RivCo Town Terminates Data Center Project, More Cities Put Similar Projects On Pause

COACHELLA, CA — Two Riverside County cities have entered into a temporary ban on data centers as of Friday. Coachella and Indio have both imposed a 45-day moratorium on new applications within the past 48 hours, and the Coachella City Council voted unanimously to terminate the proposed data center, dubbed the Coachella Valley Technology Campus, during its special Thursday meeting.

Hundreds attended the meeting and demonstrated outside it, chanting "No Data Centers!"

"So easily with the strike of a pen, you put all of our lives at risk. And you forced us to fight to undo it over the last few months since April. Regardless of what was going on in our lives, we had to drop everything to inform you about what a data center is," one resident said.

The motion to end the Stronghold agreement was made and unanimously approved.

The Coachella City Council unanimously approved an urgency ordinance imposing a 45-day moratorium on applications and terminating its agreement with Stronghold Power Systems Inc., which had planned to develop a data center in the city. The Coachella data center was planned for construction on at least 240 acres of agricultural land near the intersection of Avenue 52 and Fillmore Street.

Now, Rep. Raul Ruiz, D-Coachella, said he will fight for area families living near such proposed developments at the federal level. "This is a big win for our communities," he said in a prepared statement. "Next week, I am sending formal letters to the EPA and the Department of Energy demanding federal protections for families and neighborhoods across data centers."

The moratorium follows months of protests from community members throughout the Coachella Valley, citing concerns about data centers, ranging from environmental and health issues to higher electricity rates. City staff is expected to return to the council with a possible proposal for a permanent ban on data centers.

In February, the council approved a Municipal Utility Development Agreement with Coachella Valley Power Services LLC, an affiliate of Stronghold Power Systems Inc., establishing a public-private partnership to create a new municipally owned electric utility to serve the city. The council's action summarily terminated that deal.

Government Affairs Advisor for Stronghold Power Systems, Alex Rodriguez, released a statement after the meeting.

"Stronghold Power Systems is disappointed by the city council's decision to terminate our development agreement," Rodriguez said. "We came to Coachella with a project that would provide substantial benefits to the city, built around leading-edge environmental protections. We have been a committed partner and have learned much throughout this process."

Stronghold has said they will consider their options and remain open to a constructive resolution. At least one Coachella City Council member stated they were not interested in pursuing a relationship with Stronghold during the meeting.

Similarly, on Wednesday, the Indio City Council unanimously approved an urgency ordinance establishing the moratorium. Although the city has no current applications to develop data centers, the moratorium was adopted to give city staff sufficient time to evaluate and study issues surrounding such developments.

The urgency ordinance follows a series of large protests in nearby Coachella over a proposed data center.

"Data centers have caused a huge concern from some of our residents due to the high demand for water use, fossil fuels, potential environmental impacts, and public health impacts," Councilman Oscar Ortiz said in a social media post.

The next steps for Indio will include a review and discussion of policy options during a planning commission meeting on June 24, followed by a discussion with the council on July 15. City officials said staff might develop "very strict regulations for data centers, extending the moratorium, or considering a permanent prohibition on data center uses within the city."

Why are Data Centers being eyed for the Southern California deserts?

The proposed data center project is being developed "in coordination" with the city of as part of the ongoing implementation of the Coachella Municipal Utility, according to Stronghold.

The Coachella Valley Technology Campus is not the first data center proposed for the Southern California desert. Last month, the Imperial County Board of Supervisors voted 4-1 to make way for a massive data center complex that could rank among the largest in the U.S.

Data centers are often located in "sacrifice zones." In California, those areas are largely populated by Black and Latino residents, a 2025 study found.

The desert data center projects are among about two dozen planned for completion across California by 2030, according to the latest information gathered by analysts at Cleanview, a market intelligence platform.

Data centers are not new, but their prevalence is rapidly increasing due to the A.I. boom. Where all the water will come from to power them is unclear, especially in the thirsty Southern California desert.

A research team at the University of California, Riverside, recently found that data centers could collectively require 697 to 1,451 million gallons per day of new water capacity nationally through 2030. New York City’s average daily supply is about 1,000 million gallons per day.

Billions of dollars in new infrastructure is needed to meet spikes in data center water demands during peak usage, but even if you have money, the water source is another challenge, said Shaolei Ren, an associate professor in UC Riverside’s Bourns College of Engineering, who led the research.

"In many cases, the water is naturally replenished by snowpack and reservoirs. But reservoirs and snowpack are limited. You may have money to build treatment plants and pipes, but money can’t buy more snowpack," according to Ren.

During hot weather, a large data center can withdraw more than a million gallons of water per day, and some facilities under construction have been allocated up to eight million gallons daily, enough to supply multiple small towns, the study found.

In the Coachella and Imperial valleys, temperatures regularly exceed 110 degrees in the summer.

"People recognize power as a constraint for data center growth," Ren said, "but most of them haven’t realized water is a hidden and even more binding constraint in many communities."

Related:

Massive, Water-Thirsty Data Centers Proposed In Southern California Desert

Massive Data Center Proposed For Coachella Being Discussed This Week At City Hall

RivCo Officials Establish 45-Day Moratorium On Data Center Applications

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