Homeless Issues Committee - Regular Meeting

And so with that, I'm going to call, the advisory committee, for data centers to order. And I thought I had my agenda up, and I don't. Second here. Yeah. So next on our agenda would be consideration of the minutes from our April 14 meeting. Can you do the call to order quickly? What's that? Call to order. Oh, I'm sorry. Call the roll. Thank you. Sorry. Sure.

Richardson? Present. Yalk? Here. Lipperforth? Here. Helm Nelson? Here. Singletary? Abate? Present. Gallagher? Bradshaw? Skandura? Here. Shanahan?

Here.

Posler? Posler here. Marin?

Here.

And Miles? Miles here. Alright.

So quorum being present now, we will move on to consideration of minutes from our April 14 meeting. Is there a motion? Motion to approve. Moved by Whooperforth. Is there a second? Richardson second. Second by Richardson to approve the minutes. Any questions, corrections, anything to the minutes? Hearing none, all in favor of approval say aye. Aye. Oh,

sorry. Aye. Aye. I'm so not used to being a voting member. Step.

Opposed, say no. With that, motion carries. Minutes are approved. Moving on down to status on prior follow-up items and requests. So the way I see this portion of our agenda working is through each of our meetings, we'll be accumulating things that we want some follow-up.

It will be sort of our to do list or staff's to do list to close the loop on some of these topic areas. But in the meantime, there might be an accumulation of items here. So from our last meeting, we talked about community benefit agreements, and there's some some comments and questions around that that I think we need to give some consideration to I think, you know, Laura in particular, mentioned, you know, need for some criteria and and measures, for those. And I I think we're gonna be seeing as we move through the other subject areas that that these that the CBA may be a tool that can be employed and to address concerns in a number of these areas. But last time was in the context of land use compatibility and environmental impacts on ecological corridors and so forth.

So the context there was CBAs to maybe leverage some community benefit around agricultural or agricultural easements or ecological preservation of ecological corridors or an analysis of those and so forth. So more to come on that, I think, but it's certainly something that will stay on the list for a bit. Let's see. Oh, this last item on here, I'm not sure what Ben or Jaren, upcoming meeting topics and timeline. Do we have a slide on that?

Yep. This is obviously subject to change, but one of the requests from the committee last time was to get kind of a sense of what we were gonna talk about in the future, potentially, meeting by meeting. So, this meeting, obviously, is about noise, lighting, aesthetics, and community character. Tentatively, we're looking at our June meeting to talk about economic benefits and the lifetime lifespan of a facility and the decommissioning that would come with that. Potentially, July 14, we're talking about water usage and storm water.

And, we would still have four more topic areas about energy consumption and emissions, electrical transmissions, emergency emergency services, and intergovernmental relations. So those are the one, two, three, four, eight more topics that we would cover. It's gonna be dependent upon speakers and and who we can get, but that, again, is just a potential tentative timeline.

I would also add that those those number bullet points, they're from the resolution. So if you're kind of wondering where numbers are coming from, they're from the authorized resolution for this for this body. So that's, that's what those were referring to. So

Yep. So so Cynthia had mentioned that the next meeting might be nice to see, in the very least, a tentative layout of what we'll be tackling next. And, of course, as Ben said, subject to change, sending out an opportunity and so forth for people to present and be panelists here. Also, in in working with staff and laying this out, it I'm fully cognizant of the fact that this is really optimistic for a timeline, and I I really do suspect that we may need to be extending the life of this committee by a few months perhaps. So so that leads me in a way to the next item on the follow-up items, and that's this Manitowoc moratorium near the end of April.

Manitowoc County adopted a a moratorium on consideration and approval of of development for well, I should say, of permits and so forth for, the purpose of a data center. So, at the outset of looking at and developing the resolution to create this committee, I had also looked at into, whether or not the county could do a moratorium, and it was my assessment that there's state statute that says colony is explicitly prohibited from doing a development moratorium. Manitowoc has, in my view, used some semantics to get around that definition of development moratorium. And since they did it, I'm gonna do it

too. So

so I'll be putting in a Manitowoc did it by resolution, one fell swoop. Oh, and we got it up here on the screen here. That first paragraph actually is a I think it's a long yeah. It's actually a ordinance amendment to their I miss what I'm assuming is chapter eight is their zoning code. For us, it will have to be two pieces basically of legislation.

One will be an ordinance amendment to create a definition of data center. I'll most likely be talking with corporate corp council and zoning division staff about an appropriate definition. And then the resolution would be to employ a more moratorium, and I'm gonna sync it up with basically the the work of this committee. So so I think if we extend the life of the committee for a few months, that would just pretty much be a year from now for for that. So so I just wanna give that update and we'll see how that goes.

K. Any any thoughts, comments on on that? I mean, the moratorium thing is sort of a sort of a big deal. So go ahead, Cynthia.

Can I just say thank you very, very much? That is really excellent news. Really appreciate it. And I think it's the right thing to do. And the other thing I just want to compliment the staff and the committee on the reading background materials that were sent out like a week ago. I found a number of them. I mean, I've been doing a lot of research, but I still keep learning things. And so the one on noise pollution and the one out of Virginia were particularly informative, especially the data center industry cash campaign contributions and all these match nations that we can kind of feel and see hints of behind the scenes.

But Mhmm.

You know, it's kind of documented in some of these. So I really felt that was, you know, useful. So thank you.

Yeah. Thank you. Alright. Anything else? And we will if not, we'll move on. We don't have any reports to the committee. Correct? So one let's see. Oops. I jumped ahead.

Sorry. Presentations and discussion. Today, we have in the to talk to us about community impacts, but I also want us and I and I think Majid or somebody had sent an email out indicating that our guests today and the work they've done have have looked into a number of areas that we're looking at. So we've invited Mark Gribbon from, state of Virginia, the Virginia Joint Legislative Audit Review Commission, to discuss the work that they've done on the subject. And and we've invited him to feel free to go beyond just talking about community impacts, but some of these other related issues that we're we're wrestling with ourselves.

So welcome, Mark. I'm assuming he's online and ready to go. So k. Good.

I will stop sharing, Mark, and give you the keys to share your slides.

Mark, thank you so much for joining us today and sharing the experience and perspective of your work.

So Thanks for having me. Appreciate it. Can you guys hear me alright?

Yes.

Alright. Let me pull up my slides here. While I'm doing that, I will let you know that I'm making my first trip to Wisconsin next month. I'm going on a paddling expedition around the Apostle Island, so looking forward to that.

Oh, nice. Beautiful. Beautiful.

Can't go into Colorado this year because it's too dry. Yeah. Alright. Let's see. Is that I can see it. Is that

alright.

Okay. Is that full screen for you guys?

It is now. Yep.

Alright. Terrific. So, yes, good morning. Mark Rubin from Virginia. I work for a small state agency called JLARC, and, we are a legislative branch agency, and we do, nonpartisan objective research on subjects as directed by our general assembly. Today, I'll be talking about our 2024 study of the state's data center industry. And even though it's, kind of specific to Virginia in many ways, there's lots of lessons that are applicable to y'all in Wisconsin. So skip to the beginning. What are data centers? It's just overhearing guys talk.

It sounds like you're pretty up to speed on this. So data centers are are key hubs of the world's digital infrastructure, and they support our our modeler and digital economy and society. The industry has been growing very rapidly in the past couple of years, not just in Virginia, but everywhere else as I'm I'm sure you've noticed. That's happening to, one, support the ever growing use of cloud and digital services, and two, of course, with the growth of AI and a lot of the big bets that are being placed on AI by AI by IT companies. In Virginia and, really, in the rest of The US, there's really four companies that are driving most of that growth.

