drafting a bill to implement protections against data center impacts

A Democratic state lawmaker is working on a bill to file next year in Frankfort that would try to regulate the impacts of hyperscale data centers and the transparency concerns swirling around those pending developments in the state. 

Rep. Adam Moore, D-Lexington, proposed a bill during this year’s legislative session that sought to ensure electricity ratepayers aren’t burdened by the costs of hyperscale data centers. That bill did not receive a committee hearing in the GOP-controlled state legislature, and a GOP-sponsored bill to similarly provide ratepayer protections didn’t pass the Kentucky Senate. 

But Moore told the Lantern on Monday after hearing from constituents, they also had concerns over local officials signing non-disclosure agreements with data center developers. Such agreements prevent local officials from releasing specific information about a project. 

“It almost seems like counties or municipalities are working behind closed doors, potentially against one another, to try to lure or get the best deal possible to bring a data center there,” Moore said. “The constituents of that area are kind of left in the lurch, and they only find out about the details once it actually hits the front page of the local newspaper.”

He said his new bill being drafted by legislative staff would go beyond just electricity ratepayer protections to also ensure communities have “local control” over a data center project, if they want it in their community.

Moore’s tentative bill, described in detail in an email newsletter, would require that no hyperscale data center can locate into a community unless a county or city is designated by the state as a “Hyperscale Ready Community”. He pulled inspiration from a similar state designation process for nuclear energy. 

Such a designation would require local public hearings on a project; a resolution passed by a fiscal court or city council in favor of a data center or a successful local ballot initiative; and the adoption of a siting ordinance to regulate data centers.

Moore said such a siting ordinance would require a county or city to address setbacks, water usage, noise and other environmental considerations for a data center, but the local government would be given flexibility on how to regulate each aspect. 

“What I need in my county is not the same thing that you need in your county,” Moore said. “It’’s not just about ratepayer protection. It’s also about local control. It’s also about transparency. It’s about building trust in our communities again.” 

Barring his bill becoming law, Moore said he hopes to at least “shape the conversation” around data center regulation during next year’s legislative session. 

“I think it is our job to establish guardrails and accept that it will not be a perfect solution or even the permanent solution, but we have to put certain protections in place,” Moore said.