A cluster of data centers in Rockland County has reaped big cuts in state and local taxes through deals that have now come under fire as the public backlash against data centers has intensified.
But less well known is another government-related subsidy most of those businesses are also getting: discounted electricity from the New York Power Authority.
Three of four nearby data centers in the Orangeburg section of Orangetown are receiving those discounts through the authority's ReCharge program, which provides hydro-power at low rates to businesses and nonprofits to entice them to locate, expand or stay in New York. State records show 858 entities in all are enrolled in ReCharge, which is touted as one of New York's economic development tools.
At least two other data centers — one on Long Island, one near Cayuga Lake in Tompkins County — are also listed as ReCharge beneficiaries, in addition to those in Rockland. But how much that state-provided discount is saving those operators is a mystery. Authority officials say they can't disclose that information, or even what power rate a particular data center or other ReCharge customer is currently paying.
Critics have ripped data centers' tax breaks as unnecessary taxpayer subsidies for deep-pocketed businesses that create few permanent jobs, given how few people work in what are essentially huge warehouses of computer equipment. Gov. Kathy Hochul, who ordered a one-year moratorium on large-scale data centers in July, has vowed to pursue a statewide ban on tax reductions for data centers.
Reinvent Albany, a reform group that blasted those tax incentives, has also zeroed in on the power discounts data centers get through ReCharge, urging Hochul to disallow those breaks as well. Slashing their power bills is particularly questionable, the group argues, because of the vast amount of electricity data centers use — a resource drain that has helped spur the public outcry against them.
What does NYPA say about data centers using ReCharge?
In a response to the USA TODAY Network, a power authority spokesman pointed out that the data centers now participating in ReCharge use much less power than the giant operations seeking to open in New York on the wave of an artificial intelligence boom.
"None of the data center facilities utilizing low-cost NYPA hydropower are hyperscale facilities," spokesman Alex Chiaravalle said in a statement. "The awarded facilities have largely been around for years, providing essential back-of-the-house services to financial institutions, hospitals and other critical infrastructure."
Reinvent Albany criticizes the authority's refusal to disclose the value of public benefits it's providing data centers or other ReCharge participants. The group has tried cobbling together its own estimates after the authority rebuffed its attempts to get that information through public-records requests.
Even if a company's power usage is private information, the authority could say how much its power discounts as a whole are costing New Yorkers and reveal the "average subsidy" for ReCharge participants, argued Alex Camarda, a Reinvent Albany senior policy advisor.
"I don't see anything preventing them from doing that," Camarda said. "They should at the very least provide the total cost of these programs to taxpayers."
The authority justifies its refusal to disclose ReCharge savings for specific participants by saying that would expose private information about the companies and violate confidentiality agreements.
"The information used in a cost-benefit calculation is proprietary and protected under contract between NYPA and its customers," the authority said in a statement.
Which Rockland data centers are benefiting?
According to state records, the authority allows the Bloomberg data center in Orangeburg up to 8 megawatts of discounted power, based on its commitment to provide 176 jobs. That facility, which opened in 2014, was the first in the cluster of data centers that formed in that area, and it promised many more jobs than those that followed.
The state is dispensing up to 1.2 megawatts of discounted power to a nearby facility operated by 1547 Critical Systems Realty, which started up in 2015 and was said to provide 12 jobs.
The third Orangeburg data center participating in ReCharge is DataBank, which began operating this year and is seeking town approval for an expansion that has aroused strong opposition. That company is getting up to 1 megawatt of state-discounted power and pledged 10 jobs, authority records show.
A fourth data center in Orangeburg operated by JP Morgan Chase is not enrolled in the ReCharge program.
All four data centers have saved millions of dollars in sales or property taxes — or both — through incentives granted by the Rockland County Industrial Development Agency, the county's economic development arm. The USA TODAY Network reported in July that in 2024 alone, the agency awarded a total of $136 million in sales tax breaks to three of those facilities.
How does the ReCharge program work?
The New York Power Authority generates 80% of its electricity with water, largely from three major hydro plants located upstate. It operates 17 generating facilities in all, including some gas-fired plants in New York City and Long Island, and it moves power around through 1,550 miles of transmission lines.
ReCharge, started by state law in 2011 to replace a smaller program that preceded it, offers 910 megawatts of low-cost power, half from the authority's hydro sources and half that it buys on the open market.
That power is doled out in widely varying amounts, with tiny shares for nonprofits like Radio Catskill and the Woodstock School of Art on the low end, according to the state's inventory of users. The biggest by far is the 140-megawatt load promised to MIcron, the computer chip manufacturer that's building a $100 billion campus near Syracuse and vowing to create thousands of jobs.
Applications for ReCharge benefits are approved by the authority's board of trustees based on staff recommendations. The power provided by the authority typically makes up only part of the electricity each participant uses; the rest comes through a local utility.
Chris McKenna covers government and politics for The Journal News and USA TODAY Network. Reach him at CMcKenna@usatodayco.com.
This article originally appeared on Rockland/Westchester Journal News: NY agency cuts power bills for data centers but won't say by how much
