Council reaffirms denial of crypto mining permit – Brainerd Dispatch

BRAINERD — The company proposing to bring a new cryptocurrency mining facility to Brainerd has not given up yet.

After the City Council

denied an interim use permit

for outdoor storage units on a property in the industrial park earlier this month, VCV Digital Infrastructure now has its sights set on a building. Community Development Director James Kramvik told the council Monday, July 16, of the update. He said the Economic Development Authority and the Brainerd Public Utilities Commission — both of which have contracts with VCV for land and power purchases — are working to schedule a joint workshop to discuss what the council’s latest action means for the future of the company in Brainerd. The council, Kramvik said, will be invited to take part in that workshop.

Council members voted 6-1 Monday to formalize the list of reasons for denial of an interim use permit that would have allowed VCV Digital to construct 26 storage containers to house their data machines and cooling towers at 1918 Thiesse Drive. Staff presented the council with a list of reasons for the denial, as previously discussed by both council and Planning Commission members. The reasons stated include:

• The project is expected to consume 25 megawatts of power.
• The project fails to materially increase local employment, as only 16 jobs are expected to be added.
• One job is expected to be created for every 1.5 megawatts of power usage, which is not an efficient use of the city’s assets.
• Over 100 homes could be powered for every one employee working at the facility. The high energy demand is potentially detrimental to the city’s ability to prepare for future housing needs, as the 2020 Crow Wing County housing study stated 4,800 additional units must be created between 2018-33 to meet regional demands.
• The facility would operate 24 hours a day.
• A sound study shows nearby residential properties could experience nighttime sound levels higher than the 50 decibels A, a measurement of how loud a sound is perceived by the human ear, a standard set by the Minnesota Pollution Control Agency.

An additional reason for the denial originally listed dealt with carbon neutrality, stating: “The power for this facility would be purchased from the grid and will be the responsibility of the city in the future when the city is required by the State of Minnesota to use entirely carbon-free electrical sources by 2040. The city utilizes hydro-electric power and has recently partnered with AEP to construct solar fields to become more carbon neutral. This facility greatly increases the energy needs for the city and will make it significantly more difficult in the future to meet the state mandate.”

Council member Jeff Czeczok requested that portion be removed, as he said it was not true. He said VCV Digital has purchased renewable energy credits from BPU, thereby making it carbon neutral, as carbon neutrality is based on how energy is created and not how it’s used.

“So I feel like we’re going down a slippery slope,” Czeczok said.

When asked if he had anything to add, Interim Public Utilities Director Patrick Wussow said he did not. When asked if he disagreed with Czeczok’s statements, Wussow said he did not.

Czeczok motioned to approve the denial reasoning with the carbon neutrality portion removed.

Council member Kara Terry she believes the language is broad enough, so she would not support the motion.

“For example, ‘The city utilizes hydroelectric power and has recently partnered with AEP to construct solar fields to become more carbon neutral,’ is a fact. It’s not questionable. No one has to be an expert in carbon neutrality to be able to state that,” Terry said. “I would leave that entire section in there. I think it makes sense to drive the point home and furthers our denial of this IUP.”

Council President Kelly Bevans said he’d support the motion, as believes it reflects the will of the council and what the majority of council members believe is best for the city.

Terry was the only vote against the amended list of denial reasons, which does not include the portion about carbon neutrality.

VCV has 30 days from the denial of the permit to appeal the action to a district court.

THERESA BOURKE may be reached at

theresa.bourke@brainerddispatch.com

or 218-855-5860. Follow her on Twitter at

www.twitter.com/DispatchTheresa

.

Theresa Bourke started working at the Dispatch in July 2018, covering Brainerd city government and area education, including Brainerd Public Schools and Central Lakes College.