Arkansas’ Data Center Problem

Arkansas is set to welcome $12 billion in new data centers that will require significant electricity, while recent legislation has made it nearly impossible to develop new wind farms. The state will have to rely on importing power and building natural gas plants, leading to higher costs for ratepayers.

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Allen Hall: Let me tell you a little story about wind energy in the state of Arkansas. But first, let me pick you a picture of the natural state. Arkansas sits right in the heart of America. This is the land that gave us President Bill Clinton and the retail giant Walmart.

It’s the home to the rugged Ozark mountains and the fertile Mississippi River Delta, where folks still wave from the front porches. And Sunday dinner means the whole family surround the table. Arkansas has always been a place where old traditions meet new opportunities. Rice fields stretch across the eastern flatlands.

Timber companies harvest the dense forest. The Buffalo River runs wild and free. And now. Wind energy companies are eyeing those wide open spaces and [00:01:00] mountain ridges. But here’s where our story gets interesting. The natural state is about to welcome $12 billion in new data centers. That’s Google building a $10 billion facility in West Memphis, just across the river from where Elvis lived.

Two more billion dollars centers go up in Little Rock and Conway near the center of the state. These data centers will demand massive amounts of electricity. How much Arkansas Electric Cooperative Corporation says they’ve got requests for 4,000 megawatts of new load. That’s more power than the entire system has built in 80 years.

And the data center companies want it in just three or four years. And here’s an interesting turn of events. Arkansas just made it nearly impossible to build wind farms that could power these data centers cheaply. And cleanly. Senate Bill 4 37 passed by just one vote in the Arkansas [00:02:00] Senate 18 4 14 against, they called it the Arkansas Wind Energy Development Act, but don’t let the name fool you.

This 20 page regulatory monster is designed to kill wind development. The bail requires wind turbines to be set back three and a half times their height from property lines. That’s up to a quarter mile it. Bans turbines within one mile of schools, hospitals, churches, and city limits. It demands extensive environmental studies and public hearings.

Wind companies warned this would kill future development. Wire, Hauser the Timber Giant with 1.2 million acres in Arkansas said the rule would limit their ability to host wind projects to zero acres. Zero. Representative Jack Leman, a Republican from Jonesboro, Arkansas, summed it up on the house floor, quote, if wind is a bad idea, it will fail on its own.

It’s not our job to kill an [00:03:00] industry, unquote, but they killed it anyway. Six Arkansas counties have already banned wind development. Carroll County, Boone, Madison, Newton Crawford, and Criton Counties have all said no to commercial wind projects. The current projects get a pass. The Crossover Wind Project in Cross County and the Nimbus Project in Carroll County.

Were already under development by April 9th of this year, so they’re exempt from the new rules. Crossover wind will be Arkansas’s first operational wind farm, 135 megawatts, 32 turbines enough to power 50,000 homes. It’s going online next summer in the flat farmland of Eastern Arkansas. Nimbus is more controversial.

180 megawatts. Plan for the Ozark Mountains in Carroll County near the state line with Missouri and not far from Walmart headquarters. 46 turbines up to 600 feet tall. The locals are furious. They post it on Facebook tracking every wind turbine component [00:04:00] truck that rolls through their mountains.

Carol Rogers lives on Bradshaw Mountain near the Nmba site. She’s been fighting the project since 2023. She says, Arkansas ranks in the top 10 states for lightning strikes, quote. So will you put a 698 foot tall structure on top of a 2000 foot tall ridge line? It could be a recipe for disaster. Rogers hopes that federal wildlife enforcement might stop the project.

Nimbus supplied to the Fish and Wildlife Service for permits to protect golden eagles and endangered bats during construction and operation. But the permit process is uncertain under the Trump administration. The project is building without final federal approval. Quote. Maybe it can be more of an enforcement action, unquote.

Rogers told reporters, I hope it happens unquote. Meanwhile, Arkansas lawmakers tried to pass Senate Bill 3 0 7, the generating Arkansas Jobs Act. This would’ve allowed utilities to build power plants faster and charge rate payers while construction was [00:05:00] underway. The goal attract energy hungry industries like data centers.

But even that failed. The bill died by one vote in the Senate 17 4 11 against one short a passage. So Arkansas has made it nearly impossible to build wind farms. They can’t even pass a bill to build other power plants faster, but they welcome $12 billion in data centers that will need massive amounts of electricity.

The utilities are obviously scrambling

Energy. Arkansas is planting new natural gas plants near Hot Springs and elsewhere. Arkansas Electric Cooperative is building a gas plant in Texas to import power back to Arkansas. Both utilities co-own two major coal plants that must retire within five years.

The White Bluff plant in Redfield and the Independence plant in Newark, they’re being forced to shut down by federal court order. Now, here’s what nobody’s telling the Arkansas voter, the state had nearly two [00:06:00]gigawatts of wind projects under development before the crackdown. That’s enough to power over a million homes.

All that potential clean energy banned by politicians who then welcome data centers that’ll burn through electricity. And the irony gets thicker. Arkansas sits within the Mid-Continent independent system operator grid miso. That’s a strategic advantage for wind development. The state has excellent wind resources.

The Department of Energy estimates Arkansas has 9,200 megawatts of potential wind capacity. But instead of harnessing that wind, Arkansas will import expensive electricity from other states or burn more natural gas and coal rate.

Payers will foot the bill. Google says they’ll cover the full energy costs for their West Memphis data center, but that’s just their share the massive infrastructure upgrades to handle all that power that gets spread across everyone’s electricity bills. Arkansas Senator Ron Caldwell, the [00:07:00] Republican who represents Cross County, sees what’s happening.

He praised the Crossover Wind Project. He said most landowners who wanted a turbine got one. The environmental impact is small. Quote, I’m not trying to talk anyone into bringing them into their counties, quote called Old said quote, but as far as we’re concerned in Cross County, we’re looking forward to having those facilities there and the revenue that comes from it, unquote.

That’s the choice. Arkansas faces revenue from wind farms and cheap clean electricity, or expensive imported power to feed the data center. Boom, the data centers are coming. Whether Arkansas builds wind farms or not, Google doesn’t care where their electricity comes from. As long as the lights stay on, but Arkansas rate payers should care because they’re about to pay the price for politicians who banned one of the cheapest forms of a new electricity generation, just as demand explodes.

The natural state is about to learn an expensive lesson in energy policy.