>> Data centers are one of the most hot button topics in Chicago in Illinois and around the country alongside more construction comes more public scrutiny of their economic and environmental impacts.

They're strain on the power grid and their role in AI development earlier this month, Governor Pritzker suspended tax breaks for data center development.

And while a General Assembly bill regulating new data centers did not make it across the finish line this spring, it will likely come up again in the fall.

Joining us to talk about data center development Brad tight states state directives.

It's a policy director of the Data Center Coalition, Walling, CEO of the Illinois Environmental Council.

Andrey attention, director of regional government affairs for the Alliance for the Great Lakes and Ramiro Hernandez, vice president of public policy for the Illinois Chamber of Commerce.

Thanks to all of you for joining us.

So Brown, starting with you first wire data centers receiving so much attention now.

Well, and you have to take a step back.

The data center industry has been around for decades, There's been 20 plus data centers in Elk Grove Village.

since early 2, thousands.

>> Obviously, we are seeing a growth trajectory with the industry because of the demand from residents, businesses for digital services and data.

Right.

So the average household today has 21 connected devices in it.

We're going to use twice the amount of data in the next 5 years.

The news in the last 10 years, 95% of Fortune 500 companies are operating on a cloud-based system.

91% of small businesses are using AI embedded tools business practices.

So that is what our industry is working to meet is the demand for data and it's not just entertainment, right?

your hospital records.

Bank records, government schools, public safety, remote work, you know, telehealth like the list goes on.

So that were working for.

Obviously, I think the growth is causing communities to ask questions will work with you try to a part Janet was a data center industry was focal point for environmental advocacy.

>> Data centers use a colossal amount of energy which contributes to climate change.

If it's not done if we are using the power sector in a way that we're bringing more.

>> Carbon sources online or keeping them online longer.

It's going to be it's we proposed approach that's bring your own new, clean energy.

It also is something that uses a ton of water and will leave that to others to discuss.

But also has a strong impact in communities.

There's noise, pollution.

There's ways that it impacts area where it develops and we're extremely concerned data centers and environmental impacts.

Rivera went back to data centers have on the state's economy.

>> I think they play a huge role in economic impact of the overall state growth innovative sectors for sure.

The tech sector, especially I think looking at the Department of Commerce and Economic Opportunities report it annually review the incentive and just based off of the projects that have received the incentive over the last few years, there's been almost 16 billion dollars of investment in those projects.

obviously that's just a fraction of what the industry represents across the across the state.

So from that perspective, it's it's a major driver for jobs and investment and also local revenue.

>> And of course, Jen mentioned water.

Andrea, what makes data water policy issue?

Yeah, you know, we the line for the Great Lakes has been working for 50 years, protect the Great Lakes and the clean water.

Not only that, we that keep those lakes clean and and and healthy for ecosystem, but also drinking water.

Many of us receive drinking water from it.

>> It also it really helps to infuse our groundwater in one of the concerns as Jen was noting is the amount of water that is used, especially at large scale large-scale.

We had a report last year about the large scale data users and data centers, but also other large killed users that really are playing up a lot of resources in terms of water.

We need to manage it, right.

We need to ensure not only the in the amount water that's going in, but the any of the output.

So any pollution that's going out that we're protecting ensuring those no additional pollution.

You know, at the alliance, we helped years ago past the Great Lakes Restoration Initiative dealing with the last century's pollution from industry.

We just want to make sure that we're not causing those kind of harm's on communities on our neighbors.

on our ecosystems and we need to keep our drinking water clean.

Brad, to that point, how do data centers use water and are they using more of as >> as we continue to grow and to flourish?

as a >> well ups and you have you know, not every data center even uses water and some are using hybrid systems where in a climate like Illinois, for 90% of the year, they'll use the outside air temperature to cool their facilities and then maybe for a few weeks during the summer go to a liquid or water cooling solution and we're getting more and more efficient by the day.

I'm sure, you know, most people heard of the closed loop system now, but there's direct a chip liquid immersion, so many different innovations happening in the space.

But we use far less water than other industries do and we use less water.

The golf courses.

There was a report that came out from Elk Grove Village.

There data centers.

They're using less water than car washes and laundromats 83% of data centers in Virginia.

The capital for data centers in the world are using less water than average commercial building.

So we could go on with all the different examples.

We're going to become more and more efficient.

I mean, by Twenty-thirty, many remember companies have committed not to be water positives actually additive to the water system.

And there are so many different things we can do for water.

Reuse treated wastewater infrastructure perspective we want to play a role in that, Okay.

So we talked about legislation in Springfield but didn't make in this past session.

Tell us bit about the proposed regulations in the Power >> So we introduced with lawmakers to protecting our water, energy and rate payers act.

This is a bill that looks at 3 main components of data center regulation.

>> It's setting guardrails on data centers.

