- Meta is building a $10 billion AI data center in northeast Louisiana.
- Entergy Louisiana says it needs to build a major new natural gas plant to power the facility.
- The utility wants permission to pass the plant's construction costs onto its entire customer base.
In Louisiana, a battle is heating up over who will pay for the new power plants needed to serve the $10 billion data center Meta is building in the state's northeastern corner.
Meta announced in December the 2,000-acre Richland Parish data center campus, which is expected to be completed in 2030. The company plans to use the data center to train AI models.
Consumer advocates and climate groups filed new testimony with the Louisiana Public Service Commission on April 11, pushing the state regulator to reject a request by Meta's electricity provider to shift $5 billion in construction costs for the plants on its entire customer base.
Entergy Louisiana has proposed building three new natural gas power plants to serve Meta's data centers in the state. As an investor-owned utility, Entergy can seek regulatory approval to bill its customers for the costs of building the new plants as long as it successfully shows that the plants are in the public interest.
Entergy has argued that Meta's data center could be "transformative" for Lousiana once built, saying the facility could provide 300 to 500 jobs with an average salary of $82,000.
The testimony from advocates and climate groups argued that the utility's 1.1 million electric customers shouldn't have to foot the bill for Meta's power appetite.
Entergy did not respond to a request for comment from Business Insider. Meta declined to comment.
Beyond the $5 billion in cost recovery for the plants, the utility's plan would "put other ratepayers at risk of having to absorb hundreds of millions, if not billions of dollars, of additional costs" associated with Meta's data center, said Cathy Kunkel, an energy consultant testifying on behalf of the Union of Concerned Scientists and Alliance for Affordable Energy.
That's because Meta's power needs have grown since the Big Tech giant first announced its plans to build an AI data center in Louisiana, adding to Entergy's costs of service.
Earlier this year, Meta was planning for more than two gigawatts of capacity in Louisiana, according to a Threads post by Meta CEO Mark Zuckerberg in January. That amount of electricity is double what is being planned at the Crusoe data center in Abilene, Texas, widely thought to be the first site for Stargate, a $500 billion joint venture between Oracle, OpenAI, and SoftBank to build AI data centers in the US.
Since then, Meta has asked Entergy for even more electricity, according to the utility's filings with the LPSC. The exact amount requested is unknown, as the information is redacted from the filings.
Saddling customers with Meta's costs is especially risky given the uncertainties surrounding AI's electricity demand, Kunkel said. AI models could become more energy efficient in the future, or companies could focus more on energy efficiency as a means to enhance profit, she said. That could result in Meta "choosing to scale back or exit" the project early. Recent reports that Amazon and Microsoft are pulling out of data center leases have helped stoke concern that the AI development boom is slowing down.
Entergy's request for cost recovery has attracted a wide range of "intervenors," or parties that want to weigh in with an opinion before the LPSC. Even Walmart in Louisiana has testified, seeking assurances that Meta's escalating power demand won't affect it and other Entergy customers in the state.
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