So you might have a data center bill being built by QTS or, was it, CloudHQ or any of these other companies. A lot of times, they're doing it under contract with one of the big four. So they're they're building a facility. They have a lease in hand, and they're building that to rent out the whole facility to one of the big four. Modern data centers are large industrial scale buildings.

If you've never seen one, they look, like massive distribution centers. They can have footprints that are bigger than a basketball arena or even a football stadium. They're filled with computer servers that generate a lot of heat. They employ these massive cooling systems. Powering all that computing and cooling, of course, requires an enormous amount of energy, so they often have their own electrical substation on properties served by a nearby transmission line.

A modern data center uses substantially more energy than most other commercial or industrial operations. Back in the olden days of ten years ago, a 20 megawatt facility was the biggest you'd see, and that's, about equivalent to a a midsize automobile plant. However, the hyperscale centers that are built now are much larger, drawing from a 100 to over 200 megawatts of power, some approaching 300 megawatts. And I think as someone was discussing, the the trend is to build these multi facility campuses. And depending on the size of that campus, the total draw could be well north of a thousand megawatts.

By comparison, we have two nuclear plants and four nuclear reactors in Virginia. Each one of those reactors is a little shy of a thousand megawatts. So, you know, one data center campus is half the output of a nuclear power plant in Virginia. Our data center market is concentrated in Northern Virginia in the suburbs of Washington, DC, but, now we're actually seeing that expand, southward towards the middle of the state. Virginia's data center market is the largest in the world, accounting for about 13% of global operational capacity and 25% of capacity in The Americas.

That's us on the left. We became market leader for a number of reasons, including being located near the birthplace of the Internet, being close to the federal government and its contractors, strong fiber network, reliable and cheap energy, and the state sales tax exemption. All those serve to sort of help grow this industry. The point here and and in bringing that up with you guys is that we've been at the forefront of this industry. So we've probably encountered a lot of the friction points earlier than others have, but now we're starting to see, those friction points emerging pretty much all across the country.

So, hopefully, I have some good lessons to share with you. So first, I'll talk about those local community impacts. And if y'all have any questions at any point, feel free to to shout them out. I can't see you right now because of the way my slides pulled up, but I am listening.

Alright. Thanks.

So first, we found that a growing number of data centers are being built close to residential areas impacting nearby residents, and some localities have taken steps to try and minimize those impacts. Again, because modern data centers are large industrial facilities, they are largely incompatible with residential use. In addition to the building size and appearance, they're often surrounded by security fences and lighting. They regularly test these diesel generators, and they have massive cooling systems that have the potential to create noise. They often, as I mentioned earlier, have an electrical substation that's located on-site or close to the property.

In some cases, new transmission might be get built to serve them. That could either be, a quote, unquote extension line from, the main transmission line or what you see in Northern Virginia where you have these high concentrations. They've had to run several additional transmission line loops to provide additional power and redundancy for to serve the high concentration of data centers. So all else to say that this is a modern data center. It's not like, they were in the old days or not like an office building where you can kind of innocuously put that in next to a neighborhood.

These are industrial facilities. So even so, we found that about one third of operational data center properties in Virginia were within 200 feet of residentially zoned properties. Part of this is artifact of of where these were built. They were built in these growing, exurban neighborhoods that are now or exurban counties that are now pretty much fully suburban counties. And so we have data center growth happening alongside, some of the fastest growing residential areas in the state.

So even though these are over 200 feet, that doesn't mean, you know, they're exactly 200 feet apart, but they're still pretty close. Those property lines are are are right abutting each other. And you can see a couple of examples of this of neighborhoods, either actually that exist or that are planned, and how the data center properties abut to those neighbor neighborhoods. There's also many others in addition to the ones we found that were under construction or planned that had not yet been built. So we have a couple examples of those planned ones as well.

And, again, we could have pulled a number of other examples. There's there's a lot of this going on in in in the counties where, most of the the industry is located. So localities, the question is why do why is this happening? Localities allow data centers to be built next to residential for two reasons. The first appeared to be inadequate planning and zoning.

So some localities were still thinking of data centers like office buildings, which is kind of how they were before. And so they had them as a nonindustrial use, which allowed these now industrial facilities to go into areas that were zoned for commercial or mixed use. So essentially a mismatch between what they were thinking of a data center was and where, what it really was and where it could go. In other cases, there were some zoning changes over time, and the counties hadn't updated their zoning maps. So for example, somebody wanted to build a neighborhood and an agricultural zone, so they rezoned that agricultural to residential.

They built a neighborhood there. Well, that agricultural zone was next to it, industrial zone. That never got changed. Then the data center comes in by right in that industrial zone, and now you have a data center right next to the neighborhood. So that was one way it worked.

The other the other way it worked, and we see this a lot, I have seen this a lot, is that the elected boards were approving special permits or rezonings for specific data center projects even though they were clearly close to residential areas. It's pretty notable that sometimes this was happening against staff recommendations or against the planning commission recommendations. Get don't know how you guys are structured, but in Virginia, at the county level, we'll have a planning commission. We'll have a board of supervisors, and the board of supervisors has that final authority. So while it's the board's prerogative to approve those projects as elected officials, it's not necessarily good policy.

Ever since, really during the report and even more so since then, we've seen localities taking steps to better manage future development. For example, Loudoun and Fairfax Counties, which are two of our big Northern Virginia localities, a lot of the data centers. They've reduced the number of zones that allow by right data center development, and they've also made zoning changes to address a number of developmental concerns. So pretty strict restrictions on heights, setbacks, all those kinds of design considerations. And so while it looks like locales are responding to resident concern, the success of those efforts ultimately depends on the elected boards because, again, they have the authority to grant exceptions to whatever new rules are put in place.

I think somebody had mentioned a noise, being one of the special concerns. That's that's definitely a special concern when it comes to data centers. So I would say that every data center is different. So some data centers, you can stand right outside of it, and you won't hear a thing. All you'll hear is, you know, traffic on the street.

Others, you can hear that data center when you're driving up the road to to go see it. The noise that they make is like a sort of constant low frequency drone or so similar to a commercial air handling unit or, you know, maybe a window AC, but on a much, much more magnified scale. While that noise isn't loud enough to damage hearing, in a few cases, it has been significant enough to affect the well-being of nearby residential areas. So for example, there's one terrible story we talk about in the report where a family's house was positioned just wrong on a small hill above a data center. And, the way that the noise came off that data center and the way the house was positioned, essentially, house was kind of vibrating with the and the family had to sleep in the basement, because they couldn't sleep in their bedrooms.

That's really the worst case scenario we found, but there are plenty of other cases where, you know, that noise has been constant in a neighborhood and has been bothersome for residents. Resolving noise problems is really hard to do. That's in part because, again, speaking to Virginia, local our local noise ordinances aren't designed to deal with that type of situation. Our ordinances are typically set up to deal with the, the party issue or the barking dog issue, not a constant low frequency from an industrial facility. So the way it's set up is, you know, you if you violate the noise ordinance, it's so many decibels, your party's too loud, I'm gonna give you a 150 fine.

That really doesn't work in this situation because, one, that the noise might not be long enough or or, sorry, loud enough to trigger the violation, because it's, the is is a different sort of decibel system that I can get into a little bit if you're you're interested. But, you know, a a low low frequency, decibels can be measured differently from, you know, when a party or barking dog is. And, also, a $150 civil fine, that's not really gonna dissuade anybody from doing business. So one of the things to think about is the best way to resolve a noise problem is to never have it, and that can be handled by not allowing data centers close to residential areas or to to other sensitive areas like parks or schools. Again, the one thing that we're concerned about in Virginia because of our our our state motto is based on our history.

