From crypto to AI

Karin Critchlow has many fond memories of summers spent on Seneca Lake. After all, her family has owned land next to the lake in the small village of Dresden for more than 70 years.

Over that time, they’ve improved the property, building two lake houses, enhancing the beach area, and expanding the dock. In recent years, they’ve had to install central air conditioning; something they thought would never be needed—in the past they’d just open the windows on hot summer nights.

“On a summer night (now), you wake up at two in the morning (because) the sound is so loud. It sounds like there was a truck coming down the back road,” Critchlow says.

The sound she describes comes from the Greenidge Generating Station, a cryptomining site about 500 yards from their lake house.

As noisy as Critchlow finds it at its current size, the power plant could grow in scope. The company that operates the generating station plans to convert its operation to a hyperscale AI data center. That pivot to AI and high-performance computing was <a href="https://ir.vulcanip.com/news-releases/news-release-details/greenidge-generation-reports-preliminary-financial-and-0#:~:text=Greenidge%20CEO%20Jordan%20Kovler%20commented%3A%20%E2%80%9COur%20team%E2%80%99s%20exceptional%20focus%20and%20execution%20over%20the%20past%20two%20and%20a%20half%20years%20have%20helped%20set%20the%20stage%20for%20Greenidge%20to%20realize%20its%20significant%20growth%20potential%20and%20facilitate%20an%20effective%20transition%20from%20<a href="https://xpertsstudio.com/xrp-etfs-attract-1-55m-as-bitcoin-and-ethereum-see-outflows/” title=”XRP ETFs Attract $1.55M as Bitcoin and Ethereum See Outflows”>Bitcoin%20mining%20to%20AI/HPC.” rel=”nofollow noopener” target=”_blank”>signaled in March when the company released its fourth-quarter financial results and highlighted in July by its name change, from Greenidge Generation to Vulcan Infrastructure and Power.

Private equity firm Atlas Holdings made Greenidge the operator of the Seneca Lake site in 2017, when it first announced plans to sell power to the grid. Two years later, its focus switched to cryptomining. The company also has sites in Mississippi and North Dakota.

The shift to hyperscale AI comes as Gov. Kathy Hochul signed an executive order for a one-year moratorium on data centers and state Sen. Kristen Gonzalez has pushed for legislation to regulate data centers.

Gonzalez agrees with those who oppose Vulcan’s plans, believing the company is coercing a small town to agree to a development that will negatively impact Seneca Lake. Supporters of Vulcan believe it is an effective, responsible partner in preserving their town.

According to the minutes of an August meeting of the Torrey town council, Vulcan president Dale Irwin promised: “1. More public outreach and information. 2. No change to the lake.”

Neither Vulcan nor Irwin responded to requests for comment on this story.

Local environmental group Seneca Lake Guardian estimates that converting the facility to a hyperscale data center could triple its 104 megawatt output. These larger energy requirements will likely also increase noise pollution and require more water from Seneca Lake.

The station is currently permitted to take 139 million gallons a day from the lake to cool its equipment. According to its last submitted water withdrawal report in 2024, the company averaged 89 million gallons per day.

“Even though this is a big lake, that is a dramatic amount of water that’s just lost through evaporation,” says Stevan Ramirez, a Dresden resident. “My biggest concern is that they’re going to be requesting even more water when the data center is up and running. That’s scary.”

Karin Critchlow’s husband, Beau, says the water temperature at the mouth of the Lake Keuka Outlet, a creek that connects the two Finger Lakes, is substantially higher than the rest of Seneca Lake; when he has measured it, the temperature there has ranged from 98 to 102 degrees.

He believes the warm water is harming the lake’s fish and gives a sardonic chuckle when the sign outside Geneva, proclaiming it “The Lake Trout Capital of the World,” is mentioned. In his view, the number and diversity of fish have decreased, saying bass, sunfish, and northern pike are no longer found on his fishing trips.

“You can catch brown trout, rainbow trout, lake trout, landlocked salmon, all of those still, but you’re going to have to go out and use downriggers 100, 150, 200 feet down,” he says.

“As soon as that warm water was released, the trout and salmon stopped spawning out there,” he adds. “Now, when you look into the bay, there’s no seaweed, there’s no bay fish. We used to catch fish off the dock, but there’s no home for them now.”

