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Freedom251 › Blog › data centers

How to Compare Data Center Proposals by Power, Water, Jobs, and Tax Revenue

By Freedom251 Team · · 11 min read

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Compare data-center proposals with one evidence-labeled scorecard, not with headline investment figures. Record peak and annual electricity demand, water withdrawal and consumption, construction and permanent jobs, taxes minus incentives and public costs, and the enforceable terms that will be monitored. Keep construction and operating phases separate, use the same units and time periods for every proposal, and mark each figure as projected or measured.

A proposal that promises more jobs or tax revenue can also require larger grid upgrades, more water, or greater emergency-service capacity. No official framework establishes a universal weighting that makes one metric decisive. A defensible decision shows each trade-off, identifies who pays, and provides a way to compare actual performance with commitments after approval.

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Start with an apples-to-apples comparison

Before scoring a proposal, define what is being compared. Identify the project’s status (inquiry, zoning, permitting, construction, or operation), the exact site and jurisdiction, the proposed phase or build-out, and the date of every estimate. Tax rules, utility capacity, reporting duties, and water constraints differ by place and can change over time.

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Use a shared data dictionary for every applicant. For each number, record:

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  • Unit: megawatts, megawatt-hours, gallons, jobs, dollars, or another precise measure.
  • Period: peak hour, monthly total, annual total, construction duration, or recurring fiscal year.
  • Geography: parcel, utility service area, municipality, county, or state.
  • Status: developer projection, permit commitment, administrative record, meter reading, tax return, or independent verification.
  • Phase: construction, commissioning, steady-state operations, expansion, or closure.
  • Responsible party: developer, utility, local government, auditor, or another named verifier.

Do not compare one project’s peak electricity demand with another project’s annual consumption, or a temporary construction-job total with permanent operating employment. If a value is unavailable, write “not stated” and explain what would be needed to establish it.

Separate promises from enforceable obligations

A presentation, letter of intent, community-benefit pledge, permit condition, development agreement, utility tariff, and tax statute do not carry the same legal weight. Label each item and identify the consequence for missing it. A commitment backed by a permit condition, bond, fee, reporting requirement, or termination clause is more accountable than an unincorporated forecast.

Keep the baseline public

Ask the applicant and agencies to publish the pre-project baseline: existing peak load, annual electricity use, water availability and wastewater capacity, current assessed value, tax receipts, emergency-service demand, and local employment conditions. Without a baseline, “new” jobs or revenue may simply reflect activity that would have occurred anyway.

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Power and grid impacts

Electricity is both an operating cost and a public-infrastructure question. Request enough detail to show how much power the facility will draw, when it will draw it, how it will be supplied, and who pays for the system changes.

Numbers to request

  • Maximum coincident demand in megawatts for each phase and the expected date that demand begins.
  • Expected annual electricity consumption in megawatt-hours, with monthly or seasonal profiles where available.
  • Energy and fuel sources, including purchased electricity, on-site generation, storage, and renewable contracts. Ask whether a “renewable” claim describes physical delivery, a contract, or certificates.
  • Backup-generator capacity, fuel type, testing schedule, and expected operating hours. Emergency-only operation and routine peak shaving have different air-quality, noise, and grid implications.
  • Interconnection voltage, substation or transmission work, queue position, study status, construction schedule, and interim arrangements.
  • Required generation, transmission, distribution, road, and communications upgrades, with itemized costs and the party responsible for each.

Maryland’s 2026 reporting order illustrates the level of specificity a public record can require: monthly electricity and fuel consumption, energy sources, peak demand, and backup-generator operating hours. Use those fields as a template even when Maryland rules do not govern your site.

Test the cost allocation

Obtain the utility’s written interconnection or service estimate, not just the developer’s construction budget. Separate one-time connection charges from network upgrades, recurring demand charges, and costs shifted to other ratepayers. South Bend’s framework calls for a project to cover the full cost of required utility upgrades. Ask whether that requirement is an enforceable term for the proposal under review, and what happens if the estimate rises.

