SUNLAND PARK, New Mexico – Developers behind Project Jupiter, the proposed $165 billion data center campus in Santa Teresa, New Mexico, shared numbers about its water consumption publicly for the first time Tuesday at a rowdy community meeting – figures that, if accurate, suggest the facility’s usage would be comparable to other industrial operations in the area.
The campus, which would include four data center facilities, would feature a “closed-loop” system of pipes to cool the computer servers inside the buildings, which developers say would require a one-time fill-up before the water is recycled over and over. Filling up the four data centers would require about 10 million gallons of water, and the developers said the campus’ ongoing consumption would be 7.2 million gallons of water every year that it’s operating.
“We understand the water scarcity issues here,” said Kevin Greer, a director at the company Stack Infrastructure, which would build and operate the data centers.
The meeting was the third of five forums that backers of Project Jupiter held to let the public ask questions and learn about the project. The next two meetings are Wednesday and Thursday this week. The Doña Ana County Board of Commissioners will take a final vote on the project Friday, Sept. 19, in Las Cruces.
Greer spoke during the public meeting at the Doña Ana Community College campus in Sunland Park. He said Stack has designed and built three data centers that utilize the same closed-loop system in Oregon, Chicago and Virginia.
The closed-loop system “is not a new technology. It’s well-proven. We have experience designing and building that,” Greer said.
The project would use a daily average of 20,000 gallons when it’s up-and-running, with a maximum consumption capped at 60,000 gallons in a day, according to figures provided by the developers.
By comparison, El Paso Water supplies about 221,000 customers with 110 million gallons of water per day on average, and the Marathon Petroleum refinery in Central El Paso used an average of 1.1 million gallons daily last year, according to El Paso Water.
A Meta-owned data center that’s set to be built in El Paso has an agreement to use 750,000 gallons daily initially, although El Paso Water officials have said the facility is unlikely to reach that level of usage.
The Camino Real Regional Utility Authority, or CRRUA, the New Mexico water utility that serves Sunland Park and Santa Teresa, said it produced an average of 2.6 million gallons of water daily from its wells in March.
Community members at Tuesday’s standing-room only meeting shouted concerns over water usage and expressed other worries about the massive project that residents in Doña Ana County only became aware of in recent weeks.
Residents said the lack of trust on display from Sunland Park and Santa Teresa residents toward the project’s developers stems from the fact people living in the area for years have lived with low-quality drinking water supplied by CRRUA that has contained unsafe levels of arsenic.
The bad drinking water is the result of operator failures and mismanagement at the utility, according to a report issued by the New Mexico Environment Department, as well as long-running underinvestment in the area’s system of water infrastructure. The county government and city of Sunland Park oversee CRRUA, but they’re splitting the utility up and each forming new water providers for Sunland Park and the surrounding area.
The utility under new leadership has reported improved water quality over the last year, and earlier this week said tests it conducted showed water with levels of arsenic below the allowable threshold. But the lack of trust persists.
The deal between Doña Ana County and developers with BorderPlex Digital Assets would likely run for 30 years. In exchange for not having to pay property taxes, the company said it would provide about $300 million in payments to the county over the term of the deal. After 30 years, the company’s shareholders – not the county – would take ownership.
The project’s developers said that in addition to that $300 million, they would provide “tens of millions” of dollars to improve water infrastructure in southern Doña Ana County.
“We need clean water in Sunland right now,” Jose Saldaña, a Sunland Park resident, said during the meeting. “We need the help here.”
At times, Saldaña and many other audience members shouted that county officials’ priority above all should be ensuring safe drinking water for residents in Santa Teresa and Sunland Park.
“That’s exactly the plan – to invest in clean water first,” said Stephen Lopez, a recently appointed assistant county manager. “This funding source is very important to being able to quickly make improvements.”
Other people at the meeting suggested the project came out of the blue and is progressing rapidly. There hasn’t been enough time for the community to understand the project’s implications and whether it truly won’t be an unsustainable drag on the area’s water and electricity resources, others said.
“This is a great PowerPoint presentation. It’s nice and fluffy, and it says nothing,” one resident told a panel of the project’s developers as they sat on a stage. “We don’t have the water here.”
Project Jupiter is backed by a collection of companies, mainly Austin-based BorderPlex Digital Assets, but also Stack and construction and infrastructure firms such as Orion Digital Infrastructure.
Who exactly is putting up $165 billion – a sum that would be among the biggest private investments ever made – to fund the project’s construction is unclear because the developers haven’t identified the eventual tenant of the data centers.
But only a handful of global technology companies, such as Oracle, Meta, Alphabet, OpenAI and Microsoft, have the financial might to develop such a sprawling and costly data center campus.
“So, putting a deal like this together is – we have to bring about eight different entities together,” said Miguel Fernandez, an El Paso businessman and co-founder of the fiber company Flo Networks, which will build the fiber optic cable to serve the data centers. He’s also listed on the “leadership” page of BorderPlex Digital’s website.
“It’s not quite as straightforward as you might think, because you have the data center operators, you have a construction company, you have the compute power company, you have the software company, you have the developer. And then, on top of that, you have the government,” Fernandez said. “So, we’re talking about negotiating between eight to 10 entities that have to come together and organize this.”
Despite the lack of clarity over the source of funding, an employee with Stack Infrastructure said the project cost is so colossal because computer equipment used for the artificial intelligence-training data centers is expensive.
The majority of the $165 billion investment will go toward paying for computer equipment such as graphics processing units. And that investment cost factors in three refreshes of the computer equipment every five to seven years, said Nicholas Minor, director of public affairs for Stack.
“That’s how you get to that $135 billion, I think, just in server equipment. Then, you top on to that the construction of the power facility, and then on top of that construction of the data center facilities,” Minor said. “It’s an AI arms race right now, so this equipment is extremely expensive.”
