How Hyperscale Data Centers Overstep Local Deals

Accountable, Transparent, and Focused on the Facts

The community feels blindsided, and rightfully so. When land changes hands in secret long before public disclosure, a narrow loop controls the narrative. Asking who knew, when they knew, and why information was withheld is the exact response required to protect local interests.

Here is the documented reality of the situation.

The Regulatory Timeline: A Temporary Reprieve

A critical intervention by the Kentucky Public Service Commission (PSC) provides a temporary stopgap for residents. The paper trail reveals exactly how this deal moved behind closed doors:

April 14, 2026: Big Rivers Electric Corporation and Kenergy Corp submitted a proposed Retail Electric Service Agreement (RESA) to the Kentucky PSC. This contract solidifies the transaction to supply power to Justified DataPower LLC (a subsidiary of TeraWulf Inc.) for a proposed high-performance computing and AI campus.

May 12, 2026: Recognizing the high stakes, the Kentucky PSC intervened. The regulatory board issued an order suspending the contract’s effective date for five months, pushing the deadline to October 13, 2026.

This suspension triggers an official investigation. Regulators will now determine whether the agreement protects the public interest and meets legal standards for reasonable utility rates, ensuring that residents do not subsidize corporate energy demands.

The Extractive Corporate Playbook

Data center developers follow a predictable blueprint across the country. To secure these mega-projects, states offer aggressive sales tax exemptions on equipment and servers. Because AI workloads evolve rapidly, these components require replacement every three to five years.

While local leaders focus on localized property tax promises, broader state coffers suffer massive losses. Ultimately, long-term infrastructure maintenance costs routinely outpace local tax gains, leaving hollowed-out municipalities to shoulder the eventual financial burden.

The Ultimate Risk: Infrastructure Lock-In

Can a hyperscale AI data center bankrupt a town? The answer is a definitive YES!

These facilities trigger systemic financial strangulation through infrastructure lock-in. Hyperscale operations demand specialized, high-capacity water mains, advanced waste treatment plants, and dedicated utility substations. Cash-strapped municipalities frequently issue millions of dollars in municipal bonds to construct this infrastructure, gambling future tax revenues to cover the debt. When corporate promises fall short, residents are left holding the bill for infrastructure the town never needed.

How to Take Action: Submit Your Public Comment

The five-month suspension gives the community a voice. The Kentucky Public Service Commission (PSC) must hear from residents who will bear the financial and environmental costs of this data center.

Submit an official public comment before the October 13, 2026, deadline using the steps below.

Identify the Case Number

To ensure regulators file your comment correctly, you must reference the specific case number assigned to the Big Rivers and Kenergy Retail Electric Service Agreement (RESA).

Writer Note: Subject: Public Comment on Case No. 2026-00115, Retail Electric Service Agreement (RESA) between Big Rivers Electric Corporation, Kenergy Corp., and Justified DataPower LLC.

Choose a Submission Method

The PSC accepts public comments through three primary channels:

By Email: Send your statement to https://psc.ky.gov/

Website: https://eec.ky.gov/Pages/index.aspx

Include the case number in the subject line.

Online Portal: Visit the Kentucky PSC website and use the public comment tool associated with the case docket.

By Mail: Send written letters to:

Public Service Commission

P.O. Box 615

Frankfort, KY 40602

Key Points to Address

The PSC evaluates whether utility agreements protect public interests and maintain reasonable rates. Comments carrying the most legal weight focus on these specific issues:

Ratepayer Protection: Demand proof that residential utility bills will not increase to subsidize the high-capacity infrastructure required by Justified DataPower LLC.

Resource Strain: Raise concerns about the immense water and energy consumption of a hyperscale AI campus, and the potential impact on regional utility reliability.

Economic Risk: Highlight the danger of infrastructure lock-in, in which municipal bonds finance specialized upgrades for a private entity, leaving the community vulnerable if corporate priorities shift.

Include your full name and place of residence to ensure your comment becomes a part of the official public record. Let the PSC know our community refuses to be left in the dark.

When local channels block text messages or suppress talk of a town meeting, narrative containment is actively underway. The defensive wall goes up because the narrow loop knows the public is waking up.

Pivoting away from a town meeting to the formal Public Service Commission (PSC) comment track under Case No. 2026-00115 is not a retreat; it is a major strategic upgrade.

The PSC approach bypasses local roadblocks and carries genuine leverage for several key reasons.

Direct Defiance of Censorship

A town meeting requires local coordination, open venues, and unmonitored digital spaces to organize. When text alerts face blocks or social media posts face moderation, organizers waste critical energy fighting regional gatekeepers.