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Check reliability effects at the local level. A project can pay its direct connection bill and still alter feeder loading, reserve requirements, outage exposure, or the timing of other customers’ connections. Ask the utility and independent regulators to explain modeled reliability under normal conditions, heat waves, winter peaks, and a major generator or transmission outage.

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How to compare power claims

Field Proposal A Proposal B What to verify
Peak demand Record MW by phase Record MW by phase Coincident peak definition, weather case, and study date
Annual consumption Record MWh and monthly profile Record MWh and monthly profile Whether estimate is modeled, metered, or guaranteed
Backup generation Capacity, fuel, operating hours Capacity, fuel, operating hours Permit limits and testing assumptions
Grid upgrades Scope, schedule, cost payer Scope, schedule, cost payer Utility study and enforceable payment terms
Ratepayer exposure Direct and shared costs Direct and shared costs Regulatory treatment and contingency if costs increase

Water: distinguish withdrawal, consumption, and discharge

“Water use” is not one number. Withdrawal is water taken from a source; consumption is the portion not returned to that source, for example through evaporation or incorporation into a product. Water withdrawn and returned is not equivalent to water consumed. A proposal that reports only one figure cannot be compared fairly with one that reports both.

Request a complete water balance

  • Monthly and seasonal withdrawal volumes, peak-day demand, and annual total.
  • Monthly and seasonal consumption, with the calculation method and assumed return flows.
  • Source by volume: municipal supply, surface water, groundwater, reclaimed water, or another source.
  • Cooling method, including evaporative, air, hybrid, or liquid systems, and the expected efficiency under hot-weather conditions.
  • Process wastewater volume, temperature, pollutants, treatment requirements, discharge location, and permit status.
  • Make-up water, blowdown, chemicals, and any storage or recycling system.
  • Operating rules during drought, heat, low-flow periods, or municipal restrictions.

Maryland specifies reporting water withdrawal and consumption by source and use. South Bend’s framework emphasizes efficient water use and protection of wastewater systems. Apply those questions to the actual watershed and treatment plant serving the site; a regional framework cannot substitute for a site-capacity analysis.

Check supply and wastewater capacity

Ask the water utility for available firm capacity, existing peak demand, planned expansions, and the project’s place in the connection queue. Request a written analysis of whether the facility’s peak demand coincides with residential or industrial peaks. For wastewater, obtain hydraulic and treatment-capacity figures, seasonal constraints, pretreatment requirements, and the cost and schedule of any expansion.

Require the applicant to state what happens if drought rules reduce supply or if wastewater capacity is delayed. A contingency plan should identify curtailment thresholds, alternative sources, storage, temporary treatment, and who bears the cost. “Access to water” is not proof of dependable service during the conditions that stress a system most.

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Jobs and workforce benefits

Separate construction employment from permanent operations employment. Construction jobs may be numerous but short-lived; operating jobs may be fewer and last for decades. Report full-time-equivalent jobs, duration, shift pattern, wage levels, benefits, local hiring, apprenticeships, labor agreements, and training rather than a single job headline.

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Label the evidence behind each job number

For every estimate, state whether it is a developer projection, payroll record, administrative report, or independently verified count. Define “local”: municipality, county, commuting region, or state. Define whether contractors, security, janitorial, and indirect jobs are included. Do not add direct, indirect, and induced estimates together unless the methodology prevents double counting.

Maryland’s reporting fields distinguish construction and operations employment, wages, local hiring, and apprenticeship use. South Bend and New Jersey identify prevailing wages, project labor agreements, local hiring, apprenticeships, and workforce pathways as policy tools. Treat these as policy options, not evidence that a particular project will meet a target.

A specific caution from Washington

In its 2026 review, the Washington Joint Legislative Audit and Review Committee reported that beneficiaries claimed 53 family-wage jobs and nearly 300 temporary construction jobs. The report also said the Department of Revenue had not verified those job counts. The figures are useful as an evidence-labeling example: a reported number is not the same as an audited outcome, and neither figure should be treated as a forecast for another project.

