Paul Gessing, president of the Rio Grande Foundation, discussed the intersection of data centers and energy policy in New Mexico during a recent episode of the Powering America Podcast. Gessing addressed the state’s potential for economic growth through data center development, citing its natural resources, stable climate, and geographical advantages.
Gessing said, “There is no state with more potential if we get our political house in order.” He noted that while Governor Michelle Lujan Grisham has supported data center projects such as Oracle’s Project Jupiter near Santa Teresa and Meta’s facility in Los Lunas, there is ongoing controversy within her party and among environmental groups. According to Gessing, “New Mexico has a lot to offer for data centers,” referencing the state’s lack of earthquakes and severe weather as additional benefits.
A significant concern raised by residents involves the impact of data centers on electricity costs. Gessing explained that a microgrid bill passed in 2025 allows these facilities to operate independently from the main grid. He said, “The microgrid bill was genius, truly. It created a situation where they can have this reliable energy source right there associated with that data center.” This setup aims to prevent increases in electricity prices for average citizens.
However, Gessing challenged the Energy Transition Act—a law mandating a shift toward renewable energy sources—arguing it could deter future data center investment if applied strictly. He said, “The governor’s support for both data centers and the Energy Transition Act creates a case of cognitive dissonance.” Environmental groups remain opposed to expanding data centers due to concerns over water usage and energy consumption. On this point, Gessing remarked, “My experience with a lot of these radical environmental organizations is that they just don’t like economic development.”
Looking ahead, Gessing expressed optimism about New Mexico’s prospects if policymakers balance economic development with environmental considerations. He encouraged those interested in learning more about these issues to visit riograndefoundation.org or errorsofenchantment.com.
