News Release: City of Santa Clara to Discuss Comprehensive Approach to Data Center Development

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City of Santa Clara


News Release





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*FOR IMMEDIATE RELEASE: Friday, October 2, 2026*

*CONTACTS: *Janine De la Vega, PIO | Director of Communications, 408-615-5522 or email jdelavega@santaclaraca.gov






City of Santa Clara to Discuss Comprehensive Approach to Data Center Development

 

*"SANTA CLARA, Calif."* – On Tuesday, October 6, the Santa Clara City Council will receive an update on the City’s comprehensive approach to managing future data center development, including electric reliability, water use, siting and design, community benefits, and emerging sustainability technologies.

As communities across the country consider the rapid growth of data centers and artificial intelligence, it is important to distinguish that Santa Clara is unique and has decades of experience managing this important part of the Silicon Valley economy.

Silicon Valley Power (SVP), the City-owned electric utility, has served data centers since 1996, when the world’s first modern data center was built in Santa Clara. Since then, data centers have become an important contributor to our local economy. *In FY 2025/26, data centers contributed $35 million to the City of Santa Clara’s General Fund *from sales and use taxes, property tax, and a 5% voter-approved electric utility General Fund Transfer.

“Data centers have been part of Santa Clara and Silicon Valley’s technology landscape for decades,” said City Manager Jovan D. Grogan. “We have thoughtfully managed growth. Many in the community are not aware that* Silicon Valley Power stopped accepting new data center requests in 2023*. This was in response to receiving more requests than we could accommodate and to allow for the completion of an ongoing capital program to position the utility for continued success. The pause in electrical load applications for new data centers remains in effect, and the City is using this opportunity to revamp the review process for any future data centers.”

Additional information on the City’s efforts to maintain reliable and affordable electric service for residents and businesses, modernize Silicon Valley Power’s infrastructure, and ensure new development advances the City’s environmental sustainability goals is available in the staff report [ https://www.santaclaraca.gov/home/showdocument?id=90938&t=639265612500379331 ] for Tuesday’s meeting.

Below is a brief comparison of Santa Clara’s electric rates to other utility providers.

Managing Electric Rates

In compliance with California’s cost-of-service rules, large customers pay for the electricity they use and, through the City’s Load Development Fee, for the infrastructure upgrades needed to serve their added demand. *Residents do not pay for infrastructure built to serve that growth.* Additionally, large customers’ around-the-clock demand also spreads fixed system costs across more sales, helping keep Santa Clara’s electric rates 33% to 57% below neighboring utilities.

SVP residential rates are among the lowest in the State of California, lower than the national average, and significantly lower than PG&E.

Rate Comparison [ https://drive.google.com/file/d/11M9OIq9a5L60meePJzjzRWnA1Q2NEQj6/view?usp=sharing ]

The City of Santa Clara remains fully committed to providing reliable, affordable, and clean electric service for Santa Clara’s residents and businesses, while meeting existing customer commitments and investing in the infrastructure necessary to support the City’s long-term electric needs.






*About the City of Santa Clara
*Located at the heart of Silicon Valley about 45 miles south of San Francisco, the City of Santa Clara truly is “The Center of What’s Possible.” Incorporated in 1852, Santa Clara covers an area of 19.3 square miles with an estimated population of 129,498. Santa Clara is home to an extraordinary array of high-tech companies, including Applied Materials, AMD, Intel, Nvidia, and Ericsson. The City of Santa Clara is also home to Santa Clara University, California’s Great America Theme Park, and Levi’s® Stadium, home of the San Francisco 49ers and future host site of Super Bowl LX and FIFA World Cup in 2026. For more information, visit SantaClaraCA.gov [ http://www.SantaClaraCA.gov ].

*About Silicon Valley Power* 
Silicon Valley Power [ https://www.siliconvalleypower.com/ ] (SVP) is the trademark adopted for use by the not-for-profit electric municipal utility of Santa Clara, CA [ https://www.santaclaraca.gov/ ], serving residents and businesses since 1896. SVP provides power to over 60,000 customers at rates 33 to 57 percent below neighboring communities. SVP is the only full-service, vertically integrated publicly owned utility in Silicon Valley owning generation, transmission and distribution assets. Visit SiliconValleyPower.com [ https://www.siliconvalleypower.com/ ] for more.






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