To keep household electricity and local tax bills stable, there may be no single more effective solution today than a local data center. Our basic local infrastructure systems – electricity, roads, water/sewer – are steadily getting more expensive to maintain, meaning some level of population and/or revenue growth is needed to keep per capita costs down.
Prior to data center development in central Mississippi, local electric systems badly needed new customers to help bear the costs of improving storm resiliency and replacing old equipment like the 50 year-old gas generating plants in Greenville and Vicksburg. These costs alone are in the billions.
Every town and county needs an expanding tax base to avoid degraded systems and/or higher taxes. The Jackson water struggles are clear examples of challenges that come with economic decline (and mismanagement) with no clear financial solution in sight for City of Jackson infrastructure. In the absence of a growing population, large industrial projects are the best bets to generate new revenue for infrastructure systems.
Opposition to local data center development fails to recognize these realities along with the fact that our collective lifestyles are driving the demand for more data storage infrastructure. Each post we read on Jackson Jambalaya, every show we stream on Netflix or Amazon Prime, every purchase we make by card, driving directions we request on Google maps, our thousands of photos, years of emails, preferences and information on our apps, questions asked on ChatGPT and so on are all uses of a data center.
Across the country currently, anti-data center rhetoric, much of it exaggeration or misinformation, seems to have a louder voice than the story of massive economic benefits we’re seeing play out where companies like Amazon Web Services (AWS), AVAIO and Compass are building centers locally. Today’s negativity about data centers is reminiscent of the anti-fracking movement 10-15 years ago in the advent years of record growth in U.S. oil and gas production due to newly discovered drilling methods, which turned out to be one of the biggest economic game changers in U.S. history.
The point is, because of the sheer scale of these data center developments in Mississippi, both electricity and local tax rates appear far more likely to be lower in the future in places where these developments are happening, aside from the fact that our economy is demanding more data storage anyway.
In Madison County, officials are forecasting an additional $5 billion in added local tax revenue over 30 years from the AWS project alone, an average of $167 million per year, and not counting revenue growth from the ripple effect. In addition to a windfall for schools and roads, the threat of higher future taxes should be gone. Across Entergy Mississippi’s service area, which is much of western Mississippi, the company is projecting the data center projects will result in $2 billion in savings for existing customers over the next 20 years.
The accusation that data centers drive electric rates up is not supported by what’s happening in Mississippi, and while 2021-2025 inflation spikes drove up electricity prices everywhere, studies nationally are finding areas with large data center growth generally see benefits across the entire customer base on those systems, even declining rates in some cases (inflation adjusted).
The counterview to some’s perception about data centers is the reality that, in Mississippi, data centers look to be a huge factor in keeping electricity and local tax bills from climbing by bringing badly needed industrial scale to those systems.
Part 2 will address how electricity demand from data center and AI growth is being met, what does threaten electricity price increases in the future, and associated policy needs for Mississippi.
Patrick Sullivan is President of Mississippi Energy Institute and author of this column.
This post is sponsored by the Mississippi Energy Institute.
42 comments:
Yes, but I don't understand data centers,and for that reason alone, do not want them In MS
Math is easy. They pay for all set up and what they use and the future consumers get the benefit.
Right now the USA is in a virtual AI arms race with China. The winner will dominate the technology landscape for the next century. Do you remember the parable of the tortoise and the hare? The USA is the hare. All of the big names in technology are here in the USA. Nvidia, Texas Instruments, Micron, AMD, etc. TSMC and ASML are the not American but adversarial with China. Also, China has been denied access long enough that they are cultivating domestic production. They just pulled ahead of South Korea in DRAM production. Also, their AI models and training data are closing the gap very quickly. If we do not maintain our lead then the tortoise will pass us by and win the race.
Like 10:19, I do not totally understand data centers, and I'm pretty sure that most of my fellow readers do not either. That being said, before we all go jump on the anti-data center bandwagon, there needs to be an honest assessment of data centers so that intelligent people can make intelligent decisions about them. So far this has not happened. The people who are pushing the data centers only talk about how great they are, while those against the data centers can see no good in them. I am old enough to know that the truth is somewhere in the middle. Certainly there is at least one unbiased intelligent individual who can properly explain the data centers and outline both the positives and negatives of them.
