Mass. tries to rein in data centers but leaves open questions
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Gov. Maura Healey's latest executive order will test what regulating data centers could look like, in lieu of banning them altogether.
The big picture: Massachusetts is steering away from the moratoriums eight states are considering this year for a middle-of-the-road approach to data center infrastructure, specifically for data centers with peak electricity demand exceeding 25 megawatts.
- Its success depends on whether the state will give the order's restrictions some teeth, researchers and industry leaders say.
Catch up quick: Healey's executive order requires these data centers to sign a benefits agreement with a community before receiving state permitting approval (like those signed by cannabis companies or casinos).
- The order bars the use of non-disclosure agreements "except as otherwise provided by law."
- The data centers' owners would have to supply their own clean energy or pay into a rate-payer protection fund to mitigate utility bill increases due to spikes in energy usage.
Threat level: Data centers are cropping up nationwide to meet increasing demand for cloud storage and, most recently, AI adoption, but they consume water and electricity, among other environmental impacts.
- The prospect of companies building data centers has disrupted utilities in states including New Hampshire, which got flooded with requests for power demand studies for data center projects that never came online.
- That created delays for solar projects and other projects requesting studies to connect to the power grid.
- Healey's executive order calls on energy distributors to charge data centers fees or deposits for power demand studies, which Eversource and National Grid already require for large potential customers.
What they're saying: Requiring a community benefits agreement signals a step toward ensuring local input, but it needs teeth, says Devashree Saha, director of the U.S. clean energy economy program at the think tank World Resources Institute.
- "There have to be other tools and mechanisms in place which can enable local governments to really make [the agreement] meaningful," she says.
- "Of course, the question of how local governments are going to engage their communities right into the CBA negotiation process is going to be super important."
The fine print: The order includes a carveout for data centers using 25 megawatts or more if a project is tied to an accredited college doing academic research, a health care facility or a state-sponsored program.
- The state's executive offices of economic development and energy and environmental affairs would both have to approve such an exemption.
- It also grandfathers in existing data centers, like the Markey Group's facility, which uses up to 40 megawatts, in Lowell and the Servistar Realities project in Westfield, which would use up to 274 megawatts.
What we're watching: Energy suppliers, distributors and regulators nationwide are examining what conditions they should impose on data centers seeking to connect to the grid.