Q&A with the Chesapeake Legal Alliance: Data centers and nondisclosure agreements in the Bay region
Nondisclosure agreements (NDAs) between data center developers and public entities are increasingly common in the Chesapeake Bay region, shielding critical environmental data like water and energy usage from public scrutiny. This lack of transparency makes it difficult to assess the true impact of data center development on local resources and is prompting legal challenges under state public records laws. Residents are encouraged to take action through public records requests, local engagement, and supporting state-level disclosure legislation.
The rapid proliferation of data centers across the Chesapeake Bay watershed, particularly in Northern Virginia, Maryland, and Pennsylvania, is generating significant concern regarding their substantial demands on water and energy resources. A key challenge to public oversight is the widespread use of nondisclosure agreements (NDAs) signed between data center developers and public entities, including local governments and utilities.
These NDAs often conceal vital information such as projected water withdrawals and discharge volumes, energy consumption, and even the identity of the companies involved, making it difficult for residents and regulators to evaluate environmental impacts. While developers argue NDAs protect competitive information, critics contend they undermine public records laws, which generally favor disclosure. State public information acts in Virginia, Maryland, and Pennsylvania are increasingly being tested in court against these agreements.
In response, residents and advocacy groups like the Chesapeake Legal Alliance are encouraging proactive measures. These include filing public records requests for permit applications and NDAs, engaging in local zoning and utility board meetings, and advocating for local ordinances that mandate disclosure of water and energy use. Furthermore, state-level legislative efforts, such as bills introduced in Virginia for the 2026 session, aim to require public reporting of these figures, bypassing the secrecy imposed by private contracts.