Hello, and welcome to this week's episode of the Texas trib Cast for Tuesday, April twenty eighth. I'm Eleanor Klibanoff, joined as always by editor in chief Matthew Watkins. I feel like it's been a little while since we've done an episode together.
Did you enjoy your trip?
I went to Dallas, the Dallas suburbs, Exaltica. I was up there for one thing, and then I'll tell that we heard Ken Paxton announced that he was doing an event, which you know, he doesn't do a ton of public events, even though he's campaigning for Senate, and so we they said, would you stick around for an extra day or two and you know, try.
To see him? And uh, it was great.
I spending two extra days in the Dallas suburbs has I was like, man, there's something deeply an eight in me that makes me want to see what another town's old navy looks like.
And I'm gonna tell you this right now. It is the same as our old navy.
That's funny because I feel like usually my experience when I hear about you traveling is that you're seeking out the nearest soda fountain.
I did go to Swig. I went to Swig several times. They were like, will you stay for two extra days? And I said, can I what is my Swig budget for dirty sodas?
And yeah, I blew through it, So please.
I'm sure there are many people listening who have no idea what you're talking about, but that's okay, yep.
If you're not from the Dallas suburbs or Mormon country, you should really introduce yourself to Swig, which is essentially just a soda with more calories added to it.
It's great.
Anyway, That's not what we're here to talk about this week. We are going to be diving into, honestly, one of the thorniest issues facing Texas right now, and an issue that looks really destined to define next year's legislative session and the political conversation for the next couple rounds. Over there in the capital data centers, Texas is currently on track to become the data center capital of the country, with more data center projects under instruction and announced than
any other state. They're drawn here by plentiful land, minimal regulations, abundant tax breaks to the tune of about three point two billion dollars in sales tax revenue over the next two years alone. It's a very Texas sized problem, but not unique to Texas. It's something other states are wrestling
with two. In fact, Virginia, the only state that currently has more data centers than we do, is locked in a huge budget impasse right now over whether to continue giving tax breaks to data centers, which sort of a foreshadow of what might come next January for us here in Texas, as we decide how much we want to welcome these data centers and how much we want to demand that they pay their share.
To be here.
To dig into this, we are joined by Paul Cobbler, the economy and industry reporter at the Texas Tribune. Hey, Paul, Hey, thanks for having me absolutely thanks for being here.
Paul, you may not know got me sick last week. We had Soon as the podcast was over, I became terribly ill. And it's Pul's fault.
Who knows the order of events here. I think someone else got me sic too.
We had a chain of illness like whip through the Texas Tribune last week, which is why I was like, I will stay in North Texas.
You guys all seem disgusting. We are also joined.
By a very special guest, Charles Pollin, a Virginia based reporter for Inside Climate News who has been reporting on this very same issue a few hundred miles north.
Charles, thanks for joining us.
Hey everyone, thanks for having me. Glad to be meeting over zoom and not contributing or receiving the sickness. I guess, yes, yes.
Yes, you're safe.
Yeah. How are things in Virginia.
I mean, we'll talk about the data centers, but generally, you guys are in the midst of a legislative session.
Yeah, well, I guess a special session. We had our regular session for this year between January and March. It's a short one. It's a part time legislature here, either forty five or sixty days, wrapped up in March and got some bills across. They went to the governor. We're undergoing some final tweaks or final decisions from the governor about those now and more broadly, overarching, all that was work that was left undone on the budget regarding data center tax exemption.
Yeah. It's funny and I feel like Texas sort of created this redistricting fight the Virginia is having, and you guys are having this data center fight that we're going to have, so a real two way street for ruining political reporters' lives.
It's great.
Yeah, it's been a busy one, I guess. Yeah, we're horse trading on who can take the lead on what. There's some hope that with that being settled last week here in Virginia, that that might open up negotiations and allow people to focus in on this issue. I should say, our redistricting effort is still being reviewed by the courts. There was a here on Monday, so TVD on it fift holes or not. But we're moving along way.
