00:00 Josh
Which states are boycotting and why?
00:03 Jack
Yes, Josh, six states are considering bills right now. There are three major centers in Oklahoma, Vermont and Maryland, as well as New York, Georgia and Virginia, where Data Center Lane in the Loden area is located.
00:15 Jack
There is huge room for development among these three defenders. There are a few different ways these bills are structured, but the basic principle is
00:20 Jack
They want a moratorium on data center development. Essentially, it means a window period from about one year to about three years,
00:24 Jack
You can’t develop here, you can’t build here, unless certain barriers are met, or until we clear the requests in the pipeline or prerequisites are met.
00:34 Jack
But essentially what this means for those developers is that if these bills pass, these states will be segregated.
00:40 Jack
The real argument here is infrastructure pressure. These data centers consume a lot of energy. They absorb large amounts of water. This will put pressure on taxpayers’ bills. You’ve seen rising electricity bills in these rapidly growing areas.
00:48 Jack
You will see water pressure in these areas. The grid is under a lot of stress. So lawmakers are now trying to get ahead of it and say, wait, wait, wait, slow down. Let’s put some things down in a book and make some rules. But to do that, we need to take a breather.
00:58 Josh
Jack, what are the chances of these bills actually passing?
01:03 Jack
They will face an uphill battle for a few reasons. You have to remember that these data centers bring jobs. They bring tax revenue.
01:10 Jack
In addition, the companies behind these centers, Microsoft, Amazon, Google, these companies are not easily left aside. These companies have real political clout and firepower, real pressure. Many of these governors are at least nominally pro-development.
01:21 Jack
So the argument they’re going to have with these data center developers is, hey, we’re bringing you jobs. We bring you revenue. Why are you stopping us from building? They will face the same resistance from business interests, the business lobby.
01:31 Jack
Even if these bills don’t pass, you could still see and probably still will see some kind of regulation, cost-sharing agreements, water use parameters. But the focus right now is on these pauses because of their impact on revenue.
01:42 Josh
Jack’s final question is, to what extent will all this disrupt the AI ambitions and dreams of big tech companies?
01:48 Jack
I think the rule of hyperscale now is speed, right? There is an arms race going on. You see these companies spending hundreds of billions of dollars building this infrastructure. For Microsoft, Google, and all these companies building these products, the game now is speed.
02:02 Jack
How quickly can we put these things into the calculations that we’re trying to put into the market. Any kind of delay will hurt these companies and slow down their growth.
02:10 Jack
I was talking to someone today who works in site selection and advises these companies. She told me you’ve seen people within these companies take a second look at some of these locations and say maybe this isn’t the right idea. maybe we go somewhere
02:19 Jack
There is less law on the remaining proposals on the books. The problem is that there is less infrastructure in these areas. So you’re going to have problems wherever you go.
02:26 Jack
But no matter what, especially in these larger locations, larger states, there’s a lot of development happening and when speed rules, anything that slows things down is going to be detrimental.
02:35 Josh
Okay, big story. Thanks for the report Jack. Appreciate it. Thanks.