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Questions that reveal job quality

  • How many positions remain after commissioning, and how many are replacements for existing jobs?
  • What are starting and median wages, benefits, schedules, and required credentials?
  • What share of work is covered by a project labor agreement or prevailing-wage rule?
  • How many apprentices will be registered, for how many hours, and with which training providers?
  • Are local-hiring targets measurable, documented, and enforceable, with reporting by contractor?
  • What workforce pathway remains after construction ends?

Tax revenue, incentives, and the net fiscal effect

Gross investment is not tax revenue. Build a year-by-year fiscal model that lists expected property, sales, utility, payroll, and other applicable taxes; exemptions and abatements; public spending; and community-benefit payments. Show assumptions, timing, and the jurisdiction receiving each dollar.

Include all public costs

  • Road, bridge, signal, and site-access work.
  • Water, wastewater, stormwater, and electric infrastructure.
  • Fire, emergency medical, police, inspection, and planning capacity.
  • Debt service, operating subsidies, tax-increment financing, and foregone revenue.
  • Ongoing monitoring, reporting, and enforcement.

Compare recurring net revenue with one-time construction fees and one-time public investment. A multi-year present-value calculation can clarify timing, but publish the discount rate and sensitivity cases. Show what happens if assessed value, occupancy, electricity use, or tax law changes.

Use Washington findings narrowly

The Washington Joint Legislative Audit and Review Committee’s 2026 review estimated $42.4 million in beneficiary savings from an urban data-center sales-and-use-tax preference over 2023–26. It also found at least $111 million in added assessed value and $1.2 million in property taxes in two counties. Those are findings about the reviewed Washington preference and projects, not transferable estimates for a new facility elsewhere.

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The same review cautioned that the preference’s causal effect was unclear: some projects refurbished existing facilities, and some investments might have occurred without the incentive. That is why a fiscal comparison must include a counterfactual—what development, renovation, or tax base change would likely occur without the proposed subsidy.

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At least 38 states offered tax incentives specifically targeting data centers, according to that 2026 review. Availability of an incentive does not establish that it is necessary, cost-effective, or appropriate for a particular community.

Community benefits and tax terms

South Bend’s framework proposes full property taxes without abatements and directing project tax revenue toward neighborhood priorities. New Jersey’s municipal guidance advises communities to understand demands on infrastructure, utilities, and emergency services before setting community-benefit agreement terms. If a community-benefit payment is proposed, specify its amount, indexation, recipients, schedule, eligible uses, audit rights, and remedy for nonpayment.

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Transparency, monitoring, and enforcement

A comparison is only useful if the public can check performance later. Establish a baseline, common definitions, reporting deadlines, and a public location for data. Maryland’s order enumerates energy, water, workforce, community-benefit, efficiency, and progress fields. South Bend calls for public agreements, community meetings, and annual water, energy, carbon, and jobs reporting.

Minimum accountability package

  1. Publish the approved baseline and the assumptions behind every projection.
  2. Require monthly or quarterly operational data where seasonal peaks matter, and annual summaries for jobs, taxes, water, and energy.
  3. Identify the verifier for each field and retain underlying records for audit.
  4. Explain every withheld data point, citing legal confidentiality grounds and providing an aggregate alternative where possible.
  5. Set thresholds that trigger corrective action, additional fees, curtailed operations, or other remedies.
  6. Hold scheduled public meetings and publish responses to material deviations.

Ask whether reporting survives ownership changes, expansions, refinancing, or a change in operator. Commitments that disappear when a subsidiary or contractor changes are not durable commitments.

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A common scorecard for two or more proposals

Use identical columns and definitions. Do not force a single numerical ranking when the trade-offs are political or legal; present the evidence first and explain any weighting openly.

