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Atlanta may join ranks of data center deniers

by Martha DeGrasse 5/14/24

The Atlanta Beltline is one of the nation’s largest urban redevelopment projects, with affordable housing, green space and public transportation, designed to roughly follow a railroad for 22 miles. A fiber network built by eX² Technology also follows the Beltline, and the city is working with Honeywell on a smart city project that is expected to include free public Wi-Fi, connected trash cans, digital maps and an autonomous grocery store.


Kara Lively, the Atlanta Beltline’s director of economic development, said the city is eager to discuss potential partnerships with the communications industry. She sees the Beltline’s fiber ring as a major asset that can be leveraged to create new services for citizens.


But one major part of the communications infrastructure industry may not be able to participate. Atlanta City Council member Jason Dozier has introduced legislation that would outlaw the construction of data centers near the Beltline.


Dozier noted that Atlanta’s planned construction of data centers and warehouses has tripled within the last year. He says he wants to try to preserve the Beltline for housing and other uses that prioritize “people not machines.” Dozier expects the City Council to vote on his plan before the end of the year.


During the same week that Dozier introduced his legislation, President Joe Biden traveled to Racine, Wisconsin to announce a $3.3 billion dollar investment from Microsoft to build a new data center at the site of an ill-fated Foxconn factory that was once a flagship example of economic development orchestrated by former President Donald Trump. Biden said the Microsoft data center will create thousands of jobs.


Atlanta’s Jason Dozier sees data centers differently. “Despite their growth, data centers don't create many local jobs compared to other sectors,” he wrote on X. X itself processes petabytes of data in Atlanta without employing large numbers of people. Elon Musk’s social media business secured a $10 million tax break from the city this year as an incentive to expand its data center there, and disclosed at the time that the expansion would not create any new jobs.


Dozier, a decorated veteran of the U.S. military actions in Iraq and Afghanistan, returned to his hometown to help veterans re-enter the workforce in Atlanta. In his view, data centers don't help much with job creation. They “limit economic benefits for our communities [because] their existence presents a trade-off, diverting resources and focus away from alternative, people-oriented development priorities,” he argued in his X post.


One of the resources Dozier is talking about is power. According to Georgia Power, 80% of new demand for power is now coming from data centers. The Southern Company subsidiary shared this statistic when asking the state’s energy regulators to approve the utility’s plan to expand output by buying electricity from other utilities, and by building new capacity.


Some of Georgia Power’s additional output will be generated by renewable sources, but not all of it. Georgians recognize that data center demand is driving an increase in the burning of fossil fuels, and they also recognize that the growth in demand for data centers is driven by the training and deployment of artificial intelligence models. And while more and more people are turning to Gemini and ChatGPT for help with everything from homework to cooking to coding, many are also worried that AI is coming for their jobs, or will limit employment options for their kids.


Data center development definitely brings construction jobs, and in areas that don’t already have fiber, data centers can bring the backbone for residential broadband. So for years data centers were seen as big wins for the communities that could attract them. But that’s changing in some areas, including the world’s largest data center market, Northern Virginia. Some legislators there are now drafting laws that would limit data center development.


Their neighbors in Maryland seem to be moving in the opposite direction. This week Maryland Governor Wes Moore signed the state’s Critical Infrastructure Streamlining Act in order to make more power available for data centers. “This bill is going to supercharge the data center industry in Maryland, so we can unleash more economic potential and create more good paying union jobs,” the governor stated, according to one of the private companies involved in supporting Maryland’s data center industry.


Access to power seems to be the common thread that ties together the various data center debates around the country. In Oklahoma, lawmakers are questioning a data center developer’s plan to build near the state’s one nuclear power plant, because the developer is asking for priority access to the power.


Unlike some other forms of communications infrastructure, data centers don’t seem to have raised objections related to the safety of those who live nearby. Instead, competition for resources (mostly power) seems to be the major objection.


In Atlanta, the smart city applications envisioned by the Beltline’s economic development team could probably benefit from the ultra-low latency that a nearby data center would offer. But would those superfast speeds outweigh the benefit of more affordable housing units? It’s a complex question, because more density will drive demand for more services, which could in turn require more infrastructure in the carefully planned redevelopment zone. But it seems increasingly likely that this infrastructure will not include a data center.

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