For months, a bitter debate has raged over whether a giant proposed data center complex in Imperial County could move forward without facing an environmental review under the California Environmental Quality Act, or CEQA.
The project’s developer, Sebastian Rucci, argued it did not need to undergo a CEQA review. That’s a lengthy analysis showing the possible impacts the project would have on the region’s energy grid, air quality and water supply.
Rucci said he had planned the 950,000-square foot computing warehouse to meet local zoning requirements in hopes of getting it built swiftly. County officials accepted his argument, approving a lot merger tied to the project.
A city, a state legislator and one of the nation’s oldest environmental groups disagreed. The city of Imperial and the Sierra Club sued to halt the project, asking a court to require a CEQA analysis.
Now, a judge is preparing to grant that request.
In a tentative decision Monday, Imperial County Superior Court Judge L. Brooks Anderholt indicated that he was considering overturning the county’s approval of the project. Anderholt said he saw mounting evidence that the complex could have “significant environmental effects.”
“The court finds the county prejudicially abused its discretion by approving the lot merger without first completing the CEQA review required for the whole project,” Anderholt wrote.
The judge’s decision is not yet final, and both parties will have a chance to comment in the coming weeks. But if Anderholt upholds it, the ruling would force county planners to restart the approval process and undertake a stricter analysis of the project.
Alene Taber, the lawyer representing the city of Imperial, celebrated the decision Monday. In an interview with KPBS, Taber said it sent a strong message that city residents’ worries about the project were justified.
“I think this vindicates the fact that they had legitimate concerns,” she said. “And those legitimate concerns need to be heard.”
Imperial County spokesperson Eddie Lopez did not respond to a request for comment Monday.
Data center opponents welcome decision
If Anderholt upholds the tentative decision, it would be a major victory for the movement opposing data center development that has swept Imperial County this year.
Opposition has been particularly fierce in the city of Imperial, where Francisco Leal has lived for over a decade. The proposed data center complex would sit next to his residential neighborhood, known as Victoria Ranch. The lack of an environmental review has left Leal feeling like Rucci and his company, Imperial Valley Computer Manufacturing (IVCM), aren’t providing a full picture.
“We kept pushing because we knew that that wasn't right,” Leal told KPBS Monday. “This court ruling just proves that all of our claims were correct.”
The ruling would be a significant setback for IVCM, the Huntington Beach-based aspiring developer.
Rucci worries stricter environmental scrutiny could delay his plans by months or years. He has said in court filings that he stands to make billions leasing the data center complex to a major tech company. In an email Monday, Rucci said he respected Anderholt but would seek a hearing to contest the judge’s findings.
“The county’s economic study found $100 million a year in county-directed public benefits,” Rucci told KPBS. “Each year the project is delayed costs the local economy.”
IVCM has filed its own federal lawsuit against city officials in Imperial, alleging they treated his plans unfairly and conspired with other local agencies to block them.
Judge identifies potential environmental risks
In his decision, Anderholt identified a number of potential environmental risks that he said county officials should have evaluated more closely.
One is the vast amount of energy that the giant computing warehouse would need. In January, KPBS reported that its computer chips and cooling systems could draw more power than the entire County of Imperial used in 2024. That’s according to state data and estimates by IVCM.
The judge also pointed to the project’s need for a water supply, drainage systems and large-scale backup battery. He said its bank of natural gas generators should also be evaluated for their potential to pollute the air and produce greenhouse gases.
Those possibilities, Anderholt said, meant county officials should have elevated the project to a more thorough level of review.
Anderholt also appeared to validate allegations by the city of Imperial, the Sierra Club and local activists that the county had approved the project in small pieces rather than all at once, effectively obscuring its true environmental impact.
“The grading, lot merger, road vacation, electrical facilities, water systems, and related infrastructure serve one objective: construction and operation of the data center campus,” he wrote.
Taber said the city has made that argument from the beginning.
“It's not just a building that has data processing equipment in it,” she said. “Along with these hyperscale data centers come these battery energy storage systems and other things.”
Decision could strengthen case for moratorium
Anderholt's decision comes on the heels of a preliminary decision in another case involving the data center and Imperial County.
That decision, issued in August by Imperial County Superior Court Judge Jeffrey Jones, indicated Jones was preparing to strike down the county's recent emergency pause on data center development.
Initially, that decision looked like a victory for IVCM. But Anderholt's decision complicates things.
In his decision, Jones said the county failed to identify a current and immediate threat to public health, safety or welfare — the threshold needed to justify an emergency pause.
Anderholt’s Monday decision could actually strengthen the county’s case. That’s according to Taber, the lawyer representing the city of Imperial. She said the potential risks Anderholt identified would support county officials’ argument for a moratorium.
“This points out that the county has the evidence that it needs to draft an appropriate ordinance if it wants to,” Taber said.
On Monday, county officials announced they were planning to introduce a new version of the moratorium in response to Jones’ initial decision.
Political winds shifting against data centers
The debate comes as momentum appears to be shifting against artificial intelligence infrastructure across California and nationwide.
This week, state lawmakers in Sacramento made a major push to check the rapid growth of data centers. On Monday, the legislature sent a slate of seven bills to Gov. Gavin Newsom that would require the facilities to report energy and water needs and pay special energy rates.
Two of those bills were proposed by State Sen. Steve Padilla, who represents Imperial County and has criticized the county’s handling of this project. One of them, Senate Bill 887, would require that all proposed data centers in the state submit to environmental reviews.
Locally, a number of cities are considering pausing or outlawing data development altogether. This week, Calexico officials are set to consider banning the computing warehouses citywide.
NIMBY Imperial, the group of residents opposing data center development, is also looking ahead to the upcoming November elections. The group has threatened to recall two county supervisors who voted to advance the controversial data center: Peggy Price and Ryan Kelley. (None of the county’s five supervisors responded to requests for comment Monday.)
Leal, the Imperial resident, serves as a lead organizer for the group. Although county officials have bowed to public pressure and voted to rein in data centers in recent months, he said they were still moving ahead with the effort to oust Price.
“There’s no trust in the county by this community,” he said.
Meanwhile, Leal said he was grateful that the Imperial City Council chose to dig their heels in and fight back, along with the Sierra Club.
He also said he was proud of the many neighbors who took time off from work to attend county meetings, filed requests for public records and used social media to spread the word about the project in recent months.
“It proves that, when you stand up for your rights and you raise your voice and you organize, it pays off,” Leal added. “You just have to keep pushing.”
