CHALOTTESVILLE (CVILLE RIGHT NOW) — Albemarle County’s Board of Supervisors are expected to pause consideration of a second phase of regulations for data centers as it awaits potential statewide guidelines coming down from Richmond.

The General Assembly considered a number of bills on the topic last session and is likely to reconsider some of them this winter, Sen. Creigh Deeds told Cville Right Now.

“Data Centers are a huge part of the capital investment going on in Virginia right now,” Deeds said. “They are great sources of tax revenue to the localities where they are situated, but they create unprecedented demand for energy. There has to be a way to get data centers the energy they need, without raising costs and jeopardizing electric service to other consumers.”

The Joint Legislative Audit and Review Commission, of which Deeds is a member, sent a report to the General Assembly and the Governor on Dec. 9, 2024, stating that the construction projects associated with new data centers provide positive economic benefits, and that they can generate substantial local tax revenue.

But the report also concluded data centers could be a significant strain on infrastructure and energy usage, which could lead to raising costs for citizens.

Large-scale data centers, structures that house internet servers, continue to open throughout Virginia. 

According to the Piedmont Environmental Council, Loudon County currently holds the largest concentration of data centers in the world, with Dominion Energy reporting in late 2022 that 21% of their electricity sales in the state were going toward the centers.

While Albemarle County currently does not house a large-scale data center and there are no plans to in place to construct one, according to PEC, staff have still worked to update their regulations this year in anticipation of one being built in the future.

At Wednesday’s Board of Supervisors meeting, county staff will present the “Data Center Phase 2 Zoning Text and Zoning Map Amendment Update Presentation,” which will detail their efforts to further establish regulation for Data Centers after passing, “Phase 1” regulations in April, the first special regulations regarding data centers. 

The staff will then recommend that Phase 2 be paused in anticipation of any state regulations that may be proposed during the State General Assembly’s winter session in January.

Before the Phase 1 regulations, data centers were allowed to be built by right in the industrial districts and by special use permit in the commercial districts, with no other special regulations. 

Now, data centers over 40,000 square feet in the industrial district and of any size in the commercial district require a special use permit, with some exceptions and limits for businesses and other entities that house their own data centers. There are also limits on specific areas of the center, like the generators and cooling systems.

“That was Phase 1,” development process manager Bill Fritz said, “which was just a quick, put some regulations in place so we could review any large data centers on a case-by-case basis to determine their impacts and address those impacts accordingly.”

Phase 2 was a more comprehensive review, which Fritz said was an attempt to identify locations where larger-scale data centers could be appropriate without a special use permit. 

Staff was considering a zoning map amendment and zoning text amendment with new regulations. The ultimate hope was to pass standardized regulations that could allow for more data centers to be built without special use permits.

After a work session with the Board of Supervisors in which they overheard their concerns, they found that the areas they had been looking at “weren’t really viable anymore.” The chosen sites also received backlash from environmental groups like PEC, who were concerned about the potential loosening of regulations.

“The proximity of these data center overlay districts, where you can have a by-right structure up to 500,000 square feet is approximate to a number of residential districts, even a hospital — Sentara Hospital, Martha Jefferson, assisted living facilities, schools and parks and that’s very concerning,” Robert McGinnis, PEC’s Senior Land Use Field Representative for Albemarle AMD Greene counties, told Cville Right Now.

The problems with the sites in combination with the evolving state of data centers as a whole and the impending changes on the General Assembly, the staff are concerned that any regulation passed today may quickly go out of date.

These concerns are why the staff now plans to recommend pausing the work of the text and zoning map amendments, keeping the current regulations in place and allowing data centers to be considered by the board on a case-by-case basis for the time being.

“What we’re doing is sort of a, ‘Pause, let’s see what happens and just keep the ordinance in place right now,” Fritz said.

In the meantime, McGinnis said the PEC will continue to advocate both locally and statewide for its position that data centers over 40,000 in industrial districts and all centers in commercial districts should require special permits. The latter of which is already being upheld in the county’s proposed Phase 2 regulations.