CAPE CHARLES MIRROR ANALYSIS
Concerned about noise, resources, and farmland, many rural communities feel that their culture is under attack, especially in groundwater-dependent localities. The steam engine mechanized muscle, electricity mechanized civilization, the computer mechanized calculation, the internet connected human knowledge—and AI is beginning to mechanize intelligence itself. The AI revolution is transforming society by shifting human advantage from possessing information to knowing how to question, interpret, create, and make sound decisions with intelligence that is increasingly available to everyone. We all need to stop worrying and learn how to love Data Centers.
Virginia is the epicenter of the American data-center industry, and the explosive growth of artificial intelligence is creating demand for facilities that are larger, more powerful, and potentially more resource-intensive than anything that came before them.
For rural communities such as Northampton and Accomack counties, that presents an intriguing economic opportunity…or problem.
It also presents a question that should be answered before—not after—large projects arrive:
How much of the Eastern Shore’s limited water, electrical and infrastructure capacity should be committed to data centers, and what should the community receive in return?
That is a more useful question than whether data centers are simply “good” or “bad.”
The economics can be attractive. Data centers represent enormous capital investments and can generate substantial local tax revenue. Their construction creates significant employment, and once operating they generally generate less traffic and place fewer demands on schools and many other government services than large residential developments.
But data centers also have an unusual economic footprint: they can consume extraordinary amounts of electricity and, depending on their cooling systems, significant amounts of water while employing relatively few people after construction.
Virginia’s own experience provides a useful warning for rural communities considering this new generation of industrial development.
Northern Virginia has become the largest data-center market in the world.
According to Virginia’s Joint Legislative Audit and Review Commission, Northern Virginia alone represents approximately 13% of reported global data-center operational capacity and roughly 25% of capacity in the Americas.
The industry has brought enormous investment into Virginia.
JLARC estimates that data centers contribute approximately 74,000 jobs, $5.5 billion in labor income and $9.1 billion in annual GDP to Virginia’s economy.
But there is an important qualifier.
Much of that economic impact comes from construction, rather than the long-term operation of the facilities.
Industry representatives told JLARC that a typical 250,000-square-foot data center may employ only around 50 full-time workers, approximately half of whom may be contractors. During construction, however, a facility may have approximately 1,500 workers on site at peak activity.
That distinction should matter enormously to rural economic-development officials.
A data center can represent billions of dollars of taxable infrastructure without requiring thousands of permanent employees.
That can be an advantage.
But it also means communities should carefully compare the resources consumed with the permanent economic benefit created.
The Electricity Question May Be Bigger Than the Water Question
Much of the public debate surrounding data centers has focused on water.
For modern artificial-intelligence data centers, however, electricity may ultimately be the more consequential issue.
Data centers operate continuously and modern computing equipment—particularly the graphics processors used to train and operate AI systems—requires enormous quantities of electricity.
JLARC concluded that data centers are the primary reason Virginia’s electricity demand is expected to increase dramatically.
Virginia’s electricity demand was essentially flat between 2006 and 2020 as improvements in energy efficiency offset population growth.
That era appears to be over.
An independent forecast commissioned by JLARC found that unconstrained electricity demand in Virginia could double within approximately a decade, primarily because of data centers.
Meeting even half that projected demand would require substantial investments in generation and transmission.
The scale is difficult to overstate.
JLARC found that meeting unconstrained demand could require new solar generation at roughly twice Virginia’s 2024 construction rate, additional wind generation, new natural-gas generation and substantial transmission expansion.
That means a data-center proposal is not merely a land-use question.
It is potentially an energy infrastructure project.
Put 100 Megawatts Into Perspective
Consider a hypothetical 100-megawatt data-center campus proposed somewhere on the Eastern Shore.
At full load, that facility could consume:
100 megawatts × 24 hours × 365 days = 876,000 megawatt-hours of electricity per year.
A 200-megawatt campus could theoretically consume approximately 1.75 million megawatt-hours annually if operating continuously at full load.
Actual consumption would depend on utilization, efficiency and facility design, but the calculation illustrates the scale involved.
