A company calling itself Norway Green Energy wanted to build a large artificial intelligence computing center in Oton, a town in the central Philippines. The site covers about 10 hectares, roughly 14 soccer fields. At full load it would use about as much electricity as a small city.
At a public meeting on August 14, residents pushed back. The project’s presenter walked out and said there was no reason to keep talking.
The lesson: these giant computer buildings need more than electricity and land. They also need neighbors who agree to host them.
A public consultation on a proposed 50-megawatt AI data center in Oton, Iloilo, ended without resolution on Friday, August 14, 2026. The Manila Times reported that the project’s Norwegian proponent, Daniel Stefan Robertsen, walked out of the meeting amid mounting opposition from residents and declared there was no reason to continue the discussion.
Robertsen had presented the project under the name Norway Green Energy. The plan was a 10-hectare hyperscale AI data center campus in Barangay Abilay Sur, Oton. A barangay is the smallest unit of local government in the Philippines, roughly equivalent to a village or neighborhood. The project’s status is now uncertain.
Executive Summary
The proposal was substantial for a provincial site: 50 megawatts of capacity on a 10-hectare campus, described as hyperscale. That term usually means facilities built to the scale and specifications of the largest cloud and AI operators. The consultation was meant to put the project before the people who would live beside it. It ended with the proponent leaving and no agreed path forward.
The episode matters beyond Oton because it shows where an AI data center project can stall before any construction starts. Developers typically screen sites for grid power, fiber connectivity, land and water. The Oton consultation shows that local acceptance belongs on the same list. A project that cannot get through a public consultation has an unresolved siting input, however strong its power or land position.
Consent Works Like Power: Without It, the Site Doesn’t Close
Data center developers rank candidate sites by the inputs they cannot build without. These include deliverable grid power, a fiber route, buildable land, and water or an alternative cooling design. Each input gates financing. Lenders and prospective tenants want evidence that it is secured before capital is committed. Local consent works the same way, even though it rarely appears on a site-selection scorecard. In the Philippines, a project of this kind generally needs local clearances, starting at the barangay level and running through municipal zoning and business permits. Projects with potential environmental effects may also require clearance under the national environmental impact assessment system. The public consultation is where affected residents’ positions enter that process.
That is why the Oton meeting matters. A proposal for 50 megawatts on 10 hectares is a large footprint for one barangay. A consultation that ends with the proponent declaring there is no reason to continue leaves the question of local acceptance unresolved. Until that changes, the site lacks one of the inputs every later stage depends on. The developer, any prospective tenant, any lender, and the Oton local government are all left waiting on the same open item.
The lesson for the wider AI buildout is modest but concrete. When a developer treats consultation as a formality to get through, the siting schedule assumes an outcome the community has not yet given. Iloilo is a single case and does not by itself establish a regional trend. It does show the mechanism clearly.
Why 50 Megawatts Draws Scrutiny in a Provincial Setting
Fifty megawatts is a meaningful load anywhere. Run at full capacity for a year, it comes to about 438 gigawatt-hours of electricity. AI data centers also draw power differently from homes or shops. They run close to flat around the clock, so the demand does not ease overnight. In a metropolitan market, that load is absorbed into a large, dense grid. At a provincial site, the same load is a bigger share of the local system, and residents can reasonably ask how it will be supplied.
Communities facing AI data center proposals usually ask a consistent set of questions. Where will the power come from? Will it affect local reliability or rates? How will the servers be cooled, and does that use water? What will the site sound and look like? How many local jobs will it create? The name Norway Green Energy suggests a renewable-energy angle. However, no generation plan was set out publicly. A consultation is where a developer can answer those questions in detail, and it is the setting in which concerns can turn into conditions rather than into outright opposition.
What a Walkout Does to the Project’s Options
Leaving a consultation does not by itself end a project. It does narrow the options. A developer in this position can seek a new consultation with a revised proposal, change the design to address objections, or look for a different site. Each option costs time. The last one discards whatever work went into securing land and local relationships in Abilay Sur.
The claim worth examining is the implied one: that the discussion had nothing left to offer. From a siting perspective, the opposite is usually true. A consultation that surfaces strong objections tells the developer exactly which conditions it would have to meet, whether on power sourcing, water use, noise or community benefits. Stopping the conversation leaves those conditions undefined, and that is harder to finance around than a known set of commitments.
For the Philippines’ broader push to attract AI and cloud infrastructure beyond Metro Manila, the episode is a useful early data point. Provincial sites can offer cheaper and larger land parcels. But the host community is closer to the project there, and its consent is part of the site’s value, not a step to schedule around.
Background
The Philippines has become a growing market for data centers, driven by cloud adoption, digital services and, more recently, demand for AI computing capacity. Most existing capacity is concentrated in and around Metro Manila, where grid infrastructure, fiber routes and corporate customers are densest. Developers looking for larger and cheaper sites have begun to consider provincial locations.
Iloilo province, on the island of Panay in the Western Visayas, is anchored by Iloilo City, one of the region’s main commercial hubs. Oton is an adjacent municipality. The proposed campus in Barangay Abilay Sur would have been one of the larger AI-oriented data center projects proposed outside the capital region. That scale is one reason local consultation carried so much weight.
A suburb outside Philadelphia voted down five giant buildings meant to hold the computers that run artificial intelligence. Together they would have covered roughly 80 football fields of floor space.
The builder promised $55.4 million a year in local taxes, mostly for schools. Neighbors worried about noise, dirty air and home values, and more than 17,000 people signed a petition against it.
The twist: to avoid raising local electric bills, the site would have made its own power with gas-burning generators. That fix became part of the fight. The builder says an appeal is coming.
WHYY reported that Upper Merion Township’s Board of Supervisors on Thursday, August 13, 2026, rejected all five applications from developer Brian O’Neill for a hyperscale data center campus totaling more than 4.6 million square feet near King of Prussia, Pennsylvania. The campus would have been built at Discovery Labs, a health care and life sciences office property run by O’Neill’s company, and was designed to generate its own power using natural gas turbines with diesel backup generators.
The vote followed a July planning commission recommendation against three of the five projects, a developer lawsuit seeking more review time that a Montgomery County judge cleared on the afternoon of the vote, and a resident petition with more than 17,000 signatures. O’Neill told 6ABC an appeal is planned.
Executive Summary
A suburban Philadelphia township has turned down one of the largest data center proposals in the region, despite the developer’s estimate of $55.4 million a year in local tax revenue, nearly $38 million of it for the local school district. The board’s stated grounds were procedural and specific: Chair Tina Garzillo said the township never received landscape, traffic impact, emergency management or sanitary sewer plans, and called the projects “at best speculative and conceptual in nature.”
The case matters beyond Upper Merion because of how the campus was to be powered. Generating electricity on site is increasingly pitched as the responsible way to build AI-scale facilities without burdening the grid or ratepayers. Here, that design put gas turbines and diesel generators in front of a township board and its residents, and air pollution became a central objection. Self-generation did not remove the local approval gate; it added a power plant to what that gate had to judge.
For developers, investors and utilities trying to forecast where AI capacity will actually get built, the vote is a reminder that a proposed campus is not capacity until it clears local land-use approval, and that the power strategy is now part of that approval.
Self-Generation Swapped a Grid Question for a Local One
The campus was pitched as a good grid neighbor: it would generate its own electricity so it would not strain the regional power system or push up household bills. That is an increasingly common design for AI-scale facilities, often called on-site or behind-the-meter power because the electricity is produced on the property rather than drawn from the utility. But in Upper Merion, the power plant came with the building. The proposal included natural gas turbines and diesel backup generators, and air pollution became one of residents’ leading objections, alongside noise and water use.
