Hillsboro and Oregon are moving to limit data center growth
Hillsboro, Oregon, has adopted a four-month moratorium on approving new data centers due to concerns over infrastructure strain, electricity costs, water usage, and loss of agricultural land. The state of Oregon is also considering new compensation fees for fiber cable installations, while utility rates have significantly increased for residents. These actions address the rapid growth of data centers in the region, driven by tax incentives and intercontinental fiber connectivity.
Hillsboro, Oregon, has enacted a four-month moratorium on new data center approvals, including high-capacity battery storage systems, effective July. This swift action by the city council, taken with only a day's notice, aims to prevent a rush of applications before the new restrictions took effect. The move comes amid growing community concerns about the industry's impact on local infrastructure, escalating electricity rates, water usage, and the conversion of agricultural land.
The article highlights that critics, including community members, have observed a 50% increase in electricity costs from PGE and Pacific Power over the last five years. While utilities attribute rate hikes to capacity expansion, an estimated 26% of PGE's planned resource additions are for data centers. Earlier in May, The Oregonian reported on Hillsboro extending tax exemptions for data centers through enterprise zone agreements, allowing major corporations to avoid long-term property taxes despite creating few jobs after construction.
More broadly, the state of Oregon is reassessing its role as a major data center hub. Governor Kotek noted that Oregon has been a "cheap date" for developers, partly due to low $5,000 application fees for high-capacity fiber cable installations. The Oregon Lands department has since proposed new compensation fees to generate millions for the state. The region's appeal for data center development stems from 16 intercontinental fiber cables on the coast, tax incentives, an educated workforce, and abundant water and electricity.