By Esteban Fernandez
For Times West Virginian
Fairmont — State Sen. Joey Garcia, D-13, owns up to his vote on House Bill 2014.
HB 2014 set the rules by which microgrids that power data centers would be regulated, as well as created rules governing how tax money collected from data centers would be distributed. Garcia voted for the bill last year. However, outcry from his constituents has him reconsidering his stance.
Del. Phil Mallow, R-75, made an oblique reference to a member of Marion County’s delegation who was having second thoughts about the bill at a luncheon on Wednesday.
“I voted based on the information I had at the time, and I think I’m man enough to say when I made a mistake, and part of that is going back and now trying to do everything I possibly can to fix things going forward,” Garcia said. “I think it’s important when you hear from constituents about what’s happened in other places, how it can potentially hurt the environment, hurt energy prices, the biggest thing I can do is try to pass legislation that fixes that and makes it right.”
Opposing sides of the data center maelstrom are coalescing over the issue in Marion County. County Republicans have shown favor toward data centers. At Mallow’s luncheon, a claim from one attendee that the room was 90% in favor of data centers drew derisive laughs from another group of attendees.
Mallow’s luncheon is typically a Republican affair, however, all were welcome to Wednesday’s event. Online, plenty of vociferous opposition exists, which Mallow and Chris Morris, the state’s data center czar, argued was driven by misinformation.
Del. Guy Ward, R-Marion, argued against the West Virginia Center for Budget and Policy’s analysis that data centers would cost schools money. He pointed to last week’s presentation at the state legislature, where the tax commissioner made several points arguing schools stood to benefit from taxes collected from data centers. Matt Irby, the commissioner, argued schools would get $38 million from a $5 billion data center.
However, Ward said the real issue is infrastructure. Marion County-based Hog Lick Aggregates is exploring the idea of a data center on its property, however, no official project has been announced. Ward said he doesn’t think there are enough transmission lines to bring all the power a data center would need to the Hog Lick site. However, the Rivesville Power Station might.
To be clear, no project at Rivesville has been announced. None. Ward simply floated it as an idea of what to do with the existing defunct power plant.
“I think the people of Rivesville would welcome it, because when they lost that power plant, they lost a lot of revenue to the town,” Ward said. “And there’s plenty of water along the Monongahela River. These new data centers, or closed systems, you only need water to make up. The makeup is very little water compared to what the system uses.”
Garcia pointed out another aspect of the conversation that isn’t getting as much attention. What if the bubble around AI valuation pops? Garcia said a lot of the conversation around data centers resembles that of the zeitgeist around bitcoin during its heyday several years ago. Now, almost no one talks about it.
“I think a bubble bursting can really wreak havoc on energy costs, which is right now one of the major things that’s fueling instability,” he said.
Loudoun County, Virginia has become a favorite talking point for data center proponents because of the billion dollar revenues they brought to the county. However, Loudoun County Supervisor Caleb Kershner is worried budgets have grown too much from the revenue.
Garcia asked what happens to those budgets if the money from a data center bubble goes away when the bubble pops. Sam Altman, CEO of OpenAI, said a few weeks ago the AI bubble popping would be a good thing.
The idea of a bubble popping after AI has moved combined with the elimination of income and even property tax like Mallow wants unnerves Garcia. He compared it to how coal’s collapse led to tax revenue drying up for the state.
However, Garcia said he’s not completely against data centers, provided they’re introduced correctly. He introduced a bill this year to restore some local control over data centers. However, the bill went nowhere.
“If a company wants to come in and build a data center, and the community has the ability to regulate it and there is both local input and our Department of Environmental Protection, in collaboration with our utilities, I think there’s a way they can be done,” he said. “But they have to be done right.”
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