Lambda, the AI cloud company, said on Nov. 4, 2026, that it will be the end user of Project Red Clay, a proposed data center campus in Lowndes County, Ala., that it values at an estimated $33.1 billion. The company’s announcement names the tenant for a site whose end user had not been disclosed. It came the same day residents’ attorneys announced a lawsuit seeking to void the county’s tax breaks for the project.
The two announcements set a nine-figure-a-year local tax pitch against a transparency fight. That fight began weeks before Lambda’s name was attached to the site.
What Lambda says it will build in Lowndes County, Ala.
According to Lambda, the planned Red Clay Technology Center Campus is being readied for development by Cloverleaf Infrastructure. It would sit near U.S. Highway 80 and Alabama Highway 21. Construction is expected to begin in the first quarter of 2027 and could take up to five years. The company expects more than 1,000 construction jobs over the course of development and more than 225 full-time roles in operations, technical and support work.
Alabama Power would supply the campus, pending regulatory approval. Lambda says it will pay the full cost of the power and grid infrastructure needed to serve the facility through upfront financial commitments that apply even if plans change, so those costs are not shifted to the utility’s existing customers. Both companies have signed the White House Ratepayer Protection Pledge, the release says.
On water, Lambda says the campus will use closed-loop cooling. It also plans to work with N-Drip to help local farmers conserve water, with the goal of returning at least as much water as the facility uses. The plans call for setbacks, buffers, noise-reduction measures and DarkSky lighting. Lambda and Cloverleaf are also putting $10 million into a community benefits agreement with the Central Alabama Community Foundation.
“This project represents a significant and historic investment in Lowndes County and an opportunity to create lasting value for the area,” Lambda Chief Executive Michel Combes said in the release. Stephen Balaban, Lambda’s co-founder and chief technology officer, said the company wants “to understand what matters to Lowndes County residents and local leaders and ensure those perspectives inform our approach.”
David Berry, co-founder and CEO of Cloverleaf Infrastructure, said Cloverleaf “is pleased to announce that Lambda will serve as the end user” for the campus.
The tax revenue case
The project’s backers lead with local tax revenue, and the Red Clay figures are large for a rural county. Cloverleaf projects more than $2.8 billion in local tax revenue through 2049, including more than $1.6 billion for Lowndes County Public Schools, and $3.4 billion in combined state and local revenue.
When the Lowndes County Commission approved the project’s development agreements on Oct. 13, 2026, Cloverleaf said the campus would generate an average of $124 million a year in local tax revenue. About $70 million of that would go to county schools each year, which the developer called an estimated ninefold increase over current annual school funding. Cloverleaf described the project as the largest economic investment in the county’s history.
“More than $1.6 billion in project revenue for local schools represents a significant, long-term investment in the educational future of Lowndes County,” Samita Jeter, superintendent of Lowndes County Public Schools, said in Lambda’s release.
The lawsuit over the tax breaks
The opponents’ objection is not about the revenue projections. It is about how the commission granted the incentives. The Southern Environmental Law Center said on Nov. 4 that the community group Protect Lowndes County and the Alabama Rivers Alliance had filed suit against the Lowndes County Commission the previous evening. SELC and the Natural Resources Defense Council represent the plaintiffs.
The suit alleges that the commission violated Alabama’s Open Meetings Act and Open Records Act in connection with a vote approving more than $2.7 billion in local and state tax breaks for the project. In the release, SELC describes the project as a 1,500-megawatt, 2,200-acre proposal and calls it the largest data center proposed in Alabama to date. The plaintiffs allege the commission misled residents about when and where meetings on the abatement would be held, ran some meetings in a way the public could not hear, cut off speakers opposed to the tax breaks, and refused to release project records. They are asking the court to invalidate the tax breaks. These are allegations; the court has not ruled.
The dispute dates to the commission’s Oct. 13 meeting. In an Oct. 14 release, SELC said the regular agenda included only a resolution to schedule a special meeting on a 20-year abatement. Instead, a commissioner moved to vote on the abatement itself, and it passed 3-2.
“Decisions of this magnitude must be made in full view of the public,” said Ryan Anderson, a staff attorney in SELC’s Alabama office.
A test of the post-election climate for data centers
The timing puts Red Clay squarely in a national argument. In the Nov. 3 elections, voters backed data center limits in at least 37 of 41 local ballot measures. The offer on the table in Lowndes County is large tax revenue, paid-for grid upgrades, water pledges and a community fund.
Lambda’s package addresses the most common objections directly. The ratepayer pledge and upfront power payments answer the electricity-bill complaint. Closed-loop cooling and the farm water partnership answer the water complaint. The lawsuit goes after a different weak point, the public process. On our reading, that argument does not depend on whether the project’s economics are good for the county.
Two things will determine how quickly the campus can move toward its first-quarter 2027 start. One is the court’s handling of the open-meetings claims against the tax breaks. The other is the regulatory approval Alabama Power still needs to serve the site. More coverage of the sector is on our Technology & AI page.
