Powering the Artificial Intelligence Revolution
Pennsylvania is well positioned to become a leading state in the new frontier of artificial intelligence. More than 90 billion in capital investment has been pledged by the world’s largest technology companies to projects that will be located in Penn’s woods.
But, those companies move at the speed of business. They will have little patience for dealing with the lethal combination of Pennsylvania’s state government regulatory bureaucracy and the radical environmental activism that has derailed past efforts.
Proposals have already been put forth for the siting of new data centers – the computing capacity that feeds the AI revolution. But challenges are already emerging. State policymakers are considering new laws and regulations. At the local level NIMBYism (Not In My Back Yard) has reared its ugly head.
Actually, taxpayers should welcome the development of data centers. Such centers create both construction and ongoing operational jobs. They have little demand for municipal services. They will pay property taxes to the local school districts while adding no students to the schools.
Data centers consume massive quantities of electricity. Radical greens are fanning the flames of concern claiming this consumption will lead to higher residential electric costs. The line of attack gets traction because consumer electric bills are already rising. But, electric costs are skyrocketing because so-called “renewable” energy sources have proven to be costly and undependable.
At the same time, the extreme environmental Left has mounted an all-out assault on the development of any and every other energy source. They have been particularly aggressive in fighting the further development of carbon-based energy – the very energy Pennsylvania has in abundance.
Carl Marrara of the Pennsylvania Manufacturers Association disabused concerns over a lack of energy supply arguing:
“Pennsylvania has all the energy it could ever need. Sitting atop 214 trillion cubic feet of recoverable natural gas, the state should be leading the charge in cheap, reliable power. Instead of handcuffing our energy industry, we should be expanding natural gas-fired power plants, ramping up combined heat and power systems, and getting an LNG (Liguified Natural Gas) export facility up and running . . . “
The main roadblock to unlocking that energy potential has been the multi-state Regional Greenhouse Gas Initiative (RGGI). Marrara points out that from 2010 – 2019 “12 natural gas-powered plants were brought on line in Pennsylvania adding nearly 11 gigawatts of power.” When former Governor Tom Wolf embroiled Pennsylvania in RGGI such development virtually ground to a halt.
Governor Josh Shapiro continued to support Pennsylvania’s participation in RGGI until he needed a bargaining chip to break the recent state budget stalemate. He agreed to withdraw from RGGI in exchange for legislative approval of his state spending priorities.
But that doesn’t mean the radical greens have surrendered and gone home. Shapiro has put forth his own plans, dubbed PACER and PRESS which would double down on requirements for expensive “renewables” and/or non-existent energy sources while throwing roadblocks and taxes on carbon-based energy.
And, once again, lawmakers are proposing a so-called “severance tax” on natural gas produced in Pennsylvania. That tired old proposal has been rolled by the Left ever since production in the Marcellus Shale region began. Gas producers already pay an impact fee, which is a severance tax by another name. What the legislators are attempting to do is to double tax producers in an effort to make natural gas uncompetitive as an energy source.
The bottom line is Pennsylvania is fully capable of providing all the energy needed for data centers and related facilities if we move past failed ideologically driven energy policies. However logical that may be, it is politically difficult. Governor Josh Shapiro is preparing a run for president and thus must pander to the environmental extremists in his party. He will continue to fight for policies that slow energy development and drive up consumer prices.
Radical environmentalists and their allies in the legacy news media will continue to stoke the false claim that data centers, rather than failed public policies, are to blame for rising electric costs. The fact is Pennsylvania is capable of producing more than enough affordable electricity for data centers and consumers alike.
The solution is not to build fewer data centers – it is to produce more electricity.
(Lowman S. Henry is Chairman & CEO of the Lincoln Institute and host of the weekly American Radio Journal and Lincoln Radio Journal. His e-mail address is lhenry@lincolninstitute.org.)
Permission to reprint is granted provided author and affiliation are cited.