It's a you know, I never saw so many connections between Virginia and Texas. But Paul, maybe you can start with sort of the basics, like this where data centers get thrown around a lot when we're talking about data centers, what do we mean? And like, why is this issue suddenly here?
Yeah, So data centers are not a new thing.
I think it's a thing that's kind of entered the public consciousness in the past couple of years, obviously as
they've gotten much larger. But when you when you think of a data center, it's you know, really it's just sort of the the memory of the Internet is maybe the easiest metaphor to use here that it's kind of like all the servers, you know, the cloud storage infrastructure, sort of like the Internet is a physical thing, even though we think of it as being out in the ether, but there is equipment that makes all of this happen, that stores all of this data, and that is essentially
what a data center is. And in the kind of recent terms that people are thinking about is just as the Internet has become more intense, largely because of the rise of AI and all of the computing power that that takes, data centers are getting a lot bigger and people are starting to notice them.
Yeah, it's super interesting.
It feels like, I mean, we have this with a lot of things at the legislature, but it's like suddenly everyone has to get very up to speed on a new niche thing that we didn't really pay that much attention to, which is I mean, you did this story about these tax breaks, and it was one of the things I found interesting about this is like this was not a thing that people were paying them, like a law passed and no one paid that much attention.
And now suddenly it's super relevant. Can you talk a little bit about that.
Yeah, So the tax break that we're talking about here was actually passed in twenty thirteen during that year's legislative session. That was about the same time that Virginia was passing its own sales tax break and a bunch of other states around the country. This was at the time really an emerging industry. This was something that you know, states looked upon as a source of you know, economic development of sales tax revenue, sorry, of tax revenue, not sales
tax revenue. And you know, there was a reason to try to bring and draw these things here. And that first full year in twenty fourteen, after that tax break was passed, it was valued at about five.
Point four million dollars.
So really, I mean, when we're talking in the context of, like you said, three point two billion dollars over the next two years, I mean, it was it was basically pennies. I mean, obviously I'd love to have five point four million dollars, but you know, and it has just ballooned in size, very slowly kind of over the course of a decade, but just in the last three years, it is,
it has really grown. And again you know, this is sort of like we're talking about, is as these things get bigger, as the tax breaks get bigger, people start paying attention and noticing.
It's sort of like passing a law like two years before the iPhone comes out that says like, you know, no sales tax on like things you buy on your phone, right right, Like no one anticipating that you know, we're going to essentially just like completely change the way that this works and you know, have this massive expansion.
Yeah, that's a great metaphor of just like you're like, oh, sure, why not come on it, and now you're like, oh no, we're being like deluged with this.
Well, I thought the funny one of the funnier parts of the reporting for that story was I spoke to the bill's author, Harvey Hildebrand, and he was joking with me that he was like, you know, they did say it would take you know, ten fifteen years and we'd probably be the number one market. This is maybe the most successful bill I ever authored while I was in the legislature. And he was, you know, joking about that, but you know, I think it's true that it's it certainly is worked.
Yeah, or like extremely impactful. Yeah, so we now have as you said, this has exploded. We'd sort of set up this you're this huge sales tax exemption, which maybe was not the original intent for it to be quite that large. What are you hearing from lawmakers about sort of what are the animating sides of this issue?
Yeah, I mean the lawmakers I have spoken to this is it's like you said, I think a lot of them are kind of getting caught up to speed. I think it's a lot of sort of like we need to get our arms around this issue. But the numbers, you know, when they when they look at this three point two billion dollars over the next two years, when they look at how much it's ballooned in size, which we can talk about a little later, just over the past couple of years, that you know, their eyes pop
and they're like, this certainly does not look right to me. So, you know, I've heard from a number of legislators, from state Senator Joan Huffman, who's chair of the Finance Committee, which is one of the key committees in any tax break, you know, repealing or reworking would go through, and she is she said she would be open to repealing it, or the very least taking a look at it.
Same on the House.
Ways and Mean side, a lot of the members of that committee have also said about the same. I mean, this is definitely something that they are taking a look at, but I think they're kind of treating this next you know, how many months is it, like seven months or so before the legislative session starts to kind of wrap their arms around it and figure out what they want to do.
