Data center activity in Virginia
Virginia's regulatory environment stands out for the intensity of opposition and zoning difficulty, with at least 39 zoning denials against 18 approvals and at least 28 projects blocked compared to just 2 approved despite opposition. These figures represent some of the most challenging opposition and zoning dynamics of any state, driven by Northern Virginia's mature and densely developed data center corridor where community resistance is well organized. Moratorium activity is comparatively modest with at least 4 enacted and 1 rejected. Despite these headwinds, at least 83 companies remain active, reflecting Virginia's irreplaceable strategic position as the nation's largest data center market. Unlike neighboring North Carolina, where moratoriums dominate but zoning outcomes are favorable, Virginia's challenges are concentrated in the permitting and community opposition phases of development.
Virginia's regulatory environment stands out for the intensity of opposition and zoning difficulty, with at least 39 zoning denials against 18 approvals and at least 28 projects blocked compared to just 2 approved despite opposition. These figures represent some of the most challenging opposition and zoning dynamics of any state, driven by Northern Virginia's mature and densely developed data center corridor where community resistance is well organized. Moratorium activity is comparatively modest with at least 4 enacted and 1 rejected. Despite these headwinds, at least 83 companies remain active, reflecting Virginia's irreplaceable strategic position as the nation's largest data center market. Unlike neighboring North Carolina, where moratoriums dominate but zoning outcomes are favorable, Virginia's challenges are concentrated in the permitting and community opposition phases of development.
How is this scored?
Several citizens in Carroll County expressed their opposition to data centers during a meeting of the Board of Supervisors. This indicates ongoing local engagement regarding data center development in the area.
Residents of Stafford County, Virginia, voiced significant health and air pollution concerns regarding proposed large-scale data centers at a Board of Supervisors meeting. The Forest Lane Data Center project, developed by Real Estate Pursuits 2 LC (affiliated with Peterson Companies), is currently under staff review for rezoning and a conditional use permit. The county has updated its zoning to regulate data centers, but residents are pushing for more stringent review.
Virginia approved a gas-powered data center project, prompting local residents to seek answers from an environmental group due to the lack of public input during the approval process. The decision has raised concerns among the community regarding transparency and environmental impact.
Virginia's budget negotiations are stalled due to disagreements over data center policy, specifically regarding their energy consumption and environmental impact. Democratic leaders clashed publicly over proposals to make data centers pay more for energy. Lawmakers failed to pass a budget during the regular and a special session and are reconvening later in June.
Lawmakers are considering draft legislation that would reduce tax incentives and impose stricter rules on water consumption for data centers. These proposed changes aim to cap tax exemptions and strengthen environmental regulations impacting the industry.
The Suffolk City Council voted to place a proposed temporary ban on data centers on its June 17 agenda. This measure aims to prevent new data center applications while the city develops permanent regulations for the industry. The Council is concerned about data centers not being specifically addressed in the city's Unified Development Ordinance.
A letter to the editor connects Virginia's rising electricity rates and climate change concerns to the growth of data centers in the state. The author criticizes the proposal of new methane power plants by Dominion/NextEra and the failure of state government entities to block them. It argues that addressing energy costs and climate change are inextricably linked in the data center discussion.
The Piedmont Environmental Council (PEC) is urging Virginia communities to intensify their opposition and legal efforts against the proliferation of data centers, citing concerns about land, water, and electricity impacts. Speakers at their annual gathering highlighted increasing public apprehension and the growing number of moratoriums enacted by jurisdictions across the U.S. They advocate for aggressive negotiations with developers and leveraging environmental protection laws.
Virginia lawmakers and the Governor are clashing over the state budget, specifically regarding proposed changes to data center tax breaks. House Democrats and the Governor want to preserve the tax breaks, while senators argue that scrapping them would generate over $1.6 billion in new tax revenue. The ongoing dispute has led to a stalemate and a looming government shutdown threat.
The Shenandoah County Planning Commission voted 6-1 to recommend a new data center ordinance to the Board of Supervisors, despite significant public opposition. The proposed ordinance would change data centers from a by-right use to a special use, requiring public hearings and implementing new environmental and operational restrictions. Residents expressed strong concerns about inviting data centers into the county and urged the commission to prohibit them entirely.
A developer based in Dubai is reportedly planning an $860 million data center project in Edgerton, Virginia. This represents a significant investment in the area's infrastructure.
Halifax County officials recently toured a data center training facility in South Hill, Virginia, to explore the potential impacts and opportunities data centers could bring to Halifax County. They engaged with Mecklenburg County officials to discuss economic benefits, workforce development, and address public concerns regarding water usage, electricity demand, and environmental issues. This fact-finding mission highlights ongoing local opposition to data center development in Halifax County.
Virginia's decision to rejoin a regional carbon market could increase Dominion Energy ratepayers' electricity bills by 6% to 7.5% next year, according to a filing at the State Corporation Commission. This policy, which requires utilities to pay for carbon emissions, has implications for energy consumption, including by data centers.
The Virginia Department of Environmental Quality is holding a public hearing to collect comments on a summary of feedback regarding a discharge permit for an Amazon data center campus near Lake Anna in Louisa County. This permit is required for the discharge of treated noncontact cooling water from the facility. Amazon's $11 billion investment in two data center campuses in Louisa County was announced in 2023.
This article discusses the global environmental impact of AI data centers, highlighting their demand for power, land, and water for cooling. It notes growing local community pushback in various regions, including Northern Virginia, due to strains on electrical grids and scarce water resources. The report points to a $15 billion data center hub in Visakhapatnam as India's "warning sign" for the environmental costs of AI development.
Tech giants Google and Microsoft are seeking zero-emission alternatives for powering their data centers. They are partnering with Israel's Phinergy to replace diesel backup generators, particularly in locations like Virginia where these generators have faced environmental scrutiny and pushback.
The Chesterfield Board of Zoning Appeals denied an appeal by a landowner seeking to avoid a conditional-use permit requirement for a data center project on an 89-acre property. The landowner argued for vested rights under a previous ordinance, but the BZA upheld the planning director's determination. This means the data center project will still require a Conditional Use Permit under the county's current zoning ordinance.
A Warren County, Virginia resident warned the local planning commission against allowing data centers, citing negative impacts observed in other parts of the state. Concerns include higher electricity bills, droughts, tax disputes, and significant budget shortfalls for public services due to tax exemptions for data centers.
Virginia's data center boom is causing electricity bills to rise in West Virginia. This issue stems from a shared utility serving both states, complicating efforts to lower energy costs in West Virginia due to its reliance on coal compared to Virginia's shift away from it.
Virginia Senator Mark Warner is advocating for federal legislation, the "Power to the People Act," to implement safeguards for data centers. The proposed bill aims to prevent increased electricity costs for consumers due to data center strain on the power grid. He also plans to introduce broader legislation addressing water rights, setbacks, AI, national security, and consumer protections related to data center development.