EASTPORT, Maine — The City Council voted unanimously Wednesday to enact a 180‑day moratorium that halts all progress on a proposed underwater artificial intelligence data center planned for waters off Eastport.
Councilors said the move gives them time to consult with the Eastport Planning Board on the zoning impacts of two citizen-initiated ordinances designed to prevent data center projects in the city by amending the city’s zoning and shoreland zoning ordinances.
At the heart of the controversy is a project proposed by Louis Wolfson, a luxury real estate developer from Needham, Massachusetts, and the managing member of DeepGreen Holdings LLC.
The company formed in Delaware one month before applying for Federal Energy Regulatory Commission, or FERC, preliminary permits to build tidal‑powered, underwater artificial intelligence data centers for both DeepGreen Western Passage SVP in Maine and a second project in the Upper Cook Inlet in Alaska.
The Alaska proposal has also faced resistance from the local community.
In February, DeepGreen filed a 48‑month preliminary permit application with FERC to begin engineering and environmental tests in Maine, a required first step toward developing an underwater artificial intelligence data center in the Bay of Fundy.
The application drew an almost immediate response from residents and Passamaquoddy tribal officials, who strongly oppose the development. Among the most vocal opponents is the Eastport Coalition for Healthy Oceans, or ECHO, which submitted two citizen petitions for ordinances intended to prevent the project and protect what the group describes as “the character of the city.”
FERC found multiple deficiencies in DeepGreen’s application, including failure to identify all tribes affected by the project, failure to specify all physical dimensions and configurations required by statute, inclusion of maps that extended beyond the required project boundaries, and a lack of detailed technical explanation for a 400‑acre “operational envelope” despite a much smaller active infrastructure footprint.
In its response to FERC, DeepGreen supplied the requested names and contact information for tribal leaders. The company also provided an updated map and revised technical specifications showing a significantly smaller proposal, reducing the original 400‑acre operational envelope in the Western Passage to an active infrastructure footprint of 27.1 acres.
The company also told FERC that the “total proposed project operational capacity has been scaled down to a maximum of 15 MW (megawatts) to align with revised commercial modeling,” compared to an earlier proposal that envisioned up to 51 MW. In the revised Phase I, DeepGreen projects installing 16 marine hydrokinetic turbines, increasing to 34 in Phase II. The original proposal called for 170 turbines.
The permit application for the Alaska project received a similar letter of deficiencies from FERC, but the company has not indicated that the Alaska proposal is being scaled down.
The February filing for DeepGreen Cook Inlet SVP proposed an initial operational envelope of 1,650 acres, along with approximately 330 to 350 marine hydrokinetic turbines using the company’s proprietary Universal Docking Cradle system.
Marianna DiMaggio, a resident of Soldotna, Alaska, who says she also has generational ties to the Pembroke area and the New England coast, is lending her voice to the growing opposition and wrote a letter of dissent to officials in Eastport and Alaska, including Randy Bates, the commissioner of the Alaska Department of Environmental Conservation.
“There is lacking evidence to promote the potential benefit versus risk,” she said. “If the investors who propose this had any interest or consideration of the well-being of these communities, they would bother to show up for the town meetings. They have shown a lack of respect, transparency, and understanding of the communities they seek to profit from.”
Neither project has been granted preliminary permits.
At Wednesday’s meeting, Councilor Karen Raye made a motion for the council to adopt a moratorium to temporarily prohibit any “application, permit, license or approval related to the establishment, construction, expansion or operation of a commercial or industrial data center or artificial intelligence computing facility.”
The moratorium specifies that facilities on land, underwater, partially or fully submerged, and any co‑occurring infrastructure are included in the ban, which will last 180 days unless extended or terminated by the council or until the citizen‑initiated ordinances have been reviewed and decided.
Raye posted the full text of the moratorium on a Facebook page that she said she created for transparency and civic engagement.
A citizen‑initiative proposal for a permanent ban on data centers could go to voters with only minor formatting changes to the original language, according to the city’s legal counsel, the law firm Rudman Winchell. But a second petition — an ordinance requiring voter approval for any new industrial or commercial development larger than 25,000 square feet on land or 10,000 square feet in the ocean, if the permanent ban passes — is “unenforceable and unlawful,” according to a Rudman Winchell opinion released earlier this month.
Chris Gardner, executive director of the Eastport Port Authority, told Monitor Local he does not support this artificial intelligence data center project but does not think Eastport should rule out future projects — data center or otherwise — where the project specifications and energy architecture make sense for the waters off Eastport.
When asked about the Eastport Port Authority’s charter, Gardner said: “If the Port Authority is so inclined to say we want to partner with an AI company, our charter allows it. We can invest in filling stations, hotels, in anything we want, as long as it’s not in direct competition with anything existing in Eastport. Our responsibility first is to the health and vitality of Eastport’s waterborne assets.”
In light of the Rudman Winchell opinion on charter supremacy, which outlines legal precedent favoring charter mandates over ordinance, Gardner agreed the same principle applies to the port authority’s charter.
“Democracy is three guys who vote to steal the fourth guy’s bike,” he said. “We live in a representative republic, and if people don’t like the rules, they can change it.”
The next step for the citizen petitions is with the Planning Board, which is expected to review both proposed ordinances at a special public hearing on Aug. 24, after which the board could make recommendations for adoption and nonsubstantive changes.
In response to the city’s legal analysis, ECHO developed an updated petition requiring voter approval. The petition states, “If any provision of this ordinance is found by a court of competent jurisdiction to be ‘unenforceable,’ the rest of the ordinance shall remain in full force and effect.”
The petition received the necessary signatures, and an affidavit was filed with the city clerk just hours before Wednesday’s meeting, according to Birdy Velveteen, the spokesperson for ECHO.
Velveteen said the group also filed recall petitions on every councilor and “a second charter amendment that removed council’s power to repeal citizen initiatives.”
A statement from ECHO reads: “We’ve watched data center trends and observed that many try to circumvent local bans by calling themselves things like ‘co‑location storage facilities.’ The voter‑approval petition ensures that no matter how data centers rebrand themselves, We the People keep approval power over future large‑scale development.”
This story appears as part of a collaboration to strengthen investigative journalism in Maine between the BDN and The Maine Monitor. Read more about the partnership.