In a remarkable event a few weeks ago, a majority of the Kent County Commissioners voted for zoning changes that would allow data centers in certain parts of the county. That may have been prescient, because data centers or “farms” are expanding rapidly and the Eastern Shore is potentially well-placed to benefit; at the least, it was a vote for strengthening Kent County’s economy. In addition, on May 7 a new Maryland law came into effect that gives data farms that locate in the state a tax incentive (forgiving sales and use taxes)—a change championed by Kent County’s Economic Development office.
The coronavirus pandemic has accelerated an already strong trend for businesses of all kinds to move their computing, data storage, marketing, and transaction activities to “the cloud.” That means renting data storage and computing facilities in data farms—vast warehouses full of computers and data storage devices—instead of owning and maintaining the equipment themselves. Consumers are moving more activities on-line as well, working from home or chatting with friends and family with Zoom, streaming movies, and ordering from Amazon or Instacart.
All that online activity means more data generation, more storage and data processing needed, more data farms. Yet by some estimates, only about 20 percent of the business activity that could move to the cloud has done so, meaning there is plenty of growth to come. Spending on cloud-based services in the U.S. is expected to jump from $70 billion last year to nearly $200 billion/year by 2023.
The largest providers of such cloud-based services—and the dominant owners of data farms—are Amazon, Microsoft, and Google, but there are lots of smaller providers as well. In particular, data farms at the “edge” of the global network—meaning close to users—are expanding rapidly, simply because consumers now expect a website to load within a couple of seconds and upcoming computing needs such as autonomous vehicles and the Internet of Things (smart devices of all kinds) also demand very rapid responses. Such edge data farms will typically be built within 100 miles of every major urban area. Kent County (and other parts of the Eastern Shore) are thus within range of Washington, D.C., Baltimore, Wilmington, and Philadelphia.
Because data farms use a lot of electric power to run the computers and data servers and for cooling, they tend to locate where low-cost power (and preferably renewable power) is available and land is not expensive. And that ties into another emerging opportunity for the Eastern Shore, which is the coming development of offshore wind farms. Offshore wind could potentially supply twice the generating capacity of all current U.S. power plants, so the resource is huge. And as wind turbines get larger, they become more efficient and the cost of power that they generate drops. New materials—such as carbon fiber blades—are twice as stiff as current fiberglass blades and weigh less, also lowering costs.
Current offshore turbines in Europe typically can generate as much as 8 megawatts, but the new, larger GE wind turbines identified for the proposed Maryland Skipjack wind farm will be rated at 12 megawatts each. Other manufacturers are designing still larger 15 megawatt turbines. So offshore wind power will be low cost. And if Kent County (or some other Eastern Shore county) was to follow the successful example of Easton Utilities and create its own utility that could contract in advance for some of that low-cost power, it would have all the ingredients needed to entice data farms, and could probably sell any excess power to other utilities at a profit.
Data farms are pristine if large structures. They consume a lot of electricity, and sometimes water for cooling, and they can emit an annoying humming sound, but they don’t generate a lot of vehicle traffic nor emit pollution. As such, they are likely ideal tenants of industrial land. Opposition to the zoning change in Kent County focused most heavily on concern that farmland would be converted to data center use, but the final language of the rezoning amendment does not appear to apply to farmland.
A typical data farm also would bring a dozen or so highly-paid, IT-savvy employees to a host county, and might attract related IT businesses as well. But their potentially most important addition to a county’s economy is the value of the land they occupy—which by definition becomes highly valuable industrial property and can be taxed as such: likely valued for tax purposes at $15,000/acre or more. Compare that with farmland—which, no matter how productive of soybeans or other crops, is valued for tax purposes at $500/acre or less under formulas set by the state of Maryland. Thus a 100-acre data farm would generate 30 times as much tax revenue as a 100-acre soybean farm.
No one is suggesting wholescale conversion of farmland to data centers—and the current rezoning does not allow it—but as Kent County Commissioner Tom Mason (himself a sophisticated, large-scale farmer) put it: “Agriculture is not the agriculture of 50 years ago. We need to generate more revenue.” Data farming may be one promising way to do so, if Eastern Shore counties can organize themselves to capture this novel 21st-century form of activity.
