City review begins for large data center bid in Salem
A data center developer tied to a company spun out of Alphabet has lodged a formal proposal with Salem city staff to build an expansive campus inside the city’s Mill Creek Corporate Center.
Verrus is proposing what the city has valued at roughly $5.1 billion for a campus known on the developer’s site as Oakline at Mill Creek. The plan calls for three buildings and a supporting utility substation on 75 acres zoned as an Employment Center, where data centers are listed as an allowed use.
The proposal is still at an early stage. City Manager Krishna Namburi said the city will evaluate the submission through established planning, permitting and regulatory processes.
“Verrus’ proposal represents a potential opportunity for Salem. The City of Salem is committed to carefully evaluating the proposal and taking necessary steps to ensure it aligns with our community’s long-term interests,”
The developer’s materials emphasize engineering choices aimed at reducing traditional resource impacts. Verrus says the design will use a closed-loop cooling system and rely on lithium iron phosphate batteries for backup power, rather than prioritizing diesel generators. The company also has pledged to pay for infrastructure upgrades and share ongoing grid maintenance costs with Portland General Electric, the utility that serves Salem.
What Salem will examine during the review
City staff and elected officials will weigh multiple questions as the proposal moves through a formal pre-application and permitting process:
- Local infrastructure needs, including distribution and substation capacity for a major new load.
- Water use and environmental impacts, despite proponents pointing to closed-loop cooling as a water-conserving measure.
- Traffic, site layout and public safety implications for the Mill Creek Corporate Center neighborhood.
- Long-term economic benefits and any conditions the city might attach to approvals.
Verrus’ site materials also state the campus could help reduce grid stress by moderating power draw during peak periods, an assertion that will likely be scrutinized by the city and PGE engineers. The firm also signals it will fund transmission and distribution improvements needed to serve the campus.
Local context and statewide trends
Salem’s interest in large-scale data center projects reflects a broader push across Oregon to attract cloud and AI infrastructure. Communities statewide are weighing potential tax revenue and jobs against concerns about energy demand, water use and the strain on local services. For Salem, the project would represent one of the largest single-site private investments proposed in recent years.
However, the city’s statement underscores that the proposal is not an approval. The campus must navigate the city’s planning, development, building, utility and regulatory review, a process that can surface technical studies, public hearings and mitigation requirements before any construction permit is granted.
| Element | Detail (from proposal) |
|---|---|
| Valuation | $5.1 billion |
| Size | 75 acres |
| Buildings | Three data center buildings + utility substation |
| Cooling | Closed-loop system |
| Backup power | Lithium iron phosphate batteries emphasized |
Questions ahead for Salem residents
Residents and local businesses should expect a period of technical review and public outreach if Verrus proceeds. Key outcomes to watch include the scope of infrastructure upgrades required, any environmental mitigation measures, and the timeline for state or local permits. The financial commitments Verrus has indicated toward grid upgrades could alter how much cost PGE and customers carry, but those details will need verification in the formal review.
As Salem considers the proposal, officials will balance the potential economic scale of a multi-billion dollar campus against the operational realities data centers create: large, steady electric demand; significant built infrastructure; and long-term land use implications for the Mill Creek area.
The project remains a proposal. City staff say Verrus must take part in the formal pre-application process to discuss project details before the city will permit any work to begin.