We have a lot of historic resources such as battlefields and archaeological sites. A lot of these are up in the areas where a lot of the data center development is happening. And so, you know, just like any other development during construction, any on-site or nearby historical resource can be destroyed or disturbed by development. After construction, if you have a a data center, for example, as was proposed and now may or may not happen, There's a giant data center facility campus proposed to go next to Manassas Battlefield National Park. The part of where the the data center is gonna be built was part of the actual historical battlefield.

So the concerns about not only disturbing, historical artifacts from the construction, but then it would also the campus would be visible from the national park. So to help understand what those potential impacts are, you can do these things called predevelopment studies. In Virginia, we call them phase one studies, which is basically looking to see if there's anything of historical significance that could be affected by development. If you find something, you can do additional studies, phase two and three studies to determine the significance of what's what's there and, determine ways to mitigate those negative impacts such as, you know, this is how we could preserve this historic structure or this is how we could, you know, unearth and relocate these artifacts, or at the very least, we can document what's there to allow for future research. The other type, I think, I touched on was a viewshed study, which examines, you know, if we build a data center over here, what's the view what's it gonna look like, and how visible will it be from, for example, Manassas National Battlefield, which was a viewshed study they did as part of that project.

This slide summarizes several of the practices we found localities should implement to minimize community impacts from data center development. For example, it's important to classify data centers as an industrial use or whatever your equivalent is. Make sure your zoning maps have been revised to prevent buy right projects next to residential or other sensitive areas. Make sure you have the minimum requirements in place, like setbacks and building heights that are appropriate to keep development from intruding on residential or commercial neighbors. That would also include, I think, one of the things in in y'all's mandate about the lighting.

Again, these are secure facilities, so that lighting is on all the time. Another reason why you don't want that right next to a neighborhood. You can also consider aesthetic building standards and landscaping requirements, for facilities that are highly visible to the public. Again, the idea there is that if you build this data center in industrial area, you don't really care that much what it looks like. But if you've got something next to commercial or that people are gonna be driving by every day or close to a residential area, then the appearance of that facility becomes a lot more important.

It's also important to deal with that noise issue up front, which I think I already mentioned. So if a data center is going to be close to residential or other sensitive areas, you should probably require sound modeling studies to see what the noise impacts might be. There's a lot of variables that go into if and how a data center can be heard and from where. So one is gonna be that data center's design, especially the cooling system that it's using. That's what generates the noise.

And then there are topography considerations. You know, if that's in a a valley and you have a residential area on a hill, well, that sound's gonna go straight up the hill to the residential area. So sound studies can help get a handle on if if and how sound might be generated from that facility and how it traveled to the surrounding area. You can also revise your noise your your ordinances to make noise violations enforceable through zoning requirements. So instead of having that as a, sort of a a civil or criminal violation, where there's a penalty, a civil fine, If you have it in zoning, you can give it a lot more enforcement teeth, you know, because now you're in violation of, you know, how you should be doing business.

If the project is an area that's close to historical site, again, it's probably a good idea to at least do a phase one study to to figure out if there's anything there that should be preserved as well as if there's a historical site nearby. You know, what would it you know, how is that can how's that development gonna impinge on the view shed from that historical site?

Mark, before moving on, quick question in regards to accountability for violations. You mentioned, of course, you know, you know, fines aren't aren't especially when you're working with a in an industry where there's these deep pockets, what what what have, local governments or or even the state done in the way of creating real, teeth for accountability?

And for for noise in particular?

Well, let's let's since that's what we're talking about here, sure. But but, for any type of, zoning or conditional use violation.

As far as, the the noise in particular, I think one of the issues we found is that nobody had, any really strong enforcement mechanisms. So that that was one of the things they were, looking for was a way to better bring facilities into compliance with, noise standards so that or not necessarily compliance with noise standards, but eliminate the conflict that they were having with the neighbors. And so I think the the suggestion is by putting that into your zoning, you can then have actual teeth in terms of, well, you're in violation of of how you should be operating as a business. So now things like your business operating permit are on the table, which is obviously a pretty nuclear option, but it is one with, a lot of teeth as opposed to basically having no leverage at all and just say, wish you guys would stop making this noise. Here's a $150 fine, but I don't even know who I'm supposed to find.

Am I supposed to find the guy who's working at the desk, or do I send this to, you know, Amazon or or Google headquarters? Because I think that's from the noise perspective, that's why the more you can put into zoning and you can then have the the business operating license, the occupancy license, all those things can be used as ways to, bring that facility into compliance in theory. Again, we haven't seen it played out, in fact. In terms of other things, we just rely on our regulatory regime. So for example, during construction, there's a problem with stormwater management, and and then that just goes through that regular regulatory, you know, regime for stormwater management.

Thank you.

Mark, can I quick ask a question, please? Yeah. About two slides ago, it was a word I had never seen before, so I'd appreciate you telling me what it means, and I'll tell you in a second. And so it was like examples. And if you could explain roof tearing, and then the word was fenestration?

Roof tearing is what I I've kind of made up. Okay. So that that's just sort of instead of having a big, monolith, you know, like a big giant box, you can have a tiered roof. You can require that in zoning. I'm not sure if that's exact term that a zoning person would use. I tried to look that up to figure out what their exact term was. I know we heard it somewhere. Anyway, so instead of having, you know, here's the curb, here's a parking lot, here's a 60 foot edifice, that could be broken up by having a tiered roof. So it's, you know, it's 30 feet, then it goes back a little bit, and then it goes up to the full 60 feet.

Does that help with noise also when the hill example you gave, the

poor family in the basement? It's really just aesthetic. Okay. I think. I I'd have to I defer to a sound expert, but, you know, for the most part, all the equipment is on the roof. So it might push it back a little further, but I don't think it would really have a big effect on on noise. Fenestration is an actual word. That's what they call, so these things, they're again, they're like, distribution centers. So there there's no windows. It's just all they need is a big concrete wall, but that kinda looks ugly. So in some places, they've required, fenestration, fake windows, basically. Seriously? It looks more like an office building.

Oh my goodness. Thank you.

Because keep in mind, in Northern Virginia so a lot of these are in industrial areas, but a lot of them are right by roads, and that was one of the things that that's come up in a couple of places.

I've heard roof tearing called step backs.

That might that that's what I should have put on that slide. Alright. Next. So that that was most of the the items that were pertinent to your agenda today. So I'm happy to talk about those more. Or if you guys wanna I can cover some of the other stuff from our study, which relates to some of your other areas.

Can I ask one more question?

Yeah. Go ahead.

So, I'm a town elected, and, this is in a whole different context, but we had, a noise pre development complaint or wanted to have a noise sound study. It was very hard to find somebody. We finally did, but they operated in one to two states over. So, you know, it was kind of expensive. The good news is we had insurance.

But they're not very plentiful. I mean, who is qualified to really do proper modeling and proper both before and during and after if you have issues? I mean, it'd be great to have like a place that not recommending them, but just saying, here's a list of people who are qualified, because it's very hard to find them. It was kind of connected through a university thing. Word-of-mouth is how I found it. But just curious.

Yeah. That's a good point. I think that's come up in Virginia as well. So in some cases where they've had required these in the past, the company has found somebody. And then, of course, the residents don't trust, what the company's health study said. But, in some other cases, yeah, there there's not there's not a it's not a big industry, out there for that. So, yeah, I couldn't really give you any any good insights into to how to find folks. I know in one of these neighborhoods where they had a lot of problems, they had a former NASA slash submarine engineer, and he designed his own science studies for the neighborhood.

Oh, let us do that.

So if you have one of those, that could help. But, yeah, I really can't can't can't help you out much there, unfortunately.

You know, Mark, this is Laura Scandura. My husband was an acoustical engineer, and he worked in Washington DC and did a lot of ship silencing and submarine silencing as well. And that firm could help the people on on the house and the hill too to figure out that residence. So they are out there.

Is he still working?

Yeah. But something completely different. But the firm is still around. If you want, I can give it to you.

