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Long known as the data center capital of the United States, Virginia is becoming more selective about who gets the welcome mat.
Virginia Governor Abigail Spanberger has cut data center projects with a projected peak demand of 25 megawatts or more from the state’s site development assistance and expedited permitting programs, through an executive order signed Sept. 18. The measure comes as a public opposition to the construction of data centers grows in the Commonwealth and other parts of the country. Maryland Governor Wes Moore, for example, also signed one executive order Wednesday on the rails for data center development.
Spanberger’s order also prohibits Virginia agencies from using nondisclosure agreements to keep details about proposed data centers and their incentives confidential. It calls for new rules on noise, emissions, water use, electricity demand and other impacts in the coming months.
But many of the consequences of construction are still unknown, said Ked Whitmore, chair of the land use and zoning practice at Venable, a Washington, D.C.-based law firm.
More changes will be focused on in the coming months state agencies present recommendationsaccording to a Venable takeaway. Spanberger also plans to apply additional data center rules during 2027 Virginia General Assembly Sessionaccording to a statement from his office.
While the order itself does little to change current construction activity, Whitmore said what comes out of the recommendations could prove far more consequential for contractors.
Here, Whitmore talks to Construction Dive about what’s changing immediately, what contractors should watch out for, and whether the new rules could make it harder to build projects in the future.
Editor’s Note: The following has been edited for brevity and clarity.
Construction Dive: What’s Changing Immediately for Data Center Construction in Virginia Due to Executive Order?
KED WHITMORE: From a build standpoint, I don’t know that there are a ton of changes. Most of the changes that will affect construction will likely be the result of what the rulemaking process ends up saying at the end of the 120, 180, or 240 days.
I think most of the immediate impacts will be related to things like incentive agreements, NDAs, that kind of thing, not necessarily construction related. I think most of the immediate changes are for things that are much earlier in the process.
How might the order affect construction activity or project timelines?
There will be a major review of many things that affect the design, around noise, emissions, water and cooling and where these things can be built in general. These things will have a huge impact on how buildings are designed, especially how generators and other ancillary structures are designed.
Ked Whitmore
Courtesy of Venable
There is this exclusion from the state’s site preparation and expedited review program, but again, that doesn’t really affect the construction itself. This affects some of the permissions and overriding some of the processes, but I don’t think it’s a literal build change.
What should contractors and developers with data center projects in Virginia do now?
Developers need to understand where each of their sites are in the permitting process, so they can assess where and how these changes will align with future milestones.
And that’s a tricky question, because the changes won’t really come into focus for a couple of months.
Developers will need to be very aware of what milestones they need to achieve and how they may be affected by the legislative changes that are sure to come next year.
Do you expect the executive order to alter the Virginia data center construction pipeline?
There is still a lot to understand about what the impacts will be, and those impacts will become clearer when we get the agency’s reports in a couple of months.
Then I think there will be significant changes during the 2027 general assembly session. I think that’s really where you’re going to see the changes crystallize and those impacts start to become apparent at that point.
It is too much to say that it will limit or prevent data center construction. We don’t know what many of those impacts will be. We may hope that the State has some common sense, some good guidelines and procedures that take into account the limitations of the industry and will allow this development to continue, but with the rails that the State deems appropriate.
It is also possible that agencies and the General Assembly will make changes to the law that are unsustainable, making data center development very difficult. I don’t know the answer to that, but I think characterizing this as “they’re stopping data center development,” I don’t think is accurate, at least not at this point.