“It used to be prolific. It was Jesus fishing you know? You put your pole in the water and pull out a fish right on the dock,” his wife adds.

Ramirez brings up harmful algal blooms and how they damage the natural ecosystem. Warm temperatures, sunlight, and excess nutrients can combine to create HABs, which, when toxic, can affect drinking water, recreation, and be harmful to people, pets, and wildlife.

Although the number of blooms tend to fluctuate depending on weather conditions, they have been trending upward in recent years, with the first report of benthic cyanobacteria, or bottom-dwelling algal bloom, by the Seneca Lake Pure Waters Association. As a volunteer with the organization, Ramirez says he has become experienced at spotting HABs.

“It’s really unnatural, it looks like paint across the water,” says Ramirez. “And it’s not just the shores; you can find it far out in the lake too.”

“Imagine if you were a fish, not a human, the lake is your universe,” says Assemblymember Anna Kelles, whose district covers Ithaca and Cortland. “Imagine your universe suddenly turns toxic.”

The state Department of Environmental Conservation’s Finger Lakes Angler Diary Cooperator Program has shown a dramatic decline in the number of fish caught and kept in Seneca Lake. In 2022 and 2023, zero rainbow trout were caught by participating fishermen. The volunteer cooperator program involves anglers who record their Finger Lakes fishing trip and catch information in diaries provided by the DEC. 

However, the DEC has also noted a dramatic drop in the number of Seneca Lake cooperators. In 1994, there were 152 participants; by 2023, the most recent publicly available report, that number had dropped to 18. It does not mention lake temperature as a concern for fish.

“Overall, results suggest that the Seneca Lake trout and salmon fishery is trending in a positive

direction,” the report concludes.

According to the minutes of the August meeting, Tim Chambers, a lifelong Torrey resident and highway superintendent, stated that he was fishing in this area over 40 years ago when the plant had four coal-fired units running and catching fish. Now the plant has one gas-fired unit running, and he is still catching fish.

Irwin also reassured attendees at the meeting that “99% of water” is returned to Seneca Lake with “minimal temperature change.”

Atlas Holdings acquired the Seneca Lake facility in 2014, and Greenidge Generation became its operator in 2017. The initial plan to sell power to the energy grid was first altered in 2019 when the site began mining bitcoin.

Despite a host of environmental and legal challenges, Vulcan has maintained that its operations comply with regulations and have benefited the region as a whole. The Critchlows, Ramirez, and other Dresden residents say the planned switch to hyperscale AI has similarly been cast as a quick, easy, and harmless change.

For example, Irwin has mentioned the possibility of a closed-loop system for the data center, an option local environmentalists have supported. This option would continuously recirculate liquid coolant, decreasing the need for water re

Kelles is skeptical. “(Data centers) are more slippery than almost any other industry I have tried to work with,” she says. “They try to prevent us from having the truth about the impacts they will have in our communities until the infrastructure is in place and it’s too late.”

According to the August meeting minutes, Irwin informed residents the company has two interconnection applications with the New York Independent System Operator, which operates the state’s electricity grid, for 60 and 200 MW.

Vulcan’s hyperscale plan is similar to those put forth by its competitors. Former cryptomining companies Cipher Digital and Riot Platforms announced transition plans to AI/HPC databases in February and August, respectively. All three companies saw a jump in their stock prices following their announcements.

For Vulcan, however, its pivot comes during a state government-led push against data centers. In June, an omnibus bill limiting the reach of data centers proposed by Gonzalez passed both chambers; a month later, Hochul signed the one year moratorium on large hyperscale AI data centers.

Gonzales recently went on a state tour to raise awareness of the omnibus bill, which still remains unsigned on Hochul’s desk. Seneca Lake was one stop on her tour.

“Across the country, it’s been clear what it means if we do nothing. In other states, we have seen other waterg cost of energy,” says Gonzalez, who was accompanied by Kelles during the visit. “We’re talking about data centers proposed the size of the island of Manhattan.”

The bill would create a new water and electric rate for data centers using over 20 megawatts, order the DEC to conduct an environmental impact report, require public hearing and comment to be held prior to approval of any future permits, and compel contributions to a host benefit program by data centers for investments in the local community.

