A mega data center could drive AI, deliver billions to CT. Will politics and power worries doom it?
There is a political tug of war taking place over
development of a data center in southeast Connecticut, a project that would put
the state in the race to satisfy the voracious appetite of artificial intelligence for computational power while
delivering $1 billion or more in payments to state and local governments.
What is dividing Gov. Ned Lamont’s commissioners and some in
the legislature are questions arising from what promoters believe is a
groundbreaking arrangement that makes a power-hungry, mega data center
economically feasible in a state and region with some of the nation’s highest electric rates.
To power and cool tens of thousands of computer servers, the
developers have arranged to plug directly into two nuclear-powered generators operated by Dominion
Energy on Millstone Point in Waterford. Skeptics worry that the data
center’s power consumption — as much as 13% of the Millstone output — could
raise consumer electric rates or, worse, affect the reliability of the regional
electricity supply.
Thomas Quinn, president of NE
Edge, the data center developer, calls the concern unwarranted. He has
forecasts created by the operator of the New England electric grid that he says
show there will be more than enough generated electricity flowing into the
network in coming years to support the center. And he said the tens of millions
of dollars he has agreed to deliver to the state annually over the next 30
years could actually lower electric rates.
But not everyone is persuaded.
The Lamont administration is split. Economic and Community
Development Commissioner Dan O’Keefe is an enthusiastic supporter, along with
the town of Waterford, Dominion Energy and an array of business and labor
groups. Katie Dykes, commissioner of the state Department
of Energy and Environmental Protection, is said by others involved in the
project to oppose it and supports a bill in the legislature calling for a study
that could delay it.
Quinn says a delay might doom the project by shifting
momentum elsewhere in the race to build what would amount to New England’s
first clean energy, hyper-scale data center.
Lamont appears to be keeping both options open, a spokesman
said.
“Data centers are the backbone of the digital age, and
Governor Lamont believes that Connecticut is a prime location for this industry
to build this infrastructure and create the corresponding jobs that support
their operations,” spokesman David Bednarz said. “As the governor noted in his
State of the State address last month, modern technology is putting more
demands upon the grid, and he welcomes the insight of legislators on the energy
and environment committees regarding methods of sourcing the next generation of
clean energy with an emphasis upon affordability.”
There is agreement on at least one point: In the age of
artificial intelligence, powering the computational capacity to run devices
like self-driving cars won’t be cheap, particularly in states turning away from
traditional energy sources and struggling to develop expensive renewables like
offshore wind. One industry group estimates AI could consume 8% of U.S. energy
output by 2030.
“This is a unique one”
Quinn says NE Edge wants to build on a scale that would
separate it from typical data centers — there are more than two dozen across
Connecticut and Massachusetts — and the success of his plan turns on the cost
of electricity.
“This isn’t a data center,” Quinn said. “This is a high
performance compute AI base. That is what they call it. The difference in what
we are doing from a normal data center is the difference between a single
family house and a skyscraper.”
What distinguishes NE Edge is not just that it would be
powered by a nuclear generation plant, but that it will have an agreement with
plant operator Dominion that will allow the center to tie directly to the
Millstone generators without passing through the costly transmission
infrastructure controlled by Eversource and regulated by the state.
By remaining “behind the meter,” as Quinn puts it, NE Edge
can negotiate a power purchase agreement with Dominion that is lower than the
rate — one of the highest in the nation — that Connecticut utility customers
pay. Without a negotiated “behind the meter” agreement, Quinn said a project of
the scale he envisions would not be practical in New England.
It also makes for an environmentally friendly, “clean”
operation by avoiding the use of carbon-based electric generation..
NE Edge would make money by connecting to the high speed
fiber optic network that runs past the Millstone site and renting computing
services to businesses, from online retailers to stock exchanges.
NE Edge has pushed its proposal for five years. It got a
break in 2021 with enactment of a state law that waived sales and property
taxes for up to 30 years for developers who invest $400 million in data center
projects. The law, the product of an unsuccessful Connecticut attempt to
attract data center development that could lure the processing of Wall Street
trades away from New York and New Jersey, also cleared the way for behind the
meter connections to electricity generators.
