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Grant Hauschild’s recent letter to the Timberjay defending his big data center taxpayer giveaway caught my eye. In part, that is because I have a friend in the state of Virginia who told …
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Grant Hauschild’s recent letter to the Timberjay defending his big data center taxpayer giveaway caught my eye. In part, that is because I have a friend in the state of Virginia who told me about these noisy monstrosities that gobble up huge amounts of energy to facilitate things like Bitcoin and data mining on you and me. Her electricity rates shot up as they were built, and their presence drove property values down. So, since neither Bitcoin trading nor gathering data on my neighbors benefits anyone I know in our Senate District, I thought I would take a look at Sen. Hauschild’s claims.
First of all, a Bain Capital analysis shows that data center electricity demand does drive higher electricity rates. “Utility revenue requirements to serve growing data center electricity demand could increase customer bills by one percent annually through 2032.” Consistent with the Bain analysis, a 2023 study by the Virginia Joint Legislative Audit and Review Commission concluded that data centers’ increased energy demand will likely increase system costs for all customers. That’s because a large amount of otherwise unnecessary new generation and transmission capacity will need to be built, creating fixed costs that utilities will need to recover. “It will be difficult to supply enough energy to keep pace with growing data center demand, so energy prices are likely to increase for all customers,” the study concluded.
Bottom line; they get our tax dollars and we get the bill. The cost of generating more electricity for these energy hogs is passed on to you and me.
So, what about all of these jobs? The 2023 Virginia Legislative Study found that almost all of the jobs generated by these warehouses are in the construction phase and are temporary. These are specialized facilities, so other than the warehouse itself, the computers and equipment will be purchased elsewhere and installed by people from outside of the area. A 250,000 square foot data center can be operated by 50 or fewer people, many of whom work on contract and remotely (meaning they live in Minneapolis, Chicago, Des Moines, etc.). So, after these things are built, we pay higher electric rates, our tax dollars go to a private business, and someone who doesn’t live here gets a job while neighboring property values drop.
The increased demands of these centers will undoubtedly make it difficult, if not impossible, to meet clean energy goals. As with the mining industry, when business wants to avoid environmental compliance, they turn to people like Grant Hauschild to water down the rules. This is precisely what he is doing for the mining industry currently. I think we can expect the same will be done for big data centers associated with the Amazons of the world.
The most amazing claim was that building these electricity guzzlers will bring benefits similar to U.S. Bank Stadium. Well, Sen. Hauschild’s tax giveaway to data centers is similar in one sense; it is a gift of our tax dollars to people like the owners of the Vikings who are enormously wealthy. However, as far as the impact, I cannot recall talking to anyone who packed up the family, traveled to Minnesota, rented rooms, went out to eat, and shopped so they could see a data center.
In the end, I think that Sen. Hauschild’s response served only to support the point of the letter submitted by Mr. Wilson criticizing Hauschild for favoring big business over us. Disagreeing with an elected official on some issues is normal; it is part and parcel of democracy. However, trying to fool people into believing that benefitting wealthy special interests (foreign mining giants, and the Bezos/Amazons of the world) helps the average person is not a mere disagreement. If I was in the state Senate, I would never try to fool my neighbors. It is not respectful.
Kelly Dahl
Linden Grove