New details on a large data center in Morgan County show the $1 billion project could end up using 1,200 megawatts of power—about twice the annual usage of all of AES Indiana’s residential customers each year.
Documents submitted by AES Indiana to the Midcontinent Independent System Operator, or MISO, show the utility provider plans to build a new substation on land included in the area that’s recently been rezoned for a $1 billion data center project east of Monrovia, about 30 minutes southwest of downtown Indianapolis.
MISO helps operate the electric grid in 15 states in the Midwest. Documents on the agency’s public portal show the proposed AES Indiana substation has a load capacity of 1,200 megawatts.
If the Morgan County data center operates at around 90% of that capacity over a full year, it would use nearly twice the amount of electricity as all AES Indiana residential customers combined, according to the utility’s federal filing for 2024. Residential use that year was 5.01 million megawatts.
Relative to other data center projects, it’s about three times the expected capacity for the proposed, but withdrawn, Google data center project in Franklin Township, where documents show AES Indiana planned a 400-megawatt substation.
Ben Inskeep, a program director with the Citizens Action Coalition, which advocates on behalf of ratepayers, says the Morgan County project would be one of the biggest energy users in Indiana.
“The overall power usage, 1,200 megawatts, is an enormous amount. It would be larger than any existing industrial facility in the state of Indiana, to the best of my knowledge,” Inskeep said. “The only comparable facilities are other data centers that are being developed right now, such as the Amazon data center up in New Carlisle and the Google data center in Fort Wayne.”
The developer behind the Morgan County data center has not been publicly revealed, even as county officials have approved rezoning for around 560 acres and signed a development deal with the undisclosed entity.
An attorney representing the developer behind the project declined to comment when reached by IBJ.
MISO documents indicate the transmission upgrade could come online by 2027 and would cost AES Indiana around $68 million.
Separate documents filed in a pending case before the Indiana Utility Regulatory Commission indicate the Morgan County data center is expected to use roughly 4 million gallons of water per day. That’s also significantly more than the 1 million gallons a day that Indianapolis City-County Councilors were told Google’s Franklin Township project would use.
“AES Indiana is engaged in planning for potential future energy needs associated with this project,” the utility said in a written statement. “At this time, AES Indiana has not finalized plans with respect to this power load and we remain committed to serving our existing and future customers reliably. Should this project progress, we will share updates transparently and work closely with stakeholders to ensure responsible energy planning.”
Utility concerns
Water and electric usage are common concerns for those skeptical of data centers and the Morgan County project is no different. Residents have spoken out at public meetings saying they’re worried about water availability.
“Where in Sam Hell are we going to get the water? We don’t have that kind of water source. We don’t have 2- to 3 millions of gallons of water per day,” Martinsville resident Michael Massey told Morgan County officials on Sept. 29. “You’re doing to drain all the wells in that area—you’re going to drain the system out.”
An engineering firm representing the developers told the Morgan County Plan Commission in late September that it was conducting water studies on the local aquifer and said if there was insufficient water, the data center would look at air-cooling options to service its processing units.
Whether the additional power AES Indiana wants to bring online will raise bills for customers remains to be seen. Advocates are sounding the alarm that the proliferation of data centers will overload systems and drive up utility bills, while economic development officials have said major utility users might help subsidize power costs for residential consumers.
Under an Indiana law passed this year, large load customers that consume the bulk of the energy created in new projects are required to reimburse at least 80% of the cost that could be reasonably attributed to the customer.
Inskeep, however, says that law is vague and doesn’t provide much protection for ratepayers.
“The question of whether or not rates will go up is a pretty technical process that relates to how utilities spread out their costs across different customers,” Inskeep said. “And so how that process happens is unknown at this time for the new data center customer.”
AES’ proposed rate hike
AES Indiana readying to provide power to the Monrovia data center comes as the utility is in the midst of a rate hike request before state regulators. On Wednesday night, the City of Indianapolis and AES Indiana announced a proposed settlement that would see rates rise by less than the $192.9 million base rate increase the investor-owned utility had asked for.
The private equity firm BlackRock Inc. is also reportedly in talks to purchase AES, the parent company of AES Indiana. That news has led to consternation among Indianapolis City-County Councilors and some state lawmakers.
Also worrisome to Inskeep is AES Indiana’s plan to power the Morgan County data center primarily through new combined cycle gas turbine units. According to AES Indiana’s recently posted resource integration plan, a scenario with a “mid data center load” would involve more gas generation.
That scenario sees AES Indiana’s total carbon dioxide emissions increase by 68%.