Judge rules Chatham County data center can proceed despite moratorium

A Chatham County data center project will move forward despite the county’s moratorium, following a court decision.

In February, Chatham County commissioners enacted a year-long moratorium on new data centers. The ban remains in effect until Feb. 11, 2027, or until new zoning regulations are adopted — whichever comes first.

But it won’t stop at least one new data center from getting underway. Data center developer Eco TIP West plans to build a 750-megawatt data center at the Triangle Innovation Point West business park near Moncure.

The developer sued the county in April, arguing that its project was already in progress when county commissioners approved the moratorium, and therefore should have been exempted.

Superior Court Judge John Morris ruled (opens in a new tab) last week in favor of the developer.

“After careful consideration of the file, counsels’ legal briefs, Plaintiff’s motion for summary judgment, and the exhibits and arguments of counsel during the August 31 hearing, the Court finds that there is no genuine issue as to any material fact and that Plaintiff is entitled to a judgment in its favor as a matter of law,” Morris wrote.

Three more NC localities weigh pauses on data centers as developer backs away from Raleigh project (opens in a new tab)

The company spent $11 million on the project, according to its court filing. The developer noted in its lawsuit that the zoning of the intended site permitted its use for a data center, and said it had been working with the county in good faith before the moratorium was passed.

Morris ruled that Chatham County must pay damages to Eco TIP for trying to slow down work on the project.

“The Moratorium, and the County’s refusal to recognize that Eco TIP’s existing data center project is exempt, has and continues to cause Eco TIP substantial financial and other losses,” the developer’s lawyers wrote in a brief (opens in a new tab). “The county did not simply make one mistake but violated almost every applicable statute and governing legal principle. In short, the Moratorium is a legal trainwreck that should have never been approved, and never been applied, to take away Eco TIP’s property rights in its project.”

At least 30 local governments across North Carolina have passed moratoria on data center development in recent months. It’s unclear how this lawsuit will affect other bans.