The fight over hyperscale data centers in Kentucky reminds me of a similar fight decades ago over mega-landfills. Then, as now, Kentucky had cheap land and lots of it, with very little zoning. Then, as now, Kentuckians found themselves on the receiving end of huge decisions over which they had no say. What Kentucky did next on landfills is a template for what we could do now on data centers.
In late 1990 then-Gov. Wallace Wilkinson called the General Assembly into special session to deal with garbage. The call was triggered by public outcry over the development of mega-landfills designed to accept garbage from outside Kentucky. Kentuckians had visions of garbage coming in by the trainload, overrunning farms and fields.
I was assigned to write the governor’s bill, which was introduced as Senate Bill 2 and enacted into law as 1991 (1st Extra. Sess.) Kentucky Acts, ch. 12. SB 2 built on existing laws and added new ones. It was a deeply-negotiated piece of legislation, with all stakeholders at the table.
The linchpin of SB 2 was this: For the first time, landfill permits were tied to local planning. Counties had the duty to find a home for the garbage they expected to generate over time, by writing and implementing a management plan. A landfill developer seeking a permit from the then-Natural Resources and Environmental Protection Cabinet had to get a local determination that the landfill would be consistent with the host county’s plan.
This brought all interested parties to the table. Kentuckians had a voice, through their local elected officials. Counties had a duty to come up with a long-range garbage plan. Landfill developers offered services. Some counties agreed to host a landfill (including garbage from out-of-state); some sent their garbage outside the county for disposal.
The same linchpin – linking permits to local plans – would resolve the data center fight. We need laws that 1) set environmental protection and energy standards, with a permit program to be administered by the Energy and Environment Cabinet; 2) direct counties to write and implement a plan that addresses current and projected water and energy needs, economic development goals, and community values; 3) direct counties to issue a local determination on whether a proposed data center would be consistent with the plan; and 4) require a yes local determination on a proposed data center before a permit is issued.
We already have some idea of where to start on environmental protection and energy standards: Will there be enough water for the county’s projected development? Should cooling water be recycled? Should utilities pass construction costs along to ratepayers? Should data centers be bonded to pay for dismantling them if they go bust? What about confidential business information and non-disclosure agreements?
For local plans, SB 2 provides some insight. Kentucky’s 120 counties sometimes developed their own plans for managing garbage, but sometimes they banded together and wrote a regional plan. (Watershed-level plans might prove useful here.) Some developed 109 districts. Area development districts offered help. Counties wouldn’t have to go it alone.
Developing a local plan will put all stakeholders at the table. We would have the reassurance that Kentucky has leveled the playing field by writing into law environmental and energy standards, to be enforced with state permits. Beyond that, how do Kentuckians see our future? How much drinking water will we need? Do we want to preserve our farmland? What businesses and jobs do we want to see? Consent of the governed makes all the difference.
At a time of great national controversy over landfills (and an irate Supreme Court), Kentucky’s governor and its legislature were not afraid to lead. Kentucky could lead again, this time on data centers. We even have a template.
