Failed data center bill frustrates

Residents disappointed after legislature votes not to study impact of proposed Millstone site

— Opponents of a proposed data center on the grounds of the Millstone Power Station, who had rallied in support of a bill to study the center’s impact on the electrical grid and their communities, were frustrated Thursday to learn the legislation didn’t go forward.

Senate Bill 299 would have required ISO New England, the grid manager for five states in New England, to study the potential impact to the grid of the data center, which would receive power directly from Millstone. It passed the state Senate on Saturday, but the House failed to vote on the bill before the end of its legislative session at midnight Wednesday.

Members of Concerned Citizens of Waterford and East Lyme said they spent the past four days placing hundreds of phone calls and sending emails to the governor’s office and state representatives to lobby support for the bill.

The group, which started as just Waterford residents last summer, gathered information on data centers and shared numerous quality of life, environmental and energy concerns about the project. Among those concerns are that the project, which would consume around 15 percent of the station’s current output, would jeopardize the region’s energy security. Officials from Millstone owner Dominion Energy Nuclear Connecticut deny those claims.

Bryan Sayles, one of the leaders of the Concerned Citizens of Waterford and East Lyme, said members are “not against technology.” But they maintain it’s “not good to go meddling with power plants,” and believe the impact of an on-site data center should be investigated.

“It’s been tough,” Sayles said.

“You know we’ve worked so hard. We’ve worked along democratic lines. We’ve been nonviolent. We’ve been transparent with our information. We’ve posed credible information and reasons why SB 299 should be adopted.”

So he and other members grew frustrated and confused as they watched the bill, which he said passed the Senate “with flying colors,” die in the twilight hours of Wednesday’s House session. He described it as a blow that shook the group’s confidence in state government.

“I don’t know that there are many other grassroots efforts in the state that would be able to do what we have so far,” he said.

State Rep. Holly Cheeseman, R-East Lyme, who supported the bill since it was first raised in the Energy and Technology

Committee by state Sen. Norm Needleman, D-Essex, said Thursday she shared the residents’ anger.

“This is too important a subject not to examine in-depth,” she said, adding that she was “deeply disappointed” representatives could not at least have an “open, honest debate on the merits of the bill, which was simply a study.”

“And to be frank, you know, there were a number of barely major bills that were voted on in the last three days, and we just ran out of time,” she said. “Not for lack of trying, and it became clear as time went on that bills that might generate more significant debate would fall by the wayside, and this was one of them.”

Cheeseman and Needleman said there was nothing in the bill that would have killed any data center deals currently on the table, including the host fee agreement Waterford signed with New England Edge last year in which the developer promised to pay a fee of $231 million over 30 years instead of property taxes to construct two, two-story data center buildings on the Millstone property.

The location would allow it to buy power directly from Dominion, reducing the cost of power consumed by the data centers.

State Rep. Aundré Bumgardner, D-Groton, who was on the Town Council when NE Edge proposed a similar data center in Groton, said concerns over power consumption are valid.

“It’s an enormous amount of power,” he said, adding that with electricity needs continuing to grow, he’s not sure the state’s best interest to commit so much power to data centers.

“I would tell residents — keep speaking up, because at the end of the day when you advocate for your community, there’s an impact,” he said, praising the efforts of fellow representatives Cheeseman and state Rep. Jonathan Steinberg, D-Westport, for supporting the bill.

“Unfortunately, we couldn’t get it over the finish line,” he added.

The NE Edge project is in limbo after a January decision by the state Siting Council to deny Dominion a boundary change it would need to proceed with the project.

Needleman in 2021 introduced the bill that created tax incentives for data centers to be built in Connecticut, which Gov. Ned Lamont signed into law. It enabled the state Department of Economic and Community Development to sign long-term agreements with developers that pledge to invest millions of dollars in the state.

“Part of the reason we did the tax incentives was to offset the high costs of energy in the state,” he had explained in a phone interview Monday.

The thought of that law was that it would allow Connecticut to become “a little bit more of a hub for technology,” he said.

But at the time, Needleman said neither he nor the legislation’s other supporters contemplated the potential for “behind-the-meter” data centers that would take power directly from a power plant before it advances to the grid — like the one proposed by NE Edge.

“So really, the issue is to determine if large data centers collocated on power plants impact costs to ratepayers,” Needleman said.

Needleman added the bill that failed to get a house vote would have examined the economic impact of building such a large data center from a construction point of view, but also its impact on energy markets and reliability. If it found negative impact, there was a chance the tax incentives the state promised could have been revoked.

Cheeseman said Steinberg, the chair of the Energy and Technology Committee, has already committed to proposing the bill again when lawmakers convene next year. The legislative session begins in January and ends in June.

In the meantime, Cheeseman said “technically, there’s no reason that the Department of Energy and Environmental Protection couldn’t conduct a study on its own, and I will advocate for that.”