Arkansas residents voice concerns over proposed data centers amid environmental and economic issues

LITTLE ROCK, Ark. — Lots of noise and lots of heat, that’s how to describe giant data centers and the debate over where to build them.

Large tech companies are building huge buildings filled with computers. They power the A-I learning models that answer our questions and promise much more as technology improves. They take up a lot of space and draw a lot of power and water, which has set up local battles when companies like Google try to build, including here in Arkansas.

 Conway and Pulaski County previously held several conversations around data centers. Just this week, advocates for proposed centers in Pulaski County touted what they would do to regulate these types of centers that would be built in unincorporated parts of the county. A moratorium was even discussed amongst quorum court members. 

While in Conway, dozens gave city leaders their opinions, in hopes of preventing the project.

“One is, how is this going to affect employment? Will it bring in new jobs? Second is how this will affect, you know, anything will affect prices in some way. Will it drive up home prices? Will it drive up electricity prices, things like that? Then the third thing is, you know, how will this affect the property tax and other taxes that cities and counties collect?” Jeremy Horpedahl, an economics professor at the University of Central Arkansas, said.

Horpedahl says that those are just some of the things you can look at when it comes to data centers; however, community members in Conway are still concerned about the environmental impacts. Dr. Emily Lane, a professor of environmental health at UCA, said that these centers can cause major health and environmental impacts.

“So, I analyzed EPA data for communities within a 6.2-mile radius of the site because, as has previously been stated, heat impacts large AI data centers may extend that far out. That same research showed that surrounding temperatures increase an average of 3.6 degrees, with some areas seeing increases as high as 16.4 degrees. 53,000 people live inside this area,” Lane said.

The creation of jobs has been brought up as a positive economically, but Horpedahl suggests that recent research shows the job impact is smaller than thought.

“The research suggests those are actually going to be fairly small. It’ll add some jobs, but, you know, not as many as if it was a manufacturing facility the same size, so maybe a few 100 jobs rather than a few 1000, but still new jobs, and are often good-paying jobs,” Horpedahl said.

A data center would increase both water usage and electricity usage. Hopendahl said so far, data centers have raised rates significantly. 

“Those maybe raise electricity prices by one or one and a half percent in total, that’s not even an annual ongoing that’s a one-time increase, because they are using a lot of electricity. But the thing to remember is they’re paying for any upgrades to the infrastructure, which then those benefits get spread over all the users,” Horpedahl said.

But what are these data centers, and how do they work?

“And as the internet and computing really moves to be stuff being done offline, like not physically on your device, it’s done in the cloud. It’s done through offline servers or off-site servers. This is something that Google and other companies that are, you know, really the ones, you know, running the internet, essentially, they need to have these, and that’s why they’re building so many of them now, as so much of the activity of the internet moves in that direction,” Horpedahl said.  

Property taxes can also be significantly impacted by these data centers being built.

“If you look at like places like Loudoun County, Virginia, that’s the largest data center, you know, hub in the world. It’s near Washington, DC. They have hundreds of these in Loudoun County, the data centers pay half of the property taxes for the county, and they’ve been able to reduce property taxes by 40% over the past 10 years,” Horpedahl said.

 Arkansas’s appeal to these types of centers is the lower cost of energy, but when it comes to some proposed tax relief, it might be necessary.

“I’m not sure you really need to be offering big tax breaks to get companies to come; they’re going to want to put them anywhere. They’re going to want to put them in places that have good energy infrastructure and low energy costs. I think Arkansas is already well-positioned enough that we don’t, probably don’t need to offer huge tax breaks to them, but that’s something which I think is going to be part of the ongoing public debate about,” Horpedahl said.