Yeah. I I'd be curious.

Mark,

I I'd like to ask a question. So the most egregious sort of noise offenders, I guess, were in the range, you said, of, like, 40 to 60 decibel, like, low drone. Was that right?

No. That sounds right. Yeah. I think, yeah.

Yeah. I you know, I I'm sure there's some sort of fundamental difference, but I know Texas, has become kind of the hotspot for crypto mining, and a lot of the same aspects go into those facilities when we're talking about cooling and, you know, trying to minimize noise. I know some of the most egregious examples of crypto mines are up to 80 and even a 100 decibels, and they're having trouble. I I'm not sure how sustained those 100 decibels are, but there are consistent violations on some of those facilities up to, like, 85 decibels sustained for hours on end. And I'm just wondering what is the what's the difference between the data center and the crypto mine, and what's what's kind of hold I and I don't expect you to know this, Mark.

I'm just kinda thinking out loud.

Actually, if I could just Yeah. The ATC substation in the town of Middleton on Highway 14, I don't know from a technical point of view, but go there. I mean, you can't there's no trespassing signs because you can drive in a little way. Sure. I mean, there's actually a study from The UK where you can run a drill without having it be plugged in under one of those. That's what's and you can kind of see it on really damp days, and you can hear it. And it's this very it's almost like a buzz. I mean, it's I it's intermittent, but it's in so many seconds that it's like it's constant. Yeah. So I don't know.

That's why it'd be good to find some objective true experts to be able to that would be a great session.

Yeah.

We could find such people because they're rare and hard to find.

I just find it surprising that Texas is is dealing with such noise issues with crypto mines, and there's such a drastic difference in the kind of complaints and levels that are that you're seeing in in Virginia versus what they're seeing in Texas. And, I know there's there are different types of facilities, but you would think it's somewhat similar.

They're they're basically doing the same thing. My guess would be that so one, it the the amount of noise that you most of that, if not all of it's coming from the cooling system. And depending on so depending on the cooling system you're using, you may be generating almost no noise to a fair amount of noise. The second part is how cheaply constructed is your facility. And so these data center facilities are at least building them for you know, to last fifty years.

And so there there's they're expensive facilities. They're putting some good investment into them. I would guess that the quality of the mechanical equipment is gonna be higher than you would find in a a crypto mining facility because those are a lot more fly by night. They don't necessarily care if that's gonna be there in fifty years. They might only be building them for, you know, five years or ten years.

So my guess would be the quality of of construction and the quality of, equipment would probably account for that difference. That said, even within the data center industry, you can see, there's some facilities built by some companies which tend to be the ones that have the noise problem, and facilities built by other companies which tend to not be a problem at all. And I get a lot of that design, but also some of that is is is cost and equipment. Yeah. So I'll leave that there. If you want to ask, I could tell you who's who. But

Can I just ask one other quick question on this one article that was sent to us as background on noise? There's a quote in here from an Amazon spokesperson, and they're talking about redesigning their products to significantly reduce sound or noise levels received at properties adjoining data center facilities. How could one get more information on what's a good sound noise mitigating design versus I mean, you mentioned the quality of construction and how long its life expectancy is expected. But do you have any insights on that?

I think that would get pretty technical pretty quick. One is you could look at you know, just model off another facility and then see if there's a facility that that it, you know, that it squares up to. But, yeah, I I I think it because, like, even if you're talking Amazon so Amazon was the one that was a problem and where the the family was sleeping in the basement by the Great Oaks neighborhood. They the the you know, they were trying to figure out why it was so loud and how to reduce the the sound. And one thing they did was they realized that their, I guess, the intake fans are probably getting that wrong, were were too narrow.

So they made them bigger and that then reduced the amount of noise coming off that facility. There's also something to do with you know, they didn't have some sort of venting that was then creating some sort of weird noise, reverberations. So it's it's it's a really technical area, and I don't I don't know if there's any I don't I don't know how you address that aside from getting somebody who is an expert, in a sound study to try and look at the design compared to other designs. But as a layperson, I don't know if there's there's much that that, you know, I could do to try and figure that out.

How about getting the University of Virginia or some other esteemed and UW Madison with their new computer center to try to get a program to train people? That would be a great idea. That would be a recommendation possibility.

Yeah. Somebody. It would it would because of the variance in data center, construction, you you would have to figure out, like, each data center is gonna, you know, unless there some some companies will replicate them. A lot of them are it's a unique design. So one data center, what you would expect from it might be different from the next one just because of the different equipment, different building height, where things topography is located. So, yeah, there'd be a lot of variables to consider.

We

had one data center here. We had emailed you about it. It was in an agricultural area. I'm wondering if you've found and, obviously, you're probably more urban. Any impacts on noise to livestock or wildlife, particularly? Because I think we would see that more here where that's where you get more bang for your buck for a larger data center is to be placed in agricultural area.

A lot of the development that's happening in Virginia now is pushing into agricultural areas. So even Loudoun County, which is data center capital of the world, that county was historically half developed and then half being preserved for for, as rural. Prince William County kind of similar, and so you're seeing a lot of pushing in. In terms of actual effects on on you know, other than elimination of agricultural land, which is a pretty clear effect, it's not really clear or we didn't find a lot of information on how that might affect, you know, for example, livestock. We heard some anecdotal concerns, but nothing nothing concrete.

But, yeah, that's definitely pushing on the rural areas in Virginia as well. I don't think we have quite as much livestock as you have in Wisconsin, but we do, you know, we do have cattle farms and and I guess some I guess we don't have any sheep farming. But, yeah, I don't think I have a good answer for you on that

one. K. Thanks. So, Mark, I'm curious from an environmental standpoint. You had mentioned the lighting around the data centers. Is there an issue then for migratory birds with all of that light, at night? Did

you look

at that?

That's not something we we looked at. Again, there's another there's a number of potential impacts on the surrounding environment. Those lights tend to be, pointed down. So I don't know if and how that would affect migratory animals. Sort of bigger picture on that environmental piece, because most of these are even though it's pushing out into more agricultural areas, this is in Northern Virginia, which is a pretty heavily populated area.

It's not like we're building these in, again, talking with with, you know, wildlife experts and environmental experts. We're building these in Southwest Virginia or in the Appalachian Mountains where we have our biggest, most diverse ecosystems. That would have a much bigger impact on the environment than it would building these in, you know, basically an expanding suburban area. I should say ecological impact. But that even in that case, they are having cases where there are projects that where they found some ecological niche and, you know, that that we're relying on our existing environmental protections to avoid or keep that stuff from being destroyed.

So I think in this case, it was a rare sort I can't remember what it was, but it was a rare very rarely occurring top, ecological feature involving mosses and salamanders, that, needed to be protected. So even even in even in a suburban area, there's still there's still environmental concerns.

Mark, you talked about the development on the historic battlefields and that data centers may not be appropriate. Wouldn't it be true that maybe not any type of development would be not appropriate on those battlefield sites?

I think that that's certainly an argument. Again, I I have my own personal views as an organization. We're agnostic on that. But, this particular site or particular area, at one point, they tried to develop a I think there was an it was gonna be a location for Disneyland, and that got shut down. Then there was gonna be a Walmart Supercenter, and that got shut down. And then there was data centers were the latest attempt to develop XFAT Battlefield. And that court case was decided pretty recently, so it looks like it got shut down again.

K. Then my other question is in regards to noise, when you look at if you're living near an airport, obviously, there's a lot of noise. The the issue from what I'm hearing is the constant of the noise, not necessarily the the decibel level. Is that true?

Yes. It that's that what it is because, again, it's not loud enough to damage hearing, but it's a constant thing. And it's it's because it's a low frequency. You know, if you're stood in front of a speaker with, playing bass, it's a kind of sound that that, if it's hitting just right, you can you can feel it. And that's where the example of this house where, you know, they they this this homeowner again, this is the this is the worst case scenario that we heard in entire study.

