Amazon says it has suspended plans for a massive data center in Becker, an announcement that comes after state lawmakers and Minnesota Gov. Tim Walz said they will reduce tax breaks for these projects.
The Seattle-based tech giant said in a statement that it moved ahead with the project initially based on how quickly it thought it could obtain permits and utility agreements, but believes those timelines are now “more uncertain.”
“As a result, due to the uncertainty, we are redirecting more of our resources to focus on other projects that can provide capacity to our customers more quickly,” the statement says.
Amazon’s project would be an Xcel customer, possibly its biggest. The project likely would cost billions to build, resulting in many construction jobs.
Xcel’s president in Minnesota, Ryan Long, said in an interview Thursday that “due to confidentiality” he couldn’t comment on Amazon suspending the project. Long said he’d follow up after looking into “what exactly our obligations are.”
Last week, leaders at the Capitol said they agreed to eliminate a sales tax exemption on electricity for data centers. They will keep exemptions for computers, servers, software, cooling and energy equipment.
Together the exemptions have been worth about $100 million a year for data center companies, though they could grow explosively. Minnesota electric utilities expect the industry to multiply nearly 40-fold.