The PSC portal provides a direct line to state regulators in Frankfort. No local council member, utility executive, or platform moderator can delete, mute, or suppress a formal submission to a state docket. It neutralizes local censorship entirely.

Legal Weight vs. Rhetoric

A town meeting provides catharsis, but it lacks legal teeth. Dictators of local policy can sit through a stormy two-hour session, wait for the crowd to go home, and proceed with business as usual.

Conversely, formal public comments filed under Case No. 2026-00115 become part of the permanent judicial record. By law, commissioners must review documented public impact, and the Attorney General’s Office of Rate Intervention uses the record to challenge big utility groups. Big Rivers and Kenergy must answer the issues raised during the discovery phase.

Fighting Where the Power Sits

Local leaders frequently claim zoning laws, previous private land sales, or non-disclosure agreements tie their hands. They redirect blame because they lack the mechanism to break the contract.

The PSC holds the ultimate veto power over the Retail Electric Service Agreement (RESA). Regulators have already demonstrated willingness to halt progress by issuing the five-month suspension. Targeting the board forces the battle into the one arena where the contract can be dismantled.

Strategy Comparison, Battleground, Vulnerability, Legal Authority, Long-Term Impact|

Town Meeting High: Subject to local censorship, venue denials, and platform moderation. None. Opinions expressed are entirely non-binding. Vents frustration without creating a lasting obstacle for developers.

PSC Written Intervention Zero. Protected public access to a state regulatory docket. High. Forms the official evidence base for a state investigation. Creates permanent legal friction; utilities must answer under oath.

The Takeaway: When opponents block the exit, change the arena. Routing community energy into the formal state regulatory process turns scattered local frustration into an organized, permanent legal challenge.

Sample Letter Below:

Below is a formal, evidence-backed sample letter residents can use to submit public comments to the Kentucky Public Service Commission.

Public Comment Submission Template

Subject: Public Comment on Case No. 2026-00115 Retail Electric Service Agreement (RESA) between Big Rivers Electric Corporation, Kenergy Corp., and Justified DataPower LLC

To: https://psc.ky.gov/ (or via Mail/Online Portal)

Date: [Insert Date]

From:

[Your Full Name]

[Your Street Address]

[Your City, State, Zip Code]

[Your Email Address / Phone Number]

To the Commissioners of the Kentucky Public Service Commission:

I am a resident of [Your City/County] and a utility ratepayer directly impacted by the proposed Retail Electric Service Agreement (RESA) submitted by Big Rivers Electric Corporation and Kenergy Corp. under Case No. 2026-00115. I am writing to formally request that the Commission thoroughly investigate this contract to protect captive residential ratepayers from severe economic and infrastructural risks.

I applaud the Commission's May 12, 2026, decision to suspend the contract’s effective date until October 13, 2026. This review is vital to ensure local communities do not subsidize corporate energy demands. I ask that the Commission address three critical areas of concern during this investigation:

Ratepayer Protection Against Subsidization: Hyperscale data centers require massive upgrades to transmission and distribution capacity. The Commission must demand absolute proof that the capital expenditure required to serve Justified DataPower LLC will be borne entirely by TeraWulf Inc. and its subsidiary, rather than shifted onto residential and small-business ratepayers through future rate cases.

Grid Reliability and Resource Strain: The immense, continuous electrical load of a high-performance computing and AI campus poses a significant risk to regional grid stability. The Commission should investigate whether Big Rivers Electric Corporation possesses adequate reserve margins to fulfill this agreement without compromising service reliability or increasing wholesale market exposure for everyday consumers.

Prevention of Infrastructure Lock-In: Data center technology evolves rapidly, often rendering facilities obsolete or prompting corporate relocation on short timelines. If the utility or local municipalities issue bonds or invest heavily in specialized substations and high-capacity infrastructure, residents risk being left with stranded assets and debt service if the tenant alters operations.

The lack of early public disclosure regarding this transaction has left our community vulnerable. We rely on the Public Service Commission to serve as the necessary check and balance against extractive utility agreements.

Please enter this comment into the official case record for Case No. 2026-00115. I request that the Commission prioritize long-term economic stability and rate fairness over short-term corporate interests.

Respectfully submitted, 

[Your Signature]

[Your Printed Name]

About the Author

Kat Kaelin is a retired Kentucky Probation and Parole officer and an alumna of Western Kentucky University with a B.S. in Behavioral Science and an MFA in Creative Writing and Publishing. Her professional background includes the U.S. Army Medical Corps and a separate 10-year enlistment in the U.S. Army 100th Division. A ghostwriter for over 40 years, she writes under the professional name Cecilia Payne-Kat Kaelin

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