But, essentially, he couldn't stand the so he changed his windows thinking that the new windows would do a better job of keeping out the sound, but then the windows the new windows started vibrating from the sound. It actually got worse. But, again, not all I just wanna I just wanna be clear that not all data centers create sound. There are definitely some problem children that we came across, but that doesn't mean that all of them were were were noise problems.

But all data centers do emit a number of different wireless frequencies. Is that right?

That I am not aware of. We did not get get into that.

At all? No. Really?

Okay. I just wanna check with supervisor Meron. I you know, since I can't see you on the screen, I do have the chat window up, but just wanna check if you had any questions.

I'm all good. Thank you for checking, though.

Sure. So I have another or maybe a couple questions. First, yeah, you

Should I just should I just turn off the presentation? Like, so

Sure. If there if that's your last slide, that that'd be

Well, I I have additional ones on some of bare metal stuff, but No.

No. Leave it up then. Leave it up. Okay. So, you you know, you had some consideration in in one of your other slides of some design standards and so forth to address aesthetics and and whatnot.

But also, sounds like there could be some construction standards employed to mitigate sound and so forth. And I'm just curious if localities in Virginia or the state has done any work in, creating, standards that that are codified in building code?

We do have a a uniform state building code. So it it that but the in terms of putting special requirements on data centers, that's really more of a local issue because the building code is just, you know, what's safe and structurally sound. In terms of, you know, we want something to be less, obtrusive, or for aesthetic reasons, that then is something that comes down to what the locality wants and how and how they're making their their, you know, plan, project plan approvals, facility approvals, development approvals. And so you have seen I sent a couple of these to to Majid. There's a couple of counties in Northern Virginia, especially, that have put in, sort of the data center, you know, ordinances that have a lot of, requirements for things like setbacks for, landscaping, for building heights, that kind of thing.

So that's or lighting, I think, was one of things that came up. So those those specific things would be at the county level. And, again, Majida, I sent him a couple of links that would be helpful for for that.

Okay. And, another thing that could could contribute to noise, among other things, would be some of that's intermittent, but it's it'd be the exercise of the generators for these facilities. Is there any what what what consideration was there of that in your report?

Yeah. So there's there's really three things when it comes to noise. One is what we already talked about, which is the operational thing. Operational noise, that one is by far the worst or has caused the most conflicts, I should say, because that is something, as you said, which is it's constant. The generator testing, again, if you're living near a facility, there's a lot of complaints, from folks nearby about the generator testing.

They wanted to do it in the don't want them to it the morning, don't want to do it the evening. So that has definitely been a sore spot, for some residents. But, again, we didn't see the didn't have seem to have the of the same level of of, concern as the operational impacts because that is intermittent. It does go off. You know? I live in a neighborhood where on any given day, somebody's mowing a lawn or or running a leaf blower is kind of the same as somebody testing a generator, at least in terms of the the sound it it makes. The last one is construction noise. So a data center is a big project. Takes a year, year and a half to build one, and that's pretty darn fast, but, you know, it's still a long time. You're building a data center campus.

What happens when they're finished building that first data center? They move next door to the next data center. So some of these construction sites, could have cons or some of these campuses, you get construction ongoing for for years. And, obviously, that does create a lot of of noise, and that's another source of of noise concern to neighbors, and another reason why not why you should not have these right next to a neighborhood.

Yeah. Anybody else with any questions around community impacts?

Actually, I have one.

Yeah. Go ahead.

So, Mark, with the diesel backup generators, is there, are there have you looked at any pollution standards? I know I've read a lot about people saying they can even smell the fumes in their homes.

Well, that is my very next topic area. Do want me to jump launch into

Actually, before you delve into that too much detail, I guess, it's it's sort of a transition to that. But my next question, and that is, one of the things we'll be subject areas we'll be looking at is, I guess, the impact or demands for emergency management. And so I'm curious about what what, you know, what your insights on on that are, in particular, again, looking at community impacts, what types of, you know, unique materials might be used, both in construction and operation of a facility, that might pose risks, say, if there's a fire, that maybe normal fire suppression materials would not work. So

I don't think we got into that, in specific. I know that there's a concern that so, for example, the the main thing in here that will be different, from another building would be the the the volume of computers. So you have, you know, your, all the rare earth minerals, all the stuff that goes into computing chips, all all that is in there. So if there was a a big fire, you know, what's that emitting? I guess, would be the the to speak the angle you're talking about.

I think the concern that we had heard more was about what happens to those materials because, computer server lifespan is about three to five years. So what happens to those materials after? So we looked into that a little bit. Basically, they get recycled. So but, yeah, I don't I don't I don't know about in terms of if there's a fire, if there's extra risks. Again, these are you know, these facilities have to meet whatever their fire standards are, and so they should have pretty effective fire suppression systems. I understand those don't always work. Right? But, you know, if you're spending billion dollars in a facility, hopefully, you're putting in a decent fire suppression system.

Something I hadn't considered was the useful life of the equipment. That's a good thing to think about. So thanks.

We do have a in our report an appendix on that. It's been a while since I looked at that one, but we have a little one or one and a half pager on on what happens to that equipment, what house disposed of.

Okay. Well, we all have a link to that, so thank you. And then, like like I just said, we have a link to that report, but, I think it would be, helpful to if we if you could forward to us to staff a PDF of your slides too. Yeah. Sure. Thanks.

And I know probably over my time, I'm happy to get into this discussion. Or okay.

I I think there's interest. Yes? Remokes. So, yeah, we appreciate your time. So absolutely. Go ahead. So

to the the the backup generator point, so data center backup generators do emit pollutants, but their use is minimal, and existing regulations can help curb those adverse impacts. So to that first point, data centers rely on a large number of diesel generators for backup power. You know, they have enormous energy use. They need to stay online twenty four seven, and so they have these diesel backup generators, which is the industry standard. These are, you know, these are the the the backup generator I have in my shed.

These are tractor trailer sized industrial generators. There's easily north of 50 of these, for one data center. Those generators, because they're burning diesel, they emit several harmful pollutants that contribute to the development of smog and can have other health effects. For that reason, in Virginia, they're regulated by using state and national air quality standards. So in Virginia, all these generators must be permitted by our Department of Environmental Quality.

The permits set limits on their use and the amount of emissions they can emit over the course of a year, and then the emissions are monitored for compliance. In practice, the backup generators are rarely run for prolonged periods. I think as we already talked about, they're mostly run for maintenance testing. That happens about once a month for ten to thirty minutes per generator. So if you have 50, you can imagine that you're probably running one or two of those every day for maintenance testing. So if you're a neighbor, that might not be something that you wanna hear. They do run for longer periods during outages. So if the power goes out, those things are all gonna click on. They're gonna run until the power comes back on or they hit their emissions limit. However, data center companies report they experience few outages.

Again, this is because, you my house, your house, the building you're in is served by the overhead distribution lines. That's not the case for a data center. They are served by a transmission line, which goes to a substation. That substation's powering that data center. So any outages are usually due to a localized problem.

So the a squirrel in a transformer at the substation is one of the examples we heard or somebody, does a fat fingers move and cuts the cable that's running from the transmission or from the substation to the data center, and the power goes out, and then the generators come on. So I don't mean to, so for those reasons, because they're not really being used that much, we found they're unlikely to harm the regional air quality in Northern Virginia, which is a nonattainment zone, which means there are some air quality concerns in that area. They're basically a small part of the emissions, overall emissions, and overall emissions in the region are going down. All that said, there are two real risks to consider here. One is the worst case prolonged large scale regional power outage.