Charles, I mean, what are sort of as again, you guys are sort of living through our future. What have been sort of the battle lines around this issue in Virginia.
Yeah, so I'll say it's a very similar story to Texas, you know, wanting to create economic development and like to thousand and eight here in Virginia and it's exploded to this huge market. You know, the data center industry really likes Virginia because there's a strong fiber network. It's right next to there's strong fiber network here, it's next to the capital, so it stores a lot of information for
the government. There's relatively cheap power, and there relaxed land laws, land use laws with localities, and so it really blossomed and grew to its world leading market now and that's brought local tax revenue to local governments. Up in Louden County where a majority of the data centers are, it's about an hour west of Washington d c UH. They get about a billion dollars in revenue from localities are from data centers and that goes towards schools and other
critical services that they want to provide. And so counties have really grabbed a hold of that. And then the labor unions really like the work too. These electricians he's building in trade construction workers see you know, I guess good jobs. They talk about the perform the work agreements with the companies and how the salaries are higher. So
the economic factor has really been driving this. But people are waking up to the increases in utility rates for customers to kind of build out the infrastructure, the concerns about water use that these data centers need for cooling and then air quality for when they're using backup diesel generators. So there's a lot of like external costs that the environment and people might have to deal with. And this senator here in Virginia is a very bold, fire brand legislature.
She wants to kind of rein in some of that data center development and generate some revenue for the state that is dealing with, you know, budget shortfalls and what's to fund some additional core services. So it's really a fight kind of between her and the industry on how much money the state should get, and also with local governments and other lawmakers who want to keep the economic development going and preserve Virginia's reputation.
How does that sort of compare to what we're seeing here.
It all sounds very familiar, you know.
I think the sort of the arguments on the pro data center side, like Charlie was talking about it certainly is they point to this tax revenue at the local level. I think it's about thankfully easy to remember about three point two billion dollars that a commissioned studied by the Data Center Coalition, which is basically a trade association of all the top tech companies that you know, build a
lot of these data centers. They say they contribute about three point two billion dollars and local revenue about in twenty twenty four. This what it would have been. So that's sort of part of the argument that there is a lot of money that is still going into you know, city and county coffers on one hand, and then also you know, we've seen a lot of these sort of local fights happening where trade unions are also arguing in
favor of having data centers. You know, I think part of the argument against data centers is that construction jobs are quote unquote temporary. But I think you you know, tell that to a construction worker, all of their work is temporary. And then plumbers and electricians, like we have a shortage of them now, and a lot of these companies that are coming in and building data centers are announcing sort of like career programs to train more electricians
than plumbers because they say they need them. So there is there is sort of like this whole discussion I found honestly so interesting just because it's it's really a
discussion of trade offs. You know, are we getting our money's worth for the amount of money that we are forgoing in this in this tax break, and you know, when you think about the water use, the electricity use, the questions about rising rates, but also the job creation, the local tax revenue, so on and so forth, And so I think that's kind of what the legislators need to figure out is what is the right balance here? And I think the argument is that that balance isn't quite there right now.
Do you get a sense of how much of this is actually being driven by the tax breaks or how much it's just being taken advantage of by the companies who might locate here otherwise, Like I spent some time in West Texas recently talked to some people involved in the development of data centers. The tax breaks actually didn't
come up that much. What came up more was there's a lot of land in Texas which makes it very attractive, particularly in that part of the state there close to the Permian Basin, where there is you know, a massive amounts of cheap natural gas which can be used to
power these plants. There's obviously the regulatory environment that you know, not a lot of restrictions on land use, particularly in the rural areas of the state, which can allow these things to be easier to build, fewer hoops to jump through. Do you have any sense as to how much those factors are driving this compared to you know, we can save three point two billion dollars in sales taxes.