That is the mechanism this vote exposes. A data center that buys power from the grid leaves most generation questions to utilities and grid planners. A data center that makes its own power brings combustion equipment, fuel supply and emissions controls onto a site that a township board must approve, in front of neighbors who will live beside it. O’Neill said scrubbers would control emissions and that discussions had been held with Bloom Energy about using fuel cells on site, but no deal had been finalized, which left the board and residents to evaluate the turbine-and-diesel version of the plan.
Upper Merion is not the only place where on-site power has drawn local enforcement. In Vineland, New Jersey, where a data center under construction plans to use Bloom fuel cells, the city issued a stop-work order on parts of the 300-megawatt facility (a megawatt is a measure of electrical capacity), alleging that a liquefied natural gas tank and fuel cell units were being installed before city approval. Generating power on site may answer concerns about grid strain and electricity bills, but it adds a power plant to the list of things local officials get to review.
The Board Ruled on Missing Plans, Not Just Public Anger
The emotional scenes at the meeting can obscure what the board actually said. Garzillo cited the absence of landscape, traffic impact, emergency management and sanitary sewer plans. Those are ordinary engineering submissions for any large industrial project, and their absence gave the board a procedural basis for denial that stands apart from residents’ objections.
The process had been heading this way for weeks. In July, the township planning commission voted not to recommend three of the five projects. The developer then sued, seeking an extension and arguing there had not been adequate time to address township concerns; a Montgomery County judge vacated the injunction on the afternoon of the vote, clearing the board to reject the extension. Vice chair William Jenaway said the developer had earlier opportunities to respond to review comments and did not do so in a timely fashion. The two sides’ accounts of the timeline differ, and an appeal would likely test them.
For the industry, the lesson is about entitlement risk, meaning the risk that a site never receives the land-use approvals it needs. As AI demand pushes developers to repurpose existing properties, here a life sciences office campus, into data center sites, applications that arrive without complete plans risk being denied on the paperwork alone, whatever their scale or revenue promise.
A $55.4 Million Tax Pitch Met a 17,000-Signature Petition
The developer’s economic case was large on its face: an estimated $55.4 million a year in local tax revenue, with nearly $38 million going to the Upper Merion Area School District. For a suburban township, that is the kind of figure that usually carries weight. It did not carry the vote. Residents weighed it against quality-of-life costs that do not appear in a revenue projection, and one resident nearing retirement said a loss of home equity “would destroy our savings.”
Both sides’ claims deserve the same scrutiny. The tax figure is the developer’s own estimate, and its value depends on assumptions about how much gets built and when. Residents’ fears about property values and health are sincere, but their magnitude depends on specifics that were never settled, such as how many turbines would run, how often, and with what controls. The water debate is similar: O’Neill said a closed-loop system would reuse cooling water, while hyperscale facilities in general can consume up to 5 million gallons of drinking water a day. Closed-loop designs reduce consumption substantially, but how much make-up water this campus would need was not specified.
The backdrop is shifting against developers who lead with revenue. A University of Pennsylvania Annenberg Public Policy Center survey found a 12-point jump in widespread resistance to new data center construction over four months. In that climate, detailed answers on emissions, water and noise are likely to matter more to approval than headline tax estimates.
What Comes Next for AI Capacity Around Philadelphia
The denial is not necessarily final. The developer can appeal or submit new or revised plans, and has said an appeal is planned. Residents have said they will oppose any appeal or new application. O’Neill is also seeking approval for a data center in nearby Plymouth Township, which becomes the next test of whether a more complete application, and possibly a different power plan such as the fuel cells under discussion, changes the outcome.
For operators, investors and utilities counting future AI capacity in the region, the practical point is that local land-use approval is a gate that neither scale, tax revenue nor a plan to stay off the grid can bypass. Capacity forecasts that treat proposed campuses as inevitable will miss decisions like this one, which are made parcel by parcel at township meetings.
Background
Upper Merion Township sits in Montgomery County, Pennsylvania, and includes much of the King of Prussia area, a major suburban commercial and office hub northwest of Philadelphia. Data centers, the buildings that house the servers behind internet services, have existed since the mid-20th century, but the rise of power-hungry artificial intelligence has pushed demand toward much larger hyperscale campuses that need substantial electricity and cooling.
That demand has driven developers to look at existing commercial properties, such as office and life sciences campuses, as potential data center sites, and to consider generating their own power rather than waiting on the grid. It has also produced growing local resistance in the Philadelphia region and beyond, where township boards, not state or federal agencies, hold the zoning and land-use approvals that decide whether a campus can be built.
Amazon has dropped plans to build a large group of data centers on the grounds of a nuclear power plant in southern Maryland. Data centers are warehouse-sized buildings full of computers that run apps, websites and artificial intelligence. This one would have covered roughly 40 football fields of floor space.
Having a giant power plant next door was not enough. Local voters removed three county leaders who had resisted pausing these projects, and the county is now considering a six-month freeze. Amazon calls it a business decision. Either way, local approval proved as important as electricity.
Amazon Web Services (AWS), Amazon’s cloud computing arm, has abandoned its proposal to build data centers on the campus of the Calvert Cliffs Nuclear Power Plant near Lusby, Maryland, Maryland Matters reported on August 4, 2026, citing a Calvert County government news release. The proposal, submitted to the county in early May, called for “multiple data center campuses” covering 2.4 million square feet.
The withdrawal follows the June 23 primary election, in which all three Calvert County commissioners who had voted against a pause on data centers lost their races. The county has scheduled an August 18 public meeting on a temporary six-month moratorium on site plan approvals for data center projects. Amazon described the move as a business decision; plant owner Constellation Energy said the opportunity at the site continues.
Executive Summary
AWS has walked away from what was, on paper, one of the most attractive data center sites in the Mid-Atlantic: land beside a nuclear plant that Constellation calls Maryland’s largest source of clean, reliable energy. Co-locating a data center with a power plant is the siting strategy much of the industry has pursued to secure the large, round-the-clock electricity that AI and cloud computing demand.
The Calvert Cliffs outcome shows the limit of that strategy. Power next door does not remove the need for local land-use approval, and in Calvert County the politics of that approval shifted sharply between Amazon’s May filing and its August exit. Amazon’s own statement names development timelines as a deciding factor — the variable a county moratorium directly controls.
For developers, utilities and investors, the lesson extends well beyond one county. Much of Maryland’s population now lives under some form of data center moratorium, according to a regional climate advocacy group, and state lawmakers may take up statewide proposals in 2027.
Power Next Door Did Not Replace the Permit
Data center developers have spent the past two years chasing power, not land. Large facilities that train and run AI models draw electricity continuously, and securing that supply through a crowded regional grid can take years. Building beside a nuclear plant — often called co-location — is attractive because the plant produces large amounts of steady, carbon-free power on site. Calvert Cliffs, with Units 1 and 2 near Lusby, offered exactly that.
But a site plan still has to be approved by the county. Amazon filed its 2.4 million-square-foot proposal in early May. On June 23, voters removed commission president Todd Ireland, vice president Mark C. Cox Sr. and commissioner Earl F. “Buddy” Hance, the three commissioners who had voted against a data center pause, in favor of candidates critical of the county’s data center trajectory. On August 4, the county announced both Amazon’s withdrawal and a hearing on a six-month moratorium on data center site plan approvals, intended to allow time for new zoning rules and studies.
Amazon says the decision was a business one, and nothing public contradicts that. Its statement, however, lists the factors it weighs: “development timelines, operational requirements, and our ability to deliver quickly for customers.” A six-month pause followed by a zoning rewrite is a timeline risk that no amount of nearby generation can offset. The mechanism is straightforward: the power advantage of a nuclear site is realized only after the building exists, while the permitting clock starts first. For hyperscalers — the largest cloud operators — that measure value in speed to capacity, an uncertain local calendar can outweigh a favorable power position.
