USDA's largest-ever rural loan funds gas plant near Google data center

Overview

Updated Oct 20

The U.S. Department of Agriculture lent a Georgia electric cooperative $3.3 billion to help finish a 1.4-gigawatt natural-gas plant, the largest loan in Rural Utilities Service history. The plant is going up about half a mile from land Google bought for a data center.

Oglethorpe Power says the plant will supply its 38 member cooperatives and the roughly 4.7 million Georgians they serve. A Kiewit subsidiary is building it, and commercial operation is planned for 2029. The 6.3 percent loan saves the co-ops about $25 million a year. USDA's rural development chief has said data centers could benefit.

Why it matters

Cheap federal loans meant for rural ratepayers may end up financing power that AI data centers consume.

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Key Indicators

$3.3B

USDA Rural Utilities Service loan

Largest single loan in the program's history, at roughly 6.3% interest over 30 years.

1,425 MW

Plant capacity

Two-unit Smarr combined-cycle gas plant, enough to power about 800,000 homes.

$25M/yr

Annual interest savings

Oglethorpe says the federal financing saves member cooperatives this much compared to market rates.

Member distribution cooperatives

Oglethorpe sells wholesale power to 38 co-ops serving nearly 5 million Georgians.

$8.6B

Pending RUS loan requests

USDA's rural development chief said this much was requested in the first month of the fiscal year.

Voices

Curated perspectives — historical figures and your fellow readers.

People Involved

Brooke L. Rollins

U.S. Secretary of Agriculture

Announced the loan October 2026

Annalisa Bloodworth

President and CEO, Oglethorpe Power

Leading the cooperative's Smarr plant project

Chris Smith

USDA Under Secretary for Rural Development

Soliciting more funding for rural electric loans

Blair Romero

Spokesperson, Oglethorpe Power

Defending the plant's stated purpose

Organizations Involved

Oglethorpe Power Corporation

Nonprofit generation cooperative

Building the Smarr combined-cycle plant

A member-owned cooperative that sells wholesale electricity to 38 distribution co-ops across Georgia.

USDA Rural Utilities Service

Federal lending agency

Issued the record $3.3B loan

The federal lender that provides low-cost financing to rural electric cooperatives.

Google

Technology company

Data-center landowner near the plant

Purchased nearly 1,000 acres in Monroe County for a data center.

Timeline

2025 2029

8 events Latest: October 19th, 2026 · 3 weeks ago

Tap a bar to jump to that date

2029
Smarr plant expected to open
Upcoming Construction

Oglethorpe expects the two-unit plant to begin commercial operation.
2029
October 2026
Analysis questions rural vs. AI purpose
Latest Media

Construction Review published reporting asking whether the plant serves rural customers or AI-driven data-center demand.
October 19th, 2026
USDA official says plant could benefit data centers
Statement

USDA rural development chief Chris Smith told Reuters the plant could potentially serve data centers; Oglethorpe denied it is dedicated to one.
October 16th, 2026
USDA announces record $3.3B rural loan
Policy

Agriculture Secretary Brooke Rollins announced the largest loan in Rural Utilities Service history to help finance the Smarr plant.
October 14th, 2026
January 2026
Kiewit subsidiary picked to build Smarr plant
Construction

Oglethorpe named Kiewit's TIC unit its engineering, procurement and construction partner for the 1,425-megawatt plant, put the capital investment above $3 billion and targeted commercial operation in 2029.
January 13th, 2026
September 2025
Oglethorpe begins site work on Smarr plant
Construction

Crews started onsite work in September 2025, LCG Consulting reported. The cooperative later held a formal groundbreaking at the graded site off Rumble Road in Monroe County.
September 2025
May 2025
GE Vernova turbines chosen for the plant
Construction

Oglethorpe selected GE Vernova's 7HA.03 gas turbines for the two combined-cycle blocks, per LCG Consulting. The design uses air-cooled condensers instead of cooling towers to cut water use.
May 2025
2025
Google buys Monroe County land
Corporate

Google purchased nearly 1,000 acres in Monroe County, about half a mile from the future Smarr plant site, for a data center.
2025

Scenarios

Smarr plant comes online in 2029 serving cooperative members

Likely Resolves by End of 2029

Discussed by: USDA, Oglethorpe Power

The plant finishes construction and begins selling wholesale power to the 38 member cooperatives. The federal loan's low interest rate trims roughly $25 million a year from financing costs, which flows back into member electric bills. Data-center demand stays on Georgia Power's side of the grid.

Data center locks up a named share of Oglethorpe generation

Possible Resolves by End of 2027

Discussed by: Reuters, Construction Review

Proximity plus AI load pulls a data-center developer toward the plant's power. A member cooperative or Oglethorpe signs a large supply contract tied to a specific data-center customer, shifting a meaningful share of output from household load to industrial load. The co-op's low-cost federal financing effectively backs that contract.

RUS loan pipeline expands for AI-era generation

Possible Resolves by Q3 2027

Discussed by: USDA Rural Development chief Chris Smith

With $8.6 billion in RUS loan requests already on file one month into the fiscal year, Congress appropriates more money and the agency approves further large fossil-generation loans in states facing data-center load. The Smarr loan becomes the template, not the exception.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

1935-1936

Rural Electrification Act (1936)

The New Deal created the Rural Electrification Administration, lending at low interest to cooperatives to wire farms that private utilities refused to serve. In 1935, roughly 10% of U.S. farms had electricity; by 1950, about 90% did.

Then

Cooperatives built distribution lines across the countryside, and rural power became standard.

Now

The program evolved into today's Rural Utilities Service, still lending cheap federal money to electric cooperatives.

Why this matters now

The Smarr loan is the same subsidy mechanism deployed for a purpose the New Dealers never faced: a gas plant half a mile from an AI data center.

2010-2025

Virginia's data-center power crunch (2010s-2020s)

Northern Virginia's Loudoun County became the world's largest data-center cluster. Dominion Energy's load forecasts exploded, utilities built gas and transmission to keep up, and residents pushed back on rate increases and new lines.

Then

The region hosts most of the world's internet traffic, and power demand there keeps rising.

Now

The pattern — demand forecasts racing ahead of grids, residents paying for capacity others consume — is now repeating across the Southeast.

Why this matters now

Georgia is following the Virginia path, with Georgia Power planning a 50% capacity expansion and data centers clustering around new generation. The Smarr loan is the rural cooperative version of that buildout.