New Bill Puts the Brakes on Data Centers, but Incentivizes Fossil Fuels
North Carolina's proposed Senate Bill 730, known as the Ratepayer Protection Act, seeks to regulate data centers by prohibiting eminent domain use and local economic incentives while requiring site assessments. Simultaneously, the bill aims to fast-track fossil fuel permits and delay coal plant retirements, raising concerns among environmental advocates and some lawmakers regarding its dual objectives and potential impact on climate goals and energy costs.
North Carolina's proposed Senate Bill 730, or the Ratepayer Protection Act, is navigating the state legislature, presenting a dual approach to energy policy: curbing data center development while simultaneously boosting fossil fuel infrastructure. State Rep. Pricey Harrison, a progressive Democrat from Guilford County, lauded the bill's first section, which would forbid data center developers from using eminent domain, prohibit local governments from offering economic incentives, and shield North Carolinians from increased electric bills due to data center operations. This comes as local governments across the state are passing or drafting moratoria on data centers due to constituent pressure.
However, Harrison, along with environmental advocates like Shelley Robbins of the Southern Alliance for Clean Energy, criticized the bill's second part. This section proposes to fast-track environmental permits for fossil fuel projects, delay the retirement of coal-fired power plants, and potentially eliminate Duke Energy's carbon neutrality goal by 2050, effectively reversing decades of climate change work. The bill also empowers local governments to mandate site assessments for data centers 100 megawatts or larger, evaluating impacts such as noise, water quality, air quality, heat plumes, and effects on nearby farms and historic sites.
During a House committee meeting, the bill passed despite resistance from the data center industry. Khara Boender, director of state policy at the Data Center Coalition, representing companies like Google, Amazon, Meta, and Microsoft, voiced concerns regarding mandates on specific cooling technologies and restrictions on local incentives, arguing they could diminish North Carolina's competitiveness. While proponents like state Rep. Dean Arp, a Union County Republican, claim the bill will reduce ratepayer costs, critics point out that it incentivizes costly fossil fuel and nuclear plant construction, rather than addressing the root cause of recent rate hikes: the price of fossil fuels.
Environmental experts, including Amy Adams, deputy and programs director for Southeast Climate & Energy Network, highlighted the bill's weak water protections, criticizing vague terms and calling for explicit prohibitions on potable water use and numeric caps on water withdrawals. The bill also fails to increase transparency, allowing data centers to keep their water and energy usage, as well as tax exemptions, confidential from the public. The bill's next stop is the House Commerce and Economic Development Committee.