State Senator Files Legislation for Three-Year Moratorium on New Data Centers

RICHMOND, Va. — A state senator representing Virginia's data center alley in Loudoun County has filed a bill for the upcoming General Assembly session that would temporarily pause any new data centers from being approved in the Commonwealth.

"The bill is really just a three year pause to take a look and stop more data centers being shoved down a pipe that is already overflowing," said State Sen. Russet Perry (D-Loudoun).

If the bill becomes law as written, starting July 1 of next year local governments and state agencies would be banned from approving the necessary paperwork or applications that might be needed for new data centers

The ban would be in place for three years.

Perry said the aim is to prevent work from starting on new data centers, but notes there will be a discussion on which projects already in the approval process may have what is known as a vested right to continue.

"I'm sure some in in the pipe that have already established legal protection and I don't think the state can lawfully do that," said Perry. "But certainly the state can say we are taking a pause until we can get our hands wrapped around this and that's really what we're looking at."

Perry said the pause is needed to look at the impacts data centers are having on the state's resources and energy grid and what is sustainable.

"Even today, the Department of Energy telling PJM, who...manages the grid up and down the East Coast, including in Virginia, saying, 'Hey, we're concerned about blackouts. We need you to bring everything up to speed so you can have extra power generation," said Perry. "So we have enough water, do we have enough power that can our grid possibly sustain these? What about all these massive transmission lines that are crisscrossing our state now, going through people's farms and and their homes."

"I'm very happy to see that this is now becoming a bipartisan issue," said State Sen. Glen Sturtevant (R-Chesterfield) about Perry's bill. Sturtevant has been calling for an "indefinite" moratorium for months.

"Virginia is the data center capital of the world. To the extent that new data centers need to be built, there are 49 other states where they can go. Virginia doesn't need to have them all," he added. "We need to get rid of the tax loophole that allows the big tech AI data center industry to not pay their taxes in Virginia. We need to address their impact on our water resources and our environmental resources."

But Sturtevant added lawmakers do not have to wait until the 2027 General Assembly session to start in January to take up the moratorium and that it should be discussed at the end of the month when lawmakers are back in Richmond for a special session to take up judicial appointments.

"We don't want to wait. We can't wait. Virginians' electric bills are too high to continue kicking this can down the road and pushing this off."

Perry said special sessions are limited in scope and she has not gotten word that it will be expanded to allow for items other than judge appointments to be discussed.

While Governor Abigail Spanberger has not accepted calls for a statewide moratorium, last month she signed an executive order that her office said was "the most comprehensive and aggressive data center accountability effort in the country."

“Governor Spanberger last month laid out the nation’s most aggressive and comprehensive plan to hold data centers accountable. The Governor looks forward to implementing these nation-leading standards and working with lawmakers to protect the Commonwealth’s natural beauty, make energy more affordable for families, and listen to local communities across Virginia," a spokesperson added Thursday when asked about Perry's bill.

Meanwhile, a spokesperson for the Data Center Coalition said the industry has brought over a billion dollars in local taxes and jobs to her home county and the bill would deny other counties the same opportunity.

"Moratoriums and other anti-competitive policies send a signal that an area is closed for business, both for data centers and for other significant economic development projects. Local or state moratoriums could deprive communities of the opportunity to compete for investment and jobs, jeopardize multibillion projects that are in development, and force jurisdictions to relinquish significant long-term economic investment, high-wage jobs, and critical tax revenue to neighboring states,” said DCC's Director of Virginia Government Affairs Nicole Riley.

Perry responded that while the industry does bring in tax revenue, it has to be balanced with other impacts.

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