Data center developer has not filed required application, utilities say

The utilities said they have developed a Data Center Power tariff, or rate schedule, specifically for large data centers seeking service from electric cooperatives.

Data center developer has not filed required application, utilities say
Photo by Markus Spiske / Unsplash

GLASGOW, Ky. — Farmers Rural Electric Cooperative Corporation and East Kentucky Power Cooperative say no formal application has been submitted to them for a proposed data center project in Barren County, despite ongoing public discussion surrounding the possibility of such a development.

In a joint statement released Friday, the two utilities said they are not currently engaged in discussions with the developer and have not received the application required to begin the process of evaluating power service for a large-scale data center.

“At this time, a data center project application has not been filed with the electric cooperatives for a project in Barren County; this is the first step in developing a three-party contract,” the statement said. “Our cooperatives are not engaged in discussions with the developer.”

The statement comes as questions continue to surround a proposed data center project in Cave City and Barren County.

Court fight begins over Cave City data center moratorium
The dispute stems from a series of zoning discussions this spring over how data centers should be regulated within city limits.

Records obtained by Barrenside show developers are exploring a large-scale data center campus on more than 600 acres of land in Cave City and unincorporated Barren County, while Kentucky Industrial Alliance LLC is currently suing Cave City over a moratorium on data center development adopted by the city in May.

Kentucky Industrial Alliance LLC filed a development plan application with the Joint City-County Planning Commission on May 11, but the application described only a proposed development in Cave City and did not specifically identify it as a data center.

The application identifies East Kentucky Power and Farmers RECC as having been contacted regarding the preliminary plan, though both utilities said they are not currently engaged in discussions with the developer.

The nature of the project became clearer earlier this week when Kentucky Industrial Alliance released a fiscal impact analysis detailing the potential economic benefits of a proposed data center campus in Barren County.

Exhibits filed in Cave City data center lawsuit by brennan.crain

Farmers RECC and EKPC said they are obligated to provide electric service to homes and businesses within their service territory, but emphasized that special safeguards are in place for data center projects because of their significant power demands.

The utilities said they have developed a Data Center Power tariff, or rate schedule, specifically for large data centers seeking service from electric cooperatives.

The tariff was reviewed and approved by the Kentucky Public Service Commission and is intended to ensure that existing customers do not bear the costs associated with serving a data center.

“A key principle of this tariff is protecting other members from bearing the costs or risks involved in serving a data center,” the statement said. “Data centers must pay their own way.”

Longtime Cave City attorney tied to both sides of data center dispute
Richardson could not be reached for comment on whether he would recuse himself from the current lawsuit.

Under the tariff, a three-party agreement between Farmers RECC, EKPC and the data center developer must be negotiated and approved by the Public Service Commission before service can be provided. The agreement must outline power resources, infrastructure improvements and how those costs will be paid.

While noting concerns about the potential impact large data centers can have on electric systems, the cooperatives also voiced support for potential economic benefits associated with such projects.

“As with any economic development project, Farmers RECC and EKPC recognize the potential benefits of data centers, including job creation, investment in the community, and growth in tax base to support roads, schools and other services,” the statement said.

Communities face key decisions as data center industry expands
Local officials were briefed Wednesday on the rapid expansion of data centers across the country and what it could mean for Kentucky communities as they weigh potential economic benefits against concerns over infrastructure, energy use and local impacts.

The utilities said they are prepared to support data center projects if communities choose to pursue them, while ensuring electric reliability and shielding existing members from additional costs.

In a separate statement to Barrenside, SCRTC said it has not been contacted by, met with, or provided guidance to any developers, consultants, representatives or landowners connected to a proposed data center project.

The utility also said it could not determine whether a large-scale data center would require additional telecommunications infrastructure because it has not been provided specifications or requirements for the proposed project.

“We can't answer this, since we do not know what the specs and requirements of a ‘large-scale data center’ are,” SCRTC said. “Cave City is completely built in fiber optic and should be available near any proposed development in the area. But we can't specifically say whether additional infrastructure is required for any new industrial development.”


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