Spanberger Limits Automatic Approval for Large Data Centers in Virginia; No Full Moratorium

On Sept. 18 in Richmond, Virginia Governor Abigail Spanberger announced an executive order aimed at reining in the rapid expansion of data centers in the state without imposing a blanket moratorium. The order removes automatic local approval — commonly called "by-right" approval — for any data center that will consume more than 25 megawatts (MW) of power. The governor framed this as creating stronger state oversight while preserving a path for review and approval.

The executive order introduces three practical changes:

• Removes by-right approvals for data centers drawing more than 25 MW, meaning larger projects must undergo local review processes rather than being automatically allowed under existing zoning rules.
• Establishes requirements for transparency, which affect how project proposals, power usage, and cost responsibilities are disclosed to local officials and the public.
• Adds environmental and cost-allocation rules to address impacts such as energy demand and how utilities and communities absorb costs tied to new facilities.

Spanberger also tied data center policy to broader technology governance by creating an AI task force and directing state actions related to AI policy. The administration emphasized oversight and accountability rather than an outright halt to data center construction.

Virginia is already a major data center market. Large facilities can drive substantial new demand for electricity, require upgrades to local grids, and create fiscal and land-use tradeoffs for counties and municipalities. Ending automatic approval for big projects shifts decision-making power back to local governments, giving communities a formal role in evaluating how a proposed data center will affect infrastructure, environment, and budgets.

The transparency and cost-allocation elements aim to make the financial and environmental consequences clearer to local authorities and ratepayers. Those rules can change negotiations over who pays for grid upgrades or water and wastewater impacts tied to cooling and operations.

Spanberger did not impose a moratorium on new data centers. Projects that fall below the 25 MW threshold or those that meet review standards can proceed under the revised processes. The intent is to create stronger review mechanisms and clearer responsibilities rather than to close the market.

Practical next steps for local governments and developers

• Local planners should update review checklists and zoning procedures to reflect the new threshold and transparency expectations.
• Utilities and local fiscal officers need to clarify potential cost-allocation frameworks for grid and public-service upgrades required by larger facilities.
• Developers should prepare for more detailed disclosures on power usage and environmental impact and anticipate longer approval timelines for projects above 25 MW.

The executive order alters how large data centers enter Virginia communities: fewer automatic approvals, more transparency, and explicit attention to environmental and fiscal impacts. It preserves development options while increasing the role of local review and state-level rules tied to energy use and AI policy.