Virginia
US state hosting the world's densest data-centre cluster, now split by a tax-abatement budget standoff.
Virginia's Prince William County unanimously denied a 43-million-square-foot data-centre campus on 7 July 2026, the second major rezoning defeat in Northern Virginia's cluster since courts and counties began tightening consent after the state's per-kilowatt-hour power tax took effect in June.
Last refreshed: 4 August 2026 · Appears in 3 active topics
Will Virginia's tax abatement standoff send data centres south or out of state?
Timeline for Virginia
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Data Centres: Boom and BacklashBackground
Virginia is the mid-Atlantic state anchoring Northern Virginia's Loudoun County, home to the world's largest data-centre cluster and the proving ground for how the industry is taxed and zoned across the United States . Its roughly 8.7 million residents have trended steadily Democratic over the past decade as Washington DC's Northern Virginia suburbs have expanded, though its 11 congressional seats remain split 7 Democratic to 4 Republican after the state Supreme Court struck down a mid-decade redistricting amendment on 8 May 2026 .
Governor Abigail Spanberger, a Democrat, now leads the state alongside a Democratic-controlled legislature . Data centres remain the state's defining economic and fiscal fact: the behind-the-meter power tax, the first of its kind among US states, runs until July 2028, and county governments from Prince William to Fairfax have tightened planning consent after a string of court and zoning defeats for developers .
Prince William denies a mega campus
Virginia enacted the first US state levy on behind-the-meter power for data centres on 22 June 2026: a $0.011-per-kilowatt-hour consumption tax capped at $600 million a year, passed 23-16 in the Senate and 71-22 in the House . The tax gave Compass Datacenters, which had already abandoned two Virginia site searches over the uncertainty, a fixed cost to plan around. A tiered per-kilowatt fee is now before the Senate Finance Committee, and a new water-disclosure law requires utilities to report data-centre sales separately from other commercial use, extending the state's fiscal grip on the industry beyond the June tax.
County planning has moved in step with that state pressure rather than against it: Fairfax has added setbacks and noise studies, Loudoun keeps approving projects, and Prince William's Occoquan-watershed rejection on 7 July stands as the sharpest local test yet of the climate Richmond has set .