Quinn said NE Edge has secured $1.6 billion in financing for
construction of buildings, an electric switching station and two, two-story
buildings with a combined 1.2 million square feet. He plans to spend an
equivalent amount on 25,000 to 35,000 servers and enough recyclable sodium ion
batteries to ensure the power supply is never interrupted.
The data center would occupy 55 acres of Dominion’s 526 acre
Millstone property and would not be visible from roads to the north or from
Long Island Sound to the south, according to a report by the Connecticut Siting Council. Quinn said Turner
Construction, currently building 17 clean data centers in the U.S., is to be
the builder.
To keep the center quiet — Quinn said the center’s noise
level should match the area’s ambient level — loud equipment like air handlers
would be placed inside the buildings and enclosed by insulated concrete walls
so thick they must be poured while lying flat on the ground and later tilted up
into place.
Under a host fee provision in the state law establishing the
tax incentive, NE Edge would pay Waterford $231 million over the next 30 years
in lieu of property taxes.
The state would get more than $1 billion over 30 years,
Quinn said.
Part of the state’s money would come from a premium NE Edge
agrees to pay based on 12.08% of what it pays Dominion for electricity. Quinn
said the premium could amount to $1.1 billion or about a third of what the
state owes on a long-term power purchase agreement it has with Dominion. The
state signed its agreement with Dominion as an incentive for the company to
keep the Millstone reactors in operation, according to the Connecticut Siting
Council.
Quinn said NE Edge has agreed to pay the state another $63
million over 30 years through contributions to an energy assistance fund that
supports residents who cannot pay electricity bills.
Finally, NE Edge has agreed to store the state’s data at a
rate discounted by 27.5%, Quinn said, a deal that would make Connecticut the
first state to store its data in a fossil free operation.
Dan Dolan, president of the New England
Power Generators Association, said NE Edge’s Waterford plan is being
watched closely by industry players across the Northeast.
“I really am hard pressed to think of another example in New
England where we could see a data center come in at that scale with land use,
population density and then, honestly, the retail price of electricity that is
relatively high across New England compared to the rest of the country,” he
said. “So I think this is a unique one.”
Dominion Energy said in a statement that it supports the
project and recognizes “the benefits of constructing a large electric user near
a generating plant.” The company is applying for license renewals that could
keep the Millstone reactors active into the 2060s, and said that power purchase
agreements like that contemplated with NE Edge are “critical to Dominion
Energy’s continued operations.”
The company said it is “in discussions with NE Edge
regarding a Power Purchase Agreement (PPA) but there is not a signed PPA.”
“The right framework”
Waterford First Selectman Rob Brule said his board and the
28-member Representative Town Meeting both voted unanimously in
support of the data center “to help retain our largest taxpayer, Dominion
Energy, and provide additional decades of financial stability in the Town’s tax
base.”
Questions about the NE Edge plan are coming from the
Department of Energy and Environmental Protection.
Dominion said it has “had high level conversations with DEEP
about the data center project,” but did not elaborate. A DEEP spokesman said
Commissioner Dykes would not discuss the project beyond her brief remarks when she appeared recently before the
legislature’s Energy and Technology Committee to comment on
legislation that would order a study of data center electric power use.
“We recognize that artificial intelligence is providing
enormous promise and there are a lot of questions about it,” Dykes told the
committee. “But from the energy perspective alone I understand that the demand
and need for data centers is expanding significantly …
“And so we think that it is really important to have the
right framework to ensure that there is equitable deployment of this kind of
demand, that it doesn’t shift any costs or increase costs to other ratepayers
and is harmonized with the need to maintain reliability of the grid. So we
welcome the opportunity to further engage with the committee as it decides on
ways to support the expansion of data centers, but in a way that accomplishes
those goals.”
Dykes was testifying on a brief and hastily drawn committee
bill that, if enacted, would require a variety of regulatory agencies,
including DEEP, the state’s rate setting authority and the independent operator
of the New England energy grid, to “evaluate the impact of large data centers
on grid reliability.”
Sen. Norm Needleman, the committee chairman who had staff
draft the bill, said he is focused on a part of the NE Edge plan that would
have the data center draw power from the regional power grid on occasions when
Millstone generation is offline because of maintenance or other issues.
“That is like a double whammy on the power plan,” Needleman
said. “You’ve got a 300 megawatts reduction at Millstone. And at the same time
if something happened and backup needed to be run, you are pulling 300
megawatts off of the grid.”
