Gov. Beshear issues executive order on data center development
Kentucky Governor Andy Beshear signed an executive order establishing a strict screening process and development restrictions for data center projects across the Commonwealth. The order requires developers to submit energy plans, comply with tax obligations, and engage in community transparency. It aims to protect ratepayers and the environment while ensuring fair tax contributions.
Kentucky Governor Andy Beshear enacted an executive order on August 6, implementing a rigorous screening and restriction framework for data center developments across the state. This move mandates that all prospective data center developers meet three key requirements to operate within the Commonwealth.
The first requirement, "Ratepayer & Environmental Protection," compels developers to provide a comprehensive energy plan to the Kentucky Energy and Environment Cabinet (EEC). This plan must guarantee that the substantial power demands of data centers will not increase electricity costs for local residents and businesses. Additionally, the order directs the Kentucky Public Service Commission to prevent utility companies from raising rates to cover data center infrastructure expenses. The EEC is also tasked with denying permits for facilities that could negatively impact air quality, water supplies, wetlands, or natural resources.
Secondly, developers must ensure "Full Tax Compliance," meaning they are prohibited from evading state, local, and school taxes that support community services. Lastly, "Community Transparency" requires data center companies to engage openly with local leaders and residents, addressing concerns such as job creation and the specific regional impacts of their facilities.
Governor Beshear's office will oversee compliance with the order, which explicitly states it will not override local communities' authority regarding data center operations within their jurisdictions.