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Report: Virginia ratepayers to bear costs of data center growth in Energy sector


A recent study conducted by the Joint Legislative Audit and Review Commission (JLARC) in Virginia revealed that the state is facing challenges in meeting energy demands due to rapid growth in the data center industry. The 156-page report presented to lawmakers on Dec. 9, 2024, detailed the economic, environmental, and societal impacts of the industry in the state.

The study found that the data center industry contributes billions to the economy but mainly generates jobs during the construction phase. However, the industry’s growth is driving an exponential increase in energy demand, putting the state at risk of facing power shortages unless adequate measures are taken.

The report also highlighted concerns about water usage by data centers and the impact on residential electricity costs. Lawmakers are being urged to consider policy changes to ensure the industry takes on more of the risk for new infrastructure requirements, rather than burdening ratepayers.

Environmental advocates have welcomed the study but expressed disappointment that it did not provide enough actionable recommendations. The industry’s outsized growth in Virginia has raised alarms among advocacy groups, leading to calls for increased regulation and oversight.

As Virginia grapples with meeting energy demands and addressing environmental concerns, lawmakers are expected to introduce data center-related legislation during the upcoming legislative session. The study underscores the need for a more comprehensive approach to managing the industry’s impact on the state.

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Photo credit www.bayjournal.com

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