There has been no hotter topic in my emails, calls and meetings than the emergence of data centers. Tech companies including Google, Meta, Amazon, Microsoft and even Netflix have massive data centers driven by demand from users, like you and me.
In fact, I asked my Google AI prompt about the impact, and this is what was returned: “Yes, AI is significantly driving data center electricity demand, with the rapid growth of advanced AI systems like generative models leading to a surge in energy consumption as they require vast computational power and large numbers of processing chips, putting considerable strain on data center electricity grids.”
Credit: handout
Credit: handout
The “considerable strain” part of that artificial intelligence answer is what we in the utility world have been concerned about. These tech companies need mass quantities of power and backup natural gas generation to keep running in outages, and they want it in a relatively quick time. Georgia House Speaker Jon Burns earlier this month announced a special committee to study our state’s resource management plan. No doubt that review will include the impact of these centers. But still, thanks to Georgia tax incentives and reasonably priced electricity in our state, more data centers and large-load customers are looking for sites throughout our state with adequate land, power and water. These centers bring immense capital and contributions to the tax base, offer premiums for the right property, support community infrastructure upgrades and often give financial support to community initiatives.
Last year, our Public Service Commission took emergency action to acquire 3,300 megawatts of additional capacity, making sure the cost was borne by those asking for that power. In fact, Georgia Power agreed to reduce the average monthly bill by $2.89 as a result of these new loads and additional resources. Just recently, the PSC took further action and created new rules for very large-load customers, including data centers, to protect residential, small-business and existing large-business customers. Longer-term contracts, credit requirements, minimal bill provisions and appropriate termination policies guard against instances in which data centers or others might exit the system sooner than required to pay for their costs. These PSC-approved actions go a long way in resolving concerns from Georgia political leaders and ratepayers.
I know there is a lingering concern across Georgia about energy prices after the COVID-19 pandemic, vast inflation, hurricanes, winter storms and the completion of Plant Vogtle, a worthy project that went way over budget because of the bankruptcy of Westinghouse. But our PSC, a group of five elected officials, has proactively secured the power we all need and a healthy reserve margin — with more to come.
Not every state is in the position that Georgia is in. Southern Co. and Georgia Power have a reputation for reliability. Our PSC has approved projects that have created a high reserve margin, including Plant Vogtle, and we took action last year to acquire more capacity. And with our rates 15% below the national average and our 0% sales tax on manufacturing machinery and equipment, you can see why companies such as Hyundai, Qcells and SK Innovations now call Georgia home.
In fact, our energy policy and planning are often cited by companies coming to Georgia as a deciding factor. Our state has scooped up many clean energy projects. We landed the Hyundai Car Plant, the largest project ever in our state. Qcells, in Cartersville and Dalton, is the largest solar panel manufacturer in North America. SK Innovations in Commerce is a massive battery manufacturer making batteries for the F-150 and other models. Ascend Elements in Covington is the largest battery recycler in North America. Solarcycle being built in Northwest Georgia recycles solar panels. Bluebird buses down in Fort Valley make electric and traditional school buses. Clubcar and E-Z-GO in Augusta make more low-speed electric vehicles than any place in America.
The Kia plant has been expanded and is making the EV6 and EV9 models. And Rivian has plans to build a mammoth car plant east of Atlanta, thanks to an injection of cash from Volkswagen and the Department of Energy. A deregulated natural gas system — second to none — allows us to greatly reduce pollution, especially in Atlanta. The list goes on. We have the fourth-largest container port in America. Hartsfield-Jackson International Airport is the busiest on the planet. And Atlanta is the “fintech” capital of the United States. We have the Mercedes-Benz Stadium, a world-class aquarium and are home to many civil rights icons.
These companies create high-paying jobs in Georgia, which improves our tax base and creates other service jobs in communities where these factories are.
In Georgia, we have made steps to secure for our state an abundance of energy through multiple sources, making us attractive to both data centers and manufacturing. We are ready for the future.
Tim Echols is a statewide elected official on the Georgia Public Service Commission, having served since 2011.
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