The Fisher County Commissioners heard from company representatives and legal counsel early last month regarding a number of possible industrial enterprises as well as foreshadowing future tax abatements, and although the court tabled most votes as discussions will continue, commissioners unanimously approved the updated criteria for applying for tax abatements.
With a lengthy agenda along with numerous pages of budget to review early last month, Fisher County officials approved guidelines and criteria for establishing eligibility for receiving tax abatements, as well as the reinvestment zone proposed for some projects.
Commissioners were hesitant to get too deep into tax abatement discussions, declining to agree to retain Underwood Law Firm to represent the county regarding some tax abatement applications and agreements. However, officials also received information for one possible project being considered by IREN, which recently began expanding operations in Texas.
IREN, formerly known as Iris Energy, underwent a name change to reflect its growth in the next-generation data center sector. Co-founder and Co-CEO Daniel Roberts has been promoting the company’s significant expansion plans for 2024, including increasing its Bitcoin mining operations.
The company currently operates four data centers across North America, three in Canada, and a fourth in Childress County. The company is looking at potentially developing a data center in Fisher County, as the county meets several criteria.
Data centers like these require a lot of power to operate, and IREN representatives explained that Fisher County is appealing because of the access to an abundance of clean energy, including transmission lines and several wind and solar farms nearby the data center can access.
Although electricity costs remain high, with improved operational performance IREN reports expanding Bitcoin mining capacity and securing a cloud services contract that tripled its cloud services business with a substantial purchase of graphics processing units. In the second quarter of FY24, IREN’s Bitcoin mining revenues rose from the previous quarter, according to recent reports.
IREN's facility in Childress County, Texas, serves as a strategically located data center operation connected to the ERCOT electricity grid via a 345kV transmission line on a 420-acre property. The site currently operates 100MW of data centers, with an additional 250MW under construction.
When completed, the facility will be supported by robust infrastructure, including high wind-rated warehousing, three-phase power, town water, and access roads, all designed to accommodate current operations and future development. IREN representatives explained how the company is committed to generating long-term revenue for the communities it operates by prioritizing local hiring, purchasing, and contracting whenever feasible.
Micheal Leamons, who manages procurement for the Childress project said that much of the 300plus work crews of contractors and subcontractors were local to the area, especially in excavation work. Additionally, IREN employs over 40 full-time employees and could reach more than 50 full-time employees post-construction.
Additionally, IREN also works to establish other ways to support community efforts. Nicole Dill works within communities to establish a community grants program. “We truly believe in giving back to the communities we operate in, so we hope to be good business partners with our counties,” said Dill.
These programs provide funding for initiatives that benefit the community, especially safety, technology, and learning. Dill said a total of $100,000 in grant funding is expected to be available annually in Childress.
'We had a great experience in Childress and we would like to replicate what we’ve done up in Childress County here in Fisher County,” said IREN project manager Jason Date, explaining how the goal is to construct an additional data center in Fisher County.
IREN is also looking to secure a tax abatement in Fisher County, similar to the one entered into with Childress County officials. Although, admittedly not the venue for addressing the abatement application, the company did propose utilizing Underwood Law Firm that assisted with the deal.
Fisher Commissioners agreed they would like to speak with Underwood attorneys before agreeing to hire the firm as legal representation. The court will likely hear from those attorneys in upcoming meetings.
Although only indirectly related to IREN, the commissioners did approve the order for establishing a roughly 2,500-acre reinvestment zone to be known as IS 245 with Inidigo LLC. The project founder and initial developer, Innovative Solar Solutions (ISS), began looking to offload around 690 MW spread across four projects in Texas in early 2022.
With each proposed project having designation numbers associated with Indigo Solar, IS 245 (the Fisher County solar farm) is one of several projects in the region.
When representatives spoke to the court last September, officials were told the project has an expected value of $45.2 million after the initial 10-year period but is anticipated to continue to be in operation for an additional 20 years afterward. If approved, the agreement would likely bring in roughly $2.7 million to Fisher County over the first 10 years and is estimated to generate roughly $293,000 in property taxes annually depending on tax valuations after the abatement expires in 2035.
GGS Energy out of San Antonio later purchased the project, offering an initial tax abatement proposal last year, explaining: “GGS Energy is eager to continue their development of wind and solar plants across Texas, and their investment in Fisher County.”
As solar farms depreciate rapidly in taxable value, the company’s application requests a 100% tax abatement, which would be coupled with an annual $271,000 payment in lieu of taxes (PILOT) for the 10-year term. The initial tax abatement proposal equated to a roughly 70% tax abatement after the PILOTs were paid.
The commissioners rejected that initial abatement proposal, but assured the company the court was open to negotiating the parameters. However, the company has not entered into further discussions with the court outside of the reinvestment zone. Additional, information is expected to be reviewed in upcoming meetings and will be shared as it becomes available.