I was wrong about being wrong about the Stratos Project

Hansel Valley, the proposed Stratos site

Five months ago I wrote a post called I Was Wrong About the Stratos Project. I did the whole public mind-change thing. I told everybody to go read the sources, and I called my earlier self “loud, confident, and almost entirely wrong.” Water? Closed-loop cooling, basically zero. Taxes? Normal project financing, and the county gets “potentially, everything.” Gas? Not great, but better than the alternative. Then I closed with a sermon: do the reading first. Don’t be Past Josh.

Okay. I want to correct the correction.

May Josh had a very specific energy. Like a guy who just finished an FAQ and thought he’d cracked the case. Past Josh was the hysterical one. Turns out Past Josh was yelling at the right building, and May Josh was standing out front handing people the brochures.

Since then I’ve read the county’s signed agreement with MIDA, and last week O’Leary’s company filed a water application that actually has numbers in it. I also finally read the development agreement and the April draft of the county agreement. They’d been sitting in a public MIDA board packet since April 24, on pages 175 and 207 of 219. In May I bragged that I’d read the actual Utah Code. I had not read page 175. Nobody reads page 175. That’s what page 175 is for.

I read all of it this time. Twice, because I have trust issues now. Earned ones.

Here’s where I landed: Stratos is a bad idea. Not vibes. Paperwork. And I’m mad in two directions. I’m mad at myself for the math, which was my fault. And I’m mad at a state agency, a Legislature, a Governor’s office, a county commission, and a guy from Shark Tank for everything else, which was theirs.

Past Josh, I owe you an apology. You were right. Mostly for the wrong reasons, but right.

The Smoking Ban That Exempts the Smokestack

The pitch was closed-loop cooling. The Governor’s office Stratos FAQ promised “a closed-loop chilling system combined with dry (air-based) cooling,” and my whole water argument sat on that one sentence. My other big thing in May was demanding they publish Exhibit 1, the interlocal agreement between Box Elder County and MIDA (the Military Installation Development Authority, the state agency running the project area). I quote myself with real regret: “If the deal is as good as everyone says, and from what I’ve read I think it largely is, show the agreement.” And my favorite: “Sunlight only helps when you have a good case.”

They showed the agreement. Sunlight, meet case.

Section 5(j) requires every data center to use “exclusively closed-loop cooling systems.” It bans evaporative cooling, cooling towers, once-through water, the works. Somebody sat down and wrote a careful, thorough, actually good rule. Then somebody stapled this to the bottom of it:

“Nothing in this section shall be construed to apply to cooling for any portion of the Energy Generation Facility.”

The Energy Generation Facility is the power plants. So the rule covers the computers and exempts the part that burns the gas to run them. It’s a smoking ban that exempts the smokestack. And nobody writes “nothing in this section shall be construed” by accident. That sentence has a lawyer’s fingerprints all over it.

MIDA doesn’t regulate the plants either. Its development agreement with O’Leary’s company says MIDA’s standards “do not regulate the construction of energy production installations,” and once the plants have their state and federal permits, they get built “without additional permitting approval from MIDA.” So the county doesn’t regulate the power plants, and the agency that has “exclusive police power” over the project area doesn’t regulate the power plants. So who does? Their state and federal permits. That’s the whole list.

Last week’s filing finally says what the plants will be: “a co-located 7.5 GW reciprocating-engine generation facility arranged as fifteen blocks of 500 MW” (KSL). That’s hundreds of industrial gas engines. The company told the Tribune it’s “also considering renewables.” I’m also considering a gym membership. Engines like these get cooled with what amount to giant radiators, and the CEO says the plants will need about two gallons of water per megawatt-hour. I believe him, and that’s good news for the water. It’s bad news for the air, because these engines burn more gas per megawatt-hour than the most efficient gas plants. More on that in a minute. Either way, none of it is a condition in anything the county or MIDA actually signed.

“There Is No Continuous Water Draw”

Here’s what the FAQ said about water. Official document, on the Governor’s own website. I linked it like a responsible adult.

“This project is fundamentally different and would use a closed-loop chilling system combined with dry (air-based) cooling. There is no continuous water draw.”

Water would only be needed for “initial system fill (one-time)” and “minor maintenance,” and ongoing demand would be “similar to that of a large office complex.”