That is all correct. But most importantly is how the state negotiated the contract. It can help or it can hurt. What do u think the intelligence level of ur leaders is against the intelligence of these technology driven LLCs that most of the little people are counterparties? The more corruption happening in government and the non transparency of negotiations, the more likely Mississippians will end up paying the price. Other people are way smarter and not as biased so it doesn’t cloud their ability to think.
If what Sullivan claims is true - that data centers will strengthen the electric grid, and keep residential electricity rates and homeowners' property taxes stable - why all the secrecy? Why can't we see the deals made by the State with data center developers? The extent of this secrecy is disturbing.
I assume the issues of water usage and noise will be honestly addressed
An honest assessment can't be made with all the secrecy by the State and local governments.
I wish he'd share how much water a data system uses. How many or few jobs it will generate would be good to know as well. I'm well aware of the usefulness for our Nation. I'm not as clear as how it will help Mississippi prosper and grow.
The anti-data center movement is funded by China. What a shock. https://www.youtube.com/watch?v=pMYNaTI9T2M
10:51 am Thank you and what is the actually number of Mississippians that will be hired and will Mississippians companies be used to build it?
I'd also like to know why a more rural area in the Delta or South Mississippi wasn't chosen instead of an area that wouldn't negatively impact any chance of our capital city with it's historic buildings? It's that we are at the crossroads of the state so shipping in equipment is cheaper, and we have more water to drain off from our underground aquifers and rivers?
That comment, from 10:19 explains a lot about why Mississippi (and Jackson specifically) stays on the bottom. I don't understand it, therefore I don't want it. Brilliant
Water usage has been honestly addressed. Noise has been honestly addresed. However, many folks don't want to listen to the answers because they feel they already know.
The center in Ridgeland recently had a meeting at the new center where a question was people about the noise concerns. They were then shown that the facility was operating, as was the generator, all during the presentation and no one present could hear any noise from either the operating facility or the generator that was running for the sole purpose of showing there was no noise. But yet, social media experts have continued to claim there is a noise issue.
Same with water; the center in Canton uses totally recycled water, returning it to the river more refined than when they received it from the sewage treatment plant. Ridgeland facility will use well water three months out of the year, rest of year will use recycled water. To provide their water, and water for the city of Ridgeland, the facility has constructed five new wells for the city's use.
But in Jackson --- no. We don't want those tens of millions of dollars of tax revenue, because --- well, we don't understand them and social media has said we need to stand up against the powerful folks who do know.
So data centers will actually lower our energy bills, contrary to all of the data from actual communities where they have been built.
That sounds like more AI hallucinations.
We all need to support Jackson Jambalaya with our cash. He is reduced to raising money by accepting payment for publishing packs of lies like this from the the well-connected elites. I will not spend effort to count all the lies in this post, but they are in every single paragraph. The author is trying to sell them a future where he says the sky isn't blue.
This part. Who is foolish enough to believe that exponential growth in grid usage will stabilize and lower energy rates? Who?
Most people against data centers don't know anything about them. Listen to the
people who talk at Jxn city council meetings againt data centers.
To me, it looks like Mr Sullivan is counting chickens before they hatch...But I'm sure others are lining up to pull on them data center teats as well...
@12:38 for those who were sleeping in freshman economics:
Economies of scale occur when a company increases its production output, leading to a decrease in the average cost per unit. By expanding operations, companies can spread fixed costs over a larger volume,
12:39, So you actually think Tariq Abdul-Tawwab Skyhook represents the typical Mississippian.
That tells me all I need to know about you.
10:58, You believe Kevin O'Leary, while pushing to build his own data farm in Utah, is a neutral voice?
Wonder what happens when the next Carrington level event happens?🤔
Well, this is good info ! Thanks KF ~~ WE, almost 100% of us are part of the reason DATA centers are such a big growing ordeal. Part of the reason we are here now in time. Phones, devices... burning thru Data.. Internet, Internet, INTER NET ~~~~~~~~~~~ PICK your battles folks. Do you want data at the fingertips alllll the time. and watch the US compete against China or get ahead of them. or what???? What do you want? Pick a side if you can. I haven't researched but I doubt there is a legal case out there in the US which presents legit facts that a data center ruins a community.......I get the concerns, nothing wrong with those or expressing but pleaseeeee get the facts.
