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Data Centres: Boom and Backlash
18OCT

Kotek seeks pause on data-centre permits

3 min read
13:11UTC

Oregon's governor asked the state environment department on 9 October to stop issuing air and water permits for new data centres until July 2027, including city sewage-plant permits that would take their discharge.

IndustryAssessed
Key takeaway

Oregon's governor asked for data-centre air and water permits to stop until July 2027.

Oregon's city sewage plants fall inside the data-centre permit pause Governor Tina Kotek requested on 9 October. She asked the Oregon Department of Environmental Quality to pause processing and issuing air and water discharge permits for new or expanded data centres until 1 July 2027⁠1. The request also reaches cities: it covers municipal applications to renew or modify wastewater treatment plant permits so they can take data-centre discharge.

The letter names two water permits, the federal National Pollutant Discharge Elimination System (NPDES) permit and Oregon's Water Pollution Control Facility (WPCF) permit, and two air permits, the state's Air Contaminant Discharge Permit (ACDP) and the federal Title V permit. Air permits are what on-site gas turbines and diesel generators need, so the requested pause would also reach developers who planned their own power, as Texas's September freeze does. The letter sets no megawatt threshold and no exemption for applications already filed.

Oregon's water record sits behind the request. In March Amazon agreed to pay $20.5m to settle a class action over nitrate pollution linked to its Boardman, Oregon campus. The state has already moved grid cost onto large loads: in July Oregon's Public Utility Commission approved a 29% rate rise for Portland General Electric customers above 20 MW, cutting residential bills 1.3%.

The same letter praises the department for streamlining air permitting under a 2026 law, House Bill 4084. Kotek relies on the department's existing discretion rather than a new statute. The pause is meant to give the state's Data Center Advisory Committee time to report, so the 2027 legislative session would write the rules that follow it.

Deep Analysis

In plain English

Big data centres need government permits to release cooling water and to run backup generators that put fumes into the air. Oregon's governor has asked the state environment agency, the Oregon Department of Environmental Quality, to stop handing out those permits for new data centres until July 2027. She also wants it to hold back permits that would let city sewage plants take data-centre wastewater. The pause would give an advisory committee time to report before lawmakers write new rules in 2027.

Deep Analysis
Root Causes

Oregon's Energy Facility Siting Council reviews power plants and transmission lines, but no state body sites the loads that consume the power. Environmental permits are the only state-level approval every large data centre must pass.

The Lower Umatilla Basin, which includes Boardman, has been a designated groundwater management area since 1990 because of nitrate contamination. Cooling-water discharge to farmland and municipal plants adds to that load, which is why the request reaches wastewater permits as well as air.

Backup diesel generators and on-site gas turbines need air permits, so the air side of the pause targets developers who planned to bypass a slow grid with their own generation.

What could happen next?
  • Consequence

    Projects with pending permit applications may stall until mid-2027 if the agency agrees to the request.

    Short term · Assessed
  • Risk

    Developers may challenge a pause that rests on agency discretion rather than statute.

    Medium term · Suggested
  • Precedent

    Using municipal wastewater permits to slow data centres gives other states a route that bypasses energy regulators.

    Medium term · Suggested
First Reported In

Update #16 · Malaysia bills data centres for idle grid

Office of the Governor of Oregon· 18 Oct 2026
Read original →
Different Perspectives
Nexus Core Systems
Nexus Core Systems
Hired FiveNines Group, in a deal announced on 8 October, for early design, feasibility and permit work on a 20 MW AI data centre near Casablanca. It is the first named site of a planned 180 MW programme, still at concept design.
MC Digital Realty
MC Digital Realty
Began building the 24 MW KIX15 data centre in Osaka Prefecture on 7 October, due to open in the fourth quarter of 2028. The joint venture of Digital Realty and Mitsubishi Corporation says it will then run 10 data centres in Japan with about 220 MW of IT capacity.
KT Cloud
KT Cloud
Said on 7 October that it and Hyundai Engineering will build a 50 MW AI data centre at Cheongna, Incheon, from the fourth quarter of 2026. Completion is due in the first quarter of 2030, part of KT Cloud's target of more than 1 GW of AI capacity by 2031.
Town of Trebbin
Town of Trebbin
Said on 7 October that work has begun on two data-centre buildings and a substation under building permits already granted. The operating permit under the Federal Immission Control Act is still with Brandenburg's environment agency, so the town postponed its public presentation.
Óscar López, Digital Transformation minister
Óscar López, Digital Transformation minister
Said in Madrid on 8 October that he hopes to approve the data-centre royal decree shortly, with urgent processing to reach the cabinet before the 29 November election. He said the final text will take the more than 600 submissions into account, without saying what changes.
Hydro-Québec
Hydro-Québec
Defended its proposed Tarif CD before the Régie de l'énergie du Québec from 1 to 9 October, a rate for data centres of 5 MW or more that adds a premium when peak demand stays below 60% of forecast. Industrial consumers filed their own wording for the clause on who the rate covers.

Written with AI from Lowdown's published reporting. Not individually reviewed by an editor. Editorial standards.