Meta's $10B Data Center Faces Backlash Over Natural Gas Power Plants

Meta's $10B data center in Louisiana has been approved for gas power plants, despite controversy among locals. The plants, expected to come online in 2028 and 2029, will generate 2.25 gigawatts of electricity and have a 15-year contract with Entergy. Critics worry about special treatment for the data center project and the potential burden on ratepayers after the contract expires. The deal will make it harder for Meta to achieve its 2030 net zero pledge, requiring the company to buy carbon removal credits.

In a move that has sparked both support and controversy, the Louisiana Public Service Commission (PSC) has approved Entergy's plan to build three natural gas power plants to supply electricity to Meta's new data center in Richland Parish. The decision, made at a meeting in Plaquemine, clears the way for the construction of the facilities, which are essential for Meta's $10 billion facility to proceed [1].

The data center, covering 4 million square feet, is designed to support Meta's advanced AI models and could consume up to 5 gigawatts annually. The PSC voted 4-1 in favor of the plan proposed by Entergy, with Commissioner Foster Campbell expressing strong support for the project. Commissioner Davante Lewis was the sole dissenter, citing unresolved questions about the agreement [1].

The approval was largely expected as Louisiana officials, including Gov. Jeff Landry, have welcomed the project as an economic development gamechanger in a long-struggling region of the state. However, the project has drawn criticism over its huge energy needs and potential impacts on ratepayers and the environment. Concerns were raised about rising gas prices, unclear job commitments by the tech company, water demands of the facility, and environmental risks [1].

The plants, expected to come online in 2028 and 2029, will generate 2.25 gigawatts of electricity and have a 15-year contract with Entergy. Critics worry about special treatment for the data center project and the potential burden on ratepayers after the contract expires. The deal will make it harder for Meta to achieve its 2030 net zero pledge, requiring the company to buy carbon removal credits [2].

Entergy has stressed that the tech company will cover all revenue for the new plants throughout the 15-year contract. However, opponents argue that the plants' lifespan of up to 40 years, given Meta's contract is only for 15, poses a risk to other ratepayers if the tech company leaves. All customers will also pay for a $550 million transmission line and operational costs related to the plants [1].

While supporters say the plants can serve all customers if Meta leaves after its 15-year deal is up, allowing Entergy to retire older plants, residents from Thibodaux to Monroe voiced caution. The potential environmental impact, including pollution and climate warming emissions, is a significant concern for opponents [1].

Meta has agreed to provide 1500 megawatts of renewable energy to the grid as part of the deal, though the commitment is not legally binding. The vote took place before a judge who oversaw a recent hearing on the case was able to release her legal recommendations. Entergy and the four regulators agreed that the issues have already been thoroughly discussed, saying there was no point in further delaying such an important project [1].

References:

[1] https://www.nola.com/news/business/louisiana-meta-ai-data-center-power-electricity-environment/article_d4ec7a53-c022-4d5c-bc28-b0234d84e019.html
[2] https://www.ainvest.com/news/entergy-gains-approval-gas-plants-power-meta-louisiana-data-center-2508/