Maryland’s Moratorium Map Is Now a Siting Input
Calvert County is not an isolated case. The Chesapeake Climate Action Network (CCAN), an advocacy group that supports moratoriums, said in July that nearly 77% of Maryland’s population lives under some kind of data center moratorium. That figure comes from an interested party, but the underlying measures are matters of public record: Prince George’s County enacted a two-year hold in July, Harford County has a ban with no time limit, Montgomery County, Baltimore County and Baltimore City have adopted measures, and Queen Anne’s and Washington counties have one-year pauses.
The political signal is also visible in Frederick County, where voters ousted council chair Brad Young after the council expanded a data center zone in Adamstown. County Executive Jessica Fitzwater then paused data center development through year-end — while county leaders still intend to proceed with a planned 2,500-acre campus. That combination matters: it suggests the backlash is producing delays and new process rather than blanket rejection everywhere, which is a different risk for developers to price.
CCAN’s Maryland director expects the General Assembly to consider statewide moratorium bills in 2027. That is a forecast, not a filed bill, but for anyone evaluating Maryland sites it turns a county-by-county patchwork into a possible statewide variable.
What Constellation and the Next Applicant Are Left Holding
Constellation, which owns Calvert Cliffs, loses a named tenant but not its thesis. It said the opportunity remains to “create jobs, grow the economy and support in-state federal agencies” and that this can be done “responsibly while protecting and expanding” the plant. Those are claims about future projects that have yet to be specified; the county’s proposed review of zoning and heavy industrial use is where they would be tested.
Opponents have their own case to make. Petition organizer Melissa Emmal, whose Change.org petition has passed 10,000 signatures, and the nonprofit Save Lusby Inc. are asking for studies and zoning changes before any project proceeds. The June results suggest broad local support for that position, though the scope of the studies and the criteria for lifting a pause remain undefined — questions the county will need to answer if a moratorium is meant to lead to rules rather than indefinite delay.
Meanwhile, the pipeline has not emptied. Natelli Holdings has proposed a separate data center nearby along Route 4, near Calvert Cliffs State Park, an existing landfill, a wastewater treatment facility and a county-owned gun range. Amazon could also resubmit. Whoever moves next will face the same question Amazon did: not whether the power is there, but how long approval will take.
Background
Calvert Cliffs Nuclear Power Plant, with Units 1 and 2 near Lusby in Southern Maryland, is owned by Constellation Energy, which describes it as the state’s largest source of clean, reliable energy. Amazon Web Services is one of the hyperscalers — the handful of companies that build and operate the largest cloud and AI data centers — and has been pursuing sites with reliable access to large amounts of electricity.
Maryland has become a focal point for local resistance to data center development. Through 2026, counties including Prince George’s, Montgomery, Harford, Baltimore County, Queen Anne’s and Washington adopted pauses or bans, and data center policy became a deciding issue in county primaries in Calvert and Frederick counties.
A large investment firm, Cerberus, and a company that builds giant data centers, Yondr, bought 40 acres of land in Manassas, Virginia. They plan a computer campus that would use about 72 megawatts of electricity, roughly what tens of thousands of homes use.
The surprising part is what they chose to brag about. It was not the land. It was that they can get electricity relatively soon, and even “soon” means 2029. In the world’s busiest data center region, getting power hooked up is now the hard part, and whoever has it holds the valuable ticket.
Cerberus Capital Management and Yondr Group have acquired a 40-acre site in Manassas, Virginia, where they plan to build a 72-megawatt hyperscale data center campus expected to begin operating in 2029, citybiz reported on August 3, 2026. The project will be developed through a partnership between funds and accounts managed by Cerberus and Yondr, which develops, owns and operates large data centers for cloud providers. Financial terms were not disclosed.
The partners said the site benefits from near-term power availability in a market where utility constraints have delayed many proposed developments. The campus is intended for cloud computing, enterprise applications and artificial intelligence workloads.
Executive Summary
A private investment firm managing roughly $72 billion and a specialist hyperscale developer have teamed up to build a 72 MW campus in Northern Virginia, the world’s largest data center market. “Hyperscale” refers to facilities built for the biggest cloud operators, such as those running AI and cloud services at global scale.
The notable feature is how the deal was framed. The partners did not lead with location, fiber or acreage. They led with power, saying the site has near-term electricity access where others are waiting, and Cerberus’s Tom Wagner tied the project’s value directly to “available power and a planned 2029 delivery schedule.” That framing reflects a market in which demand for computing, sharpened by AI, has outrun the supply of sites a utility can actually energize.
For hyperscale buyers, the deal adds a prospective block of capacity with a stated delivery date. For competing developers and landowners, it is a reminder that a site’s worth in Northern Virginia increasingly depends on when electricity arrives, not on how much land comes with it.
Power Timing Is the Product Being Sold
The partners’ own description of the deal makes the argument. The announcement says demand for computing power “has outpaced the availability of power-ready development sites,” and that this campus “benefits from near-term power availability in a market where utility constraints have delayed many proposed developments.” Wagner’s quoted rationale pairs two things only: available power and a 2029 delivery date. The acreage, 40 acres, gets a single mention. The land price is not disclosed at all.
That is the mechanism behind the headline. In Northern Virginia, raw land zoned for data centers is scarce but obtainable. A confirmed path to a utility connection on a known date is much scarcer, because substations, transmission lines and grid-operator studies take years. Dominion Energy, the main utility across much of the region, warned in 2022 that transmission limits could delay new data center connections in parts of Loudoun County. Since then, the regional grid operator, PJM, has been dealing with the load growth data centers bring. A site that can credibly promise electricity by a fixed year is effectively a place near the front of that line, and that is what the partners are marketing to prospective tenants.
Who feels it: hyperscale cloud and AI operators planning 2029 capacity get another option with a date attached. Developers holding land without a firm power timeline are at a disadvantage in the same tenant conversations. And landowners learn that the premium in this market attaches to power certainty, not to dirt.
What “Near-Term” Means in Data Center Alley
The phrase “near-term power availability” sits next to an operational date roughly three years after the announcement. That gap is instructive. In today’s Northern Virginia market, three years from land purchase to operation is being presented as an advantage. The partners have not broken down how much of that runway goes to permitting, construction, equipment delivery or utility work. But the framing implies that faster is not readily available locally.
The density is also worth noting. At 72 MW on 40 acres, the plan works out to about 1.8 MW per acre. That is consistent with multi-story or tightly packed campuses in a land-constrained region, where developers try to extract as much capacity as possible from each approved, power-served parcel.
A 72 MW Campus in a Gigawatt-Scale Conversation
AI infrastructure headlines increasingly feature campuses planned in the hundreds of megawatts or more. At 72 MW, this project is modest by that standard. That scale is not a weakness in this market. In Northern Virginia, a smaller campus close to dense fiber networks and existing cloud regions can be worth more to a tenant than a larger one far from users. The release describes a mix of cloud, enterprise and AI workloads, which suggests capacity aimed at serving customers and running trained models, rather than at a single enormous training cluster.
What remains open is how AI-ready the design will be. Modern AI servers pack far more power into each rack than traditional cloud equipment and often require liquid cooling. The partners have not said what rack densities or cooling approach the campus will support. That will determine how much of the 72 MW is truly suited to the AI demand the announcement cites.
Financial Sponsor Plus Specialist Developer
The structure pairs capital from funds and accounts managed by Cerberus, a firm founded in 1992 that manages approximately $72 billion across credit, private equity and real estate, with Yondr’s development and operating expertise. This division of labor, in which investors supply money and a developer supplies delivery, has become a common route for financial firms seeking exposure to digital infrastructure without building an operating platform themselves.
The risk profile depends on facts not yet public. If a hyperscale tenant is already committed, the project is closer to a financed build-to-suit, meaning a facility built for a known customer. If not, the partners are betting that power-ready capacity in Northern Virginia will find a buyer by 2029. Given the demand the release describes, that bet is reasonable, but it is still a bet.