RE 10:19- It's the same type of thinking that doubted Kemper's clean coal carbon capture innovation that would save the utility customers billions and create thousands of jobs for Mississippi.
Same type of doubters that didn't believe in the Yalobusha County Beef Plant.
Why we don't have nice things!
candle makers and buggy whip makers did not like Edison or Ford
Datacenter evolution is transitioning to sound and vibration-dampened installations, closed-loop cooling systems, and micro-reactors for independent power generation. So, what is there left to bitch about? The conversion of empty space or old buildings to functional use is a bad thing?
The data centers are to keep data
Every single piece, about you and your family
Hence the Flock cameras popping up like weeds around Byram, podunk ass Raymond and podunker ass Crystal Springs
Welcome to your new digital prison
A deregulated douchebro run nuclear industry.
A nuclear reactor in every backyard data center.
What could go wrong?
At last we can use prediction markets to profit from the disaster arbitrage.
Patrick Sullivan’s article and all of the comments above paint an interesting picture that might be summed up in this one sentence: This seems to be a great opportunity for Mississippi tax payers and electric utility rate payers, but we have no experience with the technology and the scale of the projects, so are we sure nothing is going to bite us in the rear end, and what policies are in place or should be in place to protect Mississippians from the unforeseen? For example, the amount of property taxes to be paid by the data centers is staggering. In the early 1990s the Pascagoula-Gautier School System built two brand new high schools without increasing property taxes. This was done on the back of a windfall from a Chevron Pascagoula Refinery expansion project, a project now dwarfed by any of the data centers. What should communities do with such enormous increases in property taxes? Does anything change faster than new computer technology? If the data centers remain modern, up-to-date and competitive, then property tax receipts should remain strong over the next decades. However, maybe the owners won’t continue to invest in the data centers or the technology becomes obsolete. If this happens, the property tax windfall would disappear. To mitigate this risk, maybe local taxing authorities should take a lesson from Joseph in the Bible and squirrel away funds during the years of plenty just in case there are lean years ahead.
In my view water usage issues (both quantity and quality) should not be a concern because these are heavily regulated in Mississippi. There’s nothing new here. It happens all the time.
Electric utility rates are controlled by elected boards. But the data centers require an almost unbelievable amount of electric power. The Chevron Pascagoula Refinery was at one time the largest customer of Mississippi Power’s parent company—across Georgia, Alabama and Mississippi. One new data center requires much more power than Chevron. So do electric utility companies have the capacity to deliver this new demand, and if so, what’s the cost to generate and deliver the additional power? How will any increase be recovered? If an electric utility company has to build more power generation plants to accommodate data centers, will the power plants be built on site with the data centers or built in other locations? How will those costs be recovered? Even though the scale of new power demand is huge, there are boards and elected officials in place to protect residential rate payers while doing what’s best for Mississippi’s economic growth. If they don’t get it right, we can elect others.
Finally, we’ve heard little from the owners or operators of the data centers. Is this how Mississippi works? I don’t think so. We want to see you and hear from you. We want to know where you’re from and who your family is. We want you to help us not be worried about this new thing. We want to know you’re one of us. (Steve Renfroe, retired Chevron, former Public Service Commissioner)
If tater would have been around for windmills this state would be full of them. If you can find any hard facts about how much money was sunk into wind energy after AL Gore released his environment documentary in the 2000s
Math is simple. Supply and Demand. Anybody that gets fooled by this propaganda deserves high bills and the government telling them to keep their AC temp about 78 degrees
If I stop yelling at the data center, then it is back to yelling at the clouds....
From The Financial Times 7/6/26:
THE GREAT AI DATA CENTER COVER -UP
Tech companies need to come clean about the mounting environmental fallout of their race to build more hubs
It is just over 40 years since a US political journalist wrote something about scandals that should have been mandatory reading in school classrooms from then on.
