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EIP Investment LLC, which first unveiled its plans back in 2016, has said it intends to invest approximately $1 billion in the project, which also includes an array of fuel cells that will help power the data center. Exactly when the project might break ground is unclear. Its first phase, which includes the installation of 20 megawatts worth of fuel cells, was delayed by the pandemic, according to New Britain Mayor Erin Stewart. "It's still happening, there have been some delays with the permitting process," Stewart said. "COVID set them back." Stewart said EIP, which was formerly working with South Windsor fuel cell maker Doosan, is now working with California-based Bloom Energy. EIP did not respond to a request for comment for this story. While Connecticut has not had any data center-specific incentives until now, it still found a way to help out EIP. In 2019, the quasi-public Connecticut Innovations granted EIP a sales and use tax exemption for its planned equipment purchase at the facility. That one-off exemption, which would now be available to other data center developers, was worth $55 million over a 10-year period. A data center of EIP's proposed size might invest $100 million or more every four years in new and updated equipment, according to CI officials, so the state's new law could ultimately increase the size of EIP's sales tax exemption by including qualifying equipment purchases over the next two or even three decades, assuming the company meets minimum capital expenditure thresholds for its facility investments. Minimum buy-in Connecticut's new data center incentives allow for 20- to 30-year agreements with the state and the municipality where a data center investment of a minimum size is made, with exemptions for property taxes, as well as for personal property and sales and use taxes related to the computer servers, Mark Wick is part of the development group, EIP LLC, that has proposed to build a $1 billion data-center project in New Britain, at the site of a former Stanley Works manufacturing plant. HBJ FILE PHOTO Pat Lynch State/city/region* Inventory Northern Virginia 1,376.7 MW Dallas/Ft. Worth 360.9 MW Silicon Valley 292.1 MW Chicago 288.5 MW Phoenix 238.9 MW New York Tri-State 149.1 MW Atlanta 163.8 MW Austin/San Antonio 146.6 MW Houston 128.4 MW Southern Calif. 127.1 MW Seattle 137 MW Denver 84.8 MW Boston 77.8 MW Charlotte/Raleigh 61.7 MW Minneapolis 52 MW Top Data Center Destinations * Connecticut is estimated to have less than 20 MW of data center inventory, according to state officials. Source: CBRE's North American Data Center Report H2 2020 networking equipment, generators, electric substations and a variety of other technology common within such facilities. The minimum investment to qualify for a 20-year deal is $50 million for any data center located in a state enterprise zone or federal opportunity zone (the EIP project in New Britain would be located in the latter) and $200 million for a center located anywhere else. DECD, which will oversee any negotiations with data center investors, would increase the length of an agreement to 30 years if the investment is at least $200 million within the economic zones or $400 million elsewhere. Such taxes are key factors weighed by decision-makers when they're location shopping a new data center, according to CBRE's Lynch. However, the largest cost input is often electricity, and Connecticut's rates are among the highest in the country. "If your community is desiring to be a major competitor within the data center space, utility and taxes have to be part of it," Lynch said. According to industry data provider datacenterHawk, data center operators can expect to pay 15 to 16 cents per kilowatt hour for electricity in the Northeast U.S., but that cost can be as low as 2 or 3 cents in places like Quincy, Washington, or Montreal, Canada. However, that doesn't mean every data center is located around the cheapest power, Lynch said. There are other considerations, like fiber infrastructure and proximity to key customers in order to have fewer data transmission delays, a network factor known as "latency." Latency is important for stock trading, but it also matters in lots of other areas, such as in software for hospital operating rooms, Lynch said. Lehman is well aware of Connecticut's disadvantage when it comes to energy costs, but he is convinced the new tax incentives — which are similar to exemptions in place for manufacturing equipment — are a smart policy that could produce results. "Are we going to be the biggest data center location because of our energy costs? I don't think so," Lehman said. "But will we see a lot more than the very limited investment we've seen? I believe we will."