So we get a hurricane and the transmission lines get knocked out. In that event, all those backup generators are gonna kick on. And if that outage lasts long enough, those emissions are gonna contribute to air quality concerns. So there's gonna be a lot of diesel going diesel fumes going out all at once for, you know, a couple of days maybe. Fortunately, those outages are rare, and once the event is over, the air quality would return to normal.

The other risk, which I think one one of y'all pointed out a minute ago oh, excuse me, Is that in there could be localized concerns. So if you were in a neighborhood in Data Center Alley in Loudoun County, you were in the vicinity of a 100 facilities. Each one has, you know, 50 backup generators, and they're testing two or three of those every day. That's emitting diesel fuels fumes that on a regional scale are not that significant, but they might have localized effects. Because, again, there are is particulate matter in there that can be harmful.

Nitri nitric. I'm gonna I'm gonna get all the chemicals wrong, so I better not not guess. But there's some some form of nitrogen particulate matter and then a third one that I can't remember off the top of my head. Anyways, that's that's not things that you wanna be breathing. So that's the concern that if if you're living close to that area, you know, how much of that is going up and going away that you never breathe versus how much of that is lingering at the surface level. And so we would have had some recommendations to look at this, but our our department of environmental quality has already launched a study to monitor those emissions and see what the potential health risk might be.

Mark, can I ask a quick question?

Yeah.

Two different things. I've been reading about how there's a Elon Musk in Memphis, Tennessee, Big problems with the diesel generators. The people can't breathe, and nobody's going to help them do anything from these data center turbines. I'm reading about in Texas how to sidestep all these types of good intentioned regulations. They're just doing everything private on a piece of property. I'm just wondering if you have any knowledge of anything like that in Virginia and give us some flavor around it. And then just thinking out loud, what happens to the property values of any homes that happen to be near a data center? I can't imagine it helps the value. On

the first question, are you talking about on-site generation, like gas turbines and that kind of thing?

Yeah. The diesel gas turbines. There's like, it's all private, and they're not using all the things you're talking about. Have you

So it would be gas, not so these are diesel generators. So it's like, you know, diesel that you put in a truck, which is different from a a gas turbine or behind the meter generation, which would typically be a gas turbine.

Are you talking natural gas?

Natural gas generator.

Yeah. No. They were saying it was diesel fumes, but I don't know. It was just news reports.

Well, we know that just, in terms of the backup generators, diesel is sort of the standard. There is this big move to behind the meter generation. We had not seen much of that in Virginia at the time of our study. There's only one, data center we found that had on-site behind the meter generations that had a gas turbine on-site, and that was because there used to be a a factory or something there and was left over from that. So and and some have been proposed in Virginia, but they if if you think it's if you think it's hard to get a data center built, try building a data center with a gas turbine attached to it.

At least in Virginia, that's a local, use decision. So so, we haven't seen a lot of that happening. And what was your other question? I'm sorry.

About property value impacts, if there's been any study for residences near a data center.

We did look at that. It's it's really and after the last, I was trying to look at the effects of things on property values. Figure out the effects on property values is very hard to do. So for example, all the neighborhoods around all these data centers in Northern Virginia, the property values have been going up. And that doesn't mean that that having a data center nearby isn't somehow affecting the value of a particular property.

But if you're, you know, if you're the on the if you're backing up to the data center, I'm pretty sure that property value is affected from being backing up directly to the data center. But if you're in that same neighborhood, but you're two streets over, there might be zero effect from that, especially if it's not a data center that doesn't make any noise. So it's we we were not really able to to to tweak out how property values are being affected because, generally, they're they're going up. There is also this strange effect where property values as a whole are going up because of data centers, because a data center company is willing to spend a lot of money to go where they want to go. And so you're seeing a pretty insane, I would say, pricing per acre, around places where data centers want to go.

We're talking millions of dollars an acre, to build to buy plots to build these facilities on. And the effect there then is that, one, is it's has priced out other development. So if I'm, wanna develop, you know, single family homes hard enough to do that already in in Virginia. But now the you know, it's, you know, even I wanna do a high density residential development, I might not be able to I might be priced out of that because the data center companies is owning that land or that big tract. That's one thing we've heard a concern from from, you know, residential developers.

The other interesting thing is you're seeing that property owners will be like, oh, well, I don't wanna live next to this data center. Hey. Everybody in the neighborhood, why don't we all get together and we can sell all of our land to a data center developer, and they'll pay us out the nose for it, and then we can move somewhere else. And we've seen several instances where that has happened where groups of neighbor neighborhoods, resident groups of residents have sort of banded together and agreed to sell their property to a data center developer.

Wow. Thank you. You just mentioned, real quick, a data center that makes no noise. Is there really one of those? And would that be could you give us an example maybe, not now or in the future, that maybe would be a good case study that we could see how it is they're making no noise?

With the exception of generator units, and and there are things you can do. So but, yeah, a lot of it, I would say I can't remember how many, but of all the ones we visited and we purposely visit ones that were problems. I would say most of the ones we visited, you can stand outside and you don't hear anything. You don't hear the cooling systems. So and and and a lot of times, some of the ones that were that we were told were problems, we showed up, and they're like, oh, well, it's not making noise today because the cooling system wasn't running.

So it it really depends on the cooling system. So some can make noise all the time. Some only make noise when the cooling system's running and, at full capacity. Some, it doesn't matter what day you show up. It's just not you're not gonna hear anything from the cooling system. Now you may still hear when they're testing the generators, but there's other things that you can actually do, to help reduce that noise, like requiring generators to be housed in sort of generator sheds. So those are the things that you could do from a zoning standpoint to try and address that generator noise.

Thank you.

Water use. So we found that data center water use is currently sustainable, and the state helps ensure sustainability through its regulations. So, again, we talk a lot about cool, cooling systems and noise. Cooling system also has a major impact on how much water a facility uses. So you either have kind of two flavors.

You have your water dependent cooling processes, basically evaporative cooling, where you're using, water to facilitate cooling. The great thing about these things is they're more energy efficient. The bad thing about them is that they obviously use more water. The alternative is a dry cooling system, uses more electricity, but doesn't use any water. So, for example, your residential air conditioning system, that's gonna be a dry cooling system.

There's no water being consumed by that system. Those data centers, at least in Virginia, get their water through a water utility. We collected data from those utilities and found that while some day centers can use a lot of water, most use about the same amount or less than an average large office building. So in terms of how that scales up as an industry as a you can see that on this graphic here. So for example, those ones at the bottom, those are ones that are that you know, it's a data center, but because it's using a dry cooling system, the only water being consumed is in the bathroom or if there's a kitchen in there for the staff.

That's the only water that the facility is using. So that is, in some cases, about the same as an average home. Other cases up to the top, they're using an evaporative cooling system. It's probably a large facility, and that's consuming a fair amount of water. But only in a few cases was it more than what you'd expect from a large office building.

Again, in terms of how that scales up, so there's the facility itself question, but then you have to scale that up to the industry use as a whole. We found that data center customers accounted for between point 2% up to 21% of a water utility's total, consumer use. And so those that's a pretty big range. You know, 21% is obviously a lot of utility, use. Point 2% is very little bit.

Those were largely a function of how many data centers that utility served and how big the utility was. I'm not a 100% sure, but I think that 21% was, there's a really large, campus in a very small county, and I think that's why that one was so big. But that could also be Loudoun County. I can't remember. But, again, to put this further into perspective, the industry as a whole uses less than half a half a percent of the state's total water withdrawals.

So, yes, the facility does use water, but it's not, on the scale of, say, something like paper mills in or in the state, which are enormous water user. All that said, the data center industry is growing, so we can expect that water use to increase over time. And that raises concerns about sustainability, especially, in Virginia. I mean, we're we're still in a drought right now. We had a winter drought into a spring drought. Hopefully, it won't be a summer drought. So those changing weather patterns kind of compound those sustainability concern. We found that at least in Virginia, our state regulation appears to sufficiently address that. It doesn't mean it's not a concern. It just means that we do have good regulatory processes in place.