Al Hammond was trained as a scientist (Stanford, Harvard) but became a distinguished science journalist, reporting for Science (a leading scientific journal) and many other technical and popular magazines and on a daily radio program for CBS. He subsequently founded and served as editor-in-chief for 4 national science-related publications as well as editor-in-chief for the United Nation’s bi-annual environmental report. More recently, he has written, edited, or contributed to many national assessments of scientific research for federal science agencies. Dr. Hammond makes his home in Chestertown on Maryland’s Eastern Shore.
Letters to Editor
Janet Christensen-Lewis says
For information about the huge demands that Data centers extract I suggest you read something from someone that is far more knowledgeable: https://chestertownspy.org/2020/06/20/data-centers-amended-chr-3-2020-and-potential-impacts-by-thomas-kocubinski/.
Thank goodness CHR 3-2020 was amended before it passed to remove farmland from the mix. Unfortunately, the town and village residents were not so lucky and will not get the protections that the Kent County Planning Commission recommended.
Tom Mason, your “sophisticated large-scale farmer”, makes lots of statements like believing soil science and classification systems are “just opinions” and “garbage”. (Kent County Commissioners Meeting 6/9/2020).
Data Centers extracts water, have little employment, depending on size (data centers are categorized as I, II, III, IV and super center V) require redundant power generation (diesel generators), build high berms, create impervious surfaces, have high security fencing and lighting and offer little to the local economies.
The NYT ran an article “Power, Pollution and the Internet” about this wasteful technology along with “Cloud Computing Brings Sprawling Centers, but Few Jobs, to Small Towns”. The Washington Post likewise ran a story: “Cloud centers bring high-tech flash but not many jobs to beaten-down towns”.
Sounds like something we should all be jumping into with both feet. And stop calling them farms!
Gren Whitman says
Consuming large amounts of water? And vast amounts of electricity? Lots of noise? Few actual jobs?.
Cannot imagine why Mr. Hammond is so enthusiastic about data “farms” for Kent County. (“Farms”? A misnomer, for sure.)
Thank you, Janet, for offering cold facts and common sense.
Claudia Connelly says
I found your vision for the future of the Eastern Shore and Kent County to be alarming on many levels. As an artist I see you as displaying a very glossy and rosy picture that you have painted accompanied by the sound of cash registers merrily ringing among the violins in the background — a Mr. Rogers version of the future of technology in Kent County and the Eastern Shore.
As an intuitive, my antennas went up at many points in your letter. The first was using the words “farms and farming.” Clever. Then there was the folksy friendliness – we were filling our shopping carts, chatting with family, streaming movies – what fun Data Centers can bring us! We were groomed that we are “well placed to benefit,” that our Commissioners may have been “prescient,” that “more, more, more” Data Centers will be needed in our future, that Data Centers are “pristine” and “don’t emit” pollution (Pristine?! And, if I am not mistaken, they do pollute in many ways that do not “emit.”)
Further, we were encouraged that Data Centers will spawn even more opportunities to cash in on wind “farms” (did you forget solar “farming?”) – all this while urging us to catch the modern wave and “capture this novel 21-st century form of activity.” After all, we were reminded, we need the money.
I had to read your article a second time when I got to the bottom because I was confused when at the end you said “no one is suggesting wholescale conversion of farmland to data centers.” Upon reaching that point I had a picture of exactly that in my mind – wholesale conversion of farmland! Coupled with your comments that the rezoning amendment does not “appear” to apply to farmland and your comment that the value of the land that Data Centers occupy “which by definition becomes highly valuable industrial property” sent shivers up my spine. (Isn’t rezoning going on right now?) You even compared the value of farmland to land that has Data Center “farms” instead! I am still scratching my head.
I read your bio with interest. What we do need is someone with a scientific mind to drill down into what Data Centers could mean for Kent County from the perspective of the environment and the impact on the people who live here and the economy that does exist. I urge more study into the matter before attempting to cash in on something largely unknown. As you point out, our land is ripe for four cities within 100 miles and tax incentives have been offered to encourage it. I worry, are we vulnerable to a technology take over?
On another matter, is it just me or has anyone else noticed that across the street from the proposed solar “farm” in Chestertown is an industrial zone complete with an electrical sub-station. Isn’t that the “perfect” place for a Data Center? How big? Any size goes, right? If residents do not want it, can they afford to fight it? How many more fights could be ahead? Just wondering…..I think we ought to do more of that while we still can.