We make sure that data centers pay their fair share.

We're making sure that an energy usage they're using clean energy and they're not prioritized over other electricity users.

We look at communities making sure there's process and transparency when one of these facilities go in and then looking at the water requirements, making sure that we have closely been other systems.

And but no moratorium on data centers.

There's no moratorium.

There's no ban their communities all over that are enacting moratoriums or bans on data centers.

The city of Aurora has an active parallel regulation to the power Act.

So we're seeing these things happen in different ways all over the state, but it's not a moratorium.

It's not a ban.

Its guardrails on data centers.

I don't mind jumping in here the issue of guardrails are really important night.

I noted the Great Lakes Restoration Initiative we had >> to spend billions of dollars to clean up the last century's pollution.

And we want to ensure that not only are we protecting groundwater in Great Lakes, water, but we want to ensure that we're not for further polluting.

And so we do that by having smart guardrails.

We do that by ensuring there is monitoring of water use and water output right?

Those guardrails are reasonable and designed to be on the kind that can ensure that our communities no, what's both being used in what's going out.

And if there are moments of drought like we have had downstate that we can ensure that these large water users that these data centers do not pull waterway either for away from agriculture or from homes, bread.

Thoughts concerns with the Power Act.

>> Yeah.

So I mean, it's a 638 page bill that regulates one industry unlike any other industry in the country.

And quite frankly, they were to sink lot of time.

Having just drafted moratorium like that is the practical impact of what this bill would do.

Illinois already experiencing.

We were number 2 in the country for data center growth.

2023 in our number 8, 9, or 10 and most state rankings so ready slipping pretty significantly, which means, you know, the 2.5 billion dollars in state and local tax revenues are no wonder come here Indiana or Wisconsin or Iowa.

The jobs, the investment like the list goes on.

So, you know, they're having said that there are certainly areas within the power Act that we can work on.

we've talked to John and others about that.

And we'd like to have those conversations.

We were begging for negotiations to happen all throughout session.

And whatever happened, which was I think it's unfortunate.

So I think the hope is to get there, though, and reach a package in the fall veto session, a lame duck session, OK?

So 2024?

Report from Lawrence Berkeley.

National Lab found the data centers accounted for about 2 per cent of total electricity consumption in the country in 2018.

>> This top 4% in 2023 and is expected to reach between 6 and 12% by 2028.

And this trend is expected to be similar in Illinois to keep growing Rivera.

What kind of economic and environmental policies for that matter?

Do think the state should be considering to to keep up with that growth?

>> Yeah, no, I think to what the parents have already alluded alluded to.

I think you have a situation where we on the table, a proposal that you know is is fairly broad and does encompass a lot more.

You know, then any one specific regulatory framework, obviously there were over a dozen pieces of legislation that would introduce in Springfield, this this legislative session, one of which was the power acts, right?

I think they're just a lot of concerns kind of one size fits all approach to kind of some of the regulations that are contained in the larger package.

6 over 600 pages of regulatory framework, whether it's the permitting costs of increases on fees and certain other types new onerous provisions on industry.

I think it's a challenge from our perspective to on a philosophical level, allow such immense kind of a burden the industry.

You know, different communities have different water sources and are environmental concerns.

What what might some local communities, Ramiro might or Mike?

They want a data center in the area.

What are the benefits for them?

>> Absolutely.

I think one of the pieces that I highlighted on the economic basis as the local revenue, right.

I think you see several different projects not only on the investment on the capital infrastructure side, but you see a lot of good partners in the community that are providing substantial property tax benefits to local communities throughout the state rate.

Not just the ones that receiving the current incentive that that is scheduled to be pause.

So from that perspective, I think you see a lot of them revenue generated not just by the industry, but kind of the ancillary ecosystem that is built obviously good paying jobs on both the construction side to our partners over organized labor, but also kind of a cumulative impact on the economy locally.

>> So when governor announced earlier this month that he be suspending the tax incentives for data center construction.

Jen, do you think causing that dresses any of the environmental concerns that you have?

>> We're thrilled that the governor paused the didn't center tax incentives and came out with 7 principles that really mayor the power Act.

But I don't think that this is going to be a long-term solution.

Hopefully it pushes everybody to the table.

We've talked about the economic benefits, but I think the thing we haven't highlighted here is energy affordability that what this is going to do in energy in Illinois has already done is wild.

64% of energy growth in the next 10 years is expected to be from data centers.

When we look at there are 24 gigawatts of peak power in the comment territory right now in the summer.

There's 70 their side, 28 gigawatts of proposed data centers.

That infrastructure is going to cost 24 billion dollars to meet those needs of which we need to make sure people are that residents are not paying from things that data centers are causing, which is already happening to our electricity bills.

Right?

That's unfortunate where we'll have to leave.

But I'm sure we'll be talking about this.