Our state regulator regulates water withdrawals and requires permits for large scale withdrawals. It models the impact of any change in withdrawals on water availability and wildlife. That happens when a permit's issued. It also happens when a permit's renewed. So if utility gets some big data center customer, they have to go get a permit to add more water. That's all gonna be reviewed. And before that permit's approved, they they won't they can't approve something that's not sustainable. You might the utility might have to go build something like a reservoir or something to help make sure that they have the resources that are needed to not have negative effects, and that the water source can be sustained.

All that said

go ahead. Go ahead. I don't wanna interrupt you.

All that said, you know, Virginia is a pretty water rich state even with our those those drought concerns, but that doesn't mean that all localities have equal access to water. So a locality that doesn't have a lot of localities are located by rivers. I'm here in Richmond. We've got a river that runs right through town. But a lot of localities don't have a big water source like that.

And so on a locality scale, locality can be water restricted. And so anything that you know locality approves for data center development might then be taking away from their ability to do some other type of development, especially in certain parts of the state where, you know, my county doesn't have a river and we're relying on, groundwater or we're relying on, piping water in from the neighboring locality. Those are all restrictions, and and localities really need to understand how much water is this project going to use, how does that affect our ability to meet future residential demand or to pursue other development opportunities, like, you know, for a manufacturing center or something that might create more jobs.

Can I ask my question now? Mark? Yeah. Just quick. Here, the Wisconsin Farmers Union, in its current policy statement, in a context much larger, not specific to data centers, but just they're recommending a groundwater mapping project that supports the development of a mapping tool that will lead to better understanding, protection and utilization of groundwater and drinking water supplies in Wisconsin. Has Virginia done anything like that? Or do you how do you know what your water supply is other than there's a river running through the area kind of thing?

We do. We have again, pushing the edge of my knowledge, but we basically have, I think, three aqua we have we have one major aquifer, which is on the coast, and that has been a ground that's been the main water source for a lot of our coastal cities and also is a main water source for a couple of large industrial, legacy industrial users. Basically, that aquifer takes a long time to replenish, and we've been sucking that aquifer dry. So it's been something that's a well known policy issue and concern for several years. We have parts of our state that are sinking just as sea level is rising because of of of taking water out of that aquifer.

So that aquifer is very well understood and has been researched a lot just because it's so well used by urban areas and because the effects that we're seeing of draining that aquifer. The other aquifers are much smaller and regional. So we have this sort of topography, karst topography where, you might have a pocket here, a pocket aquifer here, another pocket one over there. But it's really only the the eastern part of the state that has that big aquifer that is sort of a giant thing that's, affects many areas. I don't if that answered your question.

No. I appreciate that. Thank you.

The last finding here, data center impacts water quality, native habitat, and agricultural lands. But those impacts are pretty similar to other large scale developments. So development of previously undeveloped areas, as you all know, that creates environmental risks. New development can destroy natural habitat. It can reduce the amount of land that's available for agriculture.

So depending on how development is done, it can also have other environmental repercussions such as increased flooding, erosion, or water pollution. These are all environmental risks that apply to any greenfield, development. So that will include data centers, just as it would include any large commercial industrial develop industrial development or even a high density residential development. And in a lot of the areas where we have our data centers being built, we also see a lot of high residential develop, high density residential developments like townhouses, picture of massive townhouses with big parking lots. In all these cases, you have clearing, grading, and installation of impervious surfaces like rooftops and parking lots that basically forever changes that land.

So our research found that, at least on the the water side, that the, state and federal regulations for new construction largely mitigate the risks to things like storm water, runoff, and wetland impacts. On the land side, again, you know, you're you're forever changing that land, through development, whether that's data center or some other high density use. And the loss of those lands is sort of a trade off, when you do development of all types. So, again, it does apply for data centers, especially seeing as in some parts of the state, that is the main development pressure. But, also, it's not unique to data centers.

It's kind of a a thing that happens when you develop land. And in Virginia, again, I'm not sure how Wisconsin works, but our localities have traditionally had and and still do have all the authority over land use decisions. I have a couple more slides on the economic tax and energy stuff, but I I'm I realize I'm well over my time here.

Okay.

Well, we got about ten minutes. So

we I can advise on

on, your insights while we have you here. So, go ahead.

Alright. So on the economic side, and the tax side, in Virginia, the industry has had positive effects on both economics and local tax revenues. So economically, most of the benefits occurred during construction. So, again, these are massive construction projects, and they can have up to 1,500 workers on-site during peak construction. And those jobs are in well playing, blue collar jobs, construction trades, so electricians, pipe fitters, steel workers.

After a facility is built, a few jobs remain. So, again, most of the impact is happening during construction because that's when the most people are employed to work, on that on that site. We estimate that for a hyperscale facility after it gets built, there's around 50 people per facility. Those jobs are pretty evenly split among sort of your IT professionals and building management professionals, which is what you might expect, but there are also a lot still a lot of contract trade workers. So, you know, there's miles of pipes and electrical wiring in these buildings.

So there's, basically a full time team of electricians and the pipe fitters who are working at these facilities after they're built. And then, of course, you also have contract security, which is probably the the lowest wage of those different, jobs that are created. Data centers can be a cash cow for a locality, and that's because they can, you know, generate revenues, but they're not sending a lot of kids to schools. They're not, aside from the construction period, they're not putting a lot of cars on the roads. So it's more more almost a a net positive when it comes to the revenue.

That really depends on where locality decides to tax it. So in Virginia, we've seen some of our localities get a really kind of enormous amount of money from these facilities. We're talking 10 to 30% of their budgets come from data center revenues. In other cases, we've seen localities are trying to attract data centers, they're cutting their local tax rates. Well, if you you do that, then you don't really get the tax revenue benefits.

You're just getting whatever the amount of jobs is that they create. On the energy side, data center growth is driving an enormous increase in energy demand. This is more pronounced in Virginia than anywhere else, but you can really see this ticking up pretty much across the board. So you look at this graphic, those top lines are showing the very top line is showing our unconstrained demand projection. The other the solid line, kind of about halfway down, that's showing, you know, what if only half of that un unconstrained demand shows up?

And then the bottom line is showing what if there was no new data center demand. The takeaway here is that if unconstrained demand happens and we can meet it, we're talking about tripling the amount of energy that's consumed in the state. If only half that shows up, we're still doubling the amount of energy that's consumed in the state by 2040. If we had no new day center demand, demand would not be going up, or be barely going up at all. So most of this this demand growth is coming from that industry.

I wanna reiterate this is what could happen because, you know, one, that demand might not show up, and maybe AI is a bit of a bubble, and a lot of what is is projected doesn't happen. Two, even if that demand is there, utilities still have to be able to meet it. Right? So that affects meeting this unconstrained demand. It would be almost a moonshot scenario in terms of building enough generation, enough transmission, and importing enough energy to keep up with demand.

So that scenario one, the unconstrained demand scenario for that that really highest highest line, that's gonna be really, really hard, if not impossible, to do. Maybe more realistically, that half of unconstrained demand, maybe we're able to meet half of that, that we're still talking, enormous investments in generation, transmission, and imported energy. So even that, keeping up with demand under under the half demand scenario is gonna be really hard to do for our state. This obviously has some cost implications. The cost come from a couple of of areas.

One is, the big one is obvious is that you're building a lot of new stuff. You're building a lot of new generation. You're building a lot of new transmission. So historically, adding a new customer, would actually reduce everybody's rates, but now we're talking about building a bunch of stuff for a small group of customers which would not otherwise be built. That then creates more costs in the system that would not otherwise have occurred.

