Oracle’s proposal to deliver at least $155 million in utility payments and customer credits linked to its massive Project Jupiter AI data center collided with strong resistance from Doña Ana County commissioners on Tuesday, prompting a company executive to offer to scrap the plan.
During a scheduled update to the county board on Oct. 13, Oracle representatives outlined a proposed Energy Service Agreement with El Paso Electric. Under the deal, the tech giant would pay the utility $10 million annually for 10 years—totaling at least $100 million—even if its power use falls short of contracted levels. The payments would cover late-stage construction needs, initial commissioning, emergency backup power, and life-safety requirements at the site.
Separately, Oracle proposed up to $55 million a year for as many as three years in direct bill credits for El Paso Electric’s residential and small-business customers in New Mexico, potentially beginning in 2027. Combined with one year of the maximum credit, the package reaches the “at least $155 million” figure highlighted in the company’s announcement. Full three-year credits could push the customer benefit higher.
Oracle stressed that the primary power source for the hyperscale campus remains unchanged: an on-site Bloom Energy fuel-cell microgrid. The utility connection would serve only limited, secondary purposes.
El Paso Electric President and CEO Kelly Tomblin welcomed the customer-credit proposal, saying the utility supports efforts to ensure growth benefits residential and small commercial customers.
“We welcome the opportunity to facilitate Oracle’s credit to further affordability for our customers,” said Kelly Tomblin, president and CEO of El Paso Electric. “Growth and investment in New Mexico has always been an EPE priority and we support the effort Oracle is making to ensure that this growth benefits our residential and small commercial customers.”
The announcement, released about 30 minutes before the meeting and absent from materials provided to commissioners more than a week earlier, caught board members off guard.
Commissioner Christopher Schaljo-Hernandez led the criticism, arguing the plan effectively tied Project Jupiter to local ratepayers after repeated assurances that the data center would generate its own power and not increase electric bills. He noted that rates are set by the New Mexico Public Regulation Commission, not by Oracle or El Paso Electric alone.
“The only way that you can 100% guarantee that you’re not going to raise the rates on New Mexico residents is by not tying in,” Schaljo-Hernandez said.
Commission Chair Manny Sanchez and others pointed to the county’s industrial revenue bond ordinance and related agreements, which require the project to rely on a microgrid power generation facility and battery storage while exploring renewable options. Connecting to the utility grid, they said, could necessitate amendments requiring further board approval.
Commissioners Susie Kimble and Susana Chaparro also objected to the late notice, with Chaparro describing it as part of a recurring transparency issue.
Mahesh Thiagarajan, executive vice president of Oracle Cloud Infrastructure and the project’s lead, acknowledged the misstep. “Our intent was that we were doing something nice. Obviously, that was incorrect. So we take that back. We want to work with you,” he said. “So I will undo any decision, if that’s what it takes.” It remained unclear Tuesday whether Oracle would formally withdraw the proposal.
Project Jupiter, a roughly 1,400-acre AI-training data center campus in the Santa Teresa area, is a cornerstone of Oracle’s large-scale computing commitments, including work tied to OpenAI. The project has faced ongoing scrutiny over power supply, natural-gas infrastructure, air quality permits, water use, and community transparency.
In the same set of announcements, Oracle pledged $1 million toward Doña Ana County flood recovery efforts and released an updated economic analysis projecting more than $13 billion in activity from the project during construction and its first 17 years of operations.
The episode underscores persistent tensions between the economic promise of large-scale data centers and local concerns about infrastructure impacts and ratepayer protections in southern New Mexico. Further discussions between Oracle and the county are expected.
