- [Matt] Coming up on IMPACT A Montana community could soon be home to a 5,000 acre AI data center.

That's if project developers can attract a major tech company to plant its flag in rural Montana.

- My vision for this project is to have Montana participate in all of this investment in job creation that's taking place across the country.

- From the campuses of Montana State University, Bozeman, and the University of Montana, Missoula, you're watching IMPACT from Montana PBS Reports.

That story is straight ahead in this special episode.

Stay with us.

- [Announcer] Major funding for IMPACT comes from the Greater Montana Foundation.

Encouraging communication on issues, trends, and values of importance to Montanans.

Funding also comes from viewers like you who are friends of Montana PBS.

Thank you.

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(tense music) - Welcome to IMPACT.

I'm Matt Standal.

Artificial intelligence is now everywhere.

It's hard to write an email, search the web, or do just about anything on a computer without an AI tool offering to help.

It's a trend that promises to change the way we work, study, and communicate.

To make all this possible, tech companies are plowing trillions of dollars into the infrastructure it takes to train these AI tools, data centers and enormous amounts of power to run them.

Montana PBS's Stan Parker and Sam Wilson traveled to Broadview to explore one company's plans to bring a large AI data center to rural Montana.

- [Stan] Broadview, Montana, 30 miles north of Billings, surrounded by a sea of family farms and ranches.

Extending westward to the Crazys and eastward until seeming infinity.

It's the type of place where the dirt roads bear the names of old time families.

Where the hopping place to be on a Friday night might just be the school gymnasium, cheering on the Pirates.

Where the place to be on a Wednesday night might be packed in the community center for a 4H meeting.

- [Group] I pledge my head to to clear thinking, my heart to greater loyalty, my hands to larger service, and my health to better living.

- [Stan] Which is all the more reason that on a Tuesday night in January, it's a curious spectacle to see this same room packed elbow to elbow hearing from environmental and conservation groups about their views on artificial intelligence data centers.

- We need to get a handle on this, right?

This is not something- - [Stan] That's because plans are underway for a 5,000 acre AI data center campus, just a couple miles outside town.

John Chesser heads Quantica Infrastructure, the company planning the campus.

- The use of AI has been growing exponentially.

You know, one of the companies, ChatGPT, went from 400 million weekly users to 800 million weekly users, people all over the globe.

My vision for this project is to have Montana participate in all of this investment in job creation that's taking place across the country by bringing a very large data center opportunity to the state.

- [Stan] Nationwide, the planned investment into data centers and the infrastructure to support them has led to some mind-boggling investment.

The big five tech companies are planning on spending upwards of $600 billion in data centers in 2026 alone.

Data centers have always been part of the backbone of the internet, but all these new AI tools need exponentially more computing power than serving up a webpage or storing photos.

And Chesser says that pre-AI, data centers had to be built near population centers to ensure a seamless web experience.

- With AI, you don't need that data center sitting 150 miles away from a user because you really just need to go run the program and think and learn and iterate over and over again.

And so three years ago there wasn't a need for a big data center in Montana.

Now there's the opportunity for there to be a data center in Montana, and you just see data centers now going to places they wouldn't have gone to in the past.

- [Stan] Places in rural America, like the Broadview area, which up until now have been the farthest thing imaginable from big tech.

Here, agriculture has reigned for generations.

- I actually had three great grandpas homestead in this Broadview area in about 1909.

All three of them came about the same time, homesteaded on 160 acres and all three of those places are still in the family.

- [Stan] Mike Swartz runs a family feedlot operation just a few miles outside Broadview, about eight miles away from the data center site that Chesser sees as a great technology opportunity.

When Swartz looks around at the wide open spaces, he sees a different sort of opportunity.

- I see it as opportunities for feeding the world, basically, you know, and I look out and just, I see it as opportunity for ranchers to graze cattle or if there's a few people around that raise sheep and stuff.

And I think that that's what it's made for and wildlife too.

- [Stan] As the data center build out has increased over the past few years, it has found friction in rural communities.

Reaction has been mixed.

Some state and local governments welcome the economic development.

At the same time, local opposition in some quarters has been mounting from those increasingly worried about the impacts that these power hungry facilities have on electricity rates, water usage, and the other concerns that come with giant construction and energy projects.

