Winneshiek County Weighs Data Center Rules as Industry Quickly Expands Across Iowa

Decorah Vikings win, City Council votes, New Referenda on the ballot — we're the one telling Decorah's story. Donate now. DECORAH — Winneshiek County supervisors are weighing how to regulate one of the fastest-growing and least understood forms of development in Iowa: data centers. During a meeting Monday, supervisors discussed with members of the Winneshiek County Planning & Zoning Commission whether existing zoning rules are sufficient to address the unique demands of such facilities or whether new regulations, or even a temporary moratorium on development, may be needed. The issue comes as data center construction accelerates across Iowa, driven by demand for cloud computing, artificial intelligence and digital storage. The Iowa Economic Development Authority reports the state has attracted billions of dollars in investment from companies including Microsoft, Meta and Google, particularly in central Iowa. Described by The U.S. Department of Energy as "one of the most energy-intensive building types, consuming 10 to 50 times the energy per floor space of a typical commercial office building," modern data centers can require anywhere from 20 to more than 100 megawatts of electricity, enough to power tens of thousands of homes. The department also estimates that data centers already account for about 2% to 3% of total U.S. electricity consumption, a share expected to grow. While Winneshiek County has not publicly received a large-scale proposal, Supervisor Steve Kelsay said smaller projects are already emerging locally, including a roughly 10-megawatt installation at an ethanol plant "a few miles south of our border on Highway 24." Kelsay said he does not support a moratorium on data center development. "That's my personal view," he said. "I've read numerous articles about other areas where they have gone down that road and the fallout from that was not good." He also noted another data center was "in the process of being annexed into the city of Harmony." Kelsay said he does not want the board's actions to be perceived as "stopping development." "I'm not supporting or denying it by any means," he said. He added that he has spoken with the vice president of MiEnergy Cooperative, who was willing to "make himself available to give the supervisors materials and information" about data centers. Supervisor Shirley Vermace countered Kelsay's proposal. "If you're going to bring in MiEnergy, I'd like to have [experts] come in and do environmental impact presentations and things like that," she said. The Winneshiek County Planning and Zoning Commission decided at a meeting April 14 to present an M2 designation restriction on data centers to the supervisors. Two representatives — Commissioner Wendy Stevens and Planning and Zoning Administrator Tony Phillips — attended the meeting and shared their perspectives on the decision. Stevens, who has conducted research on behalf of the commission regarding data centers, was not convinced the M2 designation was sufficient. She raised concerns about non-disclosure agreements. "Mostly, data centers are put up by developers, not by Amazon, Google or Meta, and so the developer usually goes into a non-disclosure agreement with the owner of the parcel of land that they want to build on. So information is not known until things start actually going up. This bothers me a lot," she said. Stevens said she would "really like a moratorium." She cited the precedent of an 18-month moratorium on hydrofracking silica sand, a unanimous decision by the Board of Supervisors in 2015. "Simply because things are moving so fast right now," she said, adding that it gave officials time to conduct in-depth research on the matter. According to Stevens' research, there are between 94 and 105 data centers in Iowa currently, while the global Data Center Map (DCM) estimates 101 from 10 markets in the state. Stevens told the supervisors that she wants "surety about it," "[Like], if a developer leaves, we're not just stuck with all of these buildings and the county has to decide what to do about it." In summation, Stevens warned that unchecked development may lead to a disadvantage for the county, especially once data centers are erected, which, as she put it, the county would have "no control over, except that they're M2." Water use was also cited as an additional concern. A study by Lawrence Berkeley National Laboratory (LBNL) found that some large facilities can consume millions of gallons of water per day, depending on cooling methods, in some cases rivaling the annual usage of small towns. While newer designs may reduce water demand through air cooling or recycled systems, the variability has complicated local planning efforts. Phillips, who arrived mid-agenda item, concurred that at a minimum, data centers should be designated as M2, or alternatively, data centers could simply be added into the county's ordinance under "M2 Only." He added that there was "very little available land that is already zoned M2." County Attorney Andy Van Der Maaten and County Auditor Ben Steines cautioned that any restrictions would need to be legally justified. Regulations that are too broad or lack a clear basis could expose the county to potential legal challenges. While no formal action was taken, Officials said they plan to gather more information, including how other communities are handling similar proposals, and to involve Planning and Zoning in developing recommendations based on mutual research. No timeline was set for action, but the issue is expected to return for further discussion. Be the first to know! Sign up for the free newsletter and unlock exclusive updates, breaking news, and tips from around the community.