New Castle County residents fight back against proposed data center

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Dozens of New Castle County residents pushed back against a planned data center for Delaware City during a tense town hall Thursday night. One by one, they lined up inside a fire hall for a chance to chastise representatives of the private investor firm that plans to construct a data center that would be 6 million square feet in size.

“You are doing nothing in our community by erecting this data center. We like jobs, but the jobs that you dangled in front of us, it’s not commensurate with what you’re proposing with the size of this data center,” said Rob Bullock, a New Castle resident and community advocate.

Starwood Digital Ventures is proposing to build a 1.2-gigawatt data center in Delaware City, which sits along the Delaware River. The investor-developer said the project, which is in the early proposal stage, would generate thousands of jobs and millions in tax revenue for the state.

But during the heated three-hour town hall, residents grilled representatives with questions about potential energy and water use, environmental impacts and whether the jobs would be given to local residents. When investors couldn’t answer some questions, frustration grew among a crowd that largely came in with apprehensions.

“Within 4 miles of where I live there are mega buildings, a refinery … Route 1 traffic, noise from airplanes and helicopters,” said resident Ike Brown. “My moral and ethical question is, who has the right to decide the impact on our health and quality of life other than the people who actually live in these communities?”

Data centers house the computer servers required to run internet services worldwide.

While they have been around since the mid-20th century, the acceleration of power-hungry artificial intelligence has boosted demand for the sites. AI requires more power at a faster rate than typical internet activities, straining the power grid, and leading to increased electricity rates for consumers.

On Wednesday, the Trump administration announced plans to accelerate AI development with limited regulatory oversight. That same day, Delaware Gov. Matt Meyer signed legislation to develop an “AI Sandbox” in the state, which will be a “testing ground” for AI technology to be developed and deployed in an ethical way across several sectors.

A 2024 Department of Energy report on U.S. data center energy use estimated that data center load growth tripled over the past decade, and would double or triple by 2028. Data center electricity usage climbed from 58 terawatt-hours in 2014 to 176 terawatt-hours in 2023, according to the report, and is likely to increase between 325 and 580 terawatt-hours by 2028.

The economic impact of data centers

The plan in Delaware City, which must be approved by New Castle County Council and would require land to be rezoned, includes an 11-building facility that would be 6 million square feet large. A Spotlight Media report suggests it could consume as much power as 1 million homes. The largest data center in the U.S., located in Nevada, is 7.2 million square feet.

Starwood Digital Ventures has delivered more than 6 gigawatts of data centers globally, and is developing similar projects in Virginia, Illinois and Texas and worldwide.

During the town hall, the firm’s CEO Anthony Balestrieri said Delaware City is an attractive location because of its proximity to high voltage power lines and the Red Lion substation. The state is also located between the world’s largest data center markets – Virginia and New York.

“If you think about electrons as cars on a highway, this location is like an interchange on a 20-lane super highway, crossing multiple state lines, carrying electrons all over the United States,” Balestrieri said.

The project would create more than 500 permanent jobs over time, as well as thousands of construction jobs, and could generate $26 million in tax revenue for the state, Balestrieri said. The project is anticipated to generate more than $470 million in economic impact during the first five years of operation.

“Data centers are the invisible backbone that make our interconnected digital lives possible,” Balestrieri said. “They’re a mission-critical infrastructure for the U.S. economy, enabling services, connectivity, innovation, across business and industry, including banks, governments, education facilities, health care and first responders. In short, they play a vital role in ensuring access to the internet cheaply and fairly for everyone.”

Without them, he said, every household and business would need a large, energy-sucking, computer in their basement.

But residents who attended the town hall expressed concerns about energy use and increased electricity bills.

Data center proposal draws skepticism

While some data center operators have built their own power plants to generate energy, most of these facilities rely on the electrical grid, which in the Philadelphia region, is managed by PJM Interconnection.

Residents in Delaware have already been hit with increased energy bills, and PJM’s recent capacity auction – where power plants bid for rates in exchange for guaranteeing future supplies – resulted in an expectation that those rates will rise another 1.5% to 5%.

“We’ve already seen big hikes, and a lot of us are retired on a fixed income,” New Castle resident Nan Wallace told WHYY before the town hall began. “So people had to absorb [Delmarva Power’s] very large rate increases last winter, and it was very hard for them.”

While experts say data centers have already put a strain on the grid, causing energy bills to soar, Balestrieri said data centers amount to less than 5% of annual electricity use in the U.S., referencing a 2023 Department of Energy study. However, the same report indicates data centers will consume 6.7 to 12% of total U.S. electricity by 2028.

The electrons used in the data center will be purchased on the open market through power purchasing agreements, likely after construction.

Delmarva Power, which provides electricity to Delaware residents, was invited to the town hall but did not attend.

Democratic state Rep. Frank Burns, whose district includes part of New Castle County, was among the residents who lined up in the town hall to criticize the project. He called the potential job prospects a “bad trade-off.”

“The more forthcoming as you can be and as helpful as you could be in ensuring that prices won’t go up, that would be very helpful, because right now what I’m feeling is that the ratepayers here in Delaware are going to pay a big cost,” Burns said.

Not only do data centers consume a significant amount of energy, they also require substantial water consumption to cool servers that are at risk of overheating. Larger data centers can consume up to 5 million gallons of drinking water per day, and in some areas, have drained resident’s well water supplies.

“This whole part of the country has had drought problems. We had forest fires just north of us in New Jersey,” New Castle resident Louise Rolleri told WHYY News before the town hall began. “We don’t have enough water to take care of ourselves, much less come up with 3, or 4, or 5 million gallons a day to cool some plants.”

Starwood Digital Ventures would get its water from Veolia, which provides drinking water for New Castle County residents. The water provider was invited to the town hall but did not attend.

“Veolia has confirmed they have adequate capacity to serve the water requirements of this campus and no on-site wells or alternative groundwater sources will be necessary,” said Vice President Holden Foxworth.

During the town hall, representatives from Starwood said data centers don’t use any more water than office buildings of the same size.

Several residents grilled the company with questions regarding the specific amount of water that would be required for the proposed data center, but representatives said it’s too early to provide answers.

“You keep referring to typical data centers, but I think it’s incredibly important to note that this is not a typical data center,” said one resident, frustrated with the vague answers to her questions.

The data center would be bigger than the company’s current largest operating data center.

Democratic state Rep. Eric Morrison, whose district includes part of New Castle County, said he didn’t trust the company’s sales pitch.

“My biggest concern tonight is that we’ve only heard from you. This essentially, coming from you, was a dog and pony show,” Morrison said during the town hall. “There are things that you said that are easily rebuttable. That’s very, very bothersome to me. It’s also bothersome for me that you were asked some very basic questions which you could not or would not answer.”

A number of residents said they were also concerned how the project might impact local wildlife, such as bird and bat populations. Many expressed frustrations after the company would not promise during the town hall to commit to hiring Delaware-based union workers.

Democratic state Rep. Melissa Minor-Brown, who co-hosted the meeting, said she was dissatisfied with what she heard during the town hall and called on the county council to reject the proposal.

“For one, using Delaware contractors, that’s a big deal to the people in this room and they weren’t able to commit to that … questions around, ‘Will this impact my energy bill?’ ‘Will this affect my water bill?’ They kind of glazed over it, but they didn’t say no, and … I’m not satisfied with their answers,” she said.