Here’s the engineering report in last week’s filing: “The selected power-water configuration uses a closed recycle loop with 90% recovery and 10% freshwater makeup.” Ten percent freshwater makeup, around the clock, forever, is a continuous water draw. That’s just what the words mean. All in, with 4,850 employees and 154 acres of landscaping, the campus would divert 1,215 acre-feet a year (Tribune), about 1.1 million gallons a day. A large office complex. If your office complex has eleven data center clusters and fifteen blocks of gas engines.

The FAQ is still up. It still says “no continuous water draw.” It still says 40,000 acres. At this point it’s less of an FAQ and more of a historical marker. On October 10, Saturday Night Live’s fake O’Leary (James Austin Johnson) said, “Is it going to take up precious water? Absolutely.” (Tribune) When the parody is closer to the filing than the official FAQ, the official FAQ has a problem.

Now the fair part, because I’m not going to only quote the stuff that helps me. By Great Salt Lake standards, this isn’t much water. After return flows, the campus would consume 987 acre-feet a year, about a tenth of a percent of the extra 800,000 acre-feet a year the state’s Great Salt Lake Strike Team says it would take to get the lake back into its healthy range. The application even argues the lake will get more water than it does today, because the old irrigation used more.

I just want that checked. It’s only true if the ranch was actually using its water, not just holding the right to it. Then I want it locked in. State law lets the State Engineer condition approval to “prevent an enlargement of the quantity of water depleted” (HB 60). In May, one of O’Leary’s partners told the Tribune they had around 10,000 more acre-feet under contract near Snowville “if needed.” A depletion cap is how you make sure “if needed” never comes up. If the numbers are real, nobody should mind writing them down.

I Checked My Math Three Times. All Three Checks Were Wrong.

In May I made a chart. A nice chart, styled to match the site and everything. It showed about 125,600 acre-feet a year of farm water on the Stratos land next to about 3,000 for the data center, with a little green box saying the switch was a net water savings. Then I wrote, and this is a direct quote: “I checked the math twice. Then I checked it a third time because I really, really did not want this to be true. Still true.”

Narrator: it was not still true.

I got 125,600 by multiplying 40,000 acres by 3.14 acre-feet per acre, a typical irrigation rate for the county. For that post I read water studies going back to 1961. I read USGS hydrology data. And then I took 40,000 acres of mostly grazing land and multiplied it by an irrigation rate. I irrigated the cows.

The water right in the new application, water right 13-2, irrigates 920 acres, with a historical allowance of about 1,712 acre-feet a year. The Governor’s FAQ, the one I linked, says “most of the project area is currently used for seasonal livestock grazing, not crop production.” My own post called the land “mostly former ranching and dryland farming.” Dryland farming means no irrigation. It’s in the name. It’s the whole name. I contradicted my own chart in the paragraph right above it. Not in a different post. Not in a footnote. One paragraph up, like a guy losing an argument to himself in a mirror.

So I overstated the farm water by about 73 times, or 42 if you count all 3,000 acre-feet the project said it was buying. Seventy-three. You can’t round your way to seventy-three.

I also wrote that the water “doesn’t come from the Great Salt Lake watershed.” It comes from Salt Wells Spring Stream, which drains toward the lake, and the FAQ itself promised a “net benefit to the Great Salt Lake watershed.” I managed to be wrong in a direction that the Governor’s office and Kevin O’Leary both disagree with. Honestly, that’s kind of impressive.

In May I gave Past Josh a 10 out of 10 for confidence and a 2 for accuracy. I was describing myself, and honestly the 2 was generous.

It’s TIF, Minus the Part Where It Ends

In May I said I’d been “treating standard public-finance plumbing like it was Ocean’s Eleven.” I also said this is “how every large industrial project in the last fifty years has worked,” which I announced with total confidence after checking zero of them. Let’s look at the plumbing. Spoiler: it runs from the school district to the developer.

Normally, a building in a MIDA project area starts paying property tax once it gets a certificate of occupancy, and MIDA can keep most of that tax for up to 25 years, or 40 with an extension (Utah Code 63H-1-501). Then the clock runs out and the money goes where property tax usually goes: schools, the county, and so on. That’s tax-increment financing. It’s normal. It ends.