The pushback has leaders of some of the biggest tech companies seeing local opposition as a threat to deploying data centers as fast as they want to.

And some industry leaders are now promising to do things differently.

Microsoft President Brad Smith told the Wall Street Journal in January, "The industry operated in a certain manner in the first half of the decade that is not an appropriate path for the second half of the decade."

That includes a pledge to build their own power.

As the industry turns this corner, Chesser's company was founded to be the partner big tech needs to get projects built.

It's a team of power industry veterans who see an opportunity to develop large scale power generation in this area and attract a data center that will buy that power for decades to come.

- We would help attract a customer who would be, you know, an AI company like Amazon, Microsoft, Meta, Google, Oracle, bring them to the state, help them develop a campus in Yellowstone, Stillwater counties.

We would, we, Quantica would build all of the power generation needed.

So we'd build the power to supply the data center our customer wants to build.

And then we'd developed the associated telecommunications so that that data center Montana can talk to data centers in Seattle, Salt Lake, Denver, Minneapolis, Chicago.

- It seems like a bit like a subdivision development where you're selling home sites.

- A little bit like that, a little bit like that.

- Their website promises project acceleration with risk reduction through an integrated and community-focused approach, showing they recognize that good community relations are key to their success.

What steps have you taken to build rapport with the community of Broadview so far?

- Yeah.

So first off, we've gone out and we're working with a local group called Western Skies who help companies like myself stay connected in the community.

- [Stan] We visited Western Skies' Jess Peterson on a windy day in February.

He showed us the 5,000 acres owned by Quantica for what they say is their flagship project.

The Big Sky Digital Infrastructure campus.

If all goes according to plan, this will soon be rows of warehouses.

And there's the power generation, both onsite and in the surrounding landscape.

The company holds about 40,000 acres worth of energy leases for wind, solar, and battery storage.

They're planning enough power to eventually run a one gigawatt data center.

That's enough to power well over a million homes.

3 1/2 miles north, a garage has been renovated to serve as the company's in town headquarters to meet with community members.

For our visit, Peterson invited a couple folks from the community who support the project to talk with us.

One of them, Shelli Roufley, lives north of town, but spends many nights far away working as an over the road trucker.

- You know, we went from farming, which is really hard to raise a family on.

And then we went into construction, which is really hard on the body.

And now with trucking, I mean, a lot of times we have to deadhead out of state just to get a load to make some money.

And we just, we really need those opportunities in Montana.

- What kind of opportunities are you hoping for?

- Jobs.

Just good paying jobs for maybe myself and my husband and my kids.

- [Stan] Another person who stopped in was Duane Swartz, a relative of Michael Swartz' and proprietor of the Homestead Inn Bar and Grill.

It's the only place to get a meal in town and has been a central part of Broadview life long before Swartz took over 10 years ago.

- I mean, I remember as a kid going in there right after games, playing foosball, playing pool.

And it was that way for many, many, many years.

That's just the way it's been.

You know, it's the only place to gather.

There was another bar that was opened at the time, but that's been closed for, I don't know, 15 or 20 years at this point.

And so there's us, the gas station, and the fertilizer place.

So yeah, we definitely could use a boost around here.

- If you had to kinda characterize the discussion that happens at your bar, how would you describe it?

- Well, the folks I know, the farmer ranchers, you know, they have questions.

They're not 100% opposed to it or 100% for it.

I haven't had any people actually just say, "No, we don't want it yet."

'Cause they don't know enough information.

I mean, it's really come down to we need more information.

We need to know what's going on and how it's gonna happen.

- Every time our team gets a directive, it's make sure you're learning and getting feedback from the community and let's apply it.

We've encouraged folks come to these open houses, come, I don't wanna say come hold us accountable, but it's kinda like that.

Like, we're here, we're sitting in this office every Wednesday and if something isn't gonna done right, we're gonna hear about it and we should.

- [Stan] The community outreach efforts so far haven't worked for everyone.

- Everything's always in the dark.

There's nothing, you know, transparent and everything's that we're guessing.

I'm tired of guessing.

