City braces for data center, crypto mining interest

The Kingsport regional planning commission plans to amend city code to address the possibility of data center and crypto mining development in the city. The move is prompted by the overall trend in data center and crypto mining development across the country, Kingsport Planning Manager Ken Weems said. It was not triggered by a direct interest in data center and crypto mining development in the city. Data centers are typically large buildings that house rows of computers for storing and sharing large amounts of digital data. Heating and cooling equipment is required to run those computing systems. Data centers have been around for years but have recently increased to support AI growth. Crypto mining is how cryptocurrencies finalize transactions. An initial draft of what would be added to the code includes a city definition of data centers and cryptocurrency mining. The document also proposes criteria for the development of a data center or crypto mining, like operating in an enclosed building a certain distance from a residential district. It would also require any applicants to submit sound studies conducted by an "acoustical expert" to prove operational noise wouldn't surpass a certain level, as well as proving that vibration from the site would not be felt beyond its property line. The document that entails the proposed changes — the zoning text amendment report — is still in the works. The proposed amendments were discussed at a commission work session on Monday. The commission decided ahead of the work session to not vote on any proposed amendments to the code at the Thursday meeting. That decision was made to allot more time for discussion on the issue, Weems said. "We take our time with these things to get feedback," he said. The commission will hold another work session to discuss the text amendments. There is not a timeline yet for when any additions or changes would be finalized and a vote would take place. "Staff expects new data-based industries looking for locations to develop. The text amendment allows for the City to appropriately locate and permit these uses," reads a working draft of the Zoning Text Amendment Report. There are currently 60 data centers in Tennessee, according to Data Center Map, a data center research tool and directory. About a third are in Nashville. Memphis and Knoxville follow Nashville with the second and third-most amount of centers in a Tennessee city. Across the U.S., employment at data centers increased by 60% from 2016 to 2023, according to the U.S. Bureau of Labor Statistics. Other local bodies in the region have also taken action to address the possibility of data center and crypto mining development. The planning commission did not discuss crypto mining or data centers at its meeting on Thursday.