Background
Northern Virginia, centered on Loudoun County’s “Data Center Alley” and extending into Prince William County and the Manassas area, hosts the world’s largest concentration of data centers. Its dense fiber networks and proximity to East Coast population centers made it the default home for cloud regions. In recent years, however, growth has run into limits on land and electrical infrastructure, with utility connection timelines becoming a central constraint on new projects.
Cerberus Capital Management, founded in 1992, manages approximately $72 billion across credit, private equity and real estate. Yondr Group develops, owns and operates hyperscale data centers globally, building purpose-designed campuses for large cloud providers and AI infrastructure operators. Their partnership follows a common model in which investment capital is paired with a specialist developer to deliver large-scale capacity.
A company called Cloud Capital raised $520 million by selling bonds that are paid back from the rent on one huge data center in Northern Virginia. A data center is a building full of computers, and a major technology company leases this one long-term. It uses 80 megawatts of power, roughly what tens of thousands of homes use.
Three separate credit-rating firms gave the bonds their highest possible grade, a first for this kind of deal.
The takeaway: lenders now see a finished, already-rented data center as one of the safest things to lend against. The cheapest money goes to buildings that are done.
Cloud Capital has completed a $520 million asset-backed securities issuance through its newly established Cloud Capital ABS Master Trust, Pulse 2.0 reported on August 2, 2026. The notes were issued as a single A-2-I tranche. They are backed by an 80-megawatt hyperscale data center in Northern Virginia that is leased long-term to an investment-grade hyperscale customer. Fitch Ratings, Morningstar DBRS and Kroll Bond Rating Agency each rated the notes AAA, which the company says is a first for a data center ABS.
Guggenheim Securities was sole structuring advisor and sole active bookrunner. Deutsche Bank Securities and Morgan Stanley were passive bookrunners. Net proceeds will support the expansion of Cloud Capital’s Core Strategy, a joint venture backed by Realty Income and a major global institutional investor.
Executive Summary
Cloud Capital has turned the rent from a single leased hyperscale data center into $520 million of top-rated bonds. It has also set up a master trust that lets it repeat the process with other buildings. The company says the deal is the first data center ABS to earn AAA from three independent agencies. It also says the deal matched the tightest spread for the asset class since the Middle East conflict began in 2026.
The significance is less about one building than about who gets cheap money in the AI-era buildout. Triple-A pricing is available to capacity that is already finished and contracted. The construction, power and leasing risk that defines a new project stays with equity investors and construction lenders. That makes an executed hyperscale lease a financing asset in its own right. It also gives owners of stabilized portfolios a lower-cost way to recycle capital into their next acquisitions.
Key details remain undisclosed, including the notes’ pricing, the tenant’s identity and the lease term. Those are the figures investors would need to judge how large a cost-of-capital advantage the structure really delivers.
Why Three Agencies Reached Triple-A
An asset-backed security, or ABS, is a bond repaid from a specific pool of cash flows rather than from a company’s general balance sheet. Here the pool is the rent from one building: an 80-megawatt hyperscale data center in Northern Virginia. The company says it is leased long-term to an investment-grade hyperscale customer. Hyperscalers are the handful of cloud and internet giants that run computing at enormous scale, and their own debt typically carries strong credit ratings. Fitch Ratings, Morningstar DBRS and Kroll Bond Rating Agency each assigned the notes their top grade, which Cloud Capital says makes this the first data center ABS rated AAA by three independent agencies.
The company attributes the rating to “a conservative capital structure, long-term contracted revenue and stabilized infrastructure assets.” Contracted revenue means the rent is fixed by a lease rather than dependent on finding tenants. Stabilized means construction is finished and the tenant is in place and paying. A conservative structure generally means the bonds are sized well below the asset’s value, which leaves a cushion before bondholders are exposed to any loss. Taken together, the credit case rests heavily on the tenant’s obligation to pay, with the building securing that promise.
The deal shows that triple-A money becomes available only after the hardest risks have been retired. A data center’s riskiest years come before it earns any rent. In that period the developer must secure land and grid power, build out electrical and cooling systems, and sign a tenant. None of that risk sits inside this transaction. The collateral is an operating, fully contracted building. That is why it could be rated at the top of the scale. It is also why, by the company’s account, it priced at a spread matching the tightest for data center ABS since the Middle East conflict began in 2026. A spread is the extra yield investors demand over a benchmark rate, and a tighter spread means cheaper borrowing.
This matters for the AI-era buildout. Demand for hyperscale capacity, driven in large part by AI alongside conventional cloud computing, is pushing developers to build at record pace. Yet the cheapest long-term money in this market reaches a project only after it has been built and leased. Until then, construction and lease-up are funded with equity and construction financing, which cost more. Once a site stabilizes, an owner like Cloud Capital can refinance it through a vehicle like this one and redeploy the proceeds. The release says net proceeds will support expansion of the company’s Core Strategy. The lowest cost of capital therefore goes to whoever holds the finished, leased building.
That has practical consequences. It favors owners with large stabilized portfolios; Cloud Capital says it has acquired 30 data center properties worth more than $12 billion since 2020. It raises the value of a signed hyperscale lease, because the lease is what unlocks the lowest-cost financing. It also deepens a market in which third-party owners supply hyperscale capacity funded by bond investors rather than by the tenant’s own balance sheet. One transaction does not establish a market-wide shift, but its structure makes the mechanism explicit.
A Master Trust Built for Repeat Issuance
The structure matters as much as the rating. A master trust is a single legal vehicle that can issue multiple series of notes over time against a growing pool of assets, so the owner does not need a new structure for every deal. Cloud Capital says this is its second ABS master trust. It describes it as the first programmatic data center ABS master trust established for a core joint venture. That venture is its Core Joint Venture Strategy, backed by Realty Income, the publicly traded net-lease real estate investment trust, and an unnamed major global institutional investor.
Jason Weaver, Cloud Capital’s head of capital markets, described the goal as a “repeatable financing platform” that diversifies funding and positions the company to “finance future growth at an increasingly competitive cost of capital.” The ambition is coherent, but its payoff depends on what comes next. The cost-of-capital benefit becomes demonstrable only if later series price as well as this one. It also requires more stabilized buildings to be added to the pool.
Reading the Claims Carefully
Several of the headline claims are relative rather than absolute. The spread claim compares this deal only with data center ABS priced since the Middle East conflict began, and no spread, coupon or maturity was disclosed. The “strong demand from a broad group of institutional investors” was not quantified with an order-book size or an oversubscription multiple. Guggenheim’s Matt Bissonette described the deal as “a new benchmark.” That assessment comes from the deal’s structuring advisor and lead bookrunner.
The collateral is also concentrated in one building, one tenant and one market. Triple-A ratings on a single-asset deal signal strong confidence in that tenant and lease. They also mean the notes’ performance depends on a single counterparty and on the long-term economics of Northern Virginia. It is the world’s largest data center market, and access to new grid power there has become a widely discussed constraint on growth. That constraint bears more on new development than on an operating, leased facility, but investors will weigh it when they assess renewal risk at the end of the lease.
Background
Cloud Capital was founded by Hossein Fateh, who previously co-founded DuPont Fabros Technology, a wholesale data center developer acquired by Digital Realty in 2017. The company says it has acquired 30 data center properties worldwide since 2020, with a combined value of more than $12 billion. Its Core Strategy centres on stabilized hyperscale facilities and is run through a joint venture backed by Realty Income and a major global institutional investor.
Data center asset-backed securities emerged in the late 2010s. Owners wanted long-term financing tied directly to leased facilities rather than to corporate balance sheets. Northern Virginia is the largest data center market in the world and hosts much of the capacity rented by the major cloud providers.
Hillsboro, Oregon, a Portland suburb, already has 35 data centers. These are giant warehouse-style buildings full of computers that run the internet and artificial intelligence. The city has now voted to stop accepting new proposals for them for 120 days.