Comparison axis Required measures Decision questions
Power and grid Peak MW, annual MWh, sources, backup hours, interconnection, upgrades, cost allocation Will reliability change, and who pays for every required upgrade?
Water Withdrawal, consumption, source, cooling, wastewater, discharge, drought plan Can the actual supply and treatment systems serve peak conditions?
Jobs Construction and permanent FTEs, duration, wages, local share, apprenticeships, verification How many durable, quality jobs are enforceably connected to the site?
Fiscal effect Taxes, incentives, public costs, community benefits, recurring net value What is the net result under realistic and downside assumptions?
Accountability Public baseline, reporting, audit rights, remedies, agreement duration Can residents verify delivery and obtain a remedy for shortfalls?

Ontario’s proposed assessment pillars similarly place durable jobs and revenue alongside community benefits, capacity impacts, and environmental considerations. That structure reinforces a practical rule: a proposal should be judged across several dimensions rather than reduced to investment size or a single score.

Step-by-step review process

  1. Define the proposal. Record site, owner, phase, capacity, schedule, jurisdiction, and applicable laws.
  2. Issue one information request. Send every applicant the same fields, units, reporting periods, assumptions, and evidence standards.
  3. Collect utility and agency records. Obtain independent grid, water, wastewater, tax, emergency-service, and traffic analyses rather than relying solely on the developer’s model.
  4. Normalize the data. Convert units, align time periods, separate phases, and identify coincident peaks. Preserve the original figures and conversion method.
  5. Build the fiscal model. List gross receipts, exemptions, public costs, community benefits, timing, and a no-incentive or no-project counterfactual.
  6. Classify evidence. Mark each field as projected, committed, measured, or independently verified. Highlight gaps instead of filling them with assumptions.
  7. Test downside cases. Model delayed interconnection, higher peak demand, drought, wastewater limits, lower assessed value, fewer permanent jobs, and early closure.
  8. Draft enforceable terms. Put payment, reporting, workforce, water, energy, and remedy provisions in permits or agreements, with audit access and successor obligations.
  9. Publish and revisit. Release the scorecard, hold public meetings, and compare annual actuals with the approved baseline.

Common comparison mistakes and how to correct them

Using investment as a proxy for public benefit

A billion-dollar construction budget does not reveal recurring tax receipts, public subsidies, water demand, or permanent employment. Replace the headline with a net fiscal and infrastructure table.

Mixing peak and annual measures

Peak demand determines capacity and reliability; annual consumption affects energy procurement and emissions totals. Keep both, with their time basis visible in the same row.

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Counting projected jobs as verified jobs

Attach an evidence label, define local and permanent, and require payroll or administrative records after hiring. The Washington example shows why a reported count needs a verification status.

Ignoring the counterfactual

Ask what would happen without the incentive or project. Refurbishment of an existing facility may produce a different tax and construction effect from wholly new development.

Assuming a regional template answers a site question

Maryland, South Bend, New Jersey, Pennsylvania, Ontario, and Washington provide useful approaches, but their rules and infrastructure differ. Confirm the actual utility, watershed, tax code, permit, and agreement governing the site.

Leaving upgrades and emergency services outside the budget

Require itemized costs for electric, roads, water, wastewater, fire, medical, police, inspection, and monitoring services. State who pays initially and who bears overruns.

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What a defensible decision looks like

The strongest comparison does not declare a winner before the evidence is assembled. It shows, in the same units and periods, how each proposal affects grid capacity, water systems, employment, public finances, and community obligations. It distinguishes a forecast from a measured result, a voluntary promise from an enforceable term, and gross receipts from net public value.

Use the scorecard to make unresolved questions visible. If a proposal cannot state peak demand, seasonal water use, permanent job counts, subsidy cost, or upgrade responsibility, that is a decision-relevant gap—not a reason to substitute an optimistic assumption. Approval should be conditioned on site-specific analysis, public reporting, and remedies that remain in force throughout the project’s life.

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