Amazon is in talks with American Electric Power (AEP) and a number of Ohio-based renewable energy suppliers, in the hopes of securing low prices for electricity used by its data centers across the state.

The Public Utilities Commission of Ohio will review a regulatory filing today, which includes proposed rate discounts and outlines AWS’ plans for energy usage and future investments in the region.

According to Data Center Frontier, should the application prove succesful, the company plans to build more data centers in Ohio, in addition to the 12 that have already been confirmed.

Take it or leave it 

Ohio Flag
Ohio Flag – Wikimedia Commons/Jeff Kubina

The filing sets out a plan, which, if approved, would give the company unspecified discounts when buying power from the utility, while conserving Amazon’s right to source the cheapest, most enviromentally-friendly energy from any provider and compensating AEP for the use of its transmission network when it does so.

The cloud provider launched its US East (Ohio) Region last year, consisting of three Availability Zones; like other major cloud providers, it has made the state its hub in the Midwest.

The company operates a total of five regions in the US including its GovCloud Region, which is exclusive to state agencies and vetted contractors, with a total of 17 availability zones.

As with all of its Availability Zones, each of the Ohio sites could eventually host up to five data centers.

In order to power the data centers, the company previously spent $300m on a 189MW wind farm in Hardin County, which will generate 530,000MWh of wind a year.

As well as being an attractive location in terms of property and energy costs, the state of Ohio offers lucrative tax breaks to encourage companies to build data centers in the region.

To qualify for tax breaks, the state’s minimum investment threshold for a single project is $100m, and an annual payroll of $1.5m. This applies both to data center owners and tenants, who get a 100 percent tax exemption for all IT equipment purchased if they meet the criteria. 

According to Bloomberg, since 2014, Amazon has received over $123m in tax breaks from the state of Ohio, as well as $2.8m in cash grants. Its planned data center in New Albany could receive up to $193,000 over a seven-year period.

The company has stated that unless it can secure competitive energy prices, it will be looking at other locations to expand its physical presence in the region. The filing reportedly indicates that the company wishes to build between 450MW and 480MW of additional capacity.