Beshear signs executive order placing new requirements on potential data centers
The executive action comes as demand for data centers and energy resources continues to increase nationwide, with communities across Kentucky considering how to handle potential large-scale technology projects.
FRANKFORT, Ky. — Kentucky Gov. Andy Beshear signed an executive order Thursday placing new requirements on potential data center developments in the commonwealth.
The executive order calls for energy plans for developers, protections against increased utility costs and environmental reviews before projects can move forward.
The executive action comes as demand for data centers and energy resources continues to increase nationwide, with communities across Kentucky considering how to handle potential large-scale technology projects.
Under the order, data center developers must submit an energy plan to the Kentucky Energy and Environment Cabinet outlining how the company will protect Kentucky families and existing businesses from increased electricity costs.
The order also directs the Kentucky Public Service Commission to prohibit utility companies from increasing rates to recover costs associated with the development or operation of a data center.
In addition, the EEC will be required to deny permit applications for data centers that would negatively impact air quality, water use, water quality, water supplies, federal jurisdictional wetlands or other natural resources.
The order also requires data center developers to pay their fair share of state, local and school taxes and to participate in transparent public discussions with local leaders and residents.
“To be clear, this order doesn’t say yes to any data center – that’s up to the local community,” Beshear said. “But it does say no to any center not meeting the requirements.”
Beshear said decisions on whether projects move forward should remain with local communities.
“Local leaders and residents know their communities best,” he said. “I trust their judgment when it comes to significant projects like these.”
The executive order comes as local officials in Barren County continue discussions surrounding potential regulations for high-intensity technological infrastructure, including data centers.
The Joint City-County Planning Commission recently hired The Kentucky Steward LLC to assist with developing possible ordinance language related to high-intensity technological infrastructure.
Brennan Crain
Officials said the work is focused on creating transparent, community-protective regulations rather than promoting or expediting data center projects.
A proposed data center project in Cave City remains paused while litigation continues over the city’s moratorium on data centers.
Kentucky Industrial Alliance LLC filed a lawsuit challenging the moratorium and the city’s 2024 annexation ordinance.
The governor’s office said the executive order is intended to provide statewide safeguards while allowing local communities to make decisions about whether individual projects are appropriate.