Yeah, I think it's hard to know. For certain unless the sales tax break goes away. And there are arguments on either side. But I think one recent example that really sticks out to me is in Hood County. They recently a data center was pursuing a local tax break that was rejected by the Commissioner's Court after a lot of resistance by locals there, and the data center is
they're still going out with the construction. They were like, Okay, well that's unfortunate, but you know, they're still building it. And you know, talking to a lot of tax experts sort of about just like economic development in general, you know, this is a really common fight across a lot of industries of whether we need to be foregoing tax revenue
to bring X industry here. And the argument that I've heard from some tax experts is basically that states, local governments so on, like they have more leverage now really than they will at any point, just because of the sort of you know, desperation is maybe too strong of a word, but the rush right now to build these data centers. These companies are trying to build as many of them as quickly as they can, and so this idea that they are going to you know that I
was reading about Virginia and then same in Texas. The Data Center coalition folks have said, if you get rid of these tax breaks, that's an end to the investment in this state. But you know, I don't think they can afford to just forego two of their largest markets if they get rid of these tax breaks, because they are trying to build so quickly, so many for all the reasons that Matthew just said.
Yeah, I mean, it's interesting because like you do sort of need Like let's say Virginia is like, we're going to get rid of this tax break, but Texas doesn't. Right, Like maybe within that you say, oh, well, now Texas.
Is a little bit more appealing. But if everyone.
Suddenly starts like looking at this again, and like I mean, Charles, I'm I know your stories have mentioned this, but like it doesn't like there's a decent amount of So I want to call it fear mongering because I'm sure there's some truth to it, but fear being raised by the industry Virginia that's like, well, Texas still has this, Illinois still has this. Like how much is Virginia feeling that heat of Well they might go to other states.
Yeah, that's very much part of the conversation here. I mean, this industry is highly competitive first and foremost too. You know, they want to build really fast and get these programs developed and advance their models. From what I understand, so they're saying, look, if we aren't going to be respected and have our old contracts honored with an abrupt end
to this sales tax exemption, we'll just go elsewhere. The Senator, Senator Luis Lucas here in Virginia kind of punches back, if you will, and says like, well, go ahead, call my bluff, call our bluff. You're not really going to go anywhere because of all the infrastructure and everything here. So that's where it's really gotten tense, and we're I guess going to see who can who can buy first.
I'll say it does seem pretty consequential to these companies that want to be highly profitable and their bottom lines from what I gathered here in Virginia, like in northern Virginia where a lot of them want to cite UH and be located UH land values have to increase quite
a lot. I think Amazon just bought a old George Washington University campus for like four hundred and twenty five million dollars, and so if there's any other way to eke out a few dollars and cents with the tax exemption, which you know applies to their computer equipment, maybe even some of their backup generators that are crucial that can
help them, you know, and their business case. So it's it's kind of nitpicky, but it's part of the big calculation you know that these companies UH are are factoring.
Is there any benefit to having the data center in your state beyond the tax revenue? I mean, is there is there anything to the idea of you know, you want this built, they're going to build it somewhere, so you'd rather than build it here.
There?
There is definitely like these fiber opt like It's like Charlie said that they have the fiber optic cables in Virginia, so that that is like one of the things that makes it more appealing. And you know it, it is true that the Internet takes time to travel, so having data centers closer by like that helps with a lot of these operations. But yeah, I mean, past that, the
appointed job growth. It's like we talked about, there are certainly these gig jobs that are created, there are these construction jobs, and then it's the tax revenue, and you know.
Not an insignificant thing, particularly in places where you know, a lot of these are having in rural communities where you know, the schools and other areas are really struggling right now and they want to see that revenue come in.
Yeah.
I mean I did a story last year about like small town in West Texas that is seen. I mean, it's like the wind farms, but it's similar like their wind farms, battery farms, data centers, like helping prop up their hospital, right, helping prop up their you know, certainly their schools. They're just like keeping the city afloat in a lot of ways and cashing in on that. But
then we do hear this local pushback as well. I mean what tools are local I mean, yeah, like, what tools do local like municipalities have on this to either empower this or pull back from it.
Not a lot, honestly, certainly in unincorporated areas and counties. You know, this was something we talked talked a lot about last year after the Curville floods and sort of the inability to regulate development in the floodplain and a lot of these areas that weren't incorporated and how that you know, contributed to some of the damage we saw from those floods. It's the same thing with data centers.