- [Stan] Cari Olson, a Broadview school parent who lives about 25 miles south of town, first heard about the data center campus volleyball game at the school.

That night, Quantica sponsored concessions and manned the food window, as you can see from this basketball game from a few months later, running the concession stand would be an effective way for anyone to introduce themselves to the community.

- So everything in the concession was free that night.

Everything from like the popcorn, the kids loved it.

They got all the candy and they were running the like hamburgers and hot dogs.

So, you got everything for free that night.

And me and my husband were like, hmm, that doesn't sound right.

What is this really about?

And so, I didn't have time.

You know, so I just stole a couple napkins.

And then as we're driving to our next event, I'm like Googling just crazy like what this was.

- [Stan] She didn't like what she found out.

- And then I just got really, really upset and really, really mad.

And I called all the environmental groups throughout the whole state.

- [Stan] Olson put together two community panels, one in Billings and one in Broadview.

Both were overflowing with interest.

- When I got involved in this, there wasn't anyone was having like, being the hero and being loud and you know, kinda blunt about it.

Like, this isn't right.

What are we doing here?

- [Stan] The panels were organized with the help of other groups, including the Montana Environmental Information Center, a long time environmental advocacy nonprofit.

- And we don't want these questions answered by somebody who is a salesman.

We want these questions answered by the company and we wanna be able to hold them accountable to their answers.

We wanna know what they're planning to do with the water and with the electricity and with the noise and with the lighting.

- [Stan] Water use was a concern that came up often in the meetings though some data centers have been clocked using millions of gallons of water per day to keep their chips cool, Quantica is pitching a closed loop system, which isn't to say they won't be going through a lot of water.

Chesser says the exact amount depends on how big the data center ends up being.

- You know, if you had a very small data center deployment, you know, it might be measured in the 10 to 20,000 gallons a day, which is just a medium sized town.

If you had a very, very large data center deployment, you know, you might start to get into the 80 or 100,000 gallons a day, which is now a moderate sized city.

- [Stan] From his feedlot eight miles west of the data center property, Michael Swartz is keenly aware of how precious water is in this part of the state.

- We count so much on groundwater and surface water.

The groundwater, that's what our livestock depend on.

And growing up here and being here for fourth generation, we know that there's very limited groundwater.

When you drill well, you might get water and you might not.

And when you do get water, you kind of take care of it and you preserve it then.

- [Stan] Broadview has struggled with water from nearly the beginning of its history.

In 1934, much of the town burned down when firefighters were unable to draw enough water to put it out.

The population nearly halved in that decade due to water scarcity.

In 2008, the town tapped state hydrogeologist Jon Reiten to help them find a new source of fresh water.

Though much of their yielded either low flows or bad quality water, he did find at least one promising location in the Broadview Dome, just south of town in the Eagle aquifer.

The Broadview Dome also happens to be on the western edge of the Big Sky Digital Infrastructure property.

- The Eagle is a very kind of important formation in this area.

It forms the Rimrocks here in Billings, but it also in the subsurface, it can be a really good aquifer.

And that's, I happened to run across an area out there that was really good and we did some test drilling and it was, you know, exceptionally good water and figured that would probably be enough for the town's needs.

- [Stan] The town never ended up using Reiten's discovery, instead choosing to wait for the central Montana Water Authority Pipeline to make it to Broadview, which is anticipated to arrive in 2027 and will not be made available to the data center campus.

The company is still studying where it will get its water, but says the Eagle aquifer is on the table, along with the Madison aquifer, which is far deeper and of such bad quality that it's toxic to plants and animals.

- And when it comes to accessing water, the ultimate goal is to not impact the people in the community that you need to partner with, the farmers, the ranchers, and the towns.

And there's sources of water like the Eagle, like the Madison that you can tap into that don't have that impact on people.

And more importantly, there are laws that say you can't do that.

There are people who have tapped into the Madison, it's 5,000 feet deep, the water comes out at, I think around 211 degrees under multiple atmospheres of pressures.

So it basically looks like a geyser.

And so you pull it out, you treat it, you use it, and then you've got opportunities around either re-injecting it or treating it again.

And when you make those types of investments in water infrastructure, you know, there's obviously opportunities for other people to benefit from that.

