Spanberger proposes by-right approval ban for data centers

Virginia Governor Abigail Spanberger signed an executive order in Richmond, aiming to implement the most "comprehensive and aggressive data center accountability effort in the country." The order seeks to eliminate by-right approvals for data centers, which would require local approval for any data center using over 25 megawatts. It also bans nondisclosure agreements (NDAs) for state executive branch employees, boards, and commissions involved with data center businesses, a move intended to increase local transparency.

The executive order, a preliminary measure, will be followed by legislation in the 2027 General Assembly session. Key provisions include removing future large data centers from the state's fast-track permitting process, expediting noise regulations, setting water-use standards, limiting on-site electricity generation, and prioritizing grid access for clean-energy-backed data centers. The order also mandates the Virginia Department of Environmental Quality to provide recommendations on noise protections, diesel fuel impacts, and criteria for identifying "cooling water scarcity areas." A state AI Task Force will also be created to address AI risks.

The Data Center Coalition expressed shared goals with the Governor, emphasizing Virginia's competitive electric rates and low water usage by data centers. However, groups like Clean Virginia and Senator Louise Lucas, a proponent of repealing sales tax exemptions for data centers, argued the order does not go far enough, particularly concerning the $2 billion in sales tax exemptions. The Virginia Senate Democratic Caucus affirmed its commitment to collaborate on data center policies, while the Virginia Chamber of Commerce cautioned against creating barriers that could deter investment.