Now Section 11(a) of the development agreement:

“A Certificate of Occupancy shall not be issued for any Energy Generation Facility or Data Center Campus.”

Read that again. They didn’t forget the certificate. They wrote down, in a contract, that it “shall not be issued.” No certificate, no clock. That’s not a loophole. That’s a load-bearing wall. Instead, the power plants and data centers pay MIDA 1.2% a year on the value they add, and nothing in the law or the agreements ever ends it. Section 13 splits that payment:

Servers and equipment: refunded 100%, within 30 days.
Land and buildings: after a small refund, 80% goes to the developer for infrastructure (it can also back bonds), and 20% goes to MIDA, partly for the state and partly for “military purposes.”
Box Elder School District: nothing.

Same tax bill, different winners. On this land, the school district normally gets about three of every four property-tax dollars (Tax Commission). Here it gets zero, unless the county feels generous; the agreement says the county “may, but is not obligated to” share. In May I said the county gets “potentially, everything.” The school district gets nothing. Potentially.

Other Utah data-center deals divert school money too. eBay’s and Meta’s do, for 20 years, after which the property goes back on the rolls (Gardner Institute). The Gardner Institute’s case for deals like these is that giving up tax now can pay off later “if the property tax increment eventually expires.” This one doesn’t expire.

Then there’s the money the county does get. In May I repeated, with total confidence, $30 million a year in phase one and $108 million at full build. Those numbers are in the agreement as estimates, next to a sentence so honest it’s almost sad: “the County is relying on receiving these amounts as an inducement to enter into this Agreement.” The April draft guaranteed them. The signed version guarantees “$10,000.00 annually for each megawatt” instead. That’s $30 million at the 3 GW first phase both agreements assume, $75 million at the 7.5 GW filed last week, $90 million at the original 9 GW, and less if they build less. Add three upfront payments of $5.4 million and it’s real money for a county whose general fund is about $30 million. But the county wrote down that it was relying on $108 million, then signed for $90, and I spent May telling everybody it got $108. Great work by me.

And the energy tax I called “the trade for the developer building their own power generation”? Data centers pay at least 0.5%, raised as needed to hit the county’s floor. Everyone else is supposed to pay 6% (though the only ordinance MIDA has posted charges everyone 0.5%). At the starting rate, that’s a 92% discount. This year the Legislature capped the energy-tax rebate a city or county can give a data center at 80%. MIDA isn’t a city or a county. So Utah now has a rule against cities and counties giving data centers more than an 80% energy-tax break, and a state agency the rule doesn’t reach.

Better yet, Section 14(b) of the development agreement lets the data-center energy tax be raised, “if requested by the Master Developer,” to help build the power plants. A public tax, raised at the developer’s request, to help pay for the power plants. That clause got cut from the county’s agreement and is alive and well in the developer’s, like the guy in the horror movie who sits back up. So much for “the developer building a private power plant to serve a private load,” as May Josh put it.

“Never Going to Happen,” Times Fifteen

In May I complained that the perfect customer for nuclear power walked into the restaurant, looked at the menu, and ordered natural gas. Update: it ordered fifteen. And they’re engines.

The Governor was on my side, sort of. In late May, Governor Cox told The Salt Lake Tribune that an all-gas buildout was “never going to happen. The very first phase will be natural gas, but the other phases should not be. They should be nuclear, and they should be geothermal, and solar and other technology” (via Grist).

“Should” is doing a lot of work there, and none of it is written down anywhere binding. The only plan on file is fifteen 500-megawatt blocks of gas engines. Here’s my rough math for that, running 70–90% of the time:

That’s 1.3 to 1.7 times all the natural gas Utah burned in 2024 (EIA): every furnace, stove, factory, and power plant in the state, and then some. Utah’s energy CO₂ would go up 37–47% (EIA). Yes, I checked this math. No, I’m not telling you how many times. I’ve learned that much.

The engines make it worse, but even the most efficient gas plants made, running only 70% of the time, would burn about as much gas as the entire state. Utah Clean Energy also estimated that engines at the original 9 GW would put out about 12,000 tons of smog-forming NOx a year.

May Josh’s fallback was that a developer-funded gas plant “is still better than 9 GW dumped onto a coal-heavy grid the public pays for.” Then, my personal favorite: “Depressing bar to clear. Cleared regardless.” Nobody ever proposed putting it on the grid, and no utility was going to serve it. I built the bar myself, out of nothing, and then handed Stratos a medal for clearing it. I won an argument against a guy I made up.

