During an Aug. 6 Chamber business panel, Jeff Bladen described closed-loop cooling, battery backup, and enforceable commitments, while acknowledging that several limits and community benefits have not been finalized.
Verrus used a Thursday morning presentation to Salem business leaders to explain how it says its proposed Oakline at Mill Creek data center would limit water consumption, reduce noise, and ease pressure on the electrical grid.
Jeff Bladen, Verrus’ head of energy and policy, delivered the remarks during an Aug. 6 business advocacy meeting hosted by the Salem Area Chamber of Commerce. The meeting included a variety of additional topics and panelists, and was attended by nearly 100 members. The Chamber said it has not taken an official position on Oakline. It supports economic development generally and said it plans to host additional discussions for the business community.
““Like the rest of our community, our Chamber members have reached out to us with many questions regarding the data center proposal. As the premier convener of leaders and influencers, we invited Verrus to come speak directly to our members and inform the business community on their vision for the project. While our organization has yet to take a position on this proposal, we encourage our city leadership to critically evaluate each economic development opportunity based on facts and impact on the community,” said Tom Hoffert, CEO of the Salem Chamber.
Jeff’s panel presentation was followed by questions from Chamber members and online participants about water, electricity, noise, impact on nearby homes, and how Salem could hold the company accountable to its promises.
Bladen acknowledged that the data center industry’s record has contributed to public skepticism. He argued that Verrus was formed by longtime data center and energy professionals who believed the traditional model could be improved.
“From our founding a few years ago, Verrus has led with our core belief that supporting economic development does not have to come at the expense of protecting things that we all rely on—our water, our air, natural landscape and quality of life,” Bladen said during his Chamber presentation.
He said Verrus agrees with calls for greater transparency, accountability and enforceable standards.
“We remain committed to a respectful dialogue, to answering the community’s questions, to working collaboratively toward a project that provides real and measurable benefits to Salem and Oregon in general,” Bladen said. “We understand that data center development raises legitimate questions and concerns for those in the community. Those concerns deserve to be heard and addressed.”
The company’s subsidiary, Alderstone LLC, submitted its first formal land-use application July 31. The pending application proposes two one-story data center buildings with a combined footprint of 600,000 square feet on three parcels totaling 100.2 acres at the Mill Creek Corporate Center.
The filing also includes equipment yards, parking areas and a replat creating a separate lot for a future electrical substation that would ultimately be owned and operated by Portland General Electric. No land-use approval has been issued.
A Closed-Loop Approach to Water
Water use has been one of the most persistent concerns surrounding the project.
Bladen began his explanation by acknowledging that some older data centers consume substantial amounts of water, particularly those that depend heavily on evaporative cooling.
“One of the knocks on data centers—and there is always a kernel of truth to these things—is they use a lot of water,” Bladen said during the meeting. “There is a history of data centers built a decade or more ago of using millions of gallons of water a day, particularly in places where water is not scarce.”
Oakline would instead use a closed-loop cooling system. Water would circulate through the equipment repeatedly rather than being continuously consumed through evaporation.
Bladen compared the underlying technology with systems used in commercial office buildings, saying closed-loop cooling is an established technology rather than an experimental system created specifically for Oakline.
“This is an understood technology,” he said. “It uses almost entirely plain old water. There are some additives to it, but they’re the same kinds of additives you put in a swimming pool. They’re designed to pH-balance the water, to make sure it won’t grow algae in it and so on.”
Bladen said the company designed the system to conserve water without substantially increasing electricity consumption.
“We’ve designed this system to be as respectful of water as a natural resource as possible while still delivering all those other benefits that come with that kind of investment,” he said.
Verrus’ application says the campus would consume much less water annually than an average 18-hole golf course, or approximately as much as a few sit-down restaurants. Bladen used a similar comparison during his Chamber presentation.
The filing does not provide a projected number of gallons per day or per year, making the comparison difficult to independently evaluate based on the application alone.
Closed-loop cooling can require more electricity during extreme heat. Bladen said Verrus would address that tradeoff by using atomized mist around the air-exchange equipment during the hottest periods.
“We’ve designed a system that, a few days a year—just the very hottest days of the year, maybe 10 or so—we have the ability to do some simple misting of atomized water,” Bladen said. “It dramatically reduces the energy consumption. So it allows us to have energy consumption at the lowest possible level while also minimizing water.”
The formal application uses a broader estimate, stating that supplemental water could be needed during peak summer heat on fewer than 20 to 25 days per year.
That does not necessarily mean the estimates conflict. The equipment may be available during a wider seasonal window but used more substantially on fewer days. Still, the difference is one of the details Salem reviewers could examine as engineering and utility information becomes available.
