Georgia Was About to Retire Coal Vegetation. Then Got here the Information Facilities.

By Emily Jones, Grist

“This story was originally published by Grist. Sign up for Grist’s weekly newsletter here.”

This protection is made potential via a partnership between Grist and WABE, Atlanta’s NPR station.

Three years in the past, one of many nation’s largest electrical utilities, Southern Firm, made a splash when it introduced it could retire most of its coal-fired energy crops within the coming years, a significant step towards the corporate’s acknowledged purpose of web zero greenhouse fuel emissions by 2050.

Southern’s subsidiary utilities — the businesses that truly run the coal crops to offer electrical energy to houses and companies — backed up the announcement by searching for and acquiring approval to shut coal crops from the highly effective state regulators who oversee them.

However now the utilities are backtracking. They are saying they should meet a rare spike in demand for electrical energy, principally from the massive services filled with laptop servers that allow intensive on-line exercise like generative AI and cryptocurrency, referred to as information facilities.

In its newest built-in useful resource plan, or IRP, Southern Firm subsidiary Georgia Energy forecasts that demand will go up by 8,200 megawatts (MW) by the winter of 2030-31, greater than thrice the output of the brand new nuclear reactors at Plant Vogtle, the primary new nuclear reactors within the U.S. in a long time, which Georgia Energy and different utilities simply spent greater than $30 billion to construct. To satisfy that progress, the corporate is requesting a variety of sources, together with upgrades to present nuclear crops, extra renewable vitality, and enhancements to the general energy grid — however it’s additionally asking to increase the lifetime of heavily-polluting coal crops that had been beforehand slated for retirement.

This transfer is a part of a nationwide pattern. The info middle trade is booming throughout, from Virginia to Texas to Oregon, and utilities throughout the nation are responding by constructing new fossil gasoline sources or delaying retirements, all at a time when scientists agree that chopping fossil gasoline emissions is extra pressing than ever. Greater than 9,000 MW of fossil gasoline era slated for closure has been delayed or is susceptible to delay, and greater than 10,800 MW of recent fossil gasoline era has been deliberate, in keeping with the sustainability analysis and coverage middle Frontier Group.

The backslide into fossil fuels is alarming to environmental and client advocates, and never solely as a result of it stands to decelerate local weather motion and prolong the dangerous results of fossil gasoline use. Some additionally query the purported progress in demand — which means utilities may very well be doubling down on climate-warming coal and fuel to satisfy vitality demand that received’t truly materialize.

When Georgia Energy requested permission to retire most of its coal crops by 2028, the choice wasn’t instantly about lowering emissions. Somewhat, the utility had deemed the crops “uneconomic” — it could now not make financial sense to maintain working them. A key think about that calculus was the price of bringing previous crops into compliance with new federal emissions restrictions. The way forward for that rule is now unsure. The Supreme Courtroom final fall ordered that the emissions rule may go into impact whereas authorized challenges from states and energy corporations proceed. As a candidate, President Donald Trump promised to repeal the rule.

Whatever the motive, environmental teams and enormous corporations with their very own emissions targets to hit applauded the transfer to shut the coal crops.

So Southern Environmental Legislation Heart senior lawyer Jennifer Whitfield referred to as Georgia Energy’s request to renege on some coal closures an “odd choice.”

“It is not only an expensive and dirty fuel that Georgia Power didn’t even want a couple of years ago for some of these plants, but the data centers don’t want it, either,” she stated. “They want clean energy.”

Although controversial, the proposal to delay coal plant closures isn’t precisely stunning or new. Final yr, the Georgia Public Service Fee accredited an influence buy deal between Georgia Energy and its sister firm Mississippi Energy that may maintain a Mississippi coal plant open past its deliberate retirement date. That transfer, too, was meant to cowl rising demand that Georgia Energy stated got here principally from information facilities. Different utilities have proposed delaying coal unit closures in Virginia and West Virginia, in keeping with the Frontier Group evaluation.

Environmental advocates have applauded coal retirements, and are actually decrying the reversals, due to the various unfavorable impacts of burning coal to make electrical energy. Together with airborne air pollution that may hurt individuals and contribute to local weather change, burning coal creates residual materials referred to as coal ash that poses severe well being dangers if it seeps into groundwater. Usually, the prices of cleansing up and storing coal ash are handed on to clients.

“Extending the lives of uneconomic coal plants, especially if tied to energy-guzzling data centers, makes no sense when better investments in renewable energy and energy efficiency are clearly available,” stated Liz Coyle of client advocacy group Georgia Watch.

Whereas information facilities are definitely not new — computing and the web require information servers, and our more and more digital lives demand ever extra information processing capability — the current explosion has taken utilities and policymakers alike abruptly.

Georgia Energy’s planning is sweet proof of that: In 2023, the utility took the weird step of submitting an IRP replace in between its regularly-scheduled plans in 2022 and 2025. Georgia Energy claimed that demand for vitality was rising a lot and so rapidly that the corporate wanted to make and purchase extra energy instantly. The purported demand from massive information facilities popped up so rapidly that the utility didn’t foresee it lower than two years earlier than and insisted it couldn’t wait one other yr to handle the difficulty.