The real upside of going off-grid is that Utah ratepayers don’t pay for the plants. That’s the best argument Stratos has. You won’t see Stratos on your power bill. You’ll see it in the air. Box Elder County sits right next to the Northern Wasatch Front’s ozone nonattainment area, and the air permit is now one of the only real checks left on the plants. The Governor says that’s “a yearlong [permitting] process... We’re not speeding those up.” Good. Hold him to it.

The Heat Nobody Has Modeled

Every watt that goes into a data center comes back out as heat, and so does all the fuel energy that doesn’t become electricity. For 7.5 GW of gas engines, that’s roughly 13 to 16 gigawatts of heat on average, by my math. Spread over the roughly 2,500 acres they plan to develop, that’s more energy per square meter than noon sunlight, and it doesn’t set. Most of it rises and blows away, so this isn’t a temperature forecast. USU physicist Robert Davies estimated in May that the original 9 GW plan could warm the valley by several degrees, more at night (Tribune). It’s back-of-the-envelope, and it’s the only estimate I could find. I couldn’t find any heat modeling from the developer, MIDA, or the state.

So that’s noon, all night, every night, and as far as I can tell nobody in charge has run the numbers. I’d love to be wrong about this one. I have practice.

Everybody Took a Turn

Okay. Here’s the part that actually makes me angry. This didn’t happen because one villain did one shady thing. It happened because everybody took a turn, and every turn made the next one easier.

The state agency. MIDA is the Military Installation Development Authority. It was created to develop land around military bases. It is now running a project with hundreds of gas engines and eleven data center clusters, which even the Governor calls “a little mission creep” (KPCW). MIDA’s board approved its deal with O’Leary’s company on April 24, and that deal says MIDA had “entered into” its agreement with the county “effective as of April 24, 2026,” “following all requirements” of state law. The county voted on May 4. The paperwork certified a handshake before the other hand showed up. (Utah Civic Compact, an advocacy group, says MIDA broke state law by acting first. I’m not a lawyer. I can read a calendar.) Then, on July 29, a MIDA spokesperson said its work was “paused at this time as there is no action before us, and we continue to respect the referendum process.” In the same Tribune story, O’Leary said, “We are full steam ahead on the project.” Paused and full steam ahead. Schrödinger’s data center.

The Legislature. “That was not a decision that was made by me or the Legislature,” the Governor said (Grist). Technically true. It was made by MIDA’s board, which was chaired by the president of the Utah Senate. Not the Legislature, just the Senate’s top guy wearing a different hat, with another senator, Jerry Stevenson, on the board too. Once the heat was on, Stevenson’s plan was to “leave it alone until after the legislative session, if possible” (KPCW). Bold strategy. Meanwhile, the Legislature’s own work: a 2025 law letting big users run their own off-grid power that, per its own staff, “did not add regulations for fuel economies, environmental standards, or energy use limits for large load users” (briefing paper). And a 2026 data center water-reporting law where skipping your report costs “up to $100 for each day” (HB 76). For a project with a $15 billion first phase, that’s not a fine. That’s a subscription.

The Governor’s office. It published the FAQ: “no continuous water draw,” plus a review committee “largely represented by Box Elder County expert staff.” The signed agreement: MIDA’s director chairs that committee, and the members “serve at the pleasure of the MIDA Board.” Largely represented, entirely removable. Then the Governor reviewed the project his own office’s FAQ had been explaining: “There’s no question, the process was not good.” The FAQ is still up.

The county. In May I complained that the county turned down a records request for the agreement because it was “not yet signed and remains a draft.” By then, a draft had been sitting on the state’s public notice website since April 24, on page 207 of MIDA’s packet. Then the commission signed a version that was weaker than that draft on water, gas, and noise. Five weeks later it passed a moratorium on new data centers that can’t touch the only one anybody’s talking about, because it had just handed MIDA the land-use authority there. And when residents appealed to get a vote, the county joined O’Leary’s company in asking a judge to throw the appeal out (Deseret News). That was about a week after MIDA said it was pausing to “respect the referendum process.” MIDA’s partners apparently didn’t get the memo.