Lanham Napier, chairman of BorderPlex Digital Assets, in mid-July told New Mexico legislators during a presentation that the data center campus his company is proposing would cover between 1,000 and 1,200 acres.
It would also require about one gigawatt of electricity capacity. By comparison, El Paso Electric owns about 2.8 gigawatts of generation capacity across its entire system, according to the utility’s corporate sustainability report.
Where will electricity for Project Jupiter come from?
Where the electricity will come from to supply the data center campus isn’t entirely clear. But the project’s developers have said they’ll pay to develop their own “micro-grid” that’s essentially separate from the main regional power grid to ensure that “nobody’s power prices are going up,” as Napier said during a meeting in Las Cruces on Aug. 26.
“With this independent power source delivering electricity to the data centers in our buildings, there’s a guarantee of reliable power going to the data center buildings. But it also insulates the opportunity for rate impacts,” said Jennifer Bradfute, a consultant for BorderPlex Digital Assets.
“We are going to be starting out with natural gas” as the primary source of electricity, said Bradfute, who was formerly an in-house attorney for Marathon Petroleum.
She also said Project Jupiter will have “one of the world’s largest battery storage projects out at the site” and that the site will gradually shift to rely largely on cleaner sources of electricity.
“The reason why you need battery storage backup power is because you plan to have intermittent sources there that need that,” she said, referring to solar power sources.
LISTEN: Podcast: Things to know about El Paso Electric and its push to raise rates
It’s not clear whether El Paso Electric will construct a natural gas-fired turbine or a solar farm dedicated to Project Jupiter, and how or whether use of a natural gas plant would phase out over time. The project will have to be net-zero – meaning produce zero carbon emissions – by 2045 to comply with New Mexico state law.
El Paso Electric didn’t immediately respond to a request for comment.
Meta project in Northeast El Paso
As Project Jupiter is set to go to a vote by Doña Ana County commissioners Sept. 19, Meta is moving forward with a separate data center project in far Northeast El Paso. The company will spend at least $800 million to build the initial phase of that campus, although El Paso city officials maintain Meta’s investment could reach $14 billion over time.
And the Meta data center will require 100 megawatts of electricity capacity that El Paso Electric will provide.
So, Meta’s investment – which former Mayor Oscar Leeser said would “completely transform” El Paso – by comparison is a small fraction of what Project Jupiter’s developers say they plan to spend. And Meta’s site will use just one-tenth as much electricity as the proposed Santa Teresa campus.
A big question looming over data center developments in El Paso and across the United States is whether utility ratepayers are paying higher power bills to fund construction of infrastructure to serve data center customers – such as poles, wires, substations or sources of power generation if the data center is big enough.
In a paper published in March, electricity researchers at Harvard Law School wrote that some U.S. utilities are “forcing the public to pay for infrastructure designed to supply a handful of exceedingly wealthy corporations.”
“Utilities tell (public utility commissions) what they want to hear: that the deals for Big Tech isolate data center energy costs from other ratepayers’ bills and won’t increase consumers’ power prices,” the authors wrote. “But verifying this claim is all but impossible.”
El Paso Electric established specific rates for the Meta data center near the Texas-New Mexico state line. Before the rate schedule was finalized, a member of the Public Utility Commission of Texas flagged that El Paso Electric customers might be paying for infrastructure that will serve only Meta’s facility.
“My concern remains, however, that there is no explicit protection against the burdening of other customers with the costs to add such an unprecedented load to the local power grid,” Commissioner Courtney Hjaltman wrote in a memo.
As a result, El Paso Electric guaranteed in writing that the next time it seeks to raise customers’ rates, the utility will “provide evidence” that Meta’s El Paso data center is “not being subsidized by other customers and that the rates contained therein do not constitute discounted rates,” according to filings submitted to the PUC.
Whether El Paso Electric will offer a similar guarantee – that its New Mexico customers won’t cover the cost of providing power to Project Jupiter – won’t be clear until a power supply agreement between the utility and the data center campus works its way through the New Mexico Public Regulation Commission.
El Paso Electric is incentivized to welcome data centers to its service territory. For one, data centers that run constantly are steady customers. The utility can more easily predict revenue and cash flow from data centers compared with less-predictable residential electricity consumption.
In general, data centers are also likely to bring bigger profits for the utility. That’s because El Paso Electric makes money based on how much money it spends on capital projects – physical, tangible things such as power plants, substations or transmission wires, for example.
So, when a company builds a big data center in El Paso Electric’s service territory, the utility can justify to regulators spending a lot of money on capital investments that serve the data center, and then it can earn a profit margin on whatever it spent.
Final vote on Project Jupiter
The debate over Project Jupiter will play out over the next week ahead of the vote by the Doña Ana County Board of Commissioners in Las Cruces. Residents showed up Tuesday at the commissioners’ regular meeting arguing they should deny tax breaks and kill the proposed deal for the data center campus.
The commissioners have largely supported the proposal. At a meeting Aug. 26, they voted 4-1 to advance the project to a final vote. District 4 Commissioner Susanna Chaparro voted against moving the deal forward.
Near the end of the packed, raucous meeting Tuesday, Sunland Park resident Albert Ibarra was jeered by the audience and argued back and forth with Saldaña as he expressed his support for Project Jupiter and the employment its developers said they’ll create.
“We want jobs. The water is my concern – my kids live here, my wife, my dad, my mom,” Ibarra said. “What are we going to do about it?”
Project Jupiter Community Meetings
- 6 p.m. Wednesday, Sept. 10: New Mexico Farm & Ranch Heritage Museum, 4100 Dripping Springs, Las Cruces
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