The Kentucky Public Service Commission Friday approved an electricity contract for a TeraWulf data center project in Hancock County.
The panel held a hearing last month at Hancock County High School, where residents voiced opposition to the TeraWulf project.
They expressed concern about rising electricity bills, air and noise pollution, and water use.
The company intends to repurpose an idle aluminum smelter for its Justified Data Campus. TeraWulf has said the project would use less water than the aluminum plant and emit fewer air pollutants.
It has also said, under its contract with regional electric cooperative Big Rivers Electric Corp. and local utility Kenergy, none of the cost of powering the data center would be passed on to residents.
The PSC approved TeraWulf to use an existing 482-megawatt connection to the grid. The electricity would be sourced from the Midcontinent Independent System Operator, or MISO.
As part of its contract, any grid emergency in MISO that maximizes power demand would require TeraWulf to curtail its use of electricity rather than trigger rolling blackouts.
Building a presence in Kentucky
Last month, Maryland-based TeraWulf signed a 20-year agreement with artificial intelligence developer Anthropic to be the primary user of the Justified Data campus, about 20 miles east of Owensboro.
Earlier in August, Kentucky Gov. Andy Beshear signed an executive order requiring data center operators to pay for their own electricity, protect air and water quality, pay their fair share of state and local taxes, and constructively engage with communities. Following the order, TeraWulf filed an energy plan with state regulators pledging to meet the requirements.
As data center proposals have multiplied across Kentucky, local governments have responded by enacting moratoriums on their development, at least in part due to strong public opposition.
Leading lawmakers have also begun to question whether data centers need the tax incentives the General Assembly approved last year, or need them for as long.
TeraWulf’s Hancock County project isn’t the largest under development statewide. However, its proposal for a 1-gigawatt campus on the border of Boyd and Greenup counties in Eastern Kentucky would be one of the largest.
The company’s CEO told investors earlier this month that TeraWulf was looking to double the size of the Muskie Data Campus, 20 miles west of Ashland, to 2 gigawatts.