Nothing already running, being built or under review is affected. What changes is the rulebook for whatever comes next.
The pause also covers big battery sites that store electricity for later. The local power company asked the city to leave those out.
Oregon Public Broadcasting reported that the Hillsboro City Council unanimously adopted a 120-day moratorium on new land-use applications for data centers and battery energy storage system (BESS) sites at a special meeting on Monday, July 27, 2026. It is the first such moratorium in Oregon. Hillsboro has 35 data centers, according to the website Data Center Maps, which is more than any other city in the state. The city says at least seven more sites are under construction or moving through permitting.
The pause does not affect existing data centers or projects whose land-use applications were already submitted. The council may extend it once for another 120 days. The city gave one day’s notice of the meeting, which Mayor Beach Pace said was meant to keep companies from rushing applications in before the cutoff.
Executive Summary
Hillsboro, the center of the cluster of technology firms around Portland known as Oregon’s Silicon Forest, has temporarily stopped accepting new land-use applications for data centers and grid-scale battery sites. The city says it will use the pause to study the facilities’ impacts and amend its community development code to regulate them.
The headline word is moratorium, but the practical effect is narrower. Operating campuses and already-filed projects continue, so Hillsboro’s near-term data center pipeline keeps moving. The lasting change will be the zoning rules that emerge from the study. Those rules will govern every new campus proposed in one of the Pacific Northwest’s most established data center markets, at a time when AI computing demand is driving much of the industry’s new capacity.
The vote also adds to a broader tightening in Oregon. The state has paused new data center tax breaks, approved higher power rates for large users, and set up a governor’s advisory council on data centers.
What the Pause Actually Freezes
The moratorium is narrower than the word suggests. It stops Hillsboro from accepting new land-use applications, which are the zoning filings a developer needs before a project can move through local approvals. It does not touch the city’s roughly 35 operating data centers, and it exempts any project whose application was already on file. By the city’s own count, at least seven more sites were under construction or moving through permitting at the time of the vote. Projects at those stages have, in the ordinary course, already passed the point the moratorium blocks.
Mayor Beach Pace’s reason for calling the meeting on a day’s notice points the same way. The concern was that companies would rush applications in before the cutoff. That suggests the city expected a queue of projects ready to file, and that the pause is aimed at the next round rather than at capacity already committed.
In the near term, then, Hillsboro’s data center footprint keeps growing. The moratorium does not change the buildings going up now. It changes the terms for whatever comes after them.
The Code Rewrite Is What AI Builders Should Watch
The city’s stated goal is to study the impacts of data centers and battery sites and amend its community development code to regulate them. That is the outcome that will last. The moratorium itself expires after 120 days, or 240 if the council uses its single extension. City Attorney Chad Jacobs told the council that state law limits moratoriums to 120 days, and the ordinance allows one renewal. Zoning amendments, by contrast, stay on the books and govern every future application.
For developers, that moves the main risk from delay to design. A four-to-eight-month pause is an inconvenience on a multi-year data center schedule. New siting standards, depending on what they cover, could change which parcels are viable and what a campus must include to be approved. Across the industry, much of the next wave of capacity is being driven by AI computing demand. That typically means larger, more power-dense campuses, which are the projects most exposed to new local rules on land, power and water.
The council has not said what the amendments will contain, and the testimony pulled in different directions. That uncertainty, more than the 120 days, is what a company weighing a new Hillsboro site has to factor in.
Batteries Caught in the Same Net
The most contested decision was to include battery energy storage systems. These are large banks of batteries that absorb electricity when it is plentiful and release it when demand peaks. Portland General Electric and clean-energy advocates asked the council to exclude them. Adam Capage of Renewable Northwest said the facilities “play a vital role in Oregon’s energy future” and already support resilience and affordable electric service in Hillsboro.
Councilors Cristian Salgado and Rob Harris acknowledged that battery sites and data centers are different, though they often come together. They argued the city needs to understand both before writing rules. That is a reasonable argument about order of operations, but it has a cost. Storage is one of the tools utilities use to manage demand peaks as large new loads connect. Pausing new battery applications at the same time as the loads leaves an open question for grid planning in the area during the study period.
A Market Tightening From Several Directions
Hillsboro’s vote follows several state-level changes. Earlier this year the Oregon Legislature enacted a one-year pause on new data center tax breaks through the Enterprise Zone program. In July the Public Utility Commission approved Portland General Electric’s 29.7% rate increase for large energy users, while residential rates fell 1.3%. Governor Tina Kotek has said the state is a “cheap date” for data centers and suggested more changes are coming.
Each measure targets a different cost: taxes, power prices and now land use. Together they show that Oregon is renegotiating its terms for large facilities. The Washington County Chamber of Commerce, the Westside Economic Alliance and three building-trades unions argued for letting established planning processes and the governor’s data center advisory council finish first. Most residents who testified supported the pause. Both positions have merit. The chamber’s point about sequencing is reasonable, and so is the city’s view that it cannot write sound rules for facilities whose local impacts it has not studied.
Background
Hillsboro, in Washington County west of Portland, is the center of Oregon’s Silicon Forest. The area has long been home to semiconductor manufacturing and has become the state’s densest cluster of data centers. Many large operators have received long-running property tax breaks through Oregon’s Enterprise Zone program. Those breaks became a local flashpoint this spring as residents learned how long they would last.
State policy has been shifting as well. The Legislature paused new Enterprise Zone tax breaks for data centers for one year. Regulators approved higher electricity rates for large power users such as data centers under a new state law. Governor Tina Kotek has said Oregon is a “cheap date” for the industry and suggested more changes are coming, and her data center advisory council is still working on recommendations.
Michigan lawmakers have proposed a set of rules for data centers, the giant warehouses of computers that run apps, cloud services and artificial intelligence.
The biggest of these buildings can use up to 5 million gallons of water a day, about seven Olympic swimming pools. One bill would limit the water a site can permanently use up to about three pools’ worth a day. Another would require cooling systems that reuse the same water over and over.
Developers would also need a signed deal with the local town before they could build or connect to the power grid.
Michigan Democrats introduced a package of bills in early July 2026 to regulate data centers’ energy use, water use, noise, labor standards and use of nondisclosure agreements, MultiState reported. The centerpiece would require operators to sign legally binding community benefit agreements with local governments before they receive site plan approvals, permits or utility interconnection. An interconnection is the approval to connect a facility to the power grid.
The package contains competing Senate and House versions on energy and water. Senate Bill 1047 would require 20-year utility contracts and 90% clean energy procurement. House Bill 6135 would create a new large-load rate class with 15-year contracts and no clean energy mandate. On water, Senate Bill 1046 would cap consumptive use at 2 million gallons per day. The House is considering a requirement for closed-loop cooling or municipal water only.
Executive Summary
Michigan’s package goes beyond one-off siting fights. It would write conditions on energy, water, labor and local benefits into state law. Most permitting disputes are settled project by project in township meetings. These bills would instead set a statewide floor that every large facility would have to clear. None of the bills has passed, and the Senate and House versions differ in important ways.
The water provisions matter most for how facilities are designed. Large data centers can use up to 5 million gallons a day. The Senate would cap consumptive use at 2 million gallons, and the House would require closed-loop cooling or municipal water. The two chambers take different routes, but both would steer developers toward cooling that evaporates less water. The community benefit agreement requirement would change the order of development. A signed local deal would come before the grid connection, not after it.
Michigan is not alone. Six other states have considered community benefit agreement mandates this year. Twelve have weighed closed-loop cooling requirements, and twelve have weighed decommissioning rules. What stands out in Michigan is how many of these ideas arrive together in a single package.