- So where would the discharge from the treatment that go then?

- Yeah, typically you can look at re-injecting.

And so, that's an opportunity there.

- And then I guess that would create some sort of solid waste.

- Yeah, you mean you have to have sewage.

So those would be investments that by the way, would be expected as part of the data center campus.

- Gotcha.

- So.

- [Stan] Injection wells are a common feature in the oil industry used to seal liquid waste deep underground.

But it depends on specific geology to make sure those liquids stay put.

And Reiten says there are underground faults in the Broadview area that would need to be taken into account to do this safely.

- They'll have challenges with the faulting issues where these faults are 'cause they could be avenues of flow.

So, that could get up into zones that people are using and that'd be the one thing that they really wouldn't wanna do.

- [Stan] The company said it's aware of the subsurface faults and would do all its homework before making any decision to inject.

But Quantica isn't mainly a water company or really even a data center company.

It's primarily a power company.

The team is made up of many people who have Talen Energy on their resume, the independent power producer that runs coal strip and owns a nuclear plant in Pennsylvania.

- So ultimately we would build the generation and we can sell the power to Northwestern and Northwestern can then sell it to the customer.

- Why don't you sell it directly to the customer?

- Because ultimately the power is gonna be located at the data center, but you need to get it to the grid so that you can move it around the system if necessary.

- [Stan] Chesser says the company can also sell its excess power on the grid, which could theoretically lower energy costs for everyone.

Broadview's location on the grid has long made it an attractive place for power development.

It's right along the high voltage line built in the '80s to ship electrons from coal strip to the Pacific Northwest and right next to an important substation.

But the grid is aging and the upgrades necessary to serve this data center and others has consumer watchdogs worried that residential rate payers will end up footing the bill.

That fear is founded in examples from other states, but the industry and its boosters are promising that won't happen in Montana.

State Senator Daniel Zolnikov, who chairs the Energy and Technology Interim Committee, is optimistic this could all lead to a win-win.

- We have a very antiquated transmission system in this state with antiquated technologies.

So, think if a very large company comes in and they invest a hundred, $200 million to upgrade the infrastructure.

Instead of those costs going from the utility through the public service commission being approved to being put on the backs of rate payers, think of some other company as paying for that.

- [Stan] While Zolnikov is not part of the Quantica project, he does work in the power industry and previously worked as a developer in the Broadview area for a company backed by the same venture capital firm as Quantica.

- There are many, many benefits that could positively affect consumers and make sure that we get new infrastructure without us having to pay for it.

Yeah, in my committee we are working to make sure that there are, we don't have the opposite where profits are privatized and the risks are socialized on the rate payers.

That is the big threat you're hearing across the nation.

They're coming in and customers and rate payers are paying for it.

That's not a good partner.

We want them to come in and pay for the upgrades and us to benefit.

- [Stan] But the watchdog groups criticizing the project want more than words.

They want regulations and more transparency.

These redaction-laden documents are letters of intent signed between electric utility, Northwestern Energy, and three data center companies, including Quantica.

After these letters were announced, state regulators at the Public Service Commission asked to see what sort of agreements have been made, but ultimately allowed the companies to limit how much information to share with the public.

Hence the redactions.

While regulators have seen the full documents, environmental and consumer groups like MEIC, have been demanding the full letters be made public.

- So, we want transparency.

That's not it.

But that's what we have right now.

So we have more questions than we have answers.

Next slide.

- [Stan] In March, the MEIC joined other groups in a PSC filing that argued, "This secrecy negatively impacts the public's ability to meaningfully engage with the utility's plans for resource adequacy and prevents the public from advocating against rising costs for existing rate payers."

Northwestern says the redactions appropriately shield confidential business information.

In our conversation with Chesser, he deferred to the utility on how much to make public.

Northwestern has also begun working through the PSC to build a new rate tariff for data centers to help shield existing customers from infrastructure costs.

- This is the nature of big infrastructure projects.

You end up building it and if it's done correctly, everybody should benefit.

- How it all works out remains to be seen, along with exactly what the data center campus itself will look like.

Chesser says a lot of details about the project will ultimately be driven by their customer.