The developer. Fun fact from the development agreement: the developer is “branding and marketing the Development Project as ‘Wonder Valley,’” the same name as O’Leary’s data center project in Alberta. Even the name is a rerun. When people pushed back, O’Leary went on Fox Business and Fox News and called opponents “proxies for the Chinese government,” naming two Utah groups, and then made similar accusations about ten more times in 23 days, by the Tribune’s count. Then he posted that he had “no evidence.” Then Fox apologized on air. He’s now facing two defamation suits, and in the first one, his lawyers argue that no “reasonable viewer” would have taken his claims as fact. So the official legal position is that nobody should have believed him. Noted.

Nobody Can Enforce Any of This

So say the developer breaks a promise. Who stops them?

Not you. Section 9 of the county agreement: “No third-party may enforce the terms of this Agreement.” That’s standard contract language, and it means only the two governments that signed it can enforce it. You’ve met them.

Not the public, really. MIDA’s yearly reports to the county can be marked “Confidential,” and the county has to honor that. The new water-reporting law only covers power generated “by the operator of the large data center,” so whether it reaches these plants depends on who ends up owning them.

Not the county. The agreement runs 50 years, and ending it doesn’t shrink the project area. Inside it, MIDA has the land-use authority, and the county has a fire truck coming if anything gets taller than 35 feet.

Not voters, directly. The county attorney rejected the referendum applications because the votes were “administrative,” not “legislative” (Utah News Dispatch). So a 50-year agreement, a tax deal with no end date, and handing a state agency land-use control of a project area that’s still officially about 40,000 acres (O’Leary announced in June he’d drop about 20,000) is, legally speaking, paperwork. The appeal is pending.

Not water protests, as much as before. HB 60, in effect since May 6, narrowed what the State Engineer can weigh and dropped the old duty to consider effects on “public recreation or the natural stream environment” (Western Water). The October application gets judged under the narrower rules.

Here’s what changed between the April draft of the county agreement and the version the county signed on May 4:

Wells: “New water wells shall be prohibited in the Project Area.” Gone.
Reporting: quarterly, with gas. Now yearly, no gas, and it can be marked confidential.
Noise: measured at the project boundary. Now measured at “any residential home outside of the boundary.” So the edge can be as loud as it likes, as long as nobody lives close enough to hear it.
Money: $30 million and $108 million guaranteed. Now $10,000 per megawatt.
Cooling: nothing. Now closed-loop for the data centers, with the power plants excluded.

Some changes did help the county: road repair, that fire truck, and keeping the land along I-84 off-limits until data centers are actually running. But apart from the data-center cooling rule, every change touching water, gas, or noise went the developer’s way.

Voters did get one say. In June, Senate President Stuart Adams, who chaired MIDA’s board when it approved Stratos, lost his primary. So did two of the three county commissioners who voted yes. One of them, Lee Perry, told the Tribune: “Do I think that the data center vote cost me the election? Yes I do.” Turns out “administrative” decisions can still get you fired.

“But What About...”

“Think of the jobs.” I did, in May, and I was right about exactly one thing: construction is thousands of jobs, roughly 5,000 to 15,000 at 7.5 GW by legislative staff’s estimate (briefing paper). The permanent number has moved from 2,000 (the FAQ) to 4,850 (the filing), which is a lot of movement for a number that’s supposed to be a plan. None of those jobs require a tax deal that never ends. Plenty of employers manage to pay their school district.

“It’s probably never getting built.” Maybe. O’Leary’s company has raised about $20 million so far (Tribune). He’s told Fox 13 the first phase alone is $15 billion. That’s about 0.13% of the way there, the equivalent of having $533 saved toward a $400,000 house. There’s no announced tenant, and his summary of the plan was “you build it and they will come,” a riff on a movie about a man who hears voices in a cornfield. But the development agreement says neither side has “a right to terminate this Agreement,” the project area outlives the county agreement, and the water right is being decided right now. “It might not happen” shouldn’t be the most reassuring thing you can say about a project.

“You’re just mad because you were wrong.” Partially. I’m definitely embarrassed. But the documents say what they say either way, and every one of them is linked below.

