The Town Council of Tarboro, North Carolina recently voted 6–1 to reject a special-use permit for a multibillion-dollar data center complex proposed by Energy Storage Solutions (ESS), a developer based in North Carolina. The ruling appeared to resolve weeks of intense local opposition, though it might be just another round: ESS president Daniel Shaffer says the company will sue to overturn the decision.
The stakes are large for this town of roughly 11,000. ESS pitched a $6.4 billion hyperscale facility on 52 acres zoned heavy industrial, promising about 500 jobs and roughly $11 million a year in property taxes. The data center, Shaffer said, would generate much of its own power. It’s also expected to use some 500,000 gallons of water daily for cooling. Supporters see high-wage tech employment and a broadening tax base, while opponents expect noise and new strains on water and energy.
What unfolded in Tarboro was not a standard up-or-down land-use vote, which is typical in these cases across the country. Because the application arrived as a special-use permit (SUP), state law required a quasi-judicial proceeding. In this format, elected officials must decide like judges: weighing sworn evidence and expert testimony against specific criteria—public safety, standards compliance, and property values.
In contrast with most municipalities, considering general public sentiment is out of bounds. That constraint proved awkward in a small town where council members fielded strong views from neighbors and friends. Mayor Tate Mayo recused himself, saying he could not disregard the public’s opposition, a statement ESS now cites as a procedural flaw.
Headed to Court
The likely next stop is Edgecombe County Superior Court, which won’t relitigate the merits but will ask whether Tarboro followed the rules and based its denial on competent evidence. Even some town leaders acknowledge the ruling could be vulnerable on process. That candid admission provides a broader lesson for North Carolina communities now facing the data-center expansion: when projects ride in on SUPs, the forum becomes a courtroom, not a public square.
Both data centers proposals and resident pushback are commonplace in North Carolina. Artificial intelligence and cloud services are driving the rapid buildout of facilities that are capital-heavy, water-dependent, and, above all, power-hungry. Across the Triangle and beyond, residents have rallied against rezonings near neighborhoods and sensitive sites, from Apex’s New Hill area to Statesville and Mooresville.
Developers tend to vary between two approaches: legislative rezonings (which invite broad public input) and SUPs (which narrow the decision to evidence and legal standards). If a rezoning falters, an SUP can be the fallback.
Overlaying the local land-use drama is an urgent consumer rights question: who pays for the electricity to feed these campuses? North Carolina’s recently enacted Power Bill Reduction Act changed how utilities allocate power and fuel costs. Critics claims the new formula shifts a larger share of those costs to households while large commercial users, including data centers, pay proportionally less.
In Tarboro, the developer ESS insists its project can coexist with the town’s quality of life concerns and fiscal goals. Opponents counter that the facility’s scale, appearance, and resource use would permanently alter a community that values its quiet neighborhoods. The SUP framework largely set those broad value judgments aside, and that is the tension: residents felt heard at the microphone, but the governing body was duty-bound to filter most of that sentiment out.
As AI-era power demand climbs, the state must decide how to balance growth with quality of life, and how to ensure that the benefits of technology growth don’t undermine the very communities that this new technology serves.