Bladen said Verrus is prepared to make its water commitment enforceable rather than asking residents to rely only on company presentations.
“This isn’t just some empty promise,” he said during the Chamber meeting. “We will put in writing, as part of an agreement with the city or with the appropriate authorities, that our water use will not exceed the amount needed.”
The application similarly says Verrus intends to work with Salem on water-conservation commitments, post-construction testing and continuing operational accountability. The actual water limit and method of enforcement have not yet been established.
Batteries Would Serve as Primary Backup
The company also devoted substantial attention to noise, particularly from cooling equipment and backup power systems.
Traditional data centers can contain large banks of diesel generators that must be tested periodically and operate during electrical outages. Bladen said Oakline would still have some diesel equipment but would use facility-scale batteries as its primary backup system.
“Our primary backup technology is not diesel generators, although we may have some,” he said. “They’re not the primary backup technology. We use battery energy storage, which is absolutely quiet as the primary backup technology.”
The batteries would also allow Verrus to reduce the amount of electricity it draws from PGE during peak demand or disruptions, according to Bladen.
The company’s land-use narrative confirms that battery storage would provide primary backup power and says the design would reduce its dependency on the diesel generators commonly used by conventional data centers. The application does not state how many diesel generators would be installed, when they would operate or how frequently they would be tested.
Cooling equipment would create another potential source of continuous sound.
Bladen said Oakline would use ultra-low-noise cooling equipment, supplemented by physical measures intended to keep sound from traveling beyond the property.
“We use sound-attenuation barriers as well,” he said during the presentation. “We have berms at the property barrier. We have foliage that helps the noise attenuate.”
Verrus says the complete combination of quieter fans, battery backup, barriers, berms and landscaping would allow Oakline to remain within Salem’s existing noise restrictions, including nighttime standards.
“A modern data center done the right way, especially with what we’re doing with low-noise equipment, battery energy storage and the like, is no noisier than your average noise load,” Bladen said.
When an attendee asked what assurances Verrus could give someone whose home is within a mile of the project, Bladen said the answer ultimately must come from technical evidence and the city’s review—not simply from statements made by the developer.
“We are going to look to the city to provide, in a public venue, the evidence that the noise levels will be at a level that is what we would expect,” he said. “You don’t have to just take my word for it. If you really wanted to dive in and look at those plans, they are publicly posted by the city.”
The application commits to meeting Salem’s noise standards, but the city will still need to evaluate the design, supporting studies and any proposed conditions of approval.
Verrus Says It Could Reduce Demand During Grid Peaks
Bladen also addressed concerns that a large data center could overwhelm the regional electric system or increase costs for existing customers.
He argued that electrical grids are designed to serve demand during a relatively small number of extreme peak periods. Much of that capacity is not fully used during moderate weather, he said.
Verrus’ proposed model is intended to make the data center more flexible during those periods. Through a combination of batteries, power-management software and workloads that can be delayed or reduced, Oakline could cut its demand when PGE’s system is under pressure.
“What we recognized in redesigning the data center from the ground up was that we could reduce our demand to as little as zero on those days,” Bladen said during the Chamber meeting. “We could get more out of the grid we have without having to build a lot more grid—and still contribute to paying for the existing system.”
That does not mean Oakline would require no new electrical infrastructure. The land-use application includes a separate lot of approximately 20.74 acres for the future PGE substation. The project’s expected maximum electricity demand has not been disclosed in the application materials reviewed for this article.
Bladen said Verrus intends to coordinate with PGE and reduce demand when conditions require it.
“When those days of the year come that the grid is stressed, we would be reducing demand in coordination with Portland General,” he said. “So we shouldn’t be adding any strain to the grid.”
Verrus announced separately that it demonstrated grid-interactive technology on a 70-megawatt test platform in collaboration with the National Renewable Energy Laboratory. The company reported that the test included reducing load by as much as 100% within one minute of a utility signal and shifting to battery-powered operation without interrupting the simulated workload. Those tests were not conducted at an operating Oakline campus.
New Rate Structure Assigns Costs to Data Centers
Bladen said Oregon’s regulatory system would create another layer of accountability by requiring large data center customers to pay the costs associated with serving them.
The Oregon Public Utility Commission recently approved Schedule 96, a separate PGE rate class required under House Bill 3546, also known as the POWER Act.
The rate structure is intended to prevent the infrastructure costs created by large data centers from being shifted to households and smaller businesses. It requires data center bills to reflect the cost of serving those loads and includes predictable charges when a customer does not fully use infrastructure built for it. According to the Governor’s Press Release on July 7, “data centers and other large energy users served by Portland General Electric (PGE) will see an average rate increase of 29% while other PGE customers will see a decrease in their rates.”
