Emerging Industry Strains Power Grid

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from The Wall Street Journal,

Georgia is a magnet for data centers and other cutting-edge industries, but vast electricity demands are clashing with the newcomers’ green-energy goals.

Bill Thomson needs power fast. The problem is that many of the other businesspeople racing into Georgia do too.

Thomson heads marketing and product management at DC Blox, which in recent years built a string of data centers in midsize cities across the fast-growing Southeast. The company more recently set its sights on Atlanta—the would-be capital of the region—joining a slew of tech and industrial firms piling into the state.

Vying for a piece of one of America’s hottest markets, those businesses tend to have two things in common. One is that they represent a U.S. economy increasingly driven by advanced manufacturing, cloud computing and artificial intelligence. The other is that they promise to hoover up huge amounts of electricity.

That combination means Georgia’s success in luring this development comes with a side effect: Power is a big source of tension. The clean-energy goals of companies and governments are running up against the need for projects to break ground fast. So far, climate advocates fear the imperatives of growth mean more fossil fuels.

Georgia’s main utility, Georgia Power, has boosted its demand projections sixteen-fold and is pushing ahead on a hotly contested plan to burn more natural gas. Critics warn it will yield higher bills and unnecessary carbon emissions for decades. Some companies are scrambling to secure bespoke renewable-energy deals to power their development.

One major source of disruption is data centers. The facilities are ballooning in size as people spend more of their waking hours online and companies digitize everything from factory processes to fast-food drive-throughs. All that computing requires power—and for firms like DC Blox to lock it in as quickly as possible.

“These companies all have clean-energy goals,” said Patty Durand, a Georgia Power critic who is campaigning to be a utility regulator in the state. “Those goals are at risk if Georgia Power gets what it wants.”

The Peach State’s energy quandary stems from the type of economic dynamism that many counterparts would envy. Its growth has consistently outpaced the nation’s. A smaller portion of Georgians are jobless than the U.S. average, while their incomes tend to be rising faster.

State and local economic-development teams have courted large businesses to set up shop with sales pitches that have included generous financial incentives. Rail lines, ports and America’s largest air hub also provide access to faraway customers.

Pat Wilson, commissioner of the Georgia Department of Economic Development, said energy is increasingly part of those discussions with newcomers. Officials tout the newly expanded Plant Vogtle, America’s largest nuclear power plant, as a sign the state is ready for long-term growth.

“We have a utility partner to make sure you can meet your energy needs on day one,” Wilson said.

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