Developer proposes hyperscale data center in Russell, Greenup County, Kentucky

Rubix Data Centers, a subsidiary of the Spain-based Submer Group, has proposed building a hyperscale data center at the former AK Steel mill site in Russell, Greenup County, Kentucky. The developer plans to invest between $8-12 billion in eight, two-story buildings, with an anticipated capacity to consume 2 gigawatts of electricity, which is over 10% of Kentucky's summer electricity production.

The project is expected to generate thousands of construction jobs and 200 full-time positions with an average salary of $125,000, bringing tens of millions in local property tax revenue. However, the proposal faces challenges as the City of Russell had recently passed a moratorium on data center applications, a move that the developer's consultant, Gateway City Consulting, indicated could impede the project. Mayor Samuel Simpson noted that the consultant's outreach in June was his first awareness of the specific project, emphasizing the city's need to evaluate potential benefits and protections.

Environmental concerns are also prominent, with the proposed data center estimated to use 55 million gallons of water annually, which is significantly less than the Russell Water Company's annual production. The proposal comes amid a statewide trend of data center development, prompting many Kentucky cities and counties to enact moratoriums due to resident concerns over water usage, electricity bills, and environmental impacts. While the GOP-controlled state legislature has passed sales tax breaks to incentivize data centers, bills to regulate their impacts failed to pass this year.