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In a contentious vote on August 20, Louisiana’s Public Service Commission approved three natural gas turbines to power Meta’s sprawling 4-million-square-foot data center in Richland Parish—a project demanding over 2 gigawatts of energy. The rushed decision, criticized for bypassing standard regulatory scrutiny, highlights the escalating tensions between Big Tech’s infrastructure ambitions and community welfare. As AI workloads strain power grids globally, this deal underscores how states are gambling with public resources to attract tech giants, often leaving taxpayers footing the bill.

The Speed-Over-Scrutiny Strategy

Utility company Entergy Louisiana spearheaded the push for accelerated approval, filing its application in early 2024 and successfully moving the final vote from October to August. The company argued delays could cost Louisiana the project, stating in filings that Meta and the tech industry "prize speed to market as vital to its competitiveness." Yet, the truncated timeline eliminated opportunities for deeper analysis by the commission’s administrative law judge and stifled public debate. Critics, including the Union of Concerned Scientists, decried the opacity: "We wanted cost caps and safeguards, but got a baffling decision instead," said energy analyst Paul Arbaje.

Meta’s data center—poised to be one of the world’s largest—will consume energy equivalent to 1.5 million homes. While Meta finances the first 15 years of the gas plants’ construction, utility customers bear the full $550 million cost of transmission lines and substation upgrades. This arrangement risks spiking local energy bills, a recurring issue near AI data centers where power demands can overwhelm regional grids.

Tax Breaks Without Teeth

Louisiana’s courtship of Meta included rewriting zoning laws and converting a broadband tax rebate into a data center exemption. Documents obtained by WIRED reveal a 93-page tax agreement offering Meta up to 80% property tax reductions if it creates 500 "full-time" jobs by 2035. However, the deal defines "full-time" loosely—permitting an aggregate of part-time roles to meet thresholds—and lacks binding local-hiring clauses. State officials insist jobs will be "permanent," but Meta’s subsidiary faces no penalties for outsourcing specialized roles. As Kasia Tarczynska of Good Jobs First notes, "Data centers often import technical staff—Meta knows local communities lack these skills."

Meta spokesperson Tracy Clayton emphasized "a concerted effort to hire locally," citing plans for technical operators and electricians. Yet the company’s tax incentives, including a sales tax exemption for equipment, could cost Louisiana over $100 million annually—joining states like Texas and Georgia where data center subsidies drain public coffers.

Water, Land, and the Ghost of Abandoned Servers

Beyond energy, the data center’s water needs for cooling threaten strained local resources in a parish where one in four residents lives in poverty. Angelle Bradford Rosenberg testified at hearings: "Do we know if jobs will go to locals, or will they import workers?" Meanwhile, Louisiana purchased the 1,400-acre site for Meta at below-market rates, with a lease that credits rent toward eventual ownership—contingent on vague investment milestones. If Meta underdelivers, the state could reclaim the land, but watchdogs fear worse: abandoned infrastructure. "With data center overbuilding, Meta might walk away, leaving a warehouse of worthless hardware," warned attorney Susan Stevens Miller.

This deal exemplifies a dangerous precedent: states racing to appease tech firms with public subsidies while communities bear environmental and financial risks. As AI’s appetite for compute grows, the true cost of progress isn’t measured in gigawatts, but in accountability sacrificed at the altar of economic promises.

Source: WIRED