May Josh’s Final Score

“Closed-loop dry cooling.” Half right. Data centers only. The smokestack is exempt.
“Doesn’t come from the Great Salt Lake watershed.” Wrong. Even the FAQ disagreed with me.
Retiring irrigation saves about 125,000 acre-feet. Wrong, by about 73 times. I irrigated the cows.
“Standard public-finance plumbing.” Wrong. Standard plumbing has a shutoff valve.
$30 million and $108 million a year to the county. Half right. The $30 million holds at 3 GW. The $108 million is a $90 million floor.
The energy-tax cut is “the trade” for building their own power. Half right. Ratepayers are off the hook, but the tax can be raised to help build the plants.
Gas is “not catastrophic” and beats the grid. Wrong. The grid was a guy I made up.
The county’s general fund is about $30 million. Right. It’s $30.48 million. I can read a budget. Just not a water right.
Thousands of construction jobs. Right.
“Show the agreement.” Granted. Monkey’s paw.

Two right, three half right, four wrong, and one wish granted by a cursed artifact. May Josh goes 3.5 for 9, which is a great batting average and a terrible policy analysis. Past Josh, who was mostly just yelling, at least had the 80% part right.

Where I Landed

In May I wrote that “I don’t like how this was done” and “this shouldn’t be done” are different sentences. They still are. It turns out both are true.

If Utah wants to do this right, and the Governor keeps saying it does, here’s what “right” looks like:

Put the power plants’ promises in writing. Cooling, water, and emissions limits in the agreements, not just in a filing.
Give the tax deal an end date, like every other data center deal in the state, with the school district getting its share.
Report water and gas use in public, quarterly, like the April draft promised.
Let the people who live there enforce it. And vote on it.

And here’s what you can do:

Protest the water application. The Division of Water Rights takes protests on change application a55167 online ($15, and you can request a hearing) until 20 days after the public notice finishes running. The State Engineer still has to find that the applicant “has the financial ability to complete the proposed works” and didn’t file “for purposes of speculation.” A company with about $20 million raised, a $15 billion first phase, and no announced tenant should have to show its work on both. Ask for a depletion cap, too.
Vote on November 3. Ask anyone on your ballot what MIDA reform means to them. The Governor has called for “major reform” (KPCW), and the 2027 legislative session is when it happens or doesn’t. Senator Stevenson would like everyone to leave it alone until after that. Don’t.

In May I ended with “do the reading first.” I still believe that. I’d just add a second rule: keep reading after you’ve made up your mind, because the documents that matter tend to show up after the press release, or on page 207 of a board packet. In May I called reading the sources “revolutionary methodology.” It was revolutionary, all right. I went all the way around in a circle and ended up right where Past Josh started.

Past Josh was loud, confident, and wrong about plenty. May Josh was calm, confident, and wrong about more. October Josh is trying something new: being right, with receipts.

We’ll see how it goes.

Everything here is current as of October 21, 2026.

Sources

The agreements

Interlocal agreement between MIDA and Box Elder County (Agreement 26-15), signed May 4, 2026
MIDA's development agreement with O'Leary Digital (April 2026)
MIDA board packet, April 24, 2026 (the development agreement starts on page 175, the April draft of the county agreement on page 207)
MIDA Ordinance 2026-01, the Stratos energy tax
MIDA's Stratos page

Water

Money

Gas, air, and heat

Enforcement, politics, and everything else

How I did my math

The gas, CO₂, and heat numbers are my own estimates, not anyone’s official figures.

Generation: 7.5 GW, from the filing, running 70–90% of the time. An off-grid campus needs spare capacity, so I don’t assume it runs flat out.
Gas: 8,295 Btu of gas per kWh, EIA’s figure for new gas engines (AEO2023, Table 1), and 1,037 Btu per cubic foot of gas. The best case (“the most efficient gas plants made”) uses about 6,370 Btu per kWh, EIA’s newest combined-cycle figure adjusted for dry cooling.
CO₂: 53.06 kg per million Btu, from the EPA.
Heat: all the fuel’s energy ends up as heat, at the engines or in the servers: 7.5 GW × 8,295 ÷ 3,412 at 70–90% output, spread over 2,500 acres, or about 1,300–1,600 watts per square meter. Noon sunlight is about 1,000.
Property tax: the Tax Commission’s 2025 rates for this part of Box Elder County add up to 0.927%, the same rate the development agreement uses. The school district’s share is 0.6978%.