Data centers reshape South Carolina's tech landscape and economy

In a pivotal meeting of the Senate Judiciary Committee's Special Committee on South Carolina's Energy Future, industry leaders gathered to discuss the critical intersection of data centers and the utility sector. As the clock struck 1:00 PM on September 19, 2024, the atmosphere buzzed with anticipation, reflecting the growing importance of technology in shaping the state's energy landscape.

A key speaker, representing the data center industry, emphasized the vital role these facilities play in modern society. Data centers, he explained, are not just storage spaces; they are the backbone of digital infrastructure, managing everything from healthcare records to streaming services. Their efficiency in processing and storing data is crucial for businesses and consumers alike, making them indispensable in today’s tech-driven world.

The discussion highlighted the significance of proximity between data centers and their users. The speaker shared a compelling example of a global automobile manufacturer that relocated its computing infrastructure out of South Carolina due to the lack of suitable data centers. This move underscored how latency—the time it takes for data to travel between servers and users—can impact operational efficiency. For certain applications, such as electric vehicle traffic control, even milliseconds matter.

Energy needs were another focal point of the meeting. The speaker noted that modern data centers are designed for efficiency, creating stable electrical loads that utilities can predict and manage effectively. This predictability is beneficial for the utility grid, as it allows for better planning and resource allocation. Furthermore, the speaker pointed out that data centers often invest significantly in utility infrastructure, helping to offset costs for both themselves and local consumers.

Despite the relatively low number of employees at data centers compared to traditional industries, the economic impact is substantial. The speaker highlighted that data centers contribute significantly to local tax bases and have a minimal impact on infrastructure, unlike distribution centers that generate traffic and wear on roads. For instance, the construction of a new facility in Myrtle Beach employed over 200 workers for 18 months, showcasing the sector's potential for job creation.

Incentives for data centers were also discussed, with the speaker stressing that without them, attracting these high-investment facilities would be challenging. The capital required for establishing data centers can reach into the billions, making state support crucial for fostering growth in this sector.

As the meeting drew to a close, the speaker expressed gratitude for the collaborative efforts between the data center industry, utility providers, and state officials. He underscored the importance of continued investment in technology and infrastructure, which promises to shape South Carolina's economic future for decades to come.

With questions from committee members, including inquiries about the varying needs for data center proximity, the dialogue underscored the complexity of balancing technological advancement with energy demands. The meeting served as a reminder of the intricate relationship between data centers and utilities, highlighting their shared goal of driving South Carolina's energy future forward.