Oklahoma is one of a dozen states that are considering temporary bans on construction of data centers.
Besides the Sooner State, others are Georgia, Maryland, Michigan, New Hampshire, New York, Pennsylvania, South Carolina, South Dakota, Vermont, Virginia, and Wisconsin. The watchdog group Good Jobs First reported on the list.
“We are now tracking at least 12 in-session states with filed data center moratorium bills this cycle — in addition to other states considering executive action and many cities [including Lawton] and counties considering local measures,” Good Jobs First wrote. “It’s a signal that the political system is starting to acknowledge the obvious: hyperscale data centers are huge, fast-moving, and highly subsidized, and states often lack basic economic and environmental guardrails to protect residents and ratepayers.”
In Oklahoma, Senate Bill 1488 would establish a moratorium on building new data centers until Nov. 1, 2029, while directing the Oklahoma Corporation Commission to study impacts on water supply, utility rates, property values, and siting. That measure was assigned to two committees on Feb. 3 and has not advanced from either one.
“More than 300 data center-related bills have been filed in more than 30 states,” reported MultiState, an Arlington, Virginia-based government relations consulting firm in a Feb. 20 update. “Unlike in recent years when many states enacted bills designed to lure data centers using tax incentives and state-funded infrastructure as inducements, they are reconsidering their apparent ‘open-door’ policy toward the facilities.”
Just recently, Rep. Amanda Clinton, D-Tulsa, announced she would support a data center bill introduced by Rep. Brad Boles, R-Marlow. His House Bill 2992, the “Data Center Customer Protection Act,” was amended and passed the House Energy and Natural Resources Oversight Committee earlier this month; it now awaits a floor vote by the full House.
As amended:
•HB 2992 would require any applicable governing body responsible for reviewing electric supplier rates to ensure that residential, commercial, and industrial customers are protected from paying unjust rates resulting directly from electric service to large-load customers such as data centers and bitcoin mining operations.
•The applicable governing body would have to ensure that all rates are fair, just, and reasonable. Costs and revenues would have to be assigned and allocated among customers in compliance with cost-causation principles.
•HB 2992 would require all electric suppliers to establish and maintain separate terms, conditions, and tariffs for electric service applicable to any large-load customer. The terms, conditions, and tariffs would be required to include credit requirements necessary to ensure that large-load customers reimburse the utility for all costs fairly allocated.
•The term of service for a large-load customer would have to be at least 10 years.
•For any public power utility using tax-exempt municipal financing, the term of the agreement would have to be less than 10 years or the applicable I.R.S. guideline.
•The provisions in HB 2992 would apply to all retail electric suppliers serving customers in this state, including investor-owned utilities regulated by the Corporation Commission, electric cooperatives, municipal electric utilities, and public power utilities.
Concerns raised about cost shift, water usage “As data centers and other energy-intensive projects expand in Oklahoma, we must ensure that working families and small businesses are not left paying for infrastructure built to support billiondollar companies,” Representative Clinton said.
Google announced it will spend $9 billion over the next two years in Oklahoma: in part to expand its data center in Pryor — which Google boasts is the second-largest data center site in the world — and to build one on 400 acres near Stillwater.
Richard Rogalski, executive director of the Lawton Economic Development Authority, told the Lawton City Council that besides the Pryor and Stillwater projects, there are seven data centers in Oklahoma City, 10 in Tulsa, one in Sand Springs, and at least one that occupies a 42-acre site at the Port of Muskogee and operates approximately 40,000 computers.
The Yukon City Council has been looking favorably toward a $1 billion, 0.5-gigawatt data center that would be constructed on 184.5 acres. However, the city reportedly is still working on securing water and electricity agreements.
But some communities — including Lawton — are wary of the downside of hosting a data center, citing rising electricity costs and strain on the power grid, and large data centers consume vast amounts of water.
After protracted debate, the Lawton City Council voted 5-3 on Feb. 24 to allow a data center with peak electrical demand “not more than 2 megawatts” as a permitted use within an Industrial-1 restricted manufacturing and warehouse district.
The council also added digital asset mining business or data center with peak electrical demand greater than 2 megawatts as a “use permitted on review” within an I-4 heavy industrial district.
Councilors Lane Hooten, Taron Epps, Kirby Brown, Sherene Williams and Randy Warren voted “aye.” Councilors Bob Weger, Tiffiny Dimery and Allan Hampton voted “nay.”
Afterward, Mayor Stan Booker requested that a follow-up report be presented to the City Council within 30 days.
During the council’s Feb. 10 meeting, Public Utilities Director Rusty Whisenhunt, responding to a question from Booker, said, “We review the water demand of every industry” that wants to locate in Lawton. If the city were unable to supply a data center’s water needs, the operator would have to petition the Oklahoma Water Resources Board for a water use permit and drill multiple water wells to tap into groundwater supplies, he said.
A data center seeking to locate in Lawton also “would require some kind of assurance from PSO that they have the resources” to fulfill their electricity requirements, Councilman Brown said.
In Claremore, a data center protestor was arrested at a recent city council meeting when he attempted to express his views beyond the 3-minute time limit placed on public speakers. And a proposed data center in Coweta has drawn heavy opposition.