Data center developers share plans at San Jose town hall

While San Jose is developing uniform data center standards to mitigate environmental impacts and support economic growth, two developers with projects in the pipeline said they will adhere to the guidelines once set.

At a Tuesday community town hall organized by the District 2 Neighborhood Leadership Council, representatives from major data center developers Prologis and Menlo Digital told residents they would commit to studying the projects’ impacts in South San Jose by conducting a new environmental review.

“The city itself is going through a process of dictating what is the appropriate level for projects and generators per unit, and we will have to follow those standards,” Allison Koo, Menlo Digital senior vice president of development and construction, said at the meeting. “The city is targeting getting these new standards out, probably by the end of the year, of which then we will have to comply with.”

At the meeting, residents expressed concerns about how these data centers will affect the neighborhood, worries over the cost of power being passed down to consumers, how developers will mitigate pollutants emitted by these facilities and whether developers will commit to treating contaminated water on-site. Diesel generators used by data centers emit harmful chemicals such as nitrogen oxides and toxic air contaminants that can cause lung issues and cancer.

Linda Hutchins-Knowles, co-founder of environmental justice group Mothers Out Front Silicon Valley, said she wanted environmental and public health groups to have equal time to present their concerns about air and water quality, water use, artificial light, noise and impact on wildlife in a future meeting.

“I noticed that in tonight’s presentation, we have the industry here putting the best spin they can on this,” Hutchins-Knowles said at the meeting. “There’s many, many concerns and frankly to me how it looks on the outside is the least important as a mother of kids in this community. I don’t understand how you can consider diesel generators ever low emission — that is a lot of air pollution in our community.”

Menlo Digital is planning to build a 444,400-square-foot data center in South San Jose on Charlotte Drive, between Lexington Avenue and Raleigh Road. It would use 99 megawatts of power, enough energy to power 99,000 homes. It will also include an on-site substation and backup generators. The project is located near residential areas.

To limit the amount of water it uses to cool equipment, the facility would use an air-cooled, closed loop system that recirculates water through pipes.

Prologis is developing another project in South San Jose at 5977 Silver Creek Valley Road. The proposed 516,000-square-foot data center would also use 99 megawatts of power and have an on-site substation and backup generator yard.

Koo said the company will incur the full costs of any infrastructure the data center requires, including power transmission cables.

“(PG&E collects) all the money from us to pay for that upfront, and if the project somehow doesn’t go forward, that money is kept by PG&E so that infrastructure cost is not passed back onto the ratepayer,” she said.

Koo added PG&E estimates data centers can reduce customer bills by 1% for every 1 gigawatt of data center usage.

Another resident asked whether the developers would commit to treating leaks from diesel generators on-site, which can spill harmful chemicals into the soil and groundwater.

Prologis Vice President Courtney Bell said the question was outside of her technical expertise.

“We’re going to have to get back on that,” Bell said. “But in terms of any sort of equipment malfunction or things that need to be repaired, that absolutely will follow all the standards. In terms of the water quality monitoring, that’s also something that I know that the city is looking at, and so we will be compliant with what they come up with.”

Bell said the company has a website to keep residents up to date on the Prologis Silver Creek project. Koo said Menlo Digital will have a website up soon for the project on Charlotte Drive.

San Jose expects to create its standards by the end of the year.

Gov. Gavin Newsom signed a package of bills on Sept. 21 to regulate data centers, including a requirement that new data centers go through an environmental review detailing impacts, and a mandate for developers to disclose information about water usage to local governments.

MJ Sasse, community engagement coordinator at Silicon Valley Youth Climate Action, said the town hall was a testament to the concerns District 2 residents had.

“Close to 100 community members showed up on a weeknight with thoughtful questions about the real impact data centers will have in their communities,” Sasse told San José Spotlight. “Many residents still left with unanswered questions, particularly those around heat island effect and water quality that will impact these communities for generations to come.”

Contact Joyce Chu at [email protected] or @joyce_speaks on X.