Originally published here in the Billings Gazette
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A data center proposed north of Billings intends to utilize gas plants to provide more energy than every single residential customer typically uses in Montana.
The Billings Gazette learned of data center developer Quantica Infrastructure’s plans after the newspaper submitted a records request to the Montana Department of Environmental Quality.
Using gas-fired generators for the planned data center near Broadview seems to contrast Quantica’s public messaging repeatedly emphasizing renewable power being crucial in powering the data center.
But last week, a press release by the company seemed to reveal a shift in public messaging. Quantica CEO John Chesser described a “resilient, all-of-the-above power portfolio, including renewable and traditional energy resources” for the project.
Behind the scenes, that shift in messaging seems to go much further.
Quantica is currently working on permitting gas plants to power its data center planned for 5,100 acres of land south of Broadview. Specifically, 585 megawatts are proposed to be generated by gas-fired engines and another 1,200 megawatts from gas-fired turbines.
In internal emails with the Montana Department of Environmental Quality, air permitting supervisor Eric Merchant described Quantica’s proposal as a “proposed fossil-fuel (gas)-fired data center project in Broadview, MT.”
The proposed gas plants would generate 1,785 megawatts, an amount that would easily dwarf every gas plant in Montana. It is more than the generating capacity of every gas plant operating statewide combined. For comparison, the recently built Yellowstone County Generating Station in Laurel creates less than a tenth of the planned project’s power at 172 megawatts. It’s currently the largest gas plant in Montana.
It’s also more than the entire generation capacity of Montana’s monopoly utility NorthWestern Energy. The company owns 1,285 megawatts of power in the state.
The DEQ emails obtained by the Gazette include DEQ, third-party environmental consultants and Quantica employees. The estimated power needs of the data center weren’t included in the emails.
In a response, Quantica noted they are in the early stages of planning and are evaluating a range of potential energy options.
“From the outset, our approach has been to develop a power portfolio where a substantial portion of the energy is expected to come from renewable resources, supported by additional capacity needed to ensure reliability,” the company said in a statement.
The company also pushed back against the idea that this represents a change in plans for powering the data center. Quantica said it’s not unusual that power resources are still being evaluated and refined, with the company saying the DEQ emails reflect that.
Quantica’s Big Sky Digital Infrastructure website mentions the data center’s unspecified energy supply would be located nearby to minimize transmission infrastructure. That same sentence on a frequently asked question list about how Quantica will power the data center mentions a mix of “renewable generation” for the project, omitting any direct mention of gas plants, but mentioning “on-demand capacity.” The company currently points to this as indication of planning including the potential for gas plants from the start.
Additionally, a focus on renewable energy is repeated throughout the website and project descriptions.
“BSDI’s new renewable generation and battery storage will add capacity to Montana’s energy system, supporting grid resilience while avoiding impacts on existing community power supplies,” a section on the home page titled Integrated Renewables reads. “On-site renewables, backed by grid power, creates a strong business case for data center development.”
The home page also mentions large-scale on-site solar, wind and battery storage in development for a “phase 1 zero-carbon, resilient energy mix.”
As of Wednesday morning, the company’s plans for gas plant development aren’t mentioned anywhere online. Nor have such plans for a gas plant been explicitly referenced in public statements or past interviews with the Gazette.
However, last week’s press release mentioned “carbon-reduction solutions,” something that wouldn’t likely be considered with standard renewable energy development.
Last week, a company statement to the Gazette clarified that Quantica is “evaluating tools that can make the project more reliable and lower-carbon over time” alongside other “lower-carbon firm resources.”
And currently, the company still emphasizes having environmental responsibilities in its messaging.
“As a responsible developer and with a leadership team with deep Montana roots, we want to ensure we comply with all applicable regulations and to be good stewards of our land and resources,” Quantica said. “As such, we’re in early discussions with MDEQ to better understand the process and requirements associated with not only power resources, but also water and other resources.”
Following a pre-application meeting with Quantica Infrastructure, DEQ emails from Merchant on March 23 estimated the project would need a Major NSR-PSD air quality permit. Such a permit is needed when a project has the potential to emit more than 100 or 250 tons of pollutants per year. It would also require an eventual public review and likely an environmental impact statement. They would also need to run a gas line to the facility, according to an April 3 email by Merchant.
In emails, Merchant repeatedly referenced a Data Center Regulations document to inform future permitting processes for Quantica.
