Frequently asked questions for large or hyperscale projects
Note: Guidance is provided to assist in the implementation of the environmental review process; it is not a substitute for the rules and does not alter the rules or change their meaning. If any inconsistencies arise between guidance provided and the rules, the rules take precedence. In addition, each responsible government unit (RGU) has discretion in implementing the rules. These FAQs presume a certain level of familiarity with Minnesota’s environmental review program.
Does a data center need to go through environmental review (ER)?
Projects that may have the potential for significant environmental effects need to go through environmental review. The mandatory categories in Minn. R. 4410.4300 and Minn. R. 4410.4400 establish certain types and sizes of projects that are required to go through review. In addition, Minnesota’s Energy Infrastructure Permitting Act (Minn. Stat. 216I) requires environmental review as part of the Public Utilities Commission’s process of issuing a site or route permit for certain energy infrastructure projects. Characteristics of the project – including its nature, size, location, and other factors that impact its potential for significant environmental effects – are important to consider in determining if environmental review is needed. Project proposers should also review all the mandatory category thresholds to determine what might apply. Data center project characteristics that are likely to be particularly important to the applicability of the mandatory categories that have state agency responsible governmental units (RGUs) include (but are not limited to):
- On-site electric generation or construction of electric-generating facilities (PUC and MPCA)
- On-site energy storage (PUC)
- Storage of hazardous materials or hazardous waste (MPCA)
- Storage facilities (MPCA)
- Air pollution (MPCA)
- Wastewater permits (MPCA)
- Water appropriation (DNR)
Data center project characteristics that are likely to be particularly important to the applicability of the mandatory categories for local government RGUs include:
- Gross floor space
- Land use conversion
- On-site electric generation, on-site energy storage, or construction of smaller electric-generating facilities (if these facilities use the local review option in Minn. Stat. 216I)
RGUs may order – or project proposers may initiate – a discretionary EAW under Minn. R. 4410.1000, Subp. 3. A discretionary EIS may be conducted by agreement under Minn. R. 4410.2000, Subp. 3, item B.
How is a “project” defined for the purpose of ER?
As defined in Minn. R. 4410.0200, “‘Project’ means a governmental action, the results of which would cause physical manipulation of the environment, directly or indirectly. The determination of whether a project requires environmental documents shall be made by reference to the physical activity to be undertaken and not to the governmental process of approving the project.” A foundational principle of Minnesota’s environmental review process is that a project must be reviewed as a whole, and there is a prohibition on construction and government decisions until environmental review is complete. In understanding the scope of a project, it is also important to consider the rules around connected and phased actions (Minn. R. 4410.1000 and Minn R. 4410.2000, subp. 4). Under those rules, “Multiple projects and multiple stages of a single project that are connected actions or phased actions must be considered in total.”
What if a data center has been included in an alternative urban areawide review (AUAR) process conducted by a local government?
Minnesota’s environmental review program includes a specific process called the alternative urban areawide review (AUAR), which is done by a local government. In that process, a local government typically describes and evaluates multiple development scenarios within a specific geographic area that align with their comprehensive plan. The requirements for an AUAR are laid out in Minn. R. 4410.3610. Specific projects may then develop within the area evaluated by the AUAR, such as plans for a residential development of a certain number of units, a warehouse of a specific number of square feet, etc. As information on specific projects becomes known, the mandatory category thresholds should be reviewed to determine if additional environmental review is needed. A completed AUAR can fulfill the environmental review requirements for some subsequent projects that are consistent with the development scenarios. If additional environmental review is required, the RGU may, at their discretion, use information generated in the AUAR to inform that review.
AUAR applicability
The AUAR can only fulfill the requirements for environmental review for commercial, residential, light industrial, or warehousing projects, as defined in Minn. R. 4410.0200. In that rule part, “‘Light industrial facility’ means a subcategory of industrial land use with a primary function other than manufacturing and less than 500 employees.”
