Entergy clears first hurdle for Richland data center buildout

(The Center Square) – Entergy cleared the first step needed to skip various regulatory hurdles in order to construct even more energy infrastructure for another data center in Richland Parish that will complement Meta’s data center.Entergy wants the recently announced gas plants and transmission upgrades to be eligible for exemptions under Gov. Jeff Landry’s Lightning Initiative, which would allow them to skip various regulatory hurdles and proceed with construction at a faster pace. The commission voted 4-1; Commissioner Davante Lewis was opposed.If the commission determines the project meets those standards, Entergy would not have to go through the usual competitive bidding process that ordinarily requires utilities to issue a formal request for proposals, solicit competing power-supply options, and compare those bids before moving forward with major new generation.“We will have a full process,” Larry Hand, Entergy’s vice president of regulatory affairs, told the commission. “The merits we’ll have to prove ourselves.”Much like the original data center, the Project Evest data center will require Entergy to construct new power generation and transmission at a cost of at least $13 billion. The costs of the transmission upgrades are redacted in Entergy’s regulatory filings, as is the data center’s expected power use.Entergy says the project is structured so existing customers will not subsidize it. According to filings with the commission, the deal includes a sustainability agreement to support more capacity at Entergy’s nuclear plant, add more solar, wind and battery resources over time, and provide $260 million in direct benefits to other customers through efficiency, weatherization and bill-assistance programs.The decision by the commission was met with some opposition. Alaina DiLaura with the Alliance for Affordable Energy said the scale of the application is so large that it raises questions about whether the investments are prudent and what effect the new generation would have on Entergy’s existing transmission system.“This decision significantly escalates our existing concerns about whether regulators are exercising the level of oversight that Louisiana residents deserve,” Jackson Voss, senior government affairs and policy coordinator for the Alliance for Affordable Energy, said in a statement.Projects like data centers – and the state’s broader push to attract them and other large-scale developments – have drawn intense public scrutiny. Much of that concern stems from the lack of transparency: many state officials have signed nondisclosure agreements limiting what they can say about the projects, and many public filings with regulators contain redactions that obscure key details needed to understand their real impact, including how much electricity a proposed data center would use.“Between NDAs and hundreds of pages of redacted information, Louisianans are being asked to accept enormous financial risk without full transparency,” Voss continued.Louisiana Economic Development Secretary Susan Bourgeois addressed the issue of nondisclosure agreements in March when she presented her budget to the Senate Finance Committee.“There isn’t an economic development corporation in this country operating without NDAs,” Bourgeois said. “It is a fundamental part of our work. And it makes sense, before they give us proprietary information, before they give us competitive information. NDAs are totally standard in the economic development world.”Entergy itself appears to be heeding the efforts made by the state to attract new businesses. In Entergy’s filings, the utility repeatedly acknowledges and emphasizes “that investment in its generation and transmission infrastructure is a significant factor in encouraging economic development growth in the state.”In testimony on the infrastructure for the new data center, Entergy CEO Phillip May said that “attracting new industrial customers and helping existing customers expand, regardless of whether they are served by Entergy, can bring more jobs and lead to improvements in community infrastructure such as schools, streets, parks, and other resources that enhance the daily lives of Louisiana’s citizens.”Whether that economic development is at the cost of current ratepayers and residents is the question.“Residents are already seeing negative impacts from the Meta data center development, including extended power outages, drinking water discoloration, and a severe increase in traffic incidents and public safety risks,” DiLaura said. “With many data center project applications on the horizon, it’s important our regulators avoid loosening requirements meant to protect their constituents.”On the other hand, the gains being made in Richland Parish are well documented. In an interview with Monroe Chamber of Commerce CEO Mike Downhour, the effects of Meta’s initial data center are showing up in public revenue. He said Monroe’s city tax collections are up 23% and that the city’s top taxpayers now include major general contractors working on the data center.“For so long, northeast Louisiana was left out of economic development,” said Mike Downhour, CEO of the Monroe Chamber of Commerce, who described the project as a rare moment of regional alignment after years when “nobody in our area worked together.”He also said local and state infrastructure work is following close behind, with road, sewer and drainage improvements underway.