Millstone is a major contributor to the regional electric
grid, supplying 12% of the region’s peak energy load between 2019 and 2022,
according to a report by the Connecticut Siting Council. The same report says
that Dominion believes that providing power to the data center would not affect
its commitment to supply the grid.
Dominion “believes the interconnection of the data centers
and associated switchyard would not have any impact on Millstone Power
Station’s winter and summer reliability,” the report said.
As written, there is nothing in the committee bill that
could block the data center. But Needleman called the bill a work in progress
and said there is the possibility of a revision that could make the tax
exemptions on which the project depends contingent on completion of an energy
study. Other legislative observers said there is no guarantee the bill has
enough support to survive in any form.
The siting council also has questions about the center’s
power use, questions similar to those asked by Dykes. Its jurisdiction over the
location of electrical generating facilities gives it authority to decide
whether to grant a request by Dominion to sell a portion of its property on
Millstone Point to NE Edge.
The council denied Dominion’s request to sell the land in early
January. In a written decision, the siting council concluded that “it is
premature” to examine terms of the land sale because of a “lack of information”
about the data centers and their direct connection to Millstone.
When Hartford Yard Goats fans pull up to Dunkin’ Park for
the first game of the season next week, they might be shocked to see mounds of
dirt and bulldozers in their former parking lot across from the stadium on Main
Street.
That’s where developer Randy Salvatore is building the next
phase of his North Crossing development, which includes a 228-unit
apartment building and a roughly 500-space parking garage.
The former primary Yard Goats parking lot is closed.
But the Yard Goats have partnered with LAZ Parking, Hartford
Parking Authority and Propark to offer $5 parking in six lots – including three
new ones – all within about a block of Dunkin’ Park.
For the first time this year, fans will be able to park in
the 1,000-space garage at 200 Church St. under an agreement with the garage
operator, Propark. The lot is next to the XL Center.
Spectators can also park at the Saints lot, which has 267
spaces. The Hartford Parking Authority lot at 75 Windsor St. adds 803 spaces.
In total, there will be 5,500 spots available within a
five-minute walk of the stadium, said Yard Goats President Tim Restall.
“We’re actually increasing the amount of parking that’s
within walking distance to the ballpark,” Restall said.
Yard Goats home games attract about 1,200 cars on an average
night, he said.
Average attendance exceeded 6,000 at home games last year –
the highest average in the team’s history.
300 Market St.
Saints Lot (285 Church St.)
1000 Main St.
275 Windsor St.
MAT Garage (55 Chapel St. South)
Church Street Garage (200 Church St.)
“We encourage fans to enter the parking lot address into
their GPS to help expedite their arrival,” Yard Goats General Manager Mike
Abramson said.
Fans can pre-pay for parking through the Yard Goats website
and via the LAZgo app.
Fans also may commute to the games via CTfastrak and CT
Transit bus services, from throughout the Greater Hartford area to within two
blocks of Dunkin' Park.
Free parking is available at CTfastrak stations in New
Britain, Newington, West Hartford and Hartford Line/Union Station.
There are also 100 bicycle racks at the ballpark.
The Yard Goats’ first home game of the season is on Tuesday,
April 9, against the Bowie Baysox.
The Yard Goats are the Double-A affiliate of the Colorado
Rockies.
For more information, visit yardgoatsparking.com.
Tax credits likely a boon to offshore wind industry in Connecticut
Greg Smith
New London ― State officials say the expanded eligibility of
federal tax credits for offshore wind projects announced on Friday by the Biden
Administration comes at an opportune time.
The bidding period for new offshore wind power projects in
Connecticut closes on Wednesday, and offshore wind developers have spent the
last year struggling with cost increases associated with inflation, high
interest rates and supply chain issues. Some companies have canceled, postponed
or tried to rebid projects in the U.S. and abroad.
On Friday, the Treasury Department issued new guidance on
the offshore wind tax credits that state Department of Energy and Environmental
Protection Commissioner Katie Dykes said provides clarity and incentives that
will help drive new investments and secure lower-cost wind power in a state
that has a goal of a zero-carbon grid by 2040.
