AINEWS
The $100B Kentucky project is called privately funded, but the federal government owns the land and the local politics still matter.
For the third time in five months, the U.S. Energy Department has steered a major AI data center onto federally owned Cold War land. This week, it announced that parts of the retired Paducah Gaseous Diffusion Plant in Kentucky will be redeveloped as a $100 billion AI data center campus, according to the Energy Department. The other two are the Piketon, Ohio uranium enrichment site, announced in March, and the Savannah River Site in South Carolina, announced earlier this month.
Each of the three projects sits on land the federal government already owns. That means local zoning boards and county commissions cannot block it the way they have been blocking AI data centers in Northern Virginia, Phoenix, and other places where utilities and developers are running into organized public opposition.
The Paducah plant ran uranium enrichment from the 1950s through 2013, when the last cascade was shut down. The new campus announced by Energy Secretary Chris Wright on July 29 includes 2 gigawatts of natural gas capacity tied to the local grid and 2.6 gigawatts of battery storage. The private partners are NextEra Energy, Brookfield, and several local utilities, and the framing is "privately funded." One gigawatt of gas can power roughly 750,000 homes, per the announcement. That is enough generation to run a city the size of San Diego for the gas portion, with battery storage sized for the spiky load that large AI training and inference clusters draw.
The other two sites are smaller but follow the same playbook. Piketon, another former uranium enrichment site in Ohio, is sized at roughly 10 gigawatts and is partly financed by Japanese investors. The Savannah River Site in South Carolina, a former nuclear weapons production complex, is about 1 gigawatt and pairs with Amentum, with gas and nuclear on the menu.
Wright framed the program as a way to "leverage federal lands to win the AI race against China" and to add power generation and jobs. Trump has publicly pushed AI as essential to the technology race with China and has been trying to confront local opposition to large, energy-hungry data centers. The political problem the workaround addresses is real: a Gallup poll cited in the wire copy finds that nearly half of Americans would "strongly oppose" a new data center in their neighborhood, citing noise, pollution, and energy concerns.
The federal-land shortcut does not eliminate those concerns; it relocates them. Paducah, Piketon, and the Savannah River Site are not anonymous brownfields. They sit near small communities in Kentucky, Ohio, and South Carolina, and the new gas plants and substations will draw cooling water, transmission corridors, and truck traffic into those counties. "Privately funded," as the Energy Department describes the Paducah deal, does not mean the cost of the power, water, and grid upgrades stays off public books, and the wire copy does not include any cost-benefit accounting for the affected communities.
The watch item going forward is whether the federal-land pipeline becomes the default route for AI data center siting, and whether communities near Piketon, Paducah, and Savannah River get the same say in the local permitting that the Loudoun County, Arizona, and Pacific Northwest fights are still fighting.