The question for local officials therefore shouldn’t simply be:
Can the electric company provide the power?
It should be:
What has to be built to provide that power reliably?
Would additional transmission infrastructure be required?
Would new substations be necessary?
Would new rights-of-way be needed?
Would additional generation have to be constructed elsewhere?
And most importantly:
Who pays for it?
Virginia regulators are already confronting that problem.
Beginning January 1, 2027, Dominion Energy customers demanding 25 megawatts or more and meeting applicable usage requirements will enter a separate GS-5 large-load rate class.
The State Corporation Commission says the new structure is intended to minimize the possibility that infrastructure costs created by extremely large electricity customers are shifted onto residential and ordinary commercial customers.
Among other protections, affected large-load customers must make long-term commitments and pay minimum percentages of contracted transmission and distribution costs.
Virginia learned something important from Northern Virginia:
Note: A utility should not build massive amounts of infrastructure for a data center and leave ordinary customers holding the bill if the anticipated demand never materializes.
The Eastern Shore should learn that lesson before such development occurs here.
Water
The water question requires more nuance.
Not every data center consumes millions of gallons of water.
In fact, JLARC found that most Virginia data centers studied used roughly as much water as—or less than—an average large office building.
But averages can be misleading.
Water consumption varies dramatically depending upon the cooling technology, size and computing density of a facility. Some data centers consume substantially more water than others.
For the Eastern Shore, however, another issue is even more important:
Where does the water come from?
A gallon of water consumed in a region with massive surface-water reservoirs is not necessarily equivalent to a gallon pumped from a coastal aquifer.
The Eastern Shore is particularly dependent upon groundwater.
Virginia DEQ regulates large groundwater withdrawals in the Eastern Shore Groundwater Management Area. Withdrawals of 300,000 gallons per month or more generally fall under the state’s groundwater permitting framework, subject to statutory exclusions.
Virginia is therefore not dealing with an unlimited resource.
And groundwater has other users.
Agriculture needs water.
Poultry operations need water.
Food processors need water.
Businesses need water.
New housing needs water.
Existing residents need water.
Future industries that have not even arrived yet may need water.
The real issue isn’t necessarily whether an individual data center would drain the aquifer.
It is opportunity cost.
Water committed to one large industrial user represents capacity that may not be available for another use decades from now.
Virginia Is Beginning to Recognize the Problem
State policy is moving quickly.
Virginia enacted legislation in 2026 requiring additional reporting of potable and reclaimed water supplied to qualifying data centers.
The regulations are currently moving through the state implementation process.
That seemingly mundane requirement could become extremely important.
Until recently, Virginia did not always have sufficiently detailed information to answer one basic question:
Exactly how much municipal water is going to data centers?
Better reporting should eventually allow policymakers and citizens to replace estimates with actual consumption figures.
Virginia also adopted new requirements aimed at cooling-water consumption.
Under language included in the 2026 budget, new data centers in the Eastern Virginia Groundwater Management Area applying for DEQ air permits after January 1, 2027, must demonstrate that they have minimized cooling-water consumption and employed best available water-efficient technologies.
Options specifically identified by the state include air cooling, closed-loop systems, recycled water, stormwater reuse and non-potable reclaimed water.
While Virginia maintains separate Eastern Virginia and Eastern Shore groundwater management areas, the policy direction is unmistakable:
Water-intensive cooling should receive greater scrutiny where water resources are constrained.
That principle makes considerable sense for the Eastern Shore.
The Economics
Imagine two hypothetical economic-development projects.
Each requires 300,000 gallons of water per day.
One employs 700 people.
The other employs 60.
That doesn’t automatically mean the 700-job project is better.
The smaller employer could generate considerably more tax revenue, require fewer public services, create less traffic and provide other economic benefits.
But taxpayers deserve to see the calculation.
For every major data-center proposal, local officials should be able to explain:
Resources consumed versus economic benefits received.
That calculation should include electricity demand, peak water consumption, land requirements and infrastructure improvements on one side.
