TeraWulf Deploys AI Data Center Project in Kentucky with Local Government Support
Wednesday, a data center conference in eastern Kentucky faced technical difficulties that made it hard for attendees to hear presentation details. Following this sometimes tense public meeting held at Boyd County High School, TeraWulf released a presentation slide deck detailing its proposal for the Muskie data park.
The 285-acre site, located approximately 20 miles west of Ashland, will ultimately be developed into a 1-gigawatt data center, making it one of the largest projects currently under construction in the state.
Maryland-based TeraWulf states that the project will generate $300 million in local tax revenue over the first 15 years. However, this figure does not include taxes on tenant server equipment within the data center.
TeraWulf's tenants—likely large technology companies such as Meta or Google—may seek exemptions from state equipment taxes.
TeraWulf has committed to providing hundreds of construction jobs during the Muskie park's five-year development period, with priority given to local workers. Once the park becomes operational, there will be 100 full-time positions.
TeraWulf's proposal was made public late last month, at a time when data center projects throughout the state are facing increased scrutiny and opposition.
Various communities have considered or implemented measures to slow data center development due to concerns about electricity and water consumption, air and noise pollution, and land use impacts.
TeraWulf and Kentucky Power Company have signed a 20-year power purchase agreement for the site. The company states that bills for Kentucky Power Company's existing customers will not increase.
TeraWulf states that the project will be fully overseen by the Kentucky Public Service Commission and the state attorney general's office.
TeraWulf states that its closed-loop cooling system requires filling only once, with replacement every 10 years. The company also states that facility noise levels will be below federal occupational exposure safety standards.
Residents have reason to be skeptical. TeraWulf plans to build the data center on a site where an aluminum rolling mill was previously proposed. The state approved $15 million in incentives in 2017 to construct the facility, but the project ultimately fell through.
More recently, Century Aluminum proposed building a smelter in northeastern Kentucky, which would have been the first in the nation in decades. Last year, the aluminum smelter chose instead to build in Oklahoma.
The region has experienced significant population loss, with major employers reducing their workforce. A steel mill has closed, and the decline in coal production and transportation has led to further workforce reductions.