Denver is considering a temporary halt on new data center projects in the city so that officials can review its regulations for the sites, Mayor Mike Johnston’s office announced Monday.
That review could result in new data center-specific regulations and zoning focused on “responsible land, energy and water use,” along with affordability for utility ratepayers, according to a news release about the proposed moratorium.
“Data centers power the technology we depend upon and strengthen our economy,” Johnston said in the release. “But as this industry evolves, so must our policies. This pause allows us to put clear and consistent guardrails in place while protecting our most precious resources and preserving our quality of life.”
Data centers are the buildings where companies, including tech giants like Google and Meta, store their infrastructure, such as servers and storage systems. The centers make commonplace services like email, online banking, telehealth, Netflix and Facebook possible for Denverites. They can also suck up massive amounts of water and energy.
The moratorium, which is intended to last “several months,” will take effect only if a majority of the council first approves an ordinance.
Two of the 13 council members, Paul Kashmann and Darrell Watson, are quoted in the mayor’s news release as being generally supportive of the initiative.
Kashmann noted in his statement that there is still “distance between the mayor’s view and mine … as well as some other council colleagues.”
“I look forward to working with the administration, the community at large and industry voices to see if regulations — as have been instituted in sister cities around the country — will or will not make additional data center development possible in the City and County of Denver,” he said.
Watson said he planned to introduce the proposal and emphasized that he sees Denver as a city that wants to be both welcoming to innovation and committed to protecting the environment.
“Data centers use significant energy and water. We have a responsibility to manage their growth in our communities wisely and sustainably,” he said. “We can protect the health of Denver communities, strengthen our climate commitments and continue to keep our city moving forward responsibly.”
City officials plan to work with residents, climate experts and industry leaders to develop the new regulations.
The pause, which city spokesman Jon Ewing says will be filed in the council in the “coming weeks,” wouldn’t impact existing data centers, those already under construction or projects the city has already permitted. But those projects could “be expected to follow new guidelines once announced.”
A controversial data center under construction in northern Denver’s Elyria-Swansea neighborhood wouldn’t immediately be affected.
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Last year, the legislature killed a bill that would’ve given tax exemptions to data centers. This year, the proposal is back. House Bill 1030 would provide 20 years’ worth of full sales and use tax exemptions to data center builders who invest a certain amount of money and provide a set amount of jobs, among other requirements.
On the other side, another group of legislators has filed Senate Bill 102, which would generally require data centers to match 100% of their energy output with renewable sources. Neither bill has yet been heard in committee, and HB-1030’s first committee meeting was delayed amid negotiations between the two camps.
Staff writer Seth Klamann contributed to this story.
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