On the other should be permanent jobs, average salaries, annual local tax revenue, construction activity, privately financed infrastructure and any incentives granted by the locality.
Only then can residents determine whether the transaction makes sense.
The Eastern Shore Should Establish the Rules Before the Applications Arrive
Northern Virginia developed many of its data-center policies while the industry was already exploding around it.
The Eastern Shore has a luxury Northern Virginia largely didn’t...Time.
Northampton and Accomack can determine what they expect from data centers before developers arrive with site plans and economic-development agreements.
At minimum, any major proposal should answer several questions before receiving local approval:
- What is the facility’s initial electrical demand, and what is the maximum demand at full buildout?
- How much water will the facility consume on an average day and on the hottest anticipated summer day?
- What aquifer, municipal system or other source will provide that water?
- Will the facility use potable groundwater, reclaimed wastewater, closed-loop cooling, air cooling or some combination?
- What electrical transmission lines, substations, wells, pipelines, roads and other infrastructure must be constructed?
- Who pays for that infrastructure?
- How many permanent employees will work at the facility after construction?
- What will the average salary be?
- What annual local tax revenue is projected after exemptions, rebates or incentives?
- What financial guarantees protect taxpayers and utility customers if the project is abandoned or only partially constructed?
Those answers should be public.
Note: A 50-Megawatt Facility Is Not the Same as a 500-Megawatt Campus
Another lesson from Northern Virginia is that local governments should evaluate full buildout, not simply the first building.
A developer might initially propose a relatively modest facility.
But if the property, zoning, electrical interconnection and infrastructure ultimately support a much larger campus, the community should understand that potential before granting approvals.
There is an enormous difference between approving a 50-megawatt data center and creating the conditions for a future 500-megawatt industrial campus.
The same principle applies to water.
Officials should ask not merely what Phase I consumes, but what the entire property could consume if completely developed.
Being Anti-Data-Center Just Because is not Useful
Data centers could potentially be excellent economic-development projects for parts of rural Virginia.
They offer something rural counties often desperately need: an enormous taxable capital investment without an equivalent increase in population.
A billion-dollar facility paying local taxes while adding relatively few children to the school system can be extremely attractive financially.
Construction could support local contractors, hotels, restaurants and suppliers.
Additional fiber infrastructure could have secondary benefits.
Electrical upgrades could potentially strengthen local infrastructure if structured correctly.
And a facility designed around air cooling, closed-loop systems or reclaimed water could have dramatically different environmental impacts from an older water-intensive design.
The question therefore isn’t:
Should the Eastern Shore allow data centers?
A better question is:
Under what conditions should the Eastern Shore allow them?
The Eastern Shore Has Something Northern Virginia Didn’t
Perhaps the most valuable commodity the Shore possesses right now isn’t electricity or groundwater.
It’s hindsight.
Northern Virginia has already conducted the experiment.
Virginia now knows that massive data-center development can generate extraordinary tax revenue and economic activity.
It also knows that the industry can create enormous electricity demand, require substantial transmission investment, generate conflicts with neighboring residential communities and create difficult questions about who should pay for infrastructure.
The Commonwealth is already rewriting its policies in response.
The Eastern Shore doesn’t have to rediscover those lessons.
Before the first hyperscale campus appears before a planning commission, Northampton and Accomack counties could establish clear standards covering water consumption, cooling technology, noise, setbacks, full-buildout electrical demand, infrastructure financing, decommissioning and financial guarantees.
That would not close the door on data centers.
It would establish the price of admission.
For a rural coastal community sitting on finite infrastructure and a valuable groundwater resource, that may ultimately be the most important distinction of all.
The issue isn’t whether technology is coming.
It is whether the Eastern Shore controls the terms under which it arrives.
About the Author
Actually Jacob, a majority of these events are created by recreational boaters pumping their holding tanks out into the water.…
From the spill in the Elizabeth River no doubt
"Pedestrians have the right of way." -Famous last words-
Pedestrians always have the right of way.
In other words there will be potential bike path injuries and deaths. Idiot drivers vs knucklehead bike riders vs 12…