And so everybody's piece of the cost pie could get a little bigger unless we change how those costs get allocated out. The other challenges, and this will be be felt, I think, pretty much everywhere is that if you have a supply demand problem, if demand is higher than supply, what happens? Prices go up, and that's gonna affect all energy users. And that's something that's really hard to to to it's really hard to deal with those costs and only assign those to the people who are increasing costs on the system, because they're you know you know, how can you say that, you know, you'd have to price things differently? It just gets really complicated.

And yeah. So I covered the energy piece a lot quicker than I normally do, but happy to take any questions on that or or anything else that you guys have. Here's my contact information as well, and I'll send you guys a copy of the slides after we're off.

Awesome. Mark, I have I have one question, if I may. This is kind of a two part question. From our experience around here, we've seen data centers come in with proposals that are hundreds, if not thousands of acres, more than what they really need to have. Have you seen in Virginia where they're using any potential excess land for other types of development? And the second part of that question is, or have you seen just the opposite where maybe it's stifling economic development where companies don't wanna be next to a data center?

So on to that second one first. I think that we've seen the the effect on other development is really, competition for land. You you get it's it's hard to outbid the deep pockets that a lot of the these data center developers have. And so what we've seen is the competition for land. Again, this isn't something we've been able to prove empirically, but, anecdotally, what we've heard is that competition for land because I'm a developer, maybe I'm not gonna build a commercial mixed use development or a residential development because I can't afford to pay however much that is per acre that is being offered by, the data center industry.

And on the on the first question, and I think that was, you know, excess land, we haven't really heard that. We have heard about data centers putting in for more energy than they actually need or more water than they actually end up planning or end up using. So may it would make sense then that they would be putting in for more land. One of the things I would I would question about that is that they might just be trying to buy all the land for a campus, and they're only gonna plan to develop one part of it at a time. So, you know, maybe I I want to eventually say say I'm a developer, and I wanna have a, 2,000 acreage data center campus.

I might buy all that land, but then my first development, I'm only developing, you know, a quarter of it. So I've got, you know, three buildings going, and I might not have my development plans for the rest of it yet. So that that would be my guess is is they're more likely planning to build stuff in the future, but they just haven't put it forward. But, again, I'm just speculating at this point.

Okay. Thank you.

Any other questions?

Have you had any of these go bankrupt or be abandoned or not lease as fast as they think they will and so they have financial issues? And if so, how have you dealt with that?

We have not seen that yet. I think I heard anecdotally that happened with, like, a crypto, data center somewhere. And crypto we don't have crypto in Virginia. I think those are a little more fly by night. I think that's a very valid concern.

You know, a lot of the industry is being bankrolled by the big four. So even though it's a data center company data center developer x, they may already have a contract in hand to build that facility for one of the big four. The financial backing should be there, but, you know, you never know how things are gonna play out. Maybe some of these AI bets don't play out, and some of the data centers aren't needed. Right now, the demand, though, far outstrips the supply.

So if if if a data center failed, somebody would pick it up immediately, because if they have a a contract to get the if they have a functioning facility that has power, somebody would snap that up right away. That's really been the main constraint on the industry is access to power. I think in Virginia, especially, but maybe other places as well. In Northern Virginia where you have this high concentration, we've had projects that have been waiting years to get full power because there's not enough transmission capacity to serve them. So that has been the the main thing. It's more demand has exceeded supply, that hasn't been, you know, an empty facility hasn't been a concern yet.

Are you are you asking the, data centers to help pay for the power that they're that was your question. Go ahead. You take it.

Is the data center covering the full cost of the increased cost of production for the energy, or are they passing along to the other consumers as well?

It's, the answer is right now, those costs are being passed on to other consumers in a way. So on the there there's three parts of the system, distribution, which is the local level. There's transmission, and then there's generation. On the distribution costs, at least in Virginia, they're fully covering those costs because they're, you know, there's a substation and then the either the the electric co op or big investor owned utility or big monopoly is basically making them pay for the cost of that because they're building it. They're It's still the the utility's property, but they're building it to serve that facility, so they're paying the full cost of the substation.

However, on the transmission side, that is something that's a regionally set, pass through cost generation depending on your utility. It's either being bought from a market or it's being paid for by the the the monopoly utility. And those costs have historically, the way they are allocated, gets spread across everyone. Right? So if you're building new generation or transmission, the cost of that gets spread across everyone.

The issue here is now we're building new generation transmission that would not otherwise be built for these small number of customers. And so if those costs continue to be spread across everyone, all of our residential and commercial bills are all gonna go up. So one of the things we recommended in our report, that that our utilities and our, utility regulator do is look at, one, create a new customer class that you can park these high load facilities in. Two, look at how costs for transmission and generation are being allocated and make sure that that customer class is paying for the cost that is incurring. So both of those things are currently underway.

Our utilities have our main utility created a customer class last year, And in their next rate case, they are supposed to be looking at how to allocate costs to that customer class to avoid having those go to residential customers. And on our our electric co ops, they're basically just passing through. So they've pretty well insulated their customers because we have sort of big for pay utility, and then we have these little electrical co ops, which used to be rural co ops, but are now serving data centers and are are actually pretty big themselves. The one thing, though, is that prices, as long as supply exceeds demand, you're gonna have those price increases. There's really no way to insulate against that effectively.

Hey. Anyone else with questions? Alright. Mark, we really appreciate you, taking time to walk us through through sort of a summary of your report and, insights on this, really big topic. So thank you very much. Thank you.

If anybody has a vacation property in Bay Field that you're willing to run up cheap for a night, let me know. Yeah.

Well, enjoy. It's it's beautiful up there. I, myself, haven't paddled around, done any kayaking around the islands, but, I've camped out there. It's it's great. So

Bring your foul weather gear.

I've been

told to bring a bug net a

bug net for me. Next. Yeah.

Thank you. I appreciate it.

Okay. Take care, Mario.

Thank you. Thank you.

Bye. Alright. Well, we're running right up against our time, and I'm actually due to another meeting. So I'd like to ask everybody if there's items from this presentation, questions that were raised, recommendations that were suggested, those would be things that if you would maybe email staff your thoughts on or just itemized list of things that we can add to the list of follow-up items. I'd appreciate that.

So, any, conversation discussion as a result of presentation that we wanna run through very quickly. Otherwise, we can adjourn and save it for another meeting. Go ahead.

I just have one. I want to go back to your opening statement about proposing a moratorium in in Dane County. Obviously, the Cities and Villages Association will wanna see what that resolution looks like to see if it impacts our members or not. I understand your reasoning for wanting to do it. I always worry about the unintended consequences that that it may stifle economic development within Dane County itself if companies looking to locate here are hearing about a moratorium on a completely different issue. Mhmm. So just keep that in mind, if you would, as you're drafting the resolution that be very specific about what it's

for. For sure. Yep. We'll have we'll have that as well as the the length of time.

And can I add Cottage Grove is considering a moratorium tomorrow at the plan commission? Mhmm. We're doing a full comp plan, revision this year. And so we felt that the board felt that was important to maybe halt on some of that opportunity.

Okay. Far as, how the impact to cities and villages, this will only, impact, will be limited to towns, unincorporated areas that are subject to county zoning. Okay.

And if you this morning, found out Greene County is considering a similar moratorium, so spreading.

Alright. Alright. Then if there's no other discussion, again, email those thoughts for follow-up items, and we'll make sure that's included. So our next meeting will be what's the ninth. June 9. So right. And we don't do we have any public comment? No. Ready to transition. To speak. Alright. So if there's no other business as allowed by law, motion to adjourn. Anybody?

So moved.

Moved by Passler. Second, Richardson. Second by Richardson. All in favor of adjournment, say aye. Aye. Opposed? We're adjourned. Thank you all.