Amid questions and concerns, Box Elder County leaders delay action on data center proposal

BRIGHAM CITY — Box Elder County officials, like many, are still getting up to speed on a massive data center project proposal and tabled action on the plans Monday as they continue to digest the information.

The action came at a sometimes raucous special meeting of the Box Elder County Commission populated by critics who fear the potential impact of the project on the Great Salt Lake. Details of the project, sought by Canadian entrepreneur Kevin O'Leary and Alpine-based West GenCo in cooperation with Utah's Military Installation Development Authority, or MIDA, started publicly emerging last week, prompting questions and concern from some.

"If we do this, it is irrevocable, and that is a concern we have as a county," said County Commissioner Lee Perry. "We want to make sure that we're making the right decision for the citizens of Box Elder County moving forward, and that's why we want to make sure we've done it right."

O'Leary, an investor who has served as a judge on the reality television show Shark Tank, is pursuing a similar project in Alberta, Canada.

Lee said the three county commissioners, given short notice on details of the plans, were "a hard no" on the project when they first learned of it, though he expressed appreciation for the information provided by MIDA and West GenCo reps at Monday's meeting. Some of those gathered for the meeting applauded when the commissioners tabled action on a proposed interlocal agreement with MIDA on the plans and a resolution required for the project to move ahead.

However, the plans are still alive — the commissioners will meet next week, on May 4, to take the matter up again.

Broadly, O'Leary's proposal, called the Stratos Project and sponsored by O'Leary Digital, calls for development of a "large data center campus supporting (artificial intelligence) and cloud computing," Hilary Venable, a MIDA project manager, told the county commissioners. It would generate 2,000 permanent jobs, maybe more over time.

The project, in full development, would be sited across three large swaths of unincorporated Box Elder County land totaling 40,000 acres and would require a power-generating capacity of 7.5 gigawatts. The power would be generated on-site, probably via natural-gas-fired plants developed for the project and supplied by the Ruby Pipeline, which cuts through Box Elder County.

"The Stratos Project Area is designed to support reliable domestic energy production while reducing dependence on foreign energy sources. The planned energy users are large data centers that will both directly benefit military and national defense-related missions," MIDA spokeswoman Kristin Kenney said in a message Monday to KSL. "Specific tenants and the number of facilities have not been publicly confirmed."

Venable touted the site in rural Box Elder County as outside of population clusters but accessible to a workforce. MIDA, a state entity, helps promote military initiatives with an economic development component. "At a high level, this is about placing the right infrastructure in the right location where it can operate efficiently and with minimal impact to surrounding communities," she said.

Notably, the project also promotes military readiness by bolstering access to energy. "At its core, this project is about infrastructure that supports military missions, not indirectly, but by design. Reliable energy and secure data assistance are no longer optional. They are part of the foundation of how national defense operates today," Venable said.

Critics of the plan have quickly coalesced, however, and one of their key concerns is the water they fear the data centers would need to operate and the potentially adverse impact on the Great Salt Lake. Many demonstrated outside the Box Elder County Courthouse ahead of Monday's meeting and filled the seats in the commission chambers, holding signs critical of the plans.

"We have a struggling lake already in peril," said Peggy Kluthe, of Indivisible Ogden, one of the critics. "This data center is going to starve the lake further of water at a time when we are ... so vulnerable."

Thor Dorosh, also with Ogden Indivisible, blasted what he sees as a lack of transparency in the project's rollout and a lack of studies documenting its potential environmental impacts. Project boosters, he said, seem to be pressing for approval before providing the public with details on the plans.

In response to the water concerns, Venable said the data centers would use "closed-loop cooling systems" that reuse water repeatedly. "Because of that, the long-term water demand is expected to be closer to what you would see from a large office campus, not a traditional industrial use," she said.

Austin Pritchett, a managing partner with West GenCo, said only "a very small fraction" of water rights secured by project developers would be used. A portion of the water would be shared with neighboring ranchers, he said, and passed to the Great Salt Lake.

New "air-cooling technologies" that project developers hope will generate the needed power, he added, don't use water.

Total build-out of the project would take 10 years, according to Venable, creating 4,000 temporary construction jobs and 2,000 permanent jobs to start with, and more, possibly, as time passes. "They'll be high-paying jobs that will stay with the development," she said.

The developers would get a break on the tax on the energy used at the facility, 0.5% instead of the 6% MIDA would typically assess. However, that will still mean the county initially receives some $30 million in tax revenue per year as the project comes online, rising to $108 million at full build-out.

Box Elder County commissioners didn't allow public comment at Monday's meeting, though many people blurted out questions and criticism as the meeting unfolded, prompting Commission Chairman Tyler Vincent to bang his gavel several times. The officials allowed public input at a meeting last week.

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