Dykes on Monday was among a host of state and local
officials to join U.S. Sen. Richard Blumenthal, D-Conn., at State Pier, the
site of an offshore wind staging and assembly facility. The group celebrated
the news that in addition to the 30% tax credit already available for renewable
energy developments, another 10% bonus credit is available for projects in
locations deemed as “energy communities.” Energy communities are areas that
have experienced job losses, economic distress or serious health ramifications
because of proximity to polluted industrial sites known as brownfields or coal-
or gas-fired power plants.
The tax credit program is part of the 2022 federal
“Inflation Reduction Act,” and Blumenthal said he expects that places like New
London, New Haven and other areas of the state being eyed for development by
the offshore wind industry would be deemed energy communities and benefit as a
result.
“(Offshore wind) is our future, we need to make sure we
realize its full potential,” Blumenthal said.
With the list of energy communities not yet established, it
remains unclear if New London qualifies and why.
Connecticut has just one contract for offshore wind power,
the 300 megawatts associated with Ørsted and Eversource’s 704-megawatt
Revolution Wind. That project is under construction and will be staged at State
Pier this spring.
Paul Lavoie, chief manufacturing officer for Connecticut and
chairman of the board for the Connecticut Wind Collaborative, said federal tax
credits provide needed incentives for the offshore wind companies to invest in
Connecticut. Aside from State Pier, which Lavoie called the “epicenter of the
offshore wind industry,” the tax credits open more opportunities for the
state’s other deep water ports in Bridgeport and New Haven.
“Having the full benefits of the Inflation Reduction Act
working here in New England, working here in Connecticut, means that we will be
assured that offshore wind will be more affordable as we look to invest in this
important resource,” Dykes said.
The state in the latest bid solicitation joined with
Massachusetts and Rhode Island, and could decide to buy up to 2,000 megawatts
of offshore wind power. Together, the three states are seeking up to 6,800
megawatts.
U.S. Rep Joe Courtney in a statement said the Treasury
Department up until Friday had provided a “limited path for credit eligibility
for offshore wind projects,” and that New London and projects at State Pier
were unlikely to receive the bonus credit.
Courtney said the new guidance is “game-changing news for
southeastern Connecticut” that will provide incentives for future offshore wind
projects to select locations like State Pier.
“Today’s announcement, coupled with the offshore wind
projects already taking place in the Long Island Sound, will further cement our
region’s leading role in clean energy production, which is good for the
economy, homeowners, and our climate,” Courtney said.
Blumenthal on Monday also highlighted $3.3 million in
federal funding for the University of Connecticut to advance an electric grid
powered by wind and solar energy.
New bridge taking shape at Wilton's Lovers Lane; work near Merwin Meadows to be completed in summer
WILTON — Construction crews have been busy with work
underway on a bridge replacement project on Lover Lane near Merwin
Meadows park.
Motorists last week faced
intermittent closures on Lovers Lane as a crane and bridge beams were
delivered and installed at the work site.
The entire bridge replacement project is expected to be
completed this summer.
The work this spring is the latest step in installing a
new 60-foot
bridge that will carry Lovers Lane over the Comstock Brook near
the park.
Lovers Lane, which is off Ridgefield Road, also known
as Route 33, opposite Wilton Center, connects with Merwin Lane. Both roads are
dead-ends, and there are about 10 houses as well as the Wilton Playshop along
the road that leads to Merwin Meadows town park.
Last year, a temporary
bridge, allowing one lane of alternating traffic, was installed on
Lovers Lane. It temporarily replaced a 90-year-old
bridge that was "functionally obsolete," had structural
problems and was only 16 feet wide.
The total cost of the construction of the replacement bridge
was estimated
at $2.7 million to $2.8 million in 2020. The town will be responsible for
20 percent of the cost, with federal funds paying the remaining 80 percent.
Fairfield will go to court to block UI monopole plan, first selectman says
FAIRFIELD — Local property owners will lose more land than
initially expected under United Illuminating's plan to build steel monopoles
through town as part of a major utility line upgrade.
The amount of private property UI can use in Fairfield is
set to increase from less than nine acres to nearly 11 acres as the result
of a Connecticut
Siting Council decision last month to move the proposed monopoles,
which will carry transmission lines along the railroad tracks, from the south
to the north of the tracks, according to council filings.
