Setting aside concerns they were dismissing potential for local concerns and increased power bills, the West Virginia House of Delegates has passed legislation requested by Gov. Patrick Morrisey aimed at ushering in data center development.
The House on Tuesday, in an 88-12 vote, passed , a sweeping energy bill which would strip local governments and regulators of jurisdiction over data centers sought by the legislation while propping up increasingly costly coal-fired electricity.
Morrisey called the legislation a “once-in-a-generation opportunity for West Virginia to power the future of data†in a statement last month. Morrisey said in a Tuesday statement he looked forward to the Senate approving the bill and sending it to his desk for approval.
HB 2014 would eliminate a requirement that electrical service to business development districts be generated from renewable sources and would remove a limit on such districts from a 2022 law designed to facilitate development of microgrids — localized power grids that can operate independently.
2022’s established a Department of Economic Development-administered program that permitted exemption from Public Service Commission requirements for provision of renewable energy within “high impact†industrial business development districts.
The bill seeking data centers — computer server-populated warehouses that power artificial intelligence expected to dramatically increase energy and water demand — now goes before the Senate.
The House voted on HB 2014 Tuesday afternoon after Speaker Roger Hanshaw, R-Clay, ruled the bill doesn’t “embrace more than one object,†something prohibited by . Delegate Kayla Young, D-Kanawha, had asked for the ruling, contending a HB 2014 section that moves beyond microgrids with provisions designed to encourage West Virginia’s increasingly anachronistic use of coal for electricity.
Tuesday’s vote came a day after the House rejected an amendment proposal from Delegate Evan Hansen, D-Monongalia, that would have restored measures of local control HB 2014 would eliminate.
HB 2014 would prohibit counties and municipalities from enforcing or adopting ordinances, rules or regulations that limit creation, development or operation of any certified microgrid district or high-impact data center project.
There’s no limit on the kind of power generation to be allowed within the microgrid districts HB 2014 would permit. So nuclear, coal or gas-fired generation could be set up in counties and municipalities denied the power to check such projects through zoning.
“This bill preempts local control in some significant ways,†Hansen said in a House floor speech Monday prior to the House’s untallied voice vote on his amendment.
But HB 2014’s proponents predicted the bill would create jobs through data center development while avoiding adverse impacts on ratepayers despite warnings from Appalachian Power and consumer advocates contending the bill will cost customers.
“We all take chances every day. We can’t write a bill down here that’s perfect because next year, something will change between here and there,†Delegate Scot Heckert, R-Wood, said in a House floor speech Tuesday. “But I think this bill is crafted well.â€
The Republican-supermajority House’s 88-12 vote for HB 2014 nearly was along party lines, with Majority Whip Marty Gearheart, R-Mercer, Assistant Majority Whip Jordan Bridges, R-Logan, and Delegate Bill Flanigan, R-Ohio, joining all nine House Democrats in voting against the bill.
“This is an attempt to innovate. This is an attempt to take a new approach to energy policy in the state,†Delegate Henry Dillon, R-Wayne, said in a House floor address Tuesday. “And it’s not going to harm our utility companies. It’s not going to harm ratepayers. It’s not going to harm oil and gas. It’s not going to harm coal.â€
‘Protect local voices, not silence them’
The West Virginia Environmental Council, in conjunction with the West Virginia Rivers Coalition and West Virginia Solar United Neighbors, urged supporters Tuesday morning via email to call delegates and tell them to “protect local voices, not silence them.â€
“These centers could create constant noise and light pollution, and there would be nothing you or your community could do to stop it,†the email warned, noting microgrid districts can be up to 2,250 acres.
Northern Virginia has emerged as the world’s largest data center market, with several hundred data centers in Fairfax, Prince William and Loudoun counties — the latter of which borders West Virginia.
A Fairfax County, Virginia, data center approved last year tightened regulations and addressed concerns about noise, building design and proximity to residential areas. The ordinance required all equipment must be enclosed or screened by a wall or similar barrier to reduce visual and noise impacts in districts where data centers are allowed, limits on the size of certain data centers and a 200-foot minimum setback for data center buildings from the lot line of an adjacent residential property.
HB 2014 would eliminate a requirement that business districts housing microgrids be located on land sold or leased by the state or its political subdivisions for creating such a district, or on land previously used for coal mining.
The bill would require utilities to maintain their generating units to be able to self-generate power and achieve at least a 69% capacity factor — a measure of how often a plant runs at full capacity.
Although a 69% capacity factor wouldn’t be required if doing so would increase electric charges above an established rate, energy experts and ratepayer advocates have said a 69% capacity factor target set by the PSC for West Virginia’s coal-fired plants in recent years has encouraged uneconomic use of the plants that cost utility customers.
Testifying before the House Energy and Public Works Committee this month, Appalachian Power regulatory and finance vice president John Scalzo testified HB 2014 wouldn’t ensure against increased rates as intended.
Appalachian Power has said opening up business districts to nonrenewable energy could raise customer bills if independent power producers taking advantage of it need backup service from the utility since nonrenewable backup needs dwarf those of renewables.
On the House floor just prior to Tuesday’s vote, Gearheart urged his fellow delegates to vote against HB 2014, skeptical it would lower power bills.
“I’m going to side with the ratepayers in the state of West Virginia,†Gearheart said.
Delegate welcomes data centers ‘off beaten path’
HB 2014 would establish a Department of Commerce-administered grid stabilization and security fund to help regulated utilities develop and maintain coal and gas power generation transmission. The fund could consist of data center property tax payments or other Legislature-approved appropriations.
The Department of Commerce would be barred from using the fund to decommission or replace existing facilities.
HB 2014 would require generating public utilities to maintain an average annual minimum of 30-day coal supply onsite at each coal-fired plant under contract for the remainder of the life of the plants.
Delegate Adam Vance, R-Wyoming, an underground coal miner, said in a Tuesday House floor speech a data center representative told him last year upon looking for area to establish a data center in the southern coalfields his unnamed company wanted to locate “off the beaten path.â€
“I kind of look at this as a way of helping the southern coalfields prosper,†Vance said. “I may be wrong.â€
Mike Tony covers energy and the environment. He can be reached at mtony@hdmediallc.com or 304-348-1236. Follow on X.
