How many data centers are coming, and what’s the impact to residents? MLGW has answers
Memphis Light, Gas & Water (MLGW) provided an update on current and planned data centers in Memphis, noting that two facilities are expanding and two new projects are in the pipeline. The update came as the City Council discussed potential regulations, particularly concerning the zoning of future data centers. Concerns were raised by a resident regarding the placement of data centers within the community.
Memphis Light, Gas & Water (MLGW) President and CEO Doug McGowen briefed the City Council on the current landscape and future prospects of data centers in Memphis and Shelby County. The presentation coincided with ongoing City Council discussions about potentially regulating new data center developments. McGowen assured residents that data centers have not led to increased electricity rates for residential, commercial, or industrial customers, explaining that data centers incur an upfront capacity charge of $1.52 million per megawatt to offset generation costs. Furthermore, the Tennessee Valley Authority (TVA), which supplies electricity to MLGW, recently approved a rate change requiring data centers to pay more for electricity than residential users.
MLGW currently serves 16 data centers, with sizes varying up to 150 megawatts. Two existing facilities are slated for significant expansion by the end of the year: 5C, located in the former Fred's headquarters, will add 9 MW, while the Colossus facility in southwest Memphis plans to double its current 150 MW capacity to 300 MW. Additionally, two new data centers are in the planning stages, requesting a combined 350 MW. One is another expansion for 5C, and the other is a new 300 MW project in an industrial park that requires TVA board approval and is not expected to be operational until after the new year. Ten further speculative applications have been received, but MLGW has not yet studied them, indicating they are not under imminent development.
During the council meeting, resident Yolanda Cooper-Sutton voiced concerns regarding the location of future data centers, suggesting they are being disproportionately placed in the Black community. City Council Attorney Allan Wade clarified that the council's primary authority over data centers would likely be through zoning regulations, which would dictate where such facilities could be built.