Two Competing Water Bills, One Direction
Senate Bill 1046 would create a new state permit for anyone using, or expecting to use, 550,000 gallons of water or more per day. Applicants would have to hold at least three public hearings before they apply. Permit holders would face a cap of 2 million gallons per day of consumptive use. Consumptive use means water that leaves the local supply and is not returned, mostly through evaporation in cooling towers. For comparison, large data centers can use up to 5 million gallons a day. At that scale, a design that depends on evaporating large volumes of water would struggle to fit under the cap.
The House approach is blunter. New data centers would have to use closed-loop cooling, which recirculates the same water instead of drawing and discharging fresh supply. The only alternative would be to take water solely from a municipal system. The mechanisms differ: the Senate sets a volume limit, while the House mandates a technology or a water source. The engineering result is similar. Developers planning large campuses in Michigan would be pushed toward low-evaporation cooling, whichever version prevails.
This follows a shift the industry has already started. Operators are actively adopting less water-intensive cooling. The effects spread beyond the building itself. Cooling equipment suppliers would gain a more predictable market. Municipal water utilities could become the default supplier under the House option. Closed-loop and dry cooling generally save water but use more electricity. That puts water policy in direct contact with the energy bills moving alongside it.
The Local Deal Would Come Before the Grid Connection
House Bill 6137 and Senate Bill 1050 would reorder the development process. No local site plan approval, no local permit and no Public Service Commission approval of an interconnection could be issued until the local government approves a community benefit plan. For developers, the negotiation with the host community would move onto the critical path, ahead of the utility process that usually sets project timelines.
The agreements would have to cover at least half of five listed topics, which in practice means three. The topics are local hiring, water use, cost allocation for electrical or water upgrades, community investment funding, and home efficiency improvements. A separate pair of bills, House Bill 6140 and Senate Bill 1049, would bar elected officials and operators from signing nondisclosure agreements about construction when a project receives a tax incentive. Intellectual property could still be redacted. Together, these bills would make the terms of the local negotiation largely public for subsidized projects.
Two Chambers, Two Ways to Price Power
The energy bills share one principle: data centers should pay for their own power, so that other ratepayers do not absorb the cost. Senate Bill 1047 would set firm terms. Contracts would run at least 20 years, customers would be billed for at least 90% of their contracted demand whether they use it or not, and applications would cost $100,000. That billing floor is aimed at the risk of a utility building for a large load that never fully arrives. The Senate bill would also require operators to procure clean energy equal to 90% of their annual usage and to join a demand response program, which pays or credits large users for cutting consumption when the grid is strained.
House Bill 6135 would create a large-load commercial rate class with contracts of at least 15 years. Its financial terms are less strict, and it has no clean energy requirement. On the House side, House Bill 6142 would require every Public Service Commission-approved data center contract to include a decommissioning plan. The plan would need financial assurance, meaning money set aside, sufficient to cover dismantling the facility, and it would be reviewed every three years. Developers comparing states would treat the choice between these two frameworks as a real cost difference, not a technicality.
Labor Standards, and No Moratorium
House Bill 6141 and Senate Bill 1048 would bar the Public Service Commission from approving data center contracts unless construction and maintenance work is done under a labor agreement or collective bargaining agreement. The International Brotherhood of Electrical Workers has urged members to oppose moratorium legislation. The union argues that data centers bring well-paid construction jobs and long-term union employment. That position helps explain the package’s shape: it regulates how data centers are built, not whether they can be built.
The package contains no moratorium and no tax incentive changes. Those questions are being handled in separate Michigan bills. They include proposals to repeal incentives, to exclude data centers from certain property tax exemptions, and to extend a brownfield-zone exemption. The package’s premise is that data centers will keep coming to Michigan and the state should set the terms, which is a middle position between welcoming them unconditionally and blocking them.
Background
Data centers house the servers behind cloud computing, streaming and artificial intelligence. The largest require power on the scale of a small city, and some draw millions of gallons of water a day for cooling. As construction has spread into new regions, state legislatures have moved from offering incentives to setting conditions. States considered hundreds of data center bills last year. This year, six states other than Michigan have weighed community benefit agreement mandates, twelve have weighed closed-loop cooling requirements, and twelve have considered decommissioning rules.
Michigan’s legislature has been active on the issue throughout 2026. Separate bills address data center tax incentives: some would repeal them, one would narrow property tax exemptions, and others would extend a brownfield-zone exemption. The July package is the state’s broadest attempt yet to set operating conditions for the industry. At the federal level, a proposal from Representative Robert Bresnahan would tie federal data center tax credits to community benefit agreements.
County leaders in Palm Beach County, Florida, voted 5 to 1 to turn down Project Tango. It was a giant complex of computers for artificial intelligence, planned near about 2,400 homes and an elementary school.
A big worry was a constant low hum, day and night. The builders said cooling would need a one-time fill of about 650,000 gallons of water, roughly one Olympic swimming pool.
The bigger lesson is that local building rules are struggling to decide what these new facilities even are. The developer can try again.
Palm Beach County commissioners on Wednesday, July 15, 2026, voted 5-1 to deny without prejudice Project Tango, a proposed AI data center campus in Loxahatchee, WPEC (CBS12) reported. The vote followed hours of debate over low-frequency noise, water use, traffic and compatibility with a rural area that opponents said now includes about 2,400 homes and Saddle View Elementary School. Commissioner Maria G. Marino cast the lone vote in favor. Mayor Sara Baxter recused herself on the County Attorney’s advice because of her prior public statements opposing the project.
The request before the board covered Phase 2 of the site: 280,000 square feet of data and information processing, 148,000 square feet of cooling-related utility space and about 1.15 million square feet of warehouse. The applicant projected a $34.5 billion asset at build-out over six to seven years and about $561 million in tax revenue at build-out.
Executive Summary
Project Tango did not fail on a single number. It failed because commissioners could not agree with the applicant on what the project was. The developer’s attorney argued that data processing was already a permitted use on a site approved years ago for economic development. County staff answered that the application would add roughly 1.5 million square feet to that approval. One commissioner called the proposal “an AI hyperscale whatever” and questioned whether the county’s definitions had kept pace.
That dispute is the part that matters beyond Palm Beach County. Many AI data center plans rely on land entitlements granted for warehouses, light industry or generic economic development. Project Tango shows a local board declining to treat those older approvals as covering a 24-hour computing campus. The questions it pressed hardest, on low-frequency noise and on water, are ones existing codes were not written to answer.
Because the denial was without prejudice, the applicant can return with a revised plan. The hearing showed fairly clearly what the next attempt would need to bring: independent expert evidence, a named end user, and firmer answers on noise and water.
An AI Campus the Zoning Code Wasn’t Written For
The sharpest exchange of the hearing was about categories rather than engineering. Applicant attorney Brian Seymour described the request as an “allocation of permitted uses, not a new use,” noting that data and information processing is already allowed under the county’s code for the site. County staff rejected that framing directly: “That is incorrect. That is why we are here today. This application is to add square footage.” Staff said the site is approved for 2,020,000 square feet of Economic Development Center uses and that the request would add about 1.5 million square feet to the master plan. Opponents described the result as a 3.6-million-square-foot campus.
Commissioner Joel Flores put the underlying problem plainly: “This is not exactly a data center. This is something new.” He said he was struggling with whether the county was relying on older definitions “just because they haven’t been updated.” The applicant argued the campus should be treated as light industrial and noted it would replace existing heavy industrial operations, including asphalt and concrete plants. By conventional land-use logic, that is a reasonable argument, since a data hall generates little truck traffic or dust. But a hyperscale AI campus (a very large facility built to run AI workloads at scale) runs around the clock, needs substantial cooling equipment and draws significant electricity. Those traits do not map neatly onto a code category written for offices, warehouses or light manufacturing.