I mean, if if a company in Texas wants to come and build and they are you know, not you know, in the city limits, they can really just sort of do whatever they want. You know, there are like we talked about in Hood County. You know, these counties can offer tax breaks, they can do other things. They can help construct infrastructure, they can do economic development grants. There are things they can do to attract these data centers.
But like, really, if you're not in a city limit, there's not a lot you can do outside of that. And then what we have seen, like in San Marcos there was a big fight over this where there was an effort to rezone a plot of land to make it industrial so a data center could be built, and the locals there were able to kind of ban together and get the city council to block that. But you know, that's the case where it's in city limits, and it's also the case where this was a plot of land
that needed to be rezoned. But you know, if it's industrial use land and.
A company wants to buy it. I mean, in Texas, we have property rights.
So yeah, one of their concerns that I've heard is that, you know, a lot of these are happening in rural areas, which are you know, sparsely by definition, sparsely populated governments, particularly county governments, that don't have a lot of experience
with just massive, massive developments. And you have i mean quite literally the biggest, most powerful companies in the world coming in and saying to you know, this Commissioner's Court, who you know, their day to day job is like funding the construction of roads and and you know, funding
the jail and things like that. Now having to negotiate these deals with you know, a team of lawyers from Meta or you know, Alphabet or insert your like massively popular, powerful, and heavily resourced company and organization, and I think, you know, some people I've heard kind of express a little bit of worry of just like, do these folks even know what they're getting into and they're signing these deals or reaching these arrangements, and do they have the resources to
make sure that the deal that they are signing is you know, not just the best possible deal, but a deal that will you know, be beneficial to the county going forward.
Yeah.
I think there's so much of that.
I mean just like look, I mean particularly what we talk about, and we could talk about this a little bit more, but like the water impact, the you know, power impacts, all this stuff that's like there's going to be add on effects of this.
You know.
Do they have the lawyers and the you know, sort of industry knowledge to make sure that they're.
Really checking out these deals before they sign on to them. Yeah.
Well, I think another kind of interesting thing that's happening right now that's contributing to this in both directions, in Virginia and in Texas is really weird in like sort of the first full budgeting year for states, for cities, for counties post COVID federal funding running out, and that was something that in Texas I'm sure in Virginia too, was contributing to very large budget surpluses and sort of allowing the legislature to kind of do all of its
different pet projects that wanted to do. You know, it's
the same cities, same at counties. That money is now gone and so budgeting is just becoming much tighter all over the country, and so that's a draw for a lot of these cities and counties that they see this as a new source of revenue at a time when budgets are tight, and for the state, you know, when they're looking at these big sales tax breaks they're giving all also at a time when their budgeting is tight, they're taking a closer look at it.
It's been interesting to see though, the sort of like strange bedfellows that have come together in opposition of this. You know, Charles, you mentioned the sort of environmental concerns, right, the amount of power that these use, the amount of water that they use. There are a lot of people, a lot of environmentalists and other folks who are concerned about that are just also these sort of popping up
and you know, perhaps pristine land beforehand. But then you just I think also have while there's this sort of like broad societal backlash to AI right and fear of like what that's bringing along, and maybe an idea of like we got to slow this down. But then you also just have people in rural communities who are very conservative who have it in their heads, rightly or wrongly, that these data centers are like not great places to
live near. You know, they're very noisy, and they I think can like make it hotter sometimes around them, and just these ideas of like we don't really you know, the sort of not in my backyard attitude of we don't want this in our community. And so you get to a place where you have someone like Bernie Sanders calling for a data center moratorium, and then you have you know, like State Rep. Helen Kerwin, who's a conservative, her daughter is in the Trump administration, is a cabinet member,
you know, raising this idea as well. It's been interesting to see sort of the politics shift around this in Texas and I assume elsewhere in recent in recent months.