State Sen. Samra Brouk, a co-sponsor, voted in favor. (Sen. Jeremy Cooney was excused from the vote)

Gonzalez and other local activists believe the popular support demonstrated by a recent rally at Geneva is an indication of the growing pushback against data centers.

The Vulcan site sits just south of Dresden. Its 262 acres include the power station, a water intake pipe into Seneca Lake, and portions of the Lake Keuka outlet. In addition, the Lockwood Coal Ash Landfill sits directly across Route 14 from the main area. The landfill holds the toxic legacy of waste from the plant’s coal-powered days. (It now uses natural gas.)

Legal and regulatory challenges have mounted since Atlas Holdings acquired the Dresden site. Last year, an agreement was reached with the state DEC, ending a legal battle dating to 2022 when the agency denied its air permit for Climate Leadership and Community Protection Act noncompliance.

In 2021, Greenidge’s plans to turn the Lockwood landfill into a solar farm was overshadowed by an Environmental Protection Agency investigation into groundwater monitoring issues.

The company reached a settlement with the EPA in 2024, which included a groundwater assessment and an updated closure plan. SEC filings in 2026 report a $17.3 million liability associated with the coal landfill, indicating it remains an issue to be addressed.

Dresden has a tiny but stable population of around 300 This comprises almost a fourth of the entire population of the encompassing town of Torrey, itself a municipality of about 1,300 people

Demographically, the area tends to be older than average, with 28% of residents age 65 or older, and wealthier, with a median household income of $95,500, compared to $69,701 for Yates County.

Dresden, Torrey, and Yates County lean solidly Republican, with a voter-enrollment advantage of at least 20 percentage points in each municipality. President Donald Trump, who recently gave comments in support of data centers, won Yates County in 2024 with 57% of the vote. (Torrey was comparatively closer, with Trump winning 51% of the vote.)

Still, Gonzalez, a Democrat, believes the issue of data centers is nonpartisan, with voters across the state voicing opposition to them.

“I think (this tour) is about showing that this is a popular issue and upstate and downstate are united in fighting AI data centers,” she says. “Seventy-one percent of Americans are opposed to the buildout of hyperscale data centers. This is not a partisan issue. It unites us across geographies, across ideologies, across demographics, into realizing that we really need to fight back.” 

Support for AI data centers also crosses party lines. Bruce Henderson, Torrey town council member and a lifelong farmer, applauded Vulcan’s efforts to improve its plant at a meeting last month. Henderson won his seat in 2023 on the Democratic Party line.

Also during the meeting, Gwen Chamberlain, a planning board member of the nearby town of Starkey and a Greenidge community advisory group member, spoke out in support of the company, saying it had produced a better environment and quality of life for the region.

Besides 210 jobs supported by its operations in New York, Vulcan has partnerships with the Dresden Fire Department, Yates County Habitat for Humanity, and Penn Yan Middle School that have increased reon of an electric sign to Dresden’s main road and the 2022 restoration of Bruce Hansen community park

How quickly Vulcan might establish a hyperscale AI and high-performance computing data center along Seneca Lake remains to be seen.

Dresden residents who spoke with the Beacon say Irwin has indicated that converting the plant would be a straightforward task with a short timeline.

“(Irwin) said that at a planning board meeting, ‘I can swap out the bitcoin mines to AI chips or whatever without any permits whatsoever.’ His analogy was, ‘It’s just like we’re selling different colored cars,’” says Ellen Campbell. “You should have seen our faces.”

The Rockefeller Institute of Government, however, lists the Seneca Lake generating station as a proposed hyperscale facility falling under Hochul’s one-year moratorium. And there is regulatory uncertainty. The DEC is still determining whether new or amended water withdrawal permits will be mandatory for large data centers, for example.

Vulcan says it has two submitted NYISO applications for greater energy consumption, but its hard-won air permit would also require a modification request in upscaling the facility.

In communications between Irwin and Torrey, Vulcan’s president has said no plans or applications have been submitted. He also had no timelines to share on any changes to the facility. But an August presentation to investors may be more revealing: It states that expansion at Seneca Lake is expected by the third quarter of 2027.

Jacob Schermerhorn is a Rochester Beacon contributing writer and data journalist.

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Source: rochesterbeacon.com