A Nebraska county just banned new data centers for up to a year. More could follow.

This story is made possible through a partnership between Flatwater Free Press and Grist, a nonprofit environmental media organization.

NEBRASKA CITY — Standing before the Otoe County Board and a room of neighbors, Wynee Benedict ticked through a long list of concerns.

Do we have enough water for them? Who pays for their power? What if they create a heat island?

The source of Benedict’s worries: data centers. Since learning their county could become home to a new data center, Otoe County has been abuzz with questions and concerns like Benedict’s, leading some residents to call for a temporary ban on the industry. 

That’s effectively what the board did Tuesday, voting to suspend the permits needed for a new data center for up to a year, according to commissioner Chuck Cole. The pause is intended to give county officials more time to study the issue and update its regulations. 

Opposition to data centers is growing in Otoe County, and around the country. The massive, resource-guzzling buildings needed to power artificial intelligence and our digital infrastructure have emerged as a galvanizing issue. Local governments from California to Maine have adopted or are considering temporary bans. And at least 14 states so far this year have weighed statewide moratoriums.  

Elsewhere in Nebraska, Madison County earlier this month set requirements for data centers to get a special permit, which allows added oversight and public input. In Gage County, the planning and zoning commission will hold a hearing on a data center moratorium in June, according to reporting by the Beatrice Daily Sun.

And more will likely follow suit thanks to a recent change in state law forcing counties to make a decision on some projects within a certain amount of time, said Jon Cannon, executive director of Nebraska Association of County Officials. The goal, according to the bill’s supporters, was to prevent counties from needlessly delaying projects. But the law could have an unintended consequence. 

“I think that you’re likely to see a number of counties that say, ‘We need to get our regulations in order,’ and … they may put moratoriums on a lot of things, not just data centers,” Cannon said.

Data centers are just the latest in a long line of controversial developments, like wind and solar, that counties in Nebraska and other states have grappled with. And much like those other developments, attitudes toward data centers could vary from county to county, Cannon said. He advises developers to be transparent with residents in rural Nebraska about large projects, including data centers, as soon as possible.

“When people are aware of something coming to town, because, ‘Oh, my neighbor told me that he just signed this big contract for a right of way,’ when people find out that way, they get very excited, and not in a good way,” Cannon said.

In Otoe County, residents who spoke at the county board meeting appeared to have different views on whether to temporarily ban data centers.

“We have said ‘no’ to a lot of things, almost a knee-jerk reaction. Maybe we need to say ‘yes’ to a few things,” resident Jim Nemec said at the meeting, adding that he understood the need for a temporary ban to study the issue. “But I also worry about the intention or impression it gives. Are we sending out the impression that business is closed here?”

Others echoed concerns expressed by Benedict, who referenced reporting by the Flatwater Free Press about a proposal by Google to build a massive new Nebraska data center. The center could require more than triple the electricity the entire city of Lincoln uses during the hottest months of the year, when electricity use spikes. 

The proposal, detailed in documents shared at a private utility meeting in January, did not identify a specific location. However, Flatwater reported that a potential partner in the overall project — the Omaha-based private energy developer Tenaska — had optioned large chunks of land in southeast Nebraska, including Otoe and Gage counties. The news sparked discussions in both counties.

In the 500-person village of Adams, nearly 70 people filled the local community center on a Sunday in late April. Organizers shared what they had heard about the potential project, including plans for a large private natural gas plant to power a new data center. They also relayed general information about data centers and residents speculated about the potential impact on local water sources. They strategized about how they could make their voices heard and discussed the potential for a countywide moratorium in Gage County.

“We have been going with the assumption that this would be for a natural gas power plant as well as a data center, and so the No. 1 concern there is going to be the water,” said Anna Wolken, a Gage County resident who helped organize the meeting. “Both the natural gas power plant would be using water, and then the data center would be using water from there, too.”

Residents will be able to voice their concerns at the county’s planning and zoning commission hearing for the moratorium in June.

Nationally, energy demand has emerged as a leading issue. In Virginia, home to more operating data centers than any other state, the primary electric utility has had to postpone connecting some new data centers because they don’t have enough power or transmission infrastructure, said Joe Lerch, director of local government and policy at Virginia Association of Counties.

“Electricity use has been the biggest issue in Virginia,” Lerch said.

Nebraska lawmakers, at the prompting of Gov. Jim Pillen, moved earlier this year to minimize the energy impact on Nebraskans. They passed a bill allowing for the creation of private power generation built for the purpose of serving a large industrial customer to hook up to the grid. While the new law is not exclusively for data centers, it’s largely viewed as being for that industry.

Tenaska, the private energy developer, provided input on the legislation, and the company’s CEO spoke in favor of the bill during a legislative hearing. 

It’s hard to know how much data centers are impacting Nebraska. There’s no centralized information source for their location, ownership and water usage. 

But that is expected to change. 

Lawmakers approved a separate bill this year aimed at increasing transparency. It requires data centers to annually report the names of their owners and developers, physical size, location, annual electricity demand, annual water usage and any sales and use tax exemptions and incentives they receive.

That information will likely be helpful to local officials, like those in Otoe County, as they weigh regulations. 

Benedict is happy that the commission voted for the moratorium. Now, she and her neighbors are turning their attention to research these developments’ impacts to share when the county committee comes back with a draft. 

“We needed regulations on the books prior to a data center coming to this county,” Benedict said. “We don’t want to have to play catch up and regulate something that’s already here.”