Minnesota’s Digital Dilemma: examining the environmental costs of AI, data centers, and cryptocurrency 

In a webinar hosted by MCEA Feb. 26th, our climate and legislative experts dove into what’s been happening with Big Tech in Minnesota, specifically in relation to data centers. They outlined the concerns and questions we are urging state leaders to grapple with before deciding how to respond to the growing push by tech giants like Meta and Amazon to build massive data centers in our communities. Below are some top takeaways from the discussion. 

1. COMPUTER WAREHOUSES: Data Centers are essentially warehouses that house the computing power needed to store and process data, run Artificial intelligence (AI) and general internet queries, or “mine” for cryptocurrency. There are different types, with the average size of what are called “enterprise” data centers being roughly the equivalent of a Target store (100,000 square feet.) 

2. TEN PROPOSALS AND GROWING FOR MN: The data centers under examination in recent local media coverage are called “hyper-scale” data centers, which are significantly larger and tend to be owned by the country’s biggest tech companies: Meta, Amazon, Microsoft and Google. There are at least 10 proposals for new data centers to be built in Minnesota, including ones proposed for Farmington, Rosemount, Hampton, Becker, North Mankato, Faribault and elsewhere. To give you a sense of their scale, if built, the data center proposed in Farmington would be roughly the size of 25 Target stores (2.5 million square feet.) Companies jockeying to lead on AI has been a key driver of the expansion of hyper-scale data centers across the United States. 

3. BIG TECH BRINGS BIG RISKS: The environmental impact of data centers like these on Minnesota’s water and energy supply is potentially vast. Hyper-scale data centers also have serious implications for mining in our state. 

• ENERGY HOGS: In terms of energy, if all 10 data centers currently proposed come online, they would consume as much energy as all of the homes in Minnesota. Since Minnesota has a law that requires utilities to serve customers that move into their territory, our state could be left scrambling to meet the seismic jump in energy demand, which could lead to delays in scheduled coal plant retirements or the construction of new fossil fuel plants. Either development would gravely jeopardize Minnesota’s ability to reach our urgent climate goals.
• DRAIN ON WATER RESOURCES: Hyper-scale data centers would also be major drains on our water resources because of the amount of water needed to cool the wall-to-wall computers operating around the clock inside data centers. For example, the massive data center proposed in Farmington is estimated to drain 900 million gallons of water from the community’s aquifer, which would essentially double the water consumption of the entire city. In combination with other growing water users (residential and industrial), this poses a serious risk to drinking water, particularly where these proposals are concentrated (such as Dakota County.)

• MINING: The construction, non-stop operation and ongoing maintenance of massive data-centers that house wall-to-wall computers has the potential to lead to a surge in mining in Minnesota as the equipment is largely made of various precious metals. Construction of a data center is not just a one-time use of metals - on average data centers replace their computer equipment every four years or so. Sulfide-mining poses its own distinct and substantial threat to our natural resources and communities.

  4. LEGISLATIVE RESPONSE: The Minnesota Legislature is grappling with the sudden emergence of data centers and so far, no comprehensive bills that address a full range of their potential impacts have been introduced. Instead, two troubling bills have advanced. One would give some of the most profitable corporations on the planet an upfront sales tax exemption that would only apply to the biggest data centers. This could cost Minnesota taxpayers hundreds of millions of dollars in a time of tight budgets. MCEA strongly opposes this bill. Join us in telling your legislators you don’t support big tax breaks for Big Tech here. The other would allow hundreds of diesel backup generators to operate without a certificate of need from the Public Utilities Commission and even if an environmental review study is incomplete. MCEA also opposes this bill.

  5. REGULATORY GAPS LEAVE MINNESOTANS VULNERABLE: While the proposed data centers would need to secure various state permits to advance, there is currently no central decision-making body in the state that has authority to assess whether the totality of a data center’s potential upsides outweigh the significant risks they pose to our natural resources, communities and climate goals. That’s a major gap in our regulatory framework that MCEA and our allies are bringing to the attention of key decision-makers. 

CONCLUSION: The issue of hyper-scale data centers in Minnesota is new for our state and emerged rapidly, leaving legislators, state agencies, local units of government, environmental watch-dogs and residents scrambling to understand a novel and complicated industry in little time. While tech companies promise benefits to host communities like jobs and programs and tout interest in building “green data centers” powered by clean energy, none of that is guaranteed and all of it largely depends on corporate giants’ voluntary benevolence. On the other hand, there are demonstrated examples across the country of the environmental impacts hyper-scale data centers have on states’ energy infrastructure, water supplies and communities. MCEA is dedicating significant resources to this issue and is committed to continuing to push legislators and other decision makers to carefully scrutinize these proposals and fill the holes in our regulatory framework. If you want to take action, we urge you to reach out to your elected officials and tell them your concerns. 

Watch the recording of "Digital Dilemma" here

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