Anxiety over the growth of large-scale data centers, used to power artificial intelligence technology, has spurred a flurry of pushback on all levels in Vermont.
In Washington, D.C., Sen. Bernie Sanders has called for a national moratorium on the construction of new data centers. In Montpelier, Vermont lawmakers are considering two bills — one would create criteria for data center construction, and another would stop them from being built in the next four years.
And even municipalities are starting to talk about taking precautions — the central Vermont town of Royalton is preparing to debate its own moratorium on Town Meeting Day next week.
“I think many of us are watching an increasingly fast-paced deployment and rollout of a technology with AI, and the infrastructure to back that technology, at an extremely scary place,” said Windsor County Sen. Becca White, who proposed the statewide moratorium. “And I think that we need to slow it down.”
Data centers house the technology needed to power the internet — they’re basically warehouses with computer servers. Vermont already has a handful of small centers, mostly clustered around Chittenden County.
But data centers have become more controversial as they’ve ballooned in scale, particularly since they’ve started powering AI. And as AI has boomed, so has the construction of these centers — which are extremely power and water intensive, with some of the biggest centers consuming millions of gallons of water per day. Neighbors of some data centers have seen their utility bills soar.
Tech giants are courting small towns as future sites. Meanwhile, more than three dozen states have passed incentives to woo companies to their states. Advocates point to the potential to increase property tax revenue and employment, though most of the jobs tend to be temporary construction positions.
On the other hand, Vermont is among six states considering temporarily blocking such data centers, policy analysts told state lawmakers earlier this month.
The concern here in Vermont is mostly preemptive.
There aren’t currently any proposals to bring a large-scale data center to the state, said Kerrick Johnson, commissioner for the Department of Public Service.
Green Mountain Power, the state’s largest utility, said it’s received “maybe one or two very speculative general inquiries over the years” but no serious proposals, according to spokesperson Kristin Kelly.
St. Albans did briefly receive a proposal to build a data center there, but developers pulled out after determining the project would require expensive transmission infrastructure investments, said Sam Chevalier, who studies electrical power systems at the University of Vermont.
It’s an illustration of why Chevalier says it’s unlikely that large data centers will come to Vermont any time soon.
“The infrastructure limits and the price of electricity together just make it kind of a non-starter,” he said.
“The infrastructure limits and the price of electricity together just make it kind of a non-starter."Sam Chevalier, who studies electrical power systems at the University of Vermont
Johnson, the public service commissioner, agrees that Vermont is not a top contender for companies building data centers. He told a legislative committee that those companies are looking for, among other factors, cheap energy and an “expeditious, predictable permitting process.”
“I’ll let you all decide how Vermont ranks in those categories,” he said.
Vermont’s electricity is more expensive than most other states, though as of the end of last year it was the cheapest in New England.
Still, Johnson said data centers could be an opportunity for Vermont. Large, deep-pocketed customers could also be a boon for the state’s utilities — and at least one is already researching what it might look like to host them here.
Earlier this month, Green Mountain Power told lawmakers that hooking up a customer that consumes such large amounts of electricity could actually lower electricity costs for existing customers, because of how electricity is regulated here.
The utility also told lawmakers that it tested five sites around Vermont to see how increasing its electric load would impact the system. And it found that data centers operating between 50 and 200 megawatts could offer benefits to consumers. (Vermont’s total peak demand hovers around 900 megawatts.)
“Our message today with data centers is that with the correct size and the correct location, these data centers can be kind of a net benefit for costs on the electric system,” said Cam Twarog, an engineer with the utility.
"With the correct size and the correct location, these data centers can be kind of a net benefit for costs on the electric system."Green Mountain Power engineer Cam Twarog
Johnson, with the Department of Public Service, said the state already has sufficient regulations in place to make sure any future data center wouldn’t burden ratepayers, though he said strengthening those regulations would still be “prudent.” He said a company that wants to build a data center could form its own utility, as Global Foundries did several years ago. That would require a certificate of public good from the Public Utility Commission, which regulates electric infrastructure.
Or, it could go through the Act 250 process, which would require it to get permission from a local utility to connect to its system. Furthermore, the company proposing the data center would be responsible for paying for any infrastructure upgrades needed to make that connection happen, and would have to go through the Public Utility Commission to do so.
That might be little consolation to data center opponents, who remain worried that the state’s not ready for the data center boom.
Bella O’Connor is an attorney based in Royalton, the town considering a five-year moratorium on data centers at its town meeting.
She fears the potential public and environmental impacts of a data center in Royalton. Until recently, she had mostly been approaching the issue as a distant possibility.
Hearing Vermont utilities testify about the research and modeling they’ve already done, she said, was a jolt.
“That's when I realized, ‘Oh, wow. This is like, real,’” she said.