Really, yeah, I am curious, Charlie, like what the sort of you know, surprises have been on this in terms of how it's playing out. And I think Virginia is less. I mean, Texas just has this like specific sort of political bent to it, and Virginia seems a little more purple and interesting around this.
Yeah, last year when a lot of legislation was introduced to kind of reign in some of the data center development and put some guardrails, and that's when we saw like these big tech companies and labor kind of align with each other to kind of protect the industry. And frankly, sometimes when you see big industry and labor and a policy debate their opposite ends. But when they unified, that made it pretty strong, a pretty strong argument, you know,
for that side, and hard to go against them. I'll say, we recently had an election in November and elected a new Democratic governor. She took over after a former Republican governor was term limited, and she ran on data centers paying their fair share. She won by fifteen points. It was a pretty easy win. The House Democrats also picked up thirteen seats, and I'll say that House and the governor, Governor Spanburger, have taken more of the approach of wanting
to protect Virginia's business climate. So there is a little bit of a fixture there in between the Democratic Party where the Senate, also controlled by the Democrats, wants to have an abrupt end to this tax exemption, but they have to go and negotiate with some of their more
centrist counterparts. I mean, there there's been polling showing increasing opposition here in Virginia to not being near parks, to putting on clean energy requirements, which is another alternative that the environmental community kind of wants to make sure that
this industry is sustainable. It seems like it's going to be here for a little bit at least in the near future, so that's an option to put on these environmental protections and then if data centers don't want it, don't want to comply with those, they don't have to get the tax exemption, and then that would generate some revenue. So it's almost like the environmental community is trying to work with the industry as opposed to pushing back against it.
So yeah, it really turns politics and these fault lines on their head quite a lot.
I mean, Paul, it really feels like the things have shifted in Texas over the last few months. I mean, I mentioned Kerman earlier, you know, Dan Patrick raising this as an issue in his you know, asking the Senate to study the tax exemption that you specifically wrote about. And I would just say, you know, anecdotally, from the publication of your story a couple of weeks ago, we just heard a lot of people from across the aisle kind of standing up and saying like this needs to stop.
We need to to, you know, if not slow down data center production, at least take a real good look at this sales tax rebate.
Yeah, and I think the thing that matters here as politics. I mean, there was a Quinnipiac poll just to bring Virginia into this too, a couple of weeks ago that found I think it was sixty five percent of Americans suppose a data center being built in their communities. That was kind of undefined on how close that would be
to their home. But you know, this is something that goes that is a very bipart is an issue, and I think lawmakers that are thinking about their reelection at the end of this year are certainly.
Looking at it.
I think one of the best examples, like you said, I also heard from just folks all over the spectrum. I had, you know, Newsmax, the right wing news outlet, aggregated and republished my article. But then I also Ginahnejosa, the Democratic candidate for governor, put a statement out about it. So I mean there's there was just both sides I think are taking a very close look at this, and it's been really fascinating for me to see sort of the conversation happening.
Are there any state lawmakers who have been at this point like overtly build baby build for data centers or tax exempt tax exempt.
No, not loudly. I would say.
I would say that the issue with Texas just not having not being in session yet is that everybody's pretty tepid about it. That sort of the kind of first thing anyone's going to say, as well, we don't even have our arms around this issue. We're not even sure how many data centers there are in the state, which
is true. We don't have any sort of like database of this that is like required by any government, so it's sort of you know, you're just relying on data firms, you know, that goes with the electricity costs, the water use. So I think like at a minimum, everybody's sort of in agreement that we need to just better understand, you know, what this issue even is before we can start to kind of draw the battle lines and address it.
Yeah, I mean, I would I agree with you that I wouldn't necessarily say there's anyone out there that you could point to and be like that's you know, like mister data center in Texas politics. But I would argue that Texas is sort of like in default, build baby build mode, you know, so norm that you know, even if there hasn't been a big booster, sort of carrying the mantle that that that's sort of the attitude that we've taken in this state so.
Far, are right, No, definitely, Yeah, And.
