Data Center Costs: Court strikes renewable energy mandate

A St. Louis judge has eliminated a requirement that a massive new data center generate 2.4 megawatts of its own power from renewable sources. The ruling removes a financial burden from TerraWatt’s $3.1 billion development project, which is planned for the former Famous-Barr warehouse site on Market Street.

The project is a 120-megawatt facility situated on an 11-acre plot within a planned technology district. TerraWatt partner David Lambiaso filed a lawsuit against the city in September, arguing that specific conditions attached to the site’s conditional use permit were legally flawed.

Lambiaso claimed the renewable energy mandate was "practically impossible" to meet on the limited 11-acre footprint. He also challenged a rule requiring the St. Louis Board of Aldermen to approve a community benefits agreement, stating this step exceeded the authority of the Board of Adjustment.

On Thursday, 22nd District Judge Christopher McGraugh granted the motion to remove the power supply mandate. The judge also struck down the requirement for aldermanic approval of the benefits deal. In his written order, McGraugh declared the Board of Adjustment’s actions "illegal and void."

The court determined that the Board of Adjustment functions in a strictly administrative capacity and lacks the power to create policy. This distinction was central to the judge’s decision to vacate the disputed conditions.

The city’s Land Clearance for Redevelopment Authority had already approved the community benefits agreement in September. However, the project remained subject to the additional legislative check until the court intervened.

A separate lawsuit is pending against both TerraWatt and the City of St. Louis. The Missouri Coalition for the Environment and other plaintiffs argue that the city illegally granted the initial use permit for the facility.