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U.S. state Connecticut has granted a 10-year sales-and-use tax exemption to EIP Investment LLC, the developer of a $1billion fuel-cell powered data center in New Britain.

The Tax break which was offered by the state venture capital arm Connecticut Innovations (CI), is estimated to be equivalent to $55.2million for EIP. This is the biggest tax benefit ever awarded by CI since about a decade of its existence.

“This will put us on a par with 23 other states that are competing every day to attract national data center operators to their sites, and it will apply only to the computing equipment after nearly $400m is spent on the bricks and mortar,”
Mark Wick, EIP Partner.

EIP intends to develop a 20-MW fuel cell microgrid in the first phase of its project, which will cost about $100million. This phase will focus on building a microgrid that spans 45,000 square-feet on the site of a closed Stanley Black & Decker manufacturing plant. Completion of the first phase would claim the largest indoor fuel-cell system in the world, according to EIP.

The U.S. subsidiary of South Korea’s Doosan will provide the fuel cells for the data center. Doosan will, therefore, supply 44 fuel cells to the site and perform all the scheduled maintenance for a period of 20 years. Doosan will also support the EID installation team and engineering efforts in setting up the microgrid.

“High performance computing centers, fuel the 21st century economy and attract many other IT companies to their campuses,”
Ned Lamont, Governor of Connecticut.

“Given Connecticut’s proximity to major metropolitan areas and the needs of our municipal, state and private sector business clusters for these high performance computing services, we can now compete with other states and transform an under-utilized industrial complex into a modern IT campus that will generate significant local and state tax revenues, and high paying IT and related service jobs.”

Development of the first phase is to begin in early autumn and expected to be completed by next year. The second phase of the project focuses on the development of the datacenter, which is estimated to cost about $300million.