Customers with 100 megawatts or more of allocated system capacity will also pay a 1-cent-per-kilowatt-hour surcharge that supports programs intended to reduce energy burdens on residential customers.
Bladen characterized the requirements strongly during the question-and-answer session.
“We are obligated, PGE is obligated to enforce this, and the commission is obligated to enforce this, to pay for every dollar of new infrastructure that is built to support our data centers,” he said. “Every single dollar.”
The commission’s order also allows data centers to reduce some costs by limiting their grid impact through efficiency and flexible demand. It requires sufficient clean-energy resources to be available before a large customer begins receiving service.
Community Benefits Remain Unwritten
Verrus has proposed negotiating a community benefits agreement with Salem separate from the normal land-use approval.
Such an agreement could create contractual obligations extending beyond the requirements available through zoning and building codes. Bladen identified schools, the fire department, emergency medical services and construction-trade training as potential areas for investment.
“I would target community benefits agreements that invest in the schools, that invest in the fire department, that invest in training programs for trades, that invest in emergency medical services and so on,” he said during the Chamber presentation.
Bladen said the company does not want to decide on its own which programs would be most valuable to Salem.
“We are not attempting to suggest we know where the most impact could be in this community,” he said. “We want feedback on what could be the most impactful and most important to the community that it’s in.”
A participant connected to Salem-Keizer Public Schools cautioned during the meeting that increased property value would not necessarily produce an equivalent increase in money available to local schools because of Oregon’s statewide school-funding system.
Bladen thanked the participant for the correction.
The city says its three primary avenues for protecting community interests are the development review, a legally binding community benefits agreement and a possible conservation easement protecting heritage oak trees.
Bladen acknowledged that the community benefits agreement has not yet been written.
“The exact terms of a community benefits agreement are to be determined,” he said. “We want to have the community actually inform that rather than some backroom deal with city management or with city councilors. That’s not how we want to operate.”
Until negotiations occur, it remains unknown how much Verrus would contribute, which programs would receive funding, how long the commitments would last or what penalties would apply if the company did not comply.
More Than $5 Billion in Projected Investment
The Chamber referenced local news articles describing the Oakline project as a proposed $5.1 billion campus that could begin operating as early as 2028. The city uses a more general estimate of more than $5 billion. What is yet to be clear is the investment amount for the proposed Phase I, a design to build on parcels of land unaffected by the Governor’s recent decision to halt the sale of 32 acres of state-owned land in Salem.
During the Chamber meeting, Bladen said the multiyear project would support thousands of construction jobs, along with spending at businesses that serve construction workers and contractors.
The City says Verrus anticipates creating 75 permanent, high-paying jobs once the full development is operating.
Oakline received approval for a standard three-year enterprise-zone property tax abatement. After the abatement ends, the project’s taxable value would contribute to Salem’s General Fund and Community Services Levy.
The city would also receive a 5% franchise fee connected to electricity provided within Salem’s right of way.
No Full-Scale Verrus Campus to Visit Yet
One of the more consequential exchanges occurred when a Chamber participant asked whether Verrus had another operating facility built to the same specifications.
Such a facility could allow residents and city officials to observe the noise, cooling equipment, battery system and surrounding effects firsthand.
Bladen acknowledged that Verrus does not yet have a complete operating example.
“I think the short answer is we do not have a full-scale operating data center that we can use today,” he said during the question-and-answer session.
He argued that the individual components are already established. Closed-loop cooling is widely used in commercial buildings. Large battery-storage projects are operating in Oregon and elsewhere. Low-noise cooling equipment, berms and sound barriers are also proven technologies.
“What we’re doing, though, is different for the data center industry in that we’re adopting the most modern ways of cooling, the most modern ways of integrating with the power grid,” Bladen said. “That’s where the innovation is. It’s the adoption of all these things at the data center. None of them are science projects anymore.”
That distinction may become central to Salem’s review. The separate technologies may be established, but the city will be evaluating how they perform together at the scale proposed for Oakline.
Bladen said Verrus welcomes that scrutiny.
“We are, honestly, looking forward to rigor,” he said during the Chamber meeting. “We’re looking forward to demonstrating that we are, in fact, doing something that is different. We have to prove everything we’re doing is what we’re saying we’re doing.”
The city’s pending Type II application will provide a 14-day public-comment period after formal notice is issued. Once the city releases a decision, the public will have 15 days to file an appeal, which could lead to a public hearing.
For Verrus, the next stage will be turning the commitments described during Thursday’s Chamber meeting into engineering documents, permit conditions, and contractual language.
For Salem, the central question will be which of those promises can be measured, independently tested, and enforced for the life of the project.