“According to the attached Data Center Regulation document, which was recently prepared by DEQ, wastewater discharge may also be in play,” Merchant wrote in an April 3 email addressed to Tatiana Davila, bureau chief of DEQ’s Water Protection Bureau.
Wastewater discharge would be reviewed by DEQ if wastewater is released into streams, rivers, lakes or groundwater, according to the Data Center Regulations document.
Read the DEQ Data Center Regulation document referenced to Quantica employees in emails.
The document is not a guiding or regulatory mechanism for DEQ, agency spokesperson Madison McGeffers told the Gazette. The document in those emails was meant to provide high-level information for Quantica, she said, and was shared to the public in February at a Governor’s Energy Task Force Open House in Butte.
According to a March 26 email from Ed Warner, a Quantica consultant, the company’s objective is to have the data center online in late 2029, with the air permit for the gas plants in place early enough to support construction. The company has previously shared plans to receive power by 2028, including on its Big Sky Digital Infrastructure website as of Wednesday. Wind and solar typically does not require air quality permits.
A summary by Merchant noted plans for on-site generation will be supported by minimal grid infrastructure, referencing ongoing discussions with NorthWestern to assist with that. NorthWestern has previously entered into an agreement to provide up to 1,000 megawatts to Quantica, but it has remained unclear where that much power would come from.
“Finally, during last Friday’s meeting, QI (Quantica Infrastructure) noted their interest in connecting with all affected DEQ programs early and often,” Merchant wrote in an email during what he described as the early stage of regulatory planning
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Data center proposals in Montana
Over the last year, data center companies from around the country have staked out Montana with a bullseye as the place to build giant new facilities. NorthWestern Energy, has signed Letters of Intent with several data center companies to supply power. The monopoly utility has publicly mentioned at least 11 more data center companies are eyeing Montana, though little details have been provided. Hover over each icon on the map to learn more about the emerging proposals.
Quantica would have more than enough space to develop its proposed gas plants. It owns about 8 square miles of land after past planned renewable projects eyed north of Billings never materialized, the Gazette previously reported. Quantica’s founder, Houston-based EnCap Investments, had mothballed the land before eventual CEO Chesser approached EnCap with the idea of a data center using the remnants of those planned projects.
EnCap is historically steeped in oil and gas investments. Chesser was previously involved with Talen Energy’s Colstrip plant.
He’s not alone in his Talen Energy ties, with several Big Sky Digital Infrastructure employees having worked for the company. In addition to operating the 1,480 megawatt Colstrip plant, Talen Energy has a portfolio of coal, gas and nuclear generation nationwide, but no wind and solar.
How much power could Montana’s proposed data centers use?
Data center companies have turned to Montana as a place to build new facilities. The largest center proposal has come from Quantica Infrastructure, which aims to power a center near Billings with up to 1 gigawatt of energy, which is enough to power approximately 750,000 homes. To put that into context, the U.S. Census Bureau estimates Montana has around 540,000 housing units.
While battery technology has improved significantly in recent years, wind and solar generation still can’t provide 24-hour power that data centers demand. And although small nuclear reactors have been discussed as an option for data center power, that expensive technology is still far from commercial deployment.
Nationally, that’s left many data centers turning to readily deployable off-the-grid gas for power. Last year on March 28, Austin-based Thunderhead Energy Solutions LLC requested a Clean Air Act exemption to the Environmental Protection Agency for a 500 megawatt behind-the-meter gas plant “supporting data center infrastructure in Jefferson County.” That exemption request was unsuccessful, according to reporting by Grist and the Boulder Monitor, with there being no indications of future gas plant development in the county currently.
Even with the planned gas plants, Quantica still continues to anticipate public concerns about data centers growing in unpopularity.
“We’re also committed to protecting our Montana way of life, including being good stewards of the land and our resources,” Quantica told the Gazette last week.
Montana Environmental Information Center Director Anne Hedges has been on the road for months campaigning statewide to packed rooms about the environmental costs of data centers and the associated lack of transparency from companies.
In Missoula County, a proposed data center plans to use 7 megawatts before potentially scaling up to 29 megawatts. She was preparing to speak on data centers in Missoula Tuesday evening when the Gazette informed her of Quantica’s plans for 1,785 megawatts of gas power to supply its data center. She expects serious air pollution and leaking pipelines with the power supply.
“I’m horrified and not surprised,” Hedges said.
Originally published here
