Bill of the Day: Mitigating the Impact of Data Centers’ Explosive Growth
Updated on March 1st, 2024.
Amazon data center, Loudoun County. Image credit: Hugh Kenny
Why Introduce Regulations for Data Centers?
Virginia is home to the largest concentration of data centers in the world, widely cited as hosting 70% of global internet traffic. Data centers are industrial complexes that store, process, and distribute large amounts of digital information. However, data centers pose a massive threat to our environment due to their sheer size and consumption of our land, water, and energy resources.
Despite Virginia having the highest number of data centers in the world, the Commonwealth lacks critical information about their impacts on our environment and energy grid. There is currently no regulatory oversight on data center development, requiring localities to approve facilities without considering the cumulative impacts. Overall, data center development threatens to derail Virginia’s efforts to meet climate goals, improve air and water quality, advance land conservation, and protect national and state parks.
You can take a deeper dive into mitigating the impacts of data centers in Our Common Agenda. To learn more, read our “Mitigating Data Center Development’s Impacts” and “Surging Energy Demand From Data Centers” policy papers.
Data Centers’ Impact on Energy Consumption and Usage:
The data center industry leaves a significant energy footprint, with a single building using 60-90 MW of power at peak demand, equivalent to the energy needs of more than 15,000 households. Data centers use backup diesel generators, burning fossil fuels and releasing harmful pollutants into the air. Data centers already make up twenty one percent of Dominion Energy Virginia’s power load, and will only continue to put strain on the electric grid as their explosive growth continues.
VCN and our Partners support the following bills to mitigate the impact of data centers on energy consumption and encourage energy efficiency:
(Delegate Rip Sullivan) Incentives energy efficiency in data centers by providing tax credits to data centers that meet energy efficiency standards. Beginning in 2027, this requires data centers to source at least 90% of their energy requirements from carbon-free renewable sources to qualify. Companion to SB 192. (Continued to 2025 in Finance Committee).
Requires data centers to submit quarterly energy source reports to the Department of Energy, detailing energy consumption and its sources. Also, it requires the Secretary of Commerce and Trade to establish a work group to estimate future energy demands of the data center industry, with findings due by November 30, 2024. (Continued to 2025 in Rules Committee).
(Delegate Mike Webert) Require public utilities to place data centers in a separate classification, allowing for specific adjustments to rates, tolls, charges, or schedule changes within that category. (Continued to 2025 in Labor and Commerce).
(Senator Suhas Subramanyam) Directs The State Corporation Commission (SCC) to review any utility plans to meet energy demand associated with data centers to consider generation, transmission, and distribution costs. This bill would require the SCC to assess whether the current cost allocation among electric utility customers, including data centers, results in unfair subsidies. (Continued to 2025 in Commerce and Labor).
(Senator Suhas Subramanyam) Incentives energy efficiency in data centers by providing tax credits to data centers that meet energy efficiency standards. Beginning in 2027, this requires data centers to source at least 90% of their energy requirements from carbon-free renewable sources to qualify. Companion to HB 116. (Continued to 2025 in Finance & Appropriations).
(Senator Russet Perry) Expands pilot projects for underground transmission lines by increasing the maximum capacity for eligible lines, accommodating the unprecedented load growth needed to meet the energy demand of data centers. This would ensure that data centers pay for a rapid and massive build out of transmission lines instead of ratepayers. (Continued to 2025 in Commerce and Labor).
Data Centers’ Impact on Land Conservation and Usage:
Data centers are built on sprawling campuses – a current project proposal in Prince William County would take up 27 million square feet , which is the equivalent of about 150 Wal-Mart Supercenters. Data centers also encroach on the health and safety of neighboring communities and ecosystems. Many developments are being proposed that would place data centers near parks, residential areas, waterways, and more sensitive areas.
VCN and our Partners support the following bills to mitigate the impact of data centers on land conservation and usage:
(Delegate Josh Thomas) Prohibits the construction of a data center within a half-mile of a national park, state park, or a historically significant site.
(Delegate Ian Lovejoy) Prohibits the construction of a data center within a quarter-mile of parks, schools, and homes. (Subcommittee recommends laying on table).
(Senator Danica Roem) Prohibits the construction of a data center within one mile of a national park, state park, or a historically significant site. (Continued to 2025 in General Laws and Technology).
(Senator Danica Roem) Establishes noise abatement standards when sitting data centers near communities. These standards include providing notice requirements within a half-mile radius and scheduling neighborhood meetings with the data center operator. Additionally, they include conducting pre- and post-construction sound studies, integrating sound mitigation methods, and limiting backup generator maintenance during normal business hours and with a twenty-four hour notice. (Defeated in Local Government).
Data Centers’ Impact on Water, Planning, & Permitting
As data center development accelerates, they will also require significant amounts of water. The average data center consumes 3-5 million gallons of water per day for cooling – the equivalent of a small city’s annual consumption. Data centers are also built on impervious surfaces, preventing rainwater from being absorbed into the ground and increasing polluted runoff.
VCN and our Partners support the following bills to mitigate the impact of data centers on water quality and usage, planning and permitting:
(Senator Danica Roem) Requires data centers to disclose their water and power usage to localities before development. This would require a site assessment to examine a center’s impact on water usage, carbon emissions, and the regional electric grid. (Continued to 2025 in General Laws and Technology).
(Senator Richard Stuart) Amends the Cloud Computing Cluster Infrastructure Grant Fund by removing the authority of localities to make commitments related to accelerated permitting, property tax classifications, and other such agreements in a performance agreement. (Defeated in General Laws & Technology)
(Senator Danica Roem) Provides $500k for the Joint Legislative Audit and Review Commission (JLARC) study to evaluate the impacts of data centers
(Delegate Josh Thomas) Provides $500k for the Joint Legislative Audit and Review Commission (JLARC) study to evaluate the impacts of data centers.
Take Action
Regulating data center growth will help us understand their impact on our natural resources, energy consumption, and public health before development.
Unfortunately, all of the VCN-supported bills to mitigate data centers’ environmental consequences have been defeated by the House and Senate. Virginia Conservation Network will continue to build on work started in the past year to make sure that our communities, water quality, significant land, and electric grid are protected from data center’s explosive growth. Help us continue this work by donating $25, $50, or $100 so that the conservation community can continue this important work!
Dive Deeper
Also, take a look at a Youtube video made by our Partners at Piedmont Environmental Council regarding the hidden costs of data center development.