“The scandal isn’t what’s illegal, the scandal is what’s legal,” wrote Michael Kinsley. He was talking about the way rules are written to let powerful insiders, from Wall Street to Washington, get away with unfair but lawful behaviour.
People say Kinsley’s adage is outdated in the age of President Donald Trump. They are wrong. Look no further than the gathering environmental misery AI barons are foisting on us as they race to build more data centres.
Data hubs already devour more electricity globally than all but 10 countries. About 448 terawatt hours last year if you’re interested. The AI boom means that amount is on track to roughly double within four years.
This would be less of a problem if all the new electricity were green. It won’t be because so many countries still get most of their power from fossil fuels. That includes the US and China, the two largest data centre markets by far.
So the faster these sites multiply, the more planet-heating carbon emissions for the rest of us.
It gets worse. The battle to build data centres is so fierce that the tech giants are not hanging around and waiting for a backlogged grid connection like other companies. Instead, they are funding their own off-grid power plants.
Cont'd from The Financial Times 7/6/26
..And because they want features such as super-reliable “five nines”, or 99.999 per cent power availability with only a few minutes of downtime a year, they are often going for systems powered by gas and diesel, which emit air pollutants when burnt.
As of this year, analysts say data centre developers in the US have announced about 100GW of off-grid gas generation. It’s unlikely this will all be built, but Mark Zuckerberg’s Meta alone is planning to fund 10 gas power plants across Louisiana for its hubs.
And here’s where that Kinsley rule of legal scandals kicks in.
Louisiana is one of a growing number of places trying to lure AI investment with business-friendly rules that in some states mean faster power plant approvals and less public scrutiny.
As Reuters reported last month, an Ohio law has allowed some plants to be approved in just 45 days without public hearings.
People are understandably angry. An unprecedented 75 US data centre projects worth around $130bn were blocked or delayed in the first three months of this year, nearly as many as in the whole of 2025, says the Data Center Watch research group. It reckons active opposition group numbers have grown from 396 at the end of 2025 to 833 by the end of March.
The AI giants’ demand for electricity is only part of the problem. Data centres are a concrete target if you’re worrying about job-killing robots. But they also swallow up land and water. By 2030, they could be using enough water to meet the basic needs of all 1.3bn sub-Saharan Africans for a year, UN researchers estimate.
You can see why it is so important to know exactly what these companies are building and where. But transparency is for the little people. You and I might be fined for not telling the government what we earned last year. An AI company can quietly get the nod for a gas power plant across the road from your home without so much as a public hearing. It’s not needed for private off-grid customers, developers say.
All of this is why António Guterres, the UN secretary-general, last month called on all big AI companies to disclose their data centres’ carbon emissions, water and land use.
I wish him luck. Meta, Google and other big tech companies have long published data on company-wide electricity and water use, which has often soared since AI took off in 2022. But the figures are not always broken down for their data centres and it is hard to find any reporting on the effect of AI workloads.
Last week I asked seven companies if they would heed Guterres’s call.
My queries went unanswered by all except Microsoft and OpenAI, who sent me their latest published environmental material, but declined to discuss Guterres’s request.
OpenAI’s policy on AI infrastructure is still instructive. “We support policies that require transparency around water, electricity, and government agreements,” it says, “with appropriate exceptions to maintain security, commercial sensitivities, trade secrets, and proprietary information.”
The case, I think, is closed.
Where did you buy your tin foil hat?
10:19, imagine that thought process in relation to space travel, air travel and the development of things that make our lives better. You succeed by trying and doing, not by fear of the unknown.
1:31 No
At least part of the objection to data centers is that most the people who are building them have proven themselves to be profoundly untrustworthy.
Henry Ford is reputed to have said, "If I had asked people what they wanted, they would have said a faster horse." Luddites arise!
Anything anybody doesn’t like is funded by China. Anything anybody likes is something that must be undertaken immediately because China is already ahead of the US.
So what happens if China "wins" this supposed AI arms race?
They get to build a better TikTok and continue to flood the Internet with garbage?
What happened to all the AI cheerleaders who jumped all over this post as soon as it went live?
If I didn't know better, I'd think an entire workforce is paid to patrol the Internet and comment on issues of relevance to certain vested interests, kind of like news involving black/white mixed-races.
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