New Mexico approves power plan for Facebook data center

By Morgan Lee, Associated Press

New Mexico regulators have approved a solar power-supply plan for a proposed Facebook data center as the state vies with Utah to lure investments by the social media giant.

 

SANTA FE, N.M. (AP) — New Mexico regulators have approved a power-supply plan for a proposed Facebook data center as the state vies with Utah to lure investments by the social media giant.

The New Mexico Public Regulation Commission voted unanimously Wednesday to approve a plan from investor-owned utility Public Service Co. of New Mexico that would use new solar energy facilities to offset much of the power demands from the proposed data center in Los Lunas, south of Albuquerque.

Facebook could still choose to locate the facility in Utah, where Rocky Mountain Power has filed a similar application with state regulators and local governments are at odds over a package of tax incentives.

A plan to lure the Facebook data center to Utah with $240 million in tax breaks hit a snag Tuesday as the Salt Lake County council decided it will vote against it at a crucial meeting next week. Several area cities and school districts will decide Aug. 22 whether to join forces and offer the social media giant the tax breaks over two decades.

In New Mexico, the village of Los Lunas has approved a multibillion-dollar series of industrial revenue bonds for a proposed data center under an arrangement that would provide the developer with relief from taxes on property and gross receipts for decades to come, according to Los Lunas Mayor Charles Griego. Industrial revenue bonds are typically tax-exempt loans issued by local governments to finance a private company's expansion.

The Los Lunas village council approved the bond agreement in late June with a company named Greater Kudu, whose relationship with Facebook is undisclosed. "I have not been told it's Facebook," Griego said. "Nobody is saying it's not" Facebook.

Griego did not have a dollar estimate for the tax incentives, and said the Village of Los Lunas currently is analyzing the potential economic impacts of the data center project. He said the Los Lunas Village Council enthusiastically endorsed the arrangement in anticipation of direct and indirect investments and jobs.

"We're looking at abating taxes on a piece of property where the last tax bill provided a little over $10," he said. "I'm willing to give up that in order to attract an employer of this magnitude."

Facebook representatives could not be reached immediately for comment. A spokeswoman for PNM declined to comment Wednesday on Facebook's plans. The utility indicated to investors last week that Facebook intends to decide on a site for the data center before the end of September and aims to complete the facility by the third quarter of 2017.

PNM estimates that Facebook initially would invest at least $250 million in the data center and create as many as 50 full-time jobs, while potentially expanding over time.

Environmental groups in New Mexico praised the energy plan put forward by Facebook and PNM. PNM says an affiliate would initially build three industrial-scale solar plants and eventually add wind energy facilities.

Mariel Nanasi, executive director of New Energy Economy, said newly approved tariffs provide Facebook with stable electricity pricing for renewable energy and will hopefully serve as a model for other businesses.

"What businesses want more than anything is price security and price stability," she said.

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