Some of these feelings that I'm feeling emanating from the community members is that, you know, people want answers for this big thing that's gonna be built next door.

- Yeah, yeah.

- And kinda the answer is it's like, well, it depends what the customer wants.

- Yeah.

- And I imagine that's gonna be pretty unsatisfying for a lot of people.

- Yeah.

- [Stan] You know, how would you respond to that?

- I'd say that ultimately, you know, the customer will be there and when that happens, which, you know, hopefully it's gonna happen by the end of the year, we'll actually have that customer signed up.

You know, all those things will become clear and you know, people will have line of sight of what's gonna happen.

- [Stan] And one of those customer-driven details will be the exact mix of power that ends up getting built.

Company literature emphasizes wind, solar, and batteries, but things are still open-ended.

- Yeah, I think the power would be in the form of two kinds.

There's demand from these customers to not have a big carbon footprint.

So there'd be development of renewable power.

And so, there's an opportunity to develop that.

And then the second would be looking to traditional and new forms of firming power.

In the long term there's technology like small modular reactors, which countries try to develop.

Those will be available.

But otherwise, you know, you look to the traditional forms of firming power.

- [Stan] Gotcha.

Those being?

- Yeah, natural gas.

- Gotcha.

So are you thinking about building a natural gas plant?

- I think, well, it would be ultimately be somewhere in the state.

I think there's opportunities to develop natural gas and that's the source of generation to the plant.

And we could be a part of developing that.

- [Stan] And despite the blanks yet to be filled in, the company plans to break ground in 2026.

For some in Broadview, the relentless pace of artificial intelligence development feels out of place for an area that's been slow to change.

- The decisions we make today are gonna last a long time.

And I mean, we outgrow thing like the elevators and all these small towns, just the way the farming and the way that the world has outgrown things of the past.

Like, are we gonna outgrow the windmills?

Are we gonna outgrow the solar farms?

- [Stan] But from his seat in the Montana Senate, Daniel Zolnikov sees data centers keeping Montana's rural communities viable.

- Diversifying that tax base and not putting it all on top of ag, which has ups and downs, maintains like a funding for that community where they can afford law enforcement to fix their schools whatnot, and gives some employment opportunities.

So I think it's a way to breathe life back into areas without changing the culture.

- [Stan] For Shelli Roufley, that means keeping her family together.

- You know, so many times just to get a good paying job, so many people move out of state.

- [Stan] While for Cari Olson, the risks outweigh any benefits.

- I'm afraid of losing for our water.

I mean, I'm afraid of losing my house because my electrical bill goes up 70%.

Who's gonna police them?

- [Stan] And this isn't the first time Duane Swartz has seen a company come to his bar in Broadview promising prosperity.

- You know, until the information is real and is still, we see actually, we see things break ground, we're not even gonna know that it's even real till then.

So, 'cause I'm tell you, it's been going on for years.

Many different companies that came through there, I've got multiple business cards sitting in my office with people who came and said, they're gonna do this and this will happen this year.

And then I get another person come through with business card say this, and it's happened for the past 10 years that I've been there, so.

- [Stan] At this point, no one can say for sure what this field in Central Montana will look like this time next year.

If Quantica is able to find a tech company customer, it could be the beginnings of a new powerful industry taking root in the state.

If not, it could be another business card in Duane Swartz office.

For IMPACT, I'm Stan Parker reporting with Sam Wilson in Broadview, Montana.

- Whether the Quantica project comes to fruition or not, Montanans are likely to see more data center proposals because the industry is preparing for it.

When Northwestern Energy announced its plans to merge with Black Hills Energy last year, company leaders said the deal would help them serve data centers.

And that's all we have for this episode of IMPACT.

You can find all of our previous shows on our website or on the PBS app for your phone or smart TV.

If you have feedback, questions, or story ideas, send us an email at impact@montanapbs.org.

I'm Matt Standal, and from all of us here at Montana PBS, thank you for watching.

(tense music) (tense music continues) (tense music continues) - [Announcer] Major funding for IMPACT comes from the Greater Montana Foundation.

Encouraging communication on issues, trends, and values of importance to Montanans.

Funding also comes from viewers like you who are friends of Montana PBS.

Thank you.

(gentle piano music)