Specter of data centers in Modesto area gets irrigation district officials talking
Officials at the Modesto Irrigation District are discussing policies to manage the impact of data centers on ratepayers, with one board member proposing triple electrical rates for data centers. This comes as Modesto city staff consider a moratorium on data center development, mirroring action in nearby Patterson, due to concerns over energy and water consumption.
The Modesto Irrigation District (MID) is actively discussing safeguards to prevent data centers from negatively impacting its ratepayers. During a recent meeting, Board Member Janice Keating proposed implementing electrical rates for data centers that are three times higher than standard customer rates, arguing that data centers should not qualify for industrial discounts. She also advocated for a policy that prevents MID personnel from signing data center agreements without board approval, citing concerns about controlling development in Stanislaus County.
This discussion comes amidst a broader controversy in California and nationwide regarding the energy and water consumption of AI-driven data centers. Modesto city staff are currently evaluating the need for a moratorium to update city codes for data center applications, following the potential extension of a 45-day moratorium in Patterson. The issue highlights concerns, particularly after a $2 billion Amazon Web Services data center in Gilroy, Santa Clara County, reportedly began construction with minimal public and municipal oversight. In Sacramento, Senate Bill 886, designed to protect California electric customers from bearing the cost of grid investments for data centers, recently advanced in a state committee.
MID Board Chairman Robert Frobose initiated the update on ratepayer safeguards, prompted by Keating's earlier request. General Manager Jimi Netniss explained that potential large-load customers, such as data centers, are required to fund studies assessing energy demand and impacts on the electric system and rates. District staff are planning a workshop to further clarify the process for managing such proposals.