The firm behind a controversial, 88.5-acre data center project in Boulder City has pulled its application and instead will build it on federally owned land nearby, according to a Tuesday news release.

Originally, a developer hoped to build a data center on a parcel of city-owned land near Interstate 11 and U.S. Highway 95 that had been zoned for solar and battery storage. The lease for that site expires at the end of the year, according to the city.

On June 26, the Bureau of Land Management approved a right-of-way grant to build the data center on an adjacent, 80-acre site. The developer behind the project, Houston-based Skylar Capital Management, did not return a request for comment.

Data centers have been a hot topic in the small Southern Nevada city and has drawn scrutiny from residents who are concerned about data centers’ water and energy use, as well as the potential for issues like pollution and heat generation.

Brynn deLorimier, a Boulder City resident who has led a grassroots campaign against data center development, said the fight is far from over.

“We’re not done until shovel is put to ground,” she said in an interview. “And even if they do build something, we will fight it every step of the way. We will watch every single thing they do, file reports with every agency needed if they break any regulations. We will not make it easy for them.”

Boulder City residents could experience the understudied, frontline impacts of a data center without cashing in on the economic benefits as a result of the company’s decision. According to the city, a lease along with property taxes, permit fees and administrative charges could have generated $2.3 million in revenue per year — a fact that inspired Mayor Joe Hardy’s public support for the project.

The news came after the Boulder City Planning Commission, in a near-unanimous vote, recommended the City Council not move forward with the proposal. The council will keep a discussion about the proposal on its agenda for Tuesday.

DeLorimier said she is fielding questions from residents about how the project could have gained approval from the Trump administration without public input.

The Bureau of Land Management did not respond to an inquiry Tuesday about whether the permit swap allowed for public engagement, as is usually required for projects on federal land per the National Environmental Policy Act. Over many years, different federal administrations have weakened the law and tightened permitting timelines.

Data centers in Southern Nevada are subject to the region’s evaporative cooling ban that prohibits systems that allow water to only be used once and evaporate.

Still, NV Energy has projected immense spikes in energy demand: By 2046, data centers could account for 64 percent of NV Energy’s electricity sales, up from 5 percent of electricity sales today. Throughout the state and nation, local governments have discussed moratoriums or bans on data centers while officials can develop thoughtful policy.

According to deLorimier, Boulder City data center opponents have been in contact with a national nongovernmental organization, Third Act, which is a network of progressive environmentalists over the age of 60.

One of its members, Janelle Sorenson, is a Boulder City resident who has expressed concerns over data center development. In an interview, Sorenson said the organization — and its legal team — are supporting residents.

The city waited too long to notify residents of its closed-door discussions with the data center developer, she said, and the federal government skirting a thorough environmental review is disingenuous.

Athough it’s too early to say whether the organization may pursue legal action against the developer or the Bureau of Land Management, Sorenson said what’s happening in Boulder City is indicative of cases across the nation.

“Boulder City is the proverbial canary in the coal mine,” Sorenson said. “It’s the same story over and over again. It’s a small town, and there’s concern over budget gaps.”

Contact Alan Halaly at ahalaly@reviewjournal.com. Follow @AlanHalaly on X.