This matters for developers and investors who treat an existing entitlement as a de-risked asset. Project Tango is a single case and should not be read as a statewide trend. It does show that a board can decline to extend a years-old approval to cover an AI campus, even when the use is technically listed, if it concludes the scale and operating profile are materially different from what was approved. Sites whose value depends on legacy economic-development or industrial zoning carry that risk until local codes define AI facilities explicitly.
Closed-Loop Cooling Shifted the Water Question Instead of Settling It
The applicant’s water figures for the computing itself were modest. Its engineer said the campus would use a closed-loop cooling system, which circulates the same water rather than evaporating it daily. The data processing portion would use about 1,696 gallons per day, mostly for restrooms, sinks and kitchens. For comparison, county Water Utilities Director Ali Bayat said the neighboring Arden community uses about 400,000 to 500,000 gallons of drinking water a day. On that basis, daily data center use would be well under 1% of the neighborhood’s use.
Scrutiny moved to other parts of the plan. The system would need a one-time fill of about 650,000 gallons, roughly a day and a half of Arden’s consumption. The warehouse portion was projected at about 50,000 gallons a day, around a tenth of Arden’s daily use. When Commissioner Maria Sachs asked who would be using it, Seymour said he did not know the headcount because that information came from the contract purchaser. Flores also asked what happens if the loop water must be drained or becomes contaminated. The applicant’s environmental health expert said it would be collected and disposed of off-site under Florida rules.
The lesson for operators is that closed-loop designs can defuse the familiar evaporative-cooling objection, but that alone does not end the conversation. Boards will ask about every gallon on the site plan. A number without a named user or an explanation reads as a gap, whatever the cooling design.
Why Meeting the Noise Standard Didn’t End the Noise Debate
Low-frequency noise drew one of the longest lines of questioning. The applicant’s experts said the project would meet county noise standards and keep levels near Arden and the school within existing ambient levels. Acoustics expert Dr. Norm Bronner acknowledged that low-frequency noise “will exist,” but said it likely would not be particularly noticeable at the predicted levels. Commissioners focused on whether a constant hum would be audible to residents and students. “We’re not talking about music,” Sachs said. “We’re talking about a hum that resonates.”
The one measurement taken in the chamber illustrates why compliance with the standard did not settle the matter. During a quiet moment, the applicant’s expert recorded 43.9 dBA and 59.8 dBC. A-weighted decibels (dBA), common in noise rules, discount low frequencies roughly as the human ear does at moderate volume. C-weighted readings (dBC) count low frequencies more fully. A gap of about 16 decibels in an ordinary quiet room shows how much low-frequency energy an A-weighted limit can leave out. That is the kind of sound a round-the-clock campus of fans and chillers produces.
Seymour offered pre- and post-operation noise studies, with shutdown or mitigation if the project failed its conditions. That is a meaningful commitment on paper. However, it asks a board to approve first and verify later. Sachs said she could not accept the project without a scientist able to vouch for a comparable operating facility. That standard points developers toward bringing measured data from existing sites rather than modeled projections alone.
What the Denial Leaves on the Table
The economic case was substantial: a projected $34.5 billion asset at build-out over six to seven years, much of it in equipment and computers, and about $561 million in tax revenue at build-out. Commissioner Marino, the lone dissent, said, “I would say we need this.” Other commissioners did not dispute the size of the investment. They said the evidence on compatibility was incomplete, and Vice Mayor Woodward said approval would require “a lot more experts, conditions.”
Denial without prejudice keeps the project alive in principle. A resubmission would likely need to resolve the square-footage dispute with staff, identify the end user, explain the warehouse water figure and bring independent low-frequency noise evidence. The hearing also carried signs of how heated the local debate had become. Flores disclosed that his office had received threatening calls, and a court had denied an emergency request to block the hearing. Any developer returning to this site, or pursuing a similar one elsewhere in Florida, should expect a long and closely examined process.
Background
The Project Tango site in Loxahatchee was approved in 2016 for Economic Development Center uses and currently hosts heavy industrial operations, including asphalt and concrete plants. Residential growth has since surrounded it. The Arden community and Saddle View Elementary School now sit nearby, and opponents put the number of surrounding homes at about 2,400. Residents said they learned of Project Tango about eight months before the vote.
In Florida, land-use decisions like this one are quasi-judicial. Commissioners act somewhat like judges, weighing evidence presented at a hearing, and they must avoid appearing to have prejudged the case. The Project Tango fight reflects a wider pattern in which AI data centers, designed to run power-hungry computing around the clock, are testing local zoning codes written before such facilities existed at this scale.
A Barcelona company best known for keeping computers cool is spending about €1 billion to build and run its own huge computer warehouse for artificial intelligence.
Submer plans to put it on the grounds of an old chemical factory in the Spanish town of Flix, which stopped operating in 2023. Catalonia’s regional president turned out for the announcement.
What makes it interesting: a company that used to sell equipment to building owners now wants to be the owner. It has not yet said how big the site will be, when it opens, or who will use it.
Submer, the Barcelona-based company that built its name in immersion cooling, plans a €1 billion ($1.14 billion) AI data center on the site of the former Ercros chemical plant in Flix, Catalonia, Data Center Dynamics reported. The facility will be built in two phases and operated by Rubix Data Centers, the AI data center division Submer launched in June, which aims to lease it to a single tenant running AI workloads.
The project was unveiled on Saturday, July 11, at an event attended by Salvador Illa, president of the government of Catalonia, and Miquel Sàmper, the regional minister of business and labor. Submer has not disclosed the facility’s planned capacity or construction timeline; renders appear to show four data halls arranged around a central building.
Executive Summary
The headline number is €1 billion, but the more consequential fact is who is spending it. Submer’s business has been supplying cooling systems to other people’s data centers. With Flix, it becomes a developer and operator in its own right, following last year’s launch of the InferX AI cloud platform and June’s launch of Rubix Data Centers.
Submer CEO Patrick Smets framed the move as a deliberate climb up the value chain: “we will expand across the full stack, from land and power to cloud and Edge.” Rubix, led by former Stack executive John Eland, leads its pitch not with cooling technology but with a claim of 8GW of power available across vacant sites in the Americas, EMEA and APAC. That ordering signals where the company believes durable value in AI infrastructure now sits.
What the announcement does not yet establish is the project’s scale, power supply, financing or customer. Until those are disclosed, Flix is best read as a statement of strategy and site selection rather than a funded, contracted build.
From Selling Cooling to Owning the Building
Submer’s trajectory over roughly a year tells the story: an immersion cooling specialist (immersion cooling submerges servers in a non-conductive liquid to carry heat away more efficiently than air) launched an AI cloud platform, InferX, then a data center division, Rubix, and now a €1 billion campus. Each step moves the company closer to the end customer and further from being a component supplier.
The economic logic is straightforward. An equipment vendor is typically paid once per deployment, and its fortunes depend on how many facilities its customers build. An operator that leases a facility earns recurring rent for the life of the lease and controls the asset that everything else depends on: the site, the building and its power supply. Smets’ own phrasing, “from land and power to cloud and Edge,” puts land and power first. Eland made the same point from the operator’s side: “We intend to operate the facility we are building here, so we are not simply passing through Flix.”
That is the substance behind reading Flix as a bet on land and power rather than on cooling hardware. The company has not said whether Submer’s own immersion systems will be deployed at Flix, which underlines the point: the announcement is about owning capacity, not showcasing a product.
Why Power Is the Asset Rubix Leads With
For AI data centers, the scarce input is increasingly not buildings or servers but a site with a large, deliverable grid connection. That is why Rubix’s headline claim is 8GW of available power across vacant sites, a figure measured in gigawatts, or thousands of megawatts. Framing a data center business around power first reflects how the market now prices development opportunities.
Former heavy-industrial sites such as the Ercros plant are attractive candidates in principle, because industrial users often required substantial electrical infrastructure and the land is already zoned for industrial use. Ercros also operates a solar farm on the site today. But Submer has not said what grid capacity is available at Flix, whether it is already connected, or how the solar installation fits into the project’s power plans. Those details will determine how quickly and how large Flix can realistically become.
