In 2006, Google opened the first of three data centers in The Dalles, Ore., a city with a population of around 15,000 that sits on the southern banks of the Columbia River.
Why did Google pick The Dalles? The river, for one; according to Google’s website, “The Dalles data center location was chosen for its mild climate and access to hydroelectric power.”
Data centers are the physical locations companies like Google and Facebook build to house their servers, which store users’ emails, photos and videos.
Rather than constructing data centers near their Silicon Valley headquarters, tech giants are building in cities and counties around the U.S. to get cheap electricity, strong Internet connectivity and tax incentives.
One could make the case that Madison is an appealing option for a data center. Yet Wisconsin’s failure to invest in renewable energy may take it out of the running, says one local leader.
Nolen Young, The Dalles’s city manager since 1997, says hydropower makes electricity relatively inexpensive for most of his city’s residents. But it’s even cheaper for Google — the company pays the local electric utility 4 cents per kilowatt hour, a 29% discount. Google’s annual power bill there is about $13 million.
Young says his city’s high-speed fiber-optic Internet network was also attractive to Google.
“The city had invested in a fiber ring that allowed us to give [Google] a route back to a major trunk line,” Young says, describing the bundles of fiber cables that make up the backbone of the Internet.
Tax breaks also played a role in landing Google. As part of its agreements with The Dalles, Google does not pay property taxes on its buildings or the equipment inside.
The Dalles has reaped significant value from its partnership with Google, which Young says has been a good corporate citizen. Besides the millions of dollars that flow to the electric utility each year, Google created over 80 high-paying jobs and donated $8.6 million to Oregon schools and nonprofits from 2008 to 2012.
Google has also invested $100 million in Shepherds Flat Wind Farm — located about 60 miles east of The Dalles — as part of a commitment the company made in 2007 to become carbon neutral.
Madison has a lot to make it attractive for a data center, including the city-owned Metropolitan Unified Fiber Network.
The climate is also ideal, says Jordan Barrette director of MIOsoft. “The summers are not too hot and the winters are plenty cold,” he says. “Those servers can run at 100 degrees, easily. If you condition the air and pull the air through, you shouldn’t need much electricity. You can cut a lot of your costs as far as cooling goes.”
But one big obstacle remains: lack of renewable energy. In recent years, Wisconsin has lagged the rest of the country in developing renewable energy. It’s also resisting efforts to curb carbon emissions, joining a lawsuit against the federal government over new regulations.
Rep. Chris Taylor (D-Madison) says these moves haven’t gone unnoticed by the tech industry. At a conference for lawmakers she attended in 2014, Taylor says, someone representing a group of Internet bluebloods including Google and Facebook told her that if a state lacks a robust renewable energy infrastructure, it’s unlikely to entice a tech company to build a data center there.
“That means they’re not coming to Wisconsin,” says Taylor. “I think it’s a huge loss that Wisconsin won’t be considered for a data center that would create jobs. We’re losing these kinds of projects because of how behind we are in renewables. [Gov. Scott Walker] and this Republican legislature are outright hostile to renewable energy.”