As utilities scramble to satisfy the information middle demand they declare is coming, lawmakers and regulators are additionally taking part in speedy catch-up.

In Georgia, information facilities get pleasure from a gross sales tax exemption on the high-tech gear they should run, which was handed in 2018 and later renewed with little fuss. The state presents many such tax incentives to financial growth tasks, a part of an ongoing effort to stay business-friendly that the governor and different state leaders ceaselessly boast about.

However in 2024, as Georgia Energy’s extremely uncommon request for extra vitality shone a highlight on the large vitality calls for of knowledge facilities, the legislature reconsidered. Lawmakers finally handed a invoice to pause the information middle tax break whereas a examine was carried out to guage the state’s vitality and water sources. Governor Brian Kemp vetoed the invoice. This yr, the state Home of Representatives is forging forward with the examine even because the tax break stays in place and new, massive information facilities proceed to be introduced.

“We want to make sure that we look at how sustainable our energy production is, our energy usage, and certainly our water usage,” Home Speaker Jon Burns stated when he introduced the examine committee.

The Georgia Public Service Fee, in the meantime, has taken steps to handle a significant concern that got here up in the course of the interim IRP. New energy era and transmission infrastructure is pricey, and client advocates and the commissioners anxious common clients would find yourself paying for prices created within the scramble to energy information facilities. So in January, the fee accredited new guidelines meant to forestall the prices from being handed on to others.

These guidelines, fee chair Jason Shaw stated, are only a first step in coping with a quickly altering problem.

“We’ve got to be flexible in terms of keeping an open mind in how we deal with this,” he stated. “And we’re also looking at what other states are doing, because Georgia’s growing faster than most but we’re not the only state that’s dealing with this.”

Policymakers elsewhere are certainly grappling with these similar considerations. In Virginia, the state main the information middle increase, lawmakers have launched a litany of payments on information facilities this yr, aiming to trace their vitality and water use, guarantee residents and different companies aren’t subsidizing their vitality wants, and assess the impression of recent information facilities earlier than they’re accredited. Legislators in New York and Oregon are engaged on comparable measures.

At the same time as lawmakers and regulators rethink the impacts, information middle corporations get pleasure from tax breaks in lots of states simply as they do in Georgia. Information facilities obtain subsidies of some type in 22 states, in keeping with a current report by Frontier Group, Surroundings America, and the U.S. Public Curiosity Analysis Group.

Though the 2025 IRP builds on the pattern of skyrocketing demand predictions in different current filings from Georgia Energy and certainly the nationwide trajectory, some client advocates are skeptical of the corporate’s forecasts. Commissioners and advocates questioned the projections intently throughout hearings final yr over Georgia Energy’s pressing request for extra vitality within the 2023 IRP replace.

“It’s not just a math exercise,” Jeffrey Grubb, Georgia Energy’s director of useful resource planning, stated of the projections on the time. “It’s based on facts. It’s tangible projects.”

Nonetheless, Public Service Fee staffers tasked with advocating for the general public curiosity sharply criticized how Georgia Energy factored these tasks into their forecast, arguing the corporate inflated the chance that the brand new demand would truly materialize. Specialists have additionally questioned the projections from Georgia Energy and different utilities as a result of a number of states are vying to draw the information facilities which might be driving the demand progress.

“I think there is a real overestimation of the power requirements throughout the southeast,” Georgia Tech professor and vitality skilled Marilyn Brown advised Grist final yr. “[The data center companies are] touring states and they’re asking for the best deal that these states can offer them for clean electricity. So what I’m seeing … it’s like double counting.”

If an organization is contemplating constructing an information middle in both Georgia or Tennessee, as an illustration, Brown stated utilities in each states might issue within the massive vitality calls for of that potential new buyer — although in actuality, just one information middle can be constructed.

Even inside the electrical utility trade, demand projections for information facilities are unsure and fluctuate extensively, in keeping with the Frontier Group report. One forecast by the Electrical Energy Analysis Institute finds information middle demand may develop by as little as 29 % or as a lot as 166 % by 2030. The trade forecasts for 2030 cited within the report differ by as a lot as a staggering 200 terawatt-hours, or 200 million megawatt-hours.

The identical report additionally factors to the dangers of inflated projections. Within the Fifties and ’60s, it explains, electrical energy demand grew quickly amid the postwar financial increase and explosion of recent expertise. The North American Electrical Reliability Council predicted this progress of greater than 7 % a yr would proceed, and utilities constructed sources accordingly. However in actuality, the increase leveled off. Tasks had been canceled and utilities defaulted on bonds, in keeping with the report.

The present second, the paper argues, may go both means — and relies upon largely on a alternative as to “whether rapid growth of energy use for technologies such as GenAI and crypto mining are worth the pollution, disruption and costs they impose.”

This text initially appeared in Grist at https://grist.org/vitality/georgia-was-about-to-retire-coal-plants-then-came-the-data-cen/.

Grist is a nonprofit, impartial media group devoted to telling tales of local weather options and a simply future. Be taught extra at Grist.org

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This Story Was Initially Revealed by Grist.

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