As the city and county consider adopting pause measures, a larger-scale battle has now taken center stage in Carson City.

The national debate over the environmental impact of artificial intelligence data centers is rapidly spreading to Southern Nevada, where it has now become the focus at Henderson City Hall.

At a Tuesday meeting, city officials indicated they would explore a 180-day pause period on data center permits while city staff studies how to modify municipal regulations to address concerns about air quality, heat generation, siting, and decommissioning plans.

In an interview, Henderson Mayor Michelle Romero stated that she personally proposed implementing the pause after technology companies contacted city officials. For Romero, the data center pause represents an opportunity to thoughtfully consider development.

Last year, officials approved a conditional use permit for Trammell Crow Co. to construct a 300-acre data center campus on the city's east side. A city spokesperson stated that currently no other companies have active applications.

"I'm not an IT expert, nor am I a data center expert, and to my knowledge, no one on the council is either," Romero said. "I think when we consider these things ahead of time, we'll make smarter decisions."

Henderson's decision to consider implementing a pause coincides with state and national communities expressing skepticism toward AI data centers. These data centers promise substantial local tax revenue but have also raised questions about other impacts, such as water and energy consumption.

Currently, no other local governments in the Las Vegas Valley have proposed updated regulations specifically targeting data centers. However, some hope the situation will change as Henderson moves in this direction.

Olivia Tannager, executive director of the Toiyabe chapter of the Sierra Club, has been a leading environmental advocate pushing for strengthened data center regulation in closed-door meetings across the state.

In an interview, Tannager stated that her organization has held months of conversations with Henderson officials, recommending they implement a pause and refine city regulations until the Nevada legislature convenes again in 2027.

"In an ideal world, my vision for Nevada is not that data centers have already dominated the entire state," Tannager said. "Unless I have a wealthy virtual friend to fund a referendum banning statewide data centers, this is the reality we're dealing with."

**Statewide anxiety breaks through the Clark County bubble**

To date, energy capacity has been the biggest factor limiting data center development. An incoming wave of applications would almost certainly result in Nevada failing to meet its legally mandated 2030 clean energy target.

NV Energy has stated it received service requests for 39 proposed data center projects, requiring a combined 16,530 megawatts of electricity across the region's north and south areas. According to the utility company's website, the state currently has a combined peak load capacity of 8,241 megawatts.

"These are requests, not definite service commitments," wrote Katie Jo Collier, a utility company spokeswoman, in a statement. "We do not intend to provide service for all proposed projects. We recognize that the scale and pace of potential data center development in Nevada is unprecedented. This is why we are conducting planning carefully and transparently."

In this nation's driest state, fears of extreme heat and rising electricity costs are mounting, and Henderson is far from the only community reacting negatively to data centers.

Residents of Mineral Spring have been lobbying against a proposed data center backed by the mayor but receiving negative recommendations from the city planning commission. In November, voters will decide whether a data center is an acceptable use on the city's portion of land in the Eldorado Valley.

The Nye County Commission, at the urging of its water department, approved a temporary pause on data centers last month. A second vote to extend this pause is pending. Similar votes have taken place or are planned in Reno City Council, Churchill County Commission, Humboldt County Commission, and elsewhere.

However, the state's most populous county has taken little action on this issue so far. What it quietly did in the early 2020s was address water consumption by banning so-called evaporative cooling, which evaporates water into the atmosphere.

This ban also applies to data centers, meaning that all data centers proposed in Southern Nevada after approximately 2023 cannot cool computer servers by evaporating water, thereby avoiding depletion of the Colorado River or Lake Mead.

"We have seen many data center projects, and that's fine," said John Entsminger, director of the Southern Nevada Water Authority, in remarks to lawmakers in March. "These data centers can be built without consuming any additional water."

Growing opposition across the Silver State has prompted the formation of the Nevada Data Center Alliance, the primary advocacy group representing technology companies in public meetings.

In an interview, the group's spokesperson, Trey Aubney, stated he believes politicians are leveraging social media hype rather than viewing data center development as an opportunity to generate stable tax revenue. He argues that big tech is crucial for economic diversification, as the current economy relies on gambling, tourism, and mining.

"Somehow, data centers have become today's scapegoat," Aubney said. "Yes, there should be restrictions on every type of development, whether it's building single-family homes, data centers, or anything in between. But we believe the level of news coverage, concerns, and fear is disproportionate to the actual impact."

Nevada has a competitive tax abatement structure offering tax incentives for data centers, with the state reducing personal property taxes by 75 percent for technology companies over a period of one to twenty years.

Data centers have gained support from Governor Joe Lombardo. Lombardo will face Attorney General Aaron Ford in the November general election. In a column published Thursday in the Reno Gazette Journal, Lombardo stated he supports projects with "responsible plans for water use, energy generation, and infrastructure needs."

Faced with some opposition at a Wednesday meeting, Switch, which operates multiple large data center parks in the Southwest Valley, received approval from the Clark County Planning Commission to build another data center.

In a phone interview following his affirmative vote, Clark County Commissioner Tick Segerblom stated he was willing to support data center regulatory measures across the county. Segerblom indicated this could become a topic for discussion at future commission meetings or designated community forums.

"We're a small valley," Segerblom said. "What impact will it have on our resources: water, electricity, and heat?"

Tannager's Sierra Club chapter has created a list of policy recommendations. She stated that when the legislature convenes in 2027, she expects data centers to be a hot-button issue.

Data centers have already become the focus of a temporary committee meeting, where many expressed their concerns. Many potential impacts of data centers, from noise and air pollution to potential heat generation, have not yet become the subject of extensive academic research.

While the state can establish broader regulations, Tannager states that local governments also have certain powers. She cited as an example ensuring that backup diesel fuel generators meet the EPA's strictest air pollution standards.

To offset tax revenue losses caused by the tax abatement, Tannager stated that officials should consider implementing a "sliding scale commercial impact fee," which would ensure communities receive appropriate compensation based on the degree of impact.

"We continue to have these conversations, trying to figure out what viable pathways are," Tannager said.

Her organization has recommended that the Southern Nevada evaporative cooling ban could be extended statewide—Aubney stated his members oppose this.

Aubney stated that adopting a "one-size-fits-all" approach to any data center regulation would be undesirable, though he stated that many fears about water impact are unfounded, based on outdated information, as technology has evolved.

Now, a larger battle between business interests and environmental advocates in Carson City has taken center stage.

"I just want to remind all of our local governments before they begin implementing pause measures and putting up stop signs for this massive investment," Aubney said. "These projects won't disappear."

Contact Alan Halaly at ahalaly@reviewjournal.com. Follow @AlanHalaly on X. Review-Journal staff reporter Casey Harrison contributed to this report.