The Louisiana Public Service Commission approved plans on Wednesday by the state utility company Entergy to build three new gas power plants that will power a Meta data center. The approval drew criticism from consumer protection groups and environmental advocates.
Shouts of “shame” and “you sold Louisiana out” erupted from the public audience as the commission went into recess immediately following its 4-1 vote to approve new power plants.
During a public comment portion of the commission meeting, over a dozen Louisiana residents spoke against Entergy’s plan and expressed concerns about the $10 billion data center in Richland Parish, which is touted as the largest planned data center in the U.S. They criticized the commission for rushing the process, while raising questions about impacts on electric rates, water consumption, air pollution and whether the downsides are worth potential economic benefits.
Larry Hand, Entergy’s vice president of regulatory and public affairs, told commissioners that the company went to “painstaking lengths” to minimize impacts on existing customers’ utility bills.
“We made sure that Meta’s deal would ensure that they pay enough to cover the generation costs that they are contributing to,” Hand said.
Big Tech is looking to quickly construct new data centers amid the boom in artificial intelligence tools. The power-hungry facilities need a reliable electricity supply, creating competition among regional power companies over who can bring more power generation online the fastest. At 2.3 gigawatts, the plants will be able to produce roughly twice the amount of power needed by the city of New Orleans. Commissioners ruled on the proposal several months ahead of schedule.
What would the project bring to Louisiana?
Although Wednesday’s vote was on Entergy’s power plants, if new power plants had not been approved, it is likely that Meta would look for alternate locations for a data center that it wants to build through a subsidiary, Laidley LLC.
Construction on the data center is already underway on a 2,250-acre site about halfway between Shreveport, Louisiana and Jackson, Mississippi.
Entergy will build two new combined-cycle gas power plants in Richland Parish, where the data center will be located. They are expected to come online in 2028. A third gas power plant will be built between New Orleans and Baton Rouge and is expected to begin operating in 2029, according to a press release from Entergy.
The approved plan also includes new transmission lines and allows Entergy to purchase 1.5 gigawatts of solar power through an expedited process.
Commissioners highlighted that the data center is expected to generate 500 new jobs in northeast Louisiana, one of the most poverty-stricken parts of the U.S.
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To power data centers run by a Meta subsidiary, utility company Entergy Louisiana is building three gas power plants capable of delivering roughly double the electricity needed by New Orleans.
“We need help, and these people are offering help and good jobs and good pay,” Commissioner Foster Campbell said. Campbell also criticized opponents who do not live near the data center location, who he said oppose the plan on “philosophical” grounds.
Why are the data center and power plants controversial?
Members of the public criticized the public service commission for moving quickly after previously planning to hear the Entergy proposal in October.
“My main concern is that this commission is damaging their credibility by rushing through this controversial decision in record time,“ said John Christopher Brown, a biologist who worked for 17 years with the U.S. Army Corps of Engineers. Brown also said the increased pollution would contribute to climate change, which he said is damaging the coastline of southern Louisiana through increasingly severe storms and sea level rise.
Entergy also did not conduct its typical request for proposals to serve Meta’s data center. That process allows alternative proposals to surface. Entergy’s representatives told commissioners that in this case, the process would have slowed progress.
“My most important job is to center the public interest,” said Commissioner Devonte Lewis, the sole vote against the proposal. Lewis cited the uncertainties around rate impacts and the lack of a competitive process that he said were “too bitter for me to swallow.”
Angelle Bradford Rosenberg, a Louisiana resident, said she volunteers with many people who live in northeast Louisiana who could not attend a daytime meeting during the week. She voiced concerns about the data center’s water consumption and Meta’s growing power over the region.
“There’s a lot of questions that are left unanswered,” she said.
The commission also approved Entergy’s plan without waiting for an official recommendation from an administrative law judge, who reviewed hundreds of pages of testimony and oversaw in-person hearings in July.
Who will pay for Louisiana’s new gas projects?
Entergy has a 15-year agreement with Laidley to cover the costs of the new gas power plants. At least half a billion dollars in new transmission costs will be paid for by all utility customers, according to Entergy’s application.
Opposition questioned plans to cover costs after the 15-year agreement expires in 2041, or if a “parental guarantee” for Meta to cover the expenses incurred by Laidley could not be enforced.
“The importance of the parental guarantee cannot be overstated,” said Susan Stevens Miller, an attorney representing the Union of Concerned Scientists and the Alliance for Affordable Energy.
“The state of Louisiana and this commission and Entergy will have no ability to obtain funds that it’s owed if that parental guarantee cannot be enforced. And there is nothing in this record that shows that it can,” Stevens Miller said.
Entergy pushed back against concerns, specifically the assertion that ratepayers could see increased costs after 2041. Hand said many existing power plants will be ready to retire at that point, so new generation resources will be needed.
Hand expects that Laidley will renew the contract, but added, “If they don’t renew, we have a gift paid for by Meta: paid-for generators that we can use to replace the existing fleet.”
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Author: Keaton Peters
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