TeraWulf will pay for transmission upgrades and a new power plant
At the Thankful Hearts Food Pantry near Pikeville, Trissia Scott operates freezers and a walk-in cooler for food distributed to local seniors. Her electricity bills have more than doubled and are now as much as $2,000, according to Scott, who said she scraped the money together from donations.
Scott does not have enough to cover December, January and February, the months she described as the hardest to pay. She continues to ask people for help through GoFundMe as the pantry receives donated food from stores.
Some eastern Kentucky communities are actively pursuing data centers or open to them, hoping the projects will bring money to a region where coal mines and a steel mill have closed. That welcome contrasts with the opposition data centers have generated elsewhere in the country. Local officials support development because of the area’s economic needs.
The immediate issue is what residents pay for electricity. Kentucky Power customers in the rural area pay some of the highest bills in the state, the report said. Mine and steel-mill closures caused a big drop in demand for Kentucky Power, while residents leaving the region reduced the number of customers paying for power.
Scott said the pantry receives people every day who need help with power bills. “My own home went up over $200. So everybody - ‘cause we have people every day needing help for their power bills. And it’s just going to get worse.”
Kentucky Power is building new transmission infrastructure to serve the planned Muskie Data Campus. Sarah Lynch, a company spokeswoman, said Maryland-based developer TeraWulf will pay for those upgrades rather than residential customers. Lynch also said TeraWulf has agreed to pay for a new power plant that will generate additional jobs and tax revenues.
Lynch described the potential customer as an economic turning point. “What this really is is potentially a transformational opportunity for eastern Kentucky,” she said. She also said, “Bringing on a large-load customer like this is a really amazing game changer for us and for our customers.”
The stakes are visible in employment. Pike County lost 300 jobs earlier this year when a coal producer closed. Reggie Hickman, Pikeville’s city manager, said a data center could replace some of the tax revenue coal provided, even if it could not replace the number of jobs.
Some local officials have signed nondisclosure agreements with data-center developers, raising concerns about transparency. Pikeville took a different approach. Hickman said: “For us, we immediately went to the public and said, you know, we’re concerned about the same things you are.”
The city did not negotiate in secret, offered no property-tax breaks and remained open about water and electricity use, air and noise pollution. Hickman said city officials shared residents’ concerns: “That whole litany of things that the public’s concerned about, we are, too. We live here, too.”
Pikeville could soon reach a deal for a data center, Hickman said, and such a project may eventually lower electricity bills. At the pantry, Scott remains focused on the next bill. The 11 freezers and walk-in cooler must run continuously to hold donated food, and she is seeking donations for turkeys for Thanksgiving meals. She still does not know how she will pay while the proposed Muskie project offers eastern Kentucky a potential source of jobs, tax revenue and transmission investment.