El Paso proposes policy framework to regulate future data centers

The City of El Paso's representatives unanimously approved a policy direction to discourage future hyperscale data center development in the city. The draft Data Center Policy Framework, developed after months of community engagement and public discussion, is intended to create a more transparent and accountable process for evaluating future projects, with a focus on environmental sustainability, infrastructure protection, and community impact.

The policy would prevent the city from actively recruiting or offering incentives, such as tax abatements and rebates, to future data center projects. City Representative Chris Canales highlighted growing concerns over infrastructure strain, water consumption, and the rapid expansion of AI-supporting data centers as key motivators for this shift. While the policy does not revisit existing agreements, such as the Chapter 380 agreement with Meta from 2023, public feedback directly influenced the recommendations for future oversight.

Mayor Renard U. Johnson stated that the framework reflects community concerns about water, infrastructure, energy demand, and long-term impacts, aiming to create stronger safeguards and greater transparency. Key proposals include requiring hyperscale data centers to obtain Special Permits rather than being automatically allowed by right in eligible zoning districts, establishing stronger environmental and utility performance standards for water use, energy consumption, noise, and emissions, and encouraging Community Benefit Agreements.

Dozens of El Pasoans voiced concerns during public comment, particularly regarding water usage in the desert community and the impact of existing agreements like the one with Meta. The official policy document is expected to return to the city council in June after further review by the city attorney.