No AI data centers in my backyard!

Hey, Darian. So look, I wanted to tell you about this meeting I went to not that long ago. It was a planning commission meeting for a little place called Pavilion Township, Michigan.

Yeah, you know, I hadn't actually either, even though I live like about an hour away. But so at the meeting, what they were going to talk about was a zoning ordinance amendment to allow data centers.

Yeah, because they're such a huge factor in the economy right now.

And it turns out data centers are a new hot button issue in local government. So I went to this meeting expecting just like a boring little discussion about this zoning amendment, but it was not. The place was packed.

Yeah, all of them.

Yeah, it's a very small building, small room. And the head of the planning commission was starting to get worried.

No, there wasn't like a group that organized this response. This was just people from the community. And it's a small community, only a little over 6,000 people live here. But when it comes to data centers, they are united.

This is Elizabeth Clark, and when she gets up to talk, she asks people to raise their hands if they live within 10 miles of here. And most people do. And Clark says for her, this is actually about water.

Yeah, it depends on the design of the data center. But the water is mostly used for cooling the computers. And Michigan has a lot of water. We're surrounded by the Great Lakes. But folks here are concerned that the proposal does not forbid using the community's drinking water.

Yeah, there are definitely clusters, places that have cheaper power, lots of land, or just lots of data centers already nearby.

But there are people who've been trying to push more data centers in Michigan, including our governor, because of the investment, the tax revenues that can flood in from a massive data center. And the demand for the AI data centers is just so big right now that the proposals are showing up everywhere, including more proposals in places that weren't at the center before, places like Michigan. But the people here are not sure it's worth it. And at the meeting, this one guy, David Sotin, raised another community concerned. He said it's all risk, no benefits.

Right, initially. Although it is worth mentioning there's some research out there that these benefits don't always outweigh the downsides. Either way, the potential benefits are what's pushing data centers forward in a lot of communities. But what it seems like now in places like Pavilion Township and many other places is the size and scale and resource requirements are just really sinking in for nearby residents.

After this meeting, I met up with John Paver, who'd been very vocal. He actually lives in the next township over, and he's not against AI. He uses it. And I'm not saying just for, like, ChatGPT to write an email. He told me he used a program called Cursor AI to code a video game for him. So this guy is in deep.

Yeah. So he pointed out that one of the state's big utility companies, CMS Energy, has recently announced plans to provide power to a data center that will use 1 gigawatt of electricity, which is a lot.

And I will say it's not confirmed yet where this 1 GW data center is going to be located. It's not necessarily Paphilion Township. And when I asked the utility, cms, Energy, Consumers Energy about it, they said they wouldn't disclose the location of this site or who they're even building it for. But for Paver, he's not saying no, absolutely not. No data centers. He just wants to see more from the developers, really.

Yeah. And here in Michigan, just in the past couple of months, at least three local communities have had significant pushback against data centers coming in. And it's not just that, because also utility regulators are starting to impose these new rate structures on data centers because there's this concern that the utilities will build out infrastructure to feed power to the data center. And the data center could just go belly up in a couple of years. And that would leave regular ratepayers just their local residents to pay for all of those utility upgrades that happened. And so they're imposing these new structures so that local residents won't get stuck with these costs.

Because until now it's all just been about speed. You get the data center up and running as fast as possible, put the servers in and go.

Well, maybe not, but it could change the approach companies might take to data centers. According to Vijay Gaddapati, who's at MIT's Lincoln Laboratory and he runs a couple

Yeah, and Vijay says the way data centers have been going up, there hasn't been a lot of reason for companies to really be efficient with the way they're using all those computers inside the data center.

Yeah, that's his take. He sees a lot of opportunity to squeeze out a lot more computational power out of the data centers that already exist. The alternative is more of what we've seen so far. A lot of these hyperscale data centers have started bringing in their own temporary power, like natural gas generators and fuel cells.

No, it definitely, definitely would not.