JAY — Developers hoping to build a data center at the former Androscoggin Mill site are seeking an exemption from a legislative proposal that would scuttle the project.

Tony McDonald, a partner in JGT2 Redevelopment, on Monday, March 23, asked the Jay Select Board to support an exemption, arguing the project would bring jobs and tax revenue without straining local resources.

The board voted to have Town Manager Shiloh LaFreniere work with JGT2 to draft a letter of support to Gov. Janet Mills advocating for an exemption.

The company purchased the property in December 2023 and has since demolished roughly 425,000 square feet of unusable buildings and worked with environmental regulators to clean the site, McDonald said.

A DIFFERENT KIND OF DATA CENTER?

McDonald said earlier redevelopment efforts, including a proposed wood products facility, stalled due to tariffs, but interest from data center developers has grown.

McDonald emphasized that the Jay proposal differs from large “hyperscale” facilities often associated with artificial intelligence.

A large-scale data center is being built at the former Loring Air Force Base in Limestone. However, similar in projects in Lewiston and Wiscasset were rejected after facing opposition, particularly in Lewiston, where residents flooded city leaders with concerns about the impacts on the environment, electricity rates and the city’s downtown.

The facility planned for Jay would operate as a co-location data center, hosting multiple smaller systems rather than a single large-scale computing operation, he said.

“They’re still called data centers, but they’re small. Instead of one big brain … you’ve got all these little ones,” McDonald said. “Our project is not the boogeyman that the drafters of LD 307 are worried about.”

LD 307 would create a temporary limitation on data centers with electricity loads of at least 20 megawatts by preventing the state, local governments and quasi-governmental agencies from issuing permits or other approvals until 90 days after the first session of the 133rd Legislature adjourns.

That will likely be around October 2027, according to the bill’s sponsor, Rep. Melanie Sachs, D-Freeport.

That would give a new Data Center Coordination Council, also created by the bill, time to study and review the potential impacts of building the centers in Maine.

EXISTING INFRASTRUCTURE

The usual worries around data centers don’t apply to the Jay project, McDonald said.

The site’s existing electrical infrastructure was a key reason for the purchase and would allow the project to proceed without upgrades to the regional power grid. McDonald indicated the additional load could slightly reduce electricity rates by spreading fixed costs across a larger base.

Initial demand for the project is expected to be about 82 megawatts, with a potential to scale higher if approved through regional grid review processes, he said.

Water use, another common concern with data centers, would be significantly lower than at the former paper mill. The facility would use a closed-loop cooling system, requiring approximately 300,000 gallons per day to replace evaporation losses.

“That sounds like a lot, but the mill was using 35 to 45 million gallons a day,” McDonald said, adding the proposed system would not discharge contaminated water.

He said the project would not require approval from the Jay Planning Board and no zoning changes are needed because the development is taking place within an existing industrial structure on the site.

‘IT WILL KILL THIS PROJECT’

McDonald said LD 307 is an existential threat to the project.

“If this moratorium is enacted and we don’t get an exemption, it will kill this project,” he said, citing a construction timeline that calls for site work to begin in July and be completed by mid-December. “This project doesn’t have the luxury of waiting around for two years.”

The project represents an estimated $550 million real estate investment, with additional spending on equipment potentially exceeding that amount, McDonald said. He estimated it could generate millions in annual property tax revenue and create 800 to 1,000 construction jobs, followed by 125 to 150 permanent positions.

“These are good, high-paying jobs,” he said.

Regional officials and residents have expressed interest in economic redevelopment tied to emerging industries.

John Benedetto, the Livermore Falls resident who proposed Project Revival 2030, an economic development initiative, said the region has struggled economically since the decline of the paper industry.

“A properly sized data center could bring tax revenue, construction work and technical jobs without the emissions, truck traffic and environmental impacts,” Benedetto said.

The proposed data center is part of broader redevelopment efforts at the former mill site, which has seen multiple proposals in recent years, including waste processing and solar energy projects.

Benedetto agrees that the project is not comparable to the hyperscale facilities that have drawn criticism elsewhere.

“A blanket moratorium risks blocking the kind of smaller, more responsible projects that could actually benefit rural communities,” he said. “The problems seen elsewhere were failures of process and communication, not proof that every data center is wrong for Maine.”