If a proposed data center (or any other project) exceeds a threshold in any other mandatory category, including a requirement for review under Minn. Stat. 216I, an AUAR is not an applicable form of environmental review. As defined in Minn R. 4410.3610, subp.1, “The procedures of this part may not be used to review any project meeting the requirements for a mandatory EAW in part 4410.4300, subparts 2 to 13, 15 to 17, 18, item C, D, or E, or 24, or a mandatory EIS in part 4410.4400, subparts 2 to 10, 12, 13, or 25.” The project must go through the appropriate review process. This helps ensure that appropriate information on the nature and location of the potential environmental effects is available to support required permits.
AUAR validity
In addition, the AUAR is only valid as a substitute form of review for specific projects that are consistent with the assumptions made in the review and consistent with the mitigation plan (See Minn. R. 4410.3610, Subps. 5 and 7). For example, if a commercial project is proposed that would have significant water use that wasn’t considered in the AUAR, the AUAR may not be valid for that project – because the AUAR didn’t consider, and therefore underestimated, an important environmental effect. Even if the water use or appropriations do not exceed a mandatory category threshold, and therefore an AUAR is still applicable, there may need to be additional review, such as an update to the AUAR.
What happens once an RGU has determined review is required?
Project proposers should work with appropriate RGUs to identify when their project needs, or is likely to need, environmental review. Early information sharing and discussion with the appropriate RGU is helpful. Key information needed is likely to include the boundaries of the project, how it is designed and capable of operating, expansions that are planned or reasonably likely to occur, and the nature and location of the potential environmental effects. When a project is determined to need environmental review – based on the specifics of the physical activity to be undertaken – other requirements kick in. These include a prohibition on governmental approvals that is applicable to all governmental units and a prohibition on construction activities until the review is completed.3 Different RGUs will have different processes, which may include screening forms, pre-submittal meetings, or other information requirements. Some state agency RGUs may review permit applications submitted to the agency to identify if environmental review is needed and if any review has already been completed.
How is nonpublic data handled during environmental review?
RGUs completing environmental review need to have sufficient information about the proposed project to be able to understand and evaluate the nature and location of the potential environmental effects. Project proposers must supply any data reasonably requested by the RGU,4 and the RGU must consider impacts from reasonably expected or planned projects.5 Government data is governed by the Minnesota Government Data Practices Act (MGDPA, Minn. Stat., ch. 13); the MGDPA presumes that all governmental data are public unless there is a federal law, state statute, or temporary classification that classifies the data as not public. Not public data can be used to inform an environmental review, as it is available to the RGU during the development of the review. However, not public data would not be included in final environmental review documents.
A project proposer may be required to provide not public data as a part of a request from an RGU. If the project proposer has concerns that the data may be not public, the project proposer can contact the RGU in advance to discuss how that data may be classified. The Department of Administration’s Data Practices Office provides assistance and advice on data practices to the public and government.
Best practices
- Reach out to Minnesota Business First Stop (MBFS), led by the Department of Employment and Economic Development (DEED), and connect with the data center coordination team for assistance navigating state regulatory and permitting processes. Email: firststop@state.mn.us.
- MBFS helps businesses navigate permitting and regulations, provides expert guidance, and supports complex location and expansion projects by working closely with business leaders and their consultants.
- If a project could need environmental review, reaching out to the EQB and any other relevant agency (i.e. one with an applicable permit or approval) early is recommended.
- Be ready to provide sufficient information to help determine whether environmental review is needed.
- Coordinate early and often for review and/or permitting with state agencies, such as the Minnesota Pollution Control Agency (MPCA), Department of Natural Resources (DNR), and Public Utilities Commission (PUC).
- If a project utilizes a water-cooled system, DNR strongly encourages early coordination prior to final site selection. o In addition, Minn. Stat. 103G.265 now includes a preapplication evaluation process for some data centers.