El Pasoans are growing more concerned about the three data centers being built in the region, including one being built just across the New Mexico border in Santa Teresa. Construction is underway in Northeast El Paso for a $10 billion, (originally $1.5 billion) META datacenter that promises to create 1,800 construction jobs as it is being built and 100 jobs to keep it running when it comes online.
A second datacenter is being proposed by the U.S. Army for artificial intelligence (AI) use at Fort Bliss. In Santa Teresa, Project Jupiter is also planned for AI use.
Concerns Over Electricity and Water Grow
Controversies across the nation over the use of electricity and water have led communities to curtail datacenters in their communities. Officials in Denver, Colorado passed a one-year moratorium halting datacenter construction in Denver over concerns about the electrical grid’s capacity. In St. Charles, Missouri and in Rosemount, Minnesota, developers were forced to cancel plans to build a datacenter after local residents pushed back on the development. Voters in Festus, Missouri ousted every incumbent on the ballot after they approved a $6 billion AI datacenter in their city. And in Tucson, Arizona, the local city council pulled out of the $3 billion Project Blue datacenter over concerns of the water it would require top keep machines cool.
Earlier this month, the City of Tucson ordered Project Blue to stop using Tucson’s water for the construction of the datacenter. City officials discovered that although they had voted unanimously to oppose the project last year, a Project Blue contractor had requested a temporary water meter. Rather than use the water within the city, the contractor was transporting the water to the datacenter construction site outside of the service area. The developers now say that instead of using water to cool the datacenter, they will instead use an air-cooled system.
Since March, El Paso city officials have been exploring options for the future of datacenters in the city, including prohibiting them altogether. In addition to the pressure put on the electrical grid, AI datacenters are also controversial for the water they require to keep systems cool.
Water Resourced and Closed-Loop Systems
The META datacenter promises to rely on a closed-loop cooling system. Like META, Project Jupiter also promises to rely on a closed-loop cooling system for its operations.
Closed-loop cooling systems in essence recirculate a fixed-volume of liquid through pipes to help keep computers cool enough to operate. Although developers argue the closed-loop systems only require water to fill up initially and do not require additional water for daily operations, there is the requirement to top off water lost through maintenance or leaks in the pipes. Because the water does not evaporate to cool the machines, the developers argue that water usage for cooling is minimal after the initial filling of the system.
However, the savings in water used for cooling puts added stress on the electrical grid because the closed-loop water system requires electricity to operate the pumps, heat exchangers and other equipment to circulate the liquid in the closed-loop system. Closed-loop cooling systems use water and other chemicals to cool the computers.
El Paso Electric relies heavily on thermal electric plants to generate electricity for consumers in the service area.
Like the datacenters, thermal electric plants, whether coal, natural gas or nuclear, require massive amounts of water to cool the equipment. Texas, in particular, “relies on state water resources,” to feed the electrical grid. A drought in 2023 and hot summers put at risk around 25% of the state’s electricity generating capacity.
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On one hand, the closed-loop cooling systems proposed by the datacenter developers seemingly save water resources while adding pressure to the electrical grid leading to their need to consume greater amounts of water.
Demand for water in Texas has forced state planners to start planning water strategies to avoid the potential loss of water access to around 25% of the state’s residents by 2070. To address the emerging water crisis for Texas, communities in the state will be required to spend $174 billion over the next 50 years said the Texas Water Development Board last month.
The proposed datacenters for Texas are likely to increase water usage in Texas by up to 9% by 2040, adding further pressure to Texas’ dwindling water supplies, according to University of Texas at Austin’s white paper released earlier this month.
Around 484 datacenters are either operating in Texas or are under construction or planned. The Texas datacenters “will consume electricity equivalent to tens of millions of homes” in Texas.
As more datacenters are planned across the nation, the demand for electricity led NextEra Energy and Dominion Energy to announce a merger on Monday to create the “world’s largest regulated electric utility” in the nation. Should regulators approve the merger, the $66.8 billion deal will make NextEra the second-largest nuclear power operator in the country.
Job Losses Across META
As El Paso officials consider limiting datacenters in the city and debate over the META center continues, proponents of datacenters argue that the jobs they create offset the problems they bring.
However, META, the developer of the Northeast datacenter in El Paso, sent an email to around 8,000 employees yesterday telling them they were immediately laid off. The layoffs, according to META’s email, will allow the company “to offset the other investments” the company is making.
META has committed to spending $600 billion to build datacenters in the U.S. through 2028. This includes the $10 billion datacenter campus in El Paso. META had originally budgeted $1.5 billion for the El Paso campus but revised that figure to $10 billion earlier this year. It hopes to open the datacenter campus by 2028.
According to the 380 Program agreement the City entered with META in December 2023, the datacenter will provide at least 50 full-time jobs within four years after the datacenter is completed, and at least for 15 years while META receives property tax abatements of around 80% of the city property taxes per the economic development agreement.
The agreement stipulates that META “is exploring (but shall not be obligated to pursue) options to use alternative energy sources” to operate the datacenter, leaving it reliant on the electrical grid used by El Pasoans, El Paso Electric. City officials also waived the government’s immunity clause against being sued when the city entered into the 380 agreement.
Although not spelled out in the agreement, city officials have been advised that if the city were to terminate the agreement with META because of community concerns, the penalty could be as high as $1 billion should META decide to pursue legal action against the city. As with any litigation, META would have to convince a judge that it suffered economic losses because the city ended the agreement.
More information about El Paso’s datacenters can be found at the city’s Data Center Resource page. Information about groups organizing oppositions to the META datacenter and other datacenters can be found at this page.
Cover photograph: Rendering of proposed META datacenter, courtesy META.