The 8GW figure deserves the same even-handed reading. It is a claim about power available across vacant sites, and Rubix has not broken it down by location, by grid status or by how much of it is contractually secured versus identified. As a signal of ambition it is clear; as a measure of deliverable capacity it is not yet substantiated.
The Single-Tenant Model Cuts Both Ways
Rubix aims to lease Flix to a single tenant for AI workloads. This build-to-suit approach is common for large AI campuses: one creditworthy customer on a long lease can anchor the financing for a very large build, and two-phase construction lets capital be deployed in step with demand.
The flip side is concentration. Until a tenant signs, the €1 billion figure describes an intended investment rather than a committed one, and the facility’s design, timing and financing will likely hinge on that single counterparty. Without a disclosed capacity, it is also impossible to judge whether €1 billion is a large or modest sum per megawatt relative to comparable AI builds.
A Supplier Becoming a Peer, With Political Backing
Moving into operations can create tension with existing customers: data center operators that buy Submer cooling may now find the same company bidding for AI tenants. How Submer manages that overlap between its cooling business and Rubix will be worth watching.
On the other side of the ledger, the project arrives with visible public support. The presence of Catalonia’s president and its business minister at the launch, and Submer’s framing of the project as part of the “reindustrialization of Flix,” suggest the regional government sees AI infrastructure as a use for idled industrial land. That backing can matter for permitting and grid access, though no specific commitments from the administration were announced.
Background
Submer, based in Barcelona, established itself as a specialist in immersion cooling, a technique that submerges servers in a non-conductive fluid to remove heat more efficiently than traditional air cooling, an approach that has gained attention as AI chips grow denser and hotter. Over the past year the company has expanded beyond cooling, launching the InferX AI cloud platform and, in June 2026, Rubix Data Centers, a division that develops and operates AI data centers and is headed by John Eland, formerly of data center operator Stack.
The Flix site was home to a chemical plant run by Ercros until industrial operations ceased in January 2023. Ercros now operates a solar farm on the site. Redeveloping former industrial land for data centers has become a recurring theme as developers look for sites with industrial zoning and access to power.
A company called Energy Storage Solutions has dropped its plan for a $19.2 billion building full of computers for artificial intelligence in a rural North Carolina county.
At first it would have used about 300 megawatts of electricity, roughly what a couple of hundred thousand homes use, and possibly three times that later.
Local officials had already refused it a permit. Now they are considering a two-year ban on any new projects like it. The takeaway: a county vote can stop part of the artificial intelligence boom before a single computer is installed.
A proposed $19.2 billion AI data center in Edgecombe County, North Carolina, has been withdrawn by its developer, Energy Storage Solutions, Data Center Dynamics reported on July 15, 2026. County Manager Eric Evans told the board of commissioners at its July 6 meeting that the company had pulled the project earlier in the month. The multi-phase campus was planned for the Kingsboro development area near Tarboro, about 70 miles east of Raleigh.
The county denied the project a special-use permit late last year, when it was described as an eight-phase, 300MW campus on 52 acres. Other accounts put the eventual build-out at 300 acres and 900MW. At the same July 6 meeting, commissioners discussed a 24-month moratorium on new data center developments. A public hearing is scheduled for August.
Executive Summary
The Edgecombe withdrawal takes one of North Carolina’s largest announced AI data center proposals off the table, at least for now. The obstacle on the public record was not chips, turbines or transformers. It was a county special-use permit, the discretionary approval a local board can grant or refuse. Commissioners refused it, the developer appealed, and the project has now been withdrawn while that appeal was reported to be ongoing.
The episode matters beyond one county because two policy layers are tightening at once. Locally, Edgecombe is weighing a two-year pause on all new data center projects. At the state level, the House has passed the Ratepayer Protection Act, which would make data center developers pay upfront for the grid expansion, transmission upgrades and new generation their facilities require. Together they change both whether a campus can be built and who pays to power it.
For developers, utilities and the cloud and AI companies that lease capacity, the practical point is that a site’s local approval status now belongs in capacity forecasts alongside land and megawatts.
The Gate on This 300MW Campus Was a County Vote
Most public discussion of AI infrastructure constraints centres on chips, power supply and electrical equipment. In Edgecombe County, the documented obstacle came earlier than any of those. Late last year, the board of commissioners denied a special-use permit for an eight-phase, 300MW data center campus on 52 acres. A special-use permit is discretionary. Even where land is zoned for industrial use, a county board can attach conditions or say no. Energy Storage Solutions appealed and said it would proceed. By early July, the county manager was telling commissioners the project had been withdrawn.
The moratorium under discussion would turn one project’s rejection into a countywide freeze. For 24 months, no developer could bring a new data center through the county’s approval process. Campuses like this one are planned in phases across several years, so a two-year stop at the approval stage delays the first phase, and every phase behind it, by at least that long. That delay holds whether or not power, financing and tenants are ready.
Several groups absorb that risk. Developers and landowners assemble parcels on the expectation of approval. Utilities plan transmission and generation around announced loads. Tenants, usually cloud and AI companies, need capacity delivered on a specific date. For all of them, entitlement status, meaning whether a site actually holds the local approvals needed to build, is as material as the megawatt figure in the announcement. A single county vote removed a planned 300MW from the pipeline here, and possibly 900MW.
A $19.2 Billion Figure Without a Fixed Size
The $19.2 billion headline is the project’s most quoted number and its least anchored one. The permit application the county reviewed described 300MW on 52 acres. Other reports described a 300-acre campus reaching 900MW. Divided across 900MW, the figure works out to about $21 million per megawatt. Divided across 300MW, it is about $64 million per megawatt. A threefold gap makes it impossible to benchmark the proposal against other campuses or to tell whether the figure includes the servers and AI chips inside the buildings, which often cost more than the buildings themselves.
Headline figures for multi-phase campuses tend to describe a full build-out rather than a first phase. That makes them useful as a measure of ambition and weak as a measure of what is financed or contracted. For readers tracking AI capacity announcements, the useful distinction is between the capacity a regulator has actually reviewed, here 300MW, and the capacity that appears in the eventual vision, here up to 900MW.
North Carolina Moves the Grid Bill Toward Developers
The state-level change could matter more than any single county’s decision. The Ratepayer Protection Act, passed by the North Carolina House and awaiting Senate approval, would require data center developers to cover the upfront costs of grid expansion, transmission upgrades and new power generation for their facilities. The practical effect is to shift those costs away from a utility’s general customer base and onto the project. That raises the capital a developer needs before a site produces revenue, and it makes locations near existing grid capacity relatively more valuable.
The bill also includes a coal plant moratorium. Public utilities could not retire coal-fired plants until regulators approve new large-scale nuclear facilities. That provision would keep existing generation on the system while new supply is planned. Its cost and environmental trade-offs will be argued on their merits in the Senate.
Taken together, the local and state layers raise the bar for projects that lack committed customers and deep financing. Developers with signed tenants and capital to fund grid upgrades are better placed under these rules than those seeking approvals first and backers later. Counties and ratepayers gain more leverage over terms. The open question for the industry is how many other North Carolina counties adopt similar tools. The state has seen resident opposition to data center proposals in several places.
Background
North Carolina has become a hotspot for data center development, with some local residents opposing new projects in several parts of the state. Edgecombe County, whose seat is Tarboro, about 70 miles east of Raleigh, became one focal point when Energy Storage Solutions proposed a multi-phase AI data center campus in the Kingsboro development area.
The county board of commissioners denied the project a special-use permit late last year. The developer appealed and said it would proceed, before withdrawing the project in early July 2026. State lawmakers are meanwhile debating the Ratepayer Protection Act, which would make data center developers pay upfront for the grid infrastructure and generation their facilities require.
