permitting and Power Risks: Regulatory compliance and reliance on fossil fuels can trigger backlash from environmental groups, forcing infrastructure changes and exposing data centers to heightened compliance scrutiny.
Concerns about large-scale data centers often relate not only to the facility itself, but also to the supporting infrastructure and power supply they require.
High-Profile Target: Elon Musk’s national visibility likely amplified local mobilization against the xAI project, increasing pressure on regulators.
Links
Talen Energy considers alternative data center power deals after regulator push
https://www.reuters.com/business/energy/talen-energy-considers-alternative-data-center-power-deals-after-regulator-push-2025-05-08/
Data Center Executives Cool on Nuclear, Still a Decade Out
https://broadbandbreakfast.com/data-center-executives-cool-on-nuclear-still-a-decade-out/
Big Tech Spending Projections Calm Fears Of Data Center Slowdown
https://www.bisnow.com/national/news/data-center/big-tech-earnings-calm-fears-of-data-center-slowdown-129220
Water, water everywhere: Plano approves $29K water study for proposed Microsoft data center
https://www.shawlocal.com/kendall-county-now/2025/05/02/water-water-everywhere-plano-approves-29k-water-study-for-proposed-microsoft-data-center/