Data centers may benefit from massive rural utility loan, US official says

By Leah Douglas

WASHINGTON, Oct 16 (Reuters) – A record-breaking $3.3 billion loan from the U.S. Department of Agriculture to a power plant in Georgia’s Monroe County could potentially benefit data centers in the state, the agency’s head of rural development said in an interview with Reuters.

The administration of President Donald Trump has supported the rapid expansion of data centers, despite their unpopularity with communities concerned about water use and utility costs. Democrats are attempting to capitalize on that discontent in November’s midterm elections.

Glen Smith, the USDA’s Under Secretary for Rural Development, said in the Thursday interview that he hopes to secure more funding for such projects.

Here are more details: 

• The USDA announced on Tuesday the loan to Oglethorpe Power Corporation, the largest ever given under the agency’s Rural Utilities Service.

• Smith said the plant will serve 38 rural utility cooperatives and support growing industry in the state, including potentially data centers.

• Last year, Google purchased nearly 1,000 acres of land in Monroe County for a data center.

• Oglethorpe spokesperson Blair Romero said in an email, “This facility is not dedicated to serving a data center. The new facility will help our Member cooperatives meet growing electricity demand across their communities.”

• Smith said he plans to meet with congressional appropriators next week and request more money for such loans. “We have almost $8.6 billion in requests, and we’re only into our fiscal year one month,” he said.

• Smith said rural areas can benefit from data centers, “but you have to have the infrastructure in place. and that’s where rural utilies and rural development comes into play.”

• Data centers are driving US electricity use to record highs and in some regions, demanding more power than grids can supply.

• The Trump administration has not sought to regulate data center construction, instead asking tech companies to pledge not to pass on electricity costs to consumers.

(Reporting by Leah Douglas in Washington; editing by Valerie Volcovici and Chizu Nomiyama )

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