UI had applied to use 19.25 acres of private property across
Fairfield and Bridgeport for the project, but the Siting Council's
decision had not specified that relocating the monopoles north would increase
that number to 22 acres, which UI officials confirmed to Hearst Connecticut
Media was their current total estimate. The Siting Council is the state panel
that regulates utility projects.
"Oh my dear lord," said Fairfield First Selectman
Bill Gerber, who was unaware of the increase in private property acreage until
reached for comment.
Gerber said the town plans to file an appeal against the
project in Superior Court soon, and he hopes the legal action from the town
will mean a stay from the court, pausing UI's construction until a judge makes
a ruling on the project's legality. UI officials said construction is set to
begin between 2025 and 2026, and the revised plans would likely jack up the
project's cost from $225 million to an estimated $322 million.
Gerber said he viewed the Siting Council's decision as
a potential "step in the right direction" last month but said the
lack of communication about the added impact to private property did a
"disservice" to the public.
"It's embarrassing — I don't know if its embarrassing
for me or for them," he said of UI. "If they had this information,
it's another example of them not being transparent. That's really, really hard
to understand why they wouldn’t have made that clear."
Neighbors, businesses and elected officials have protested
the construction plans for months. The plan to use private property
for the poles would provide UI with permanent access to homes, businesses and
place of worship and restrict
the development of those properties, critics said.
Cindi Bigelow — president and CEO of Bigelow Tea, whose
Fairfield headquarters border the railroad tracks — said officials with the tea
company are working to learn more about the monopoles, worried there might be a
"significant impact" if any are put up on their property. She said
she hasn't heard from UI about the plans and questioned if that means the
Bigelow property would dodge the direct effects of the project.
"I realize these poles could be impacting a lot of
residents and businesses," she said in an email. "I am
concerned for all those affected."
Gerber said UI and his administration had not spoken about
the alternative plan to move the monopoles north until earlier this month,
when they met for a tour of the targeted properties north of the railroad
tracks. UI officials said they sent a letter last month to their resident and
business customers who either are near the railroad tracks or sit within the
project's "direct visual line." The letter explained the engineering,
energy land management, community outreach and environmental and permitting work
the company plans over the next year or two.
Liz O'Connell, a business manager at Highland Imports
on Linwood Avenue, which sits across the street from the railroad tracks, said
earlier this month that she hadn't received any kind of a notice from UI about
the monopoles. She said she was worried about traffic interruptions from
construction near the business, which sits in between Post Road and Interstate
95.
"It's difficult for the truck drivers to even back into
our loading dock as it is right now, so if these poles are going to be some
massive obstacle, that's going to be a problem," she said.
The monopoles relocated to the north would extend from the
project's western border near Sasco Creek to the Ash Creek substation,
which sits across from the Fairfield Metro station in Bridgeport's Black Rock
neighborhood. Moving those monopoles north would increase the total area of
private property easements in Fairfield, which give UI the legal right to
use residents' land. UI applied to use 5.9 acres of private property
between those two points, but that number will jump to eight acres under the
revised plans, according to the Siting Council.
UI project manager Shawn Crosbie said the private property
easements won't extend east of the Ash Creek substation, leaving
Bridgeport virtually untouched by any further increase. Crosbie also said
UI plans to lower the monopoles by roughly 10 percent of their originally
proposed heights, which were set to range from 95 to 195 feet tall. He
said lower monopole height likely means more monopoles to account for wire
slack.
"Our job is to reduce impacts to customers and the
environment in some of the things we look at," he said.
The Siting Council process surrounding the UI project
has stirred debate in Hartford, where committees in the state Senate and House
of Representatives consider bills that would reform the body's makeup. The
Senate bill proposed
neighborhood representation on the Siting Council; the House bill
would bar
more than one member with past or current investment or employment
ties to utilities from serving on the body.
Siting Council officials did not return multiple requests
for comment.
UI spokesperson Sarah Wall Fliotsos stressed that
current figures for the Fairfield project are estimates, not cemented
calculations, as UI continues to craft a new project design that will balance
its electric grid with the community it abuts.
"Modernizing the transmission infrastructure — not only
in Fairfield County but across our service territory — is essential to
delivering reliable, resilient electric service now and well into the future,
and UI is committed to working with all our stakeholders to ensure this
obligation is met,” she said in an email.