Like I think it's going to be incredibly interesting to see like how far, if at all, Texas is willing to go kind of against that instinct in the legislative session, given you know, our sort of free market proclivities, and also given the fact that there is a lot of money behind this and a lot of people who are going to try to spend to influence elections and elect pro AI pro data center politicians, and you know, frankly, like there's a lot of money to be made among
former Texas politicians and money being made by tech former Texas politicians in this world as well. I mean, look at you know, Rick Perry's company related to this, which had an initial public goth heory and I think last year, and he you know, might be a billionaire now because of that, right.
I mean, it is notable that anyone is coming out now and saying, well, we need to look at this more because makes it harder to later say like, well, with the help of the industry, I looked at.
It more and I actually think we're okay. I think we're good. So, yeah, it certainly is notable.
Yeah, I mean if you put on your prediction hat Charles, like, where do you think Virginia is going to land on this? And you know, how much do you think it will signal to other states? Like what comes next?
Yeah, that's certainly a waiting factor. What this, what the messages sends. That's why it's kind of been like the defining issue on datas in a regulation. If I had to bet, I would expect it to come down the middle somewhere, particularly between the Senate and negotiations with the industry and then the governor again wanting to respect the business climate but also generate some revenue. I should say,
I don't think. I mentioned it was expected to be one point five million at the start and now it's one point nine billion, So same exponential growth throughout the you know, And I guess I should say too, there are other regulations being debated and put in place on data centers, and so I think that's part of the conversation on how much money do you want to recoup from them, while you're also changing their business model with
how they operate sustainably or not. There's a whole bunch of other laws and regulatory processes going under way to kind of determine how many projects are real or not. I guess this tax exemption could help contribute to that. So we'll see. They're supposed to have a decision by June. They say, we'll see what the governor does with some other bills and if it can be done by July one.
I want to just like kind of run by the two of y'all, like some of the arguments in favor
of this, or maybe maybe in favor. I mean it is in favor, but also sort of resisting some of the pushback, right, Like you will hear people make the case like, you know, yes, data centers use a good amount of water, but they're becoming more efficient and like they use less water than like a golf course, right and you don't see like people like calling for a moratorium on golf course construction in Texas right now, or this idea that yes they use a ton of power,
but a lot of those centers coming into Texas are bringing their own power with them and essentially you know, bringing generation building their own things that are going to exist right next to the plants. It's not like necessarily we're talking about like just hooking them up to the grid, and you know, suddenly like we can't control all that demand. Is there any truth?
Do you?
Like? What do you think of the arguments being made that like some of this is a little bit like the fear is a little bit trumped up here more than more than reality reflects.
Yes, No, I think that's a totally legit argument. Honestly, Like, I think that AI has really kind of sent a shock through our society since Open Eye first launched in
twenty twenty two. And you know, there's all these questions about what it is going to do to the way we worked, to jobs that people might have, and you know, I think that's part of it, is like are we we're building these big boxes that use a lot of power and may use a lot of water and could also you know, are powering this tool that could steal our jobs. And you know, I think that is just
sort of that's just how it is. I mean, this is just such a new thing I mean, if you hear the people that work on these kind of tools, like a I talk about this, I mean they say this is like the next industrial revolution and then they really mean it. And I think people hear that, and you know that is that is part of this is people just don't really have their heads wrapped around what
all of this means yet. And so you know, I think it's very easy to hook onto these questions about power use, about water use, and you know, it's like I said, it's really still hard to know exactly what the landscape is too. And so I think you know that that information vacuum gets filled by something.
Yeah, I think this is like to your point, like, I think we're going to see people cycling through arguments on this right Like I think a lot of the arguments we're having today or like that, you know, data versus some of these other groups are having will not be the same shape of the arguments that we're having, you know, five years from now on this, as people get more up to speed and sharper.
On all this.
Yeah, all right, Well, thank you so much Paul and Charles for joining us. Charles, we will send you back into the warm embrace of the legislature, which you know we will enjoy not having to deal with this year, which is great for us, but sorry for you. And yeah, I'm sure we will be following closely what is happening in Virginia to understand what awaits us next January when the legislature returns.
Thank you both so much for joining.
Thank you, thank you, and you can get.
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