Environmental Cents: Data Center Power Costs
Meeting data centers' power needs will require significant new generating capacity, but what is the cost impact?
By Bruce Saller
COLUMNIST
Dominion Energy estimates their peak load will double in the next fifteen years, mainly due to new data center demand. Meeting this need will require significant new generating capacity, but what is the cost impact?
The U.S. Energy Information Agency released a report in April 2025 which estimates the average cost of generation (in dollars per Giga-Watt Hour [one billion Watt-Hours]) coming online in 2030. The costs are provided with and without federal tax credits (TC). (Geothermal and Hydroelectric were removed since they are not feasible in our area.)
Dominion has varying loads depending on the season. YES Energy has charted Dominion’s average daily load for January and July:
According to Dominion Energy’s 2023 Integrated Resource Plan, Data Centers will consume an additional 70,000 GWH by 2038.
The addition of data centers will mainly cause the chart to shift higher with a slight increase in the peaks, as the power they consume only varies a few percent over the year.
Even though nuclear is the most expensive generation option, most of the cost is in construction, and once built its operating costs are lower than biomass, gas and offshore wind. So, utilities try to power most of their base load with nuclear and supplement it with other generation types.
Solar is a low-cost option to help with the summer peak, as panels generate the most energy in the afternoon when demand is peaking. Onshore wind is a low-cost option to help with the winter peaks as their output is highest in the winter months.
Solar and wind generation need to be supported by some battery storage, which increases their cost. However, the cost of Solar with Battery Storage is still about $30 less per GWH than nuclear.
The federal and Virginia governments are pushing for large amount of new advanced nuclear generating capacity to power the data centers and other new loads. We need to make sure data centers bear the costs of their power needs, so existing customers do not foot the bill.
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Thanks to BRUCE SALLER for writing this 8-1-25 Column: 'Data Center Power Costs'. Dozens of us in 22401 met every single week (still are) back in Fall 2024 through the FREDERICKSBURG NEIGHBORHOODS COALITION when we heard that 8-12 DATA CENTERS were being proposed at 'Celebrate Virginia' near the Fred Nats Ballpark and two residential communities of seniors and families with young children.
Some of us went to the Fredericksburg City Council mic then and asked those 7-0 block vote Councilors (they all have to be 'YES", no dissent is tolerated) to 'PUSH THE PAUSE BUTTON', as Sierra Club advocated, to wait for that darn 12-9-24 Joint Legislative Audit Review Commission JLARC study by the Virginia General Assembly to be released.
Those 7 Councilors wouldn't take a pause. Instead, we hear the admitted excuse: We're on an 'aggressive' timeline.
hmm, Developer pulling their puppet strings: They were afraid of losing the deal. The standard MO of a Data Center Developer, rush the decision before the community finds out the real story of their billion-dollar industry.
To bum-rush the vote. because now 22401 residents are realizing, after the fact. that Council's 2-25-25 block vote ain't really a deal for us as rate-payers and the environment. We're the ones paying the DC fees hidden within our Dominion Resources power bills. even now. even without a data center built.
Shortly after that 2-25-25 Council block vote, the American Rivers organization put our beloved Rappahannock River up as the 6th most ENDANGERED RIVER in the country.
Susanna Finn, Ward 3 appointee, got to vote twice in favor of Data Centers. That 'YES! vote! As the Chair of the Planning Commission on 2-12-25, in which 4 on the Planning Commission voted "NO" because the Technology Overlay District and paperwork associated with it were not ready to make sure that Fredericksburg got the best deal in specifying the conditions and standards in the documents.
and then later 'YES!!!!!!!' on 2-25-25 on Council. That ignored the fact that the build was going to be 150-200 ft near residences for seniors and young children.
When the 12-9-25 JLARC report was finally released, it just motivated us to get the word out to the community. Yet, the council and city government would not hold any Community Meetings, not even on 'What is a DATA CENTER?'. So we residents chipped in the money to pay the rental fees for rooms to meet.
Here's what we learned in 5 meetings on Data Centers, including those hosted by Sierra Club, Piedmont Environmental Council, and Facebook's INFORM FREDERICKSBURG:
Environmental Concerns:
Energy Consumption:
DATA CENTERS are driving a substantial increase in Virginia's energy demand, with projections indicating a significant rise in the need for power generation and transmission infrastructure.
Water Usage:
DATA CENTERS require substantial amounts of water for cooling, and while some use less than typical office buildings, others use significantly more.
Air Quality:
Backup generators, while rarely used for extended periods, can emit pollutants and impact air quality during regional power outages. Due to this summer's excruciating heat, the generators in Prince William have had to kick on. They were only supposed to be used in a 'check-up probe' or in an emergency. not every day. There is a baseline study of bees and butterflies in that area to note if there is a change in their behavior.
Resource Strain:
The rapid growth of data centers is putting a strain on the state's resources, including energy, water, and land.
Key Findings of the JLARC Study:
Increased Energy Demand:
Data centers are the primary driver of projected electricity demand growth in Virginia. Residents are now expressing concern about who gets priority on the power. If it's DATA CENTERS, are we going to be living in 'brown out' conditions in our homes, as Spotsylvania Co had to do years ago due to its population growth in the western part of the county?
Infrastructure Needs:
The study emphasizes the need for substantial investments in solar, wind, nuclear, and natural gas power to meet the increased energy demand.
Potential Conflicts:
There is a potential conflict between the need to meet the energy demands of DATA CENTERS and the goals of the Virginia Clean Economy Act (VCEA), which aims to transition to 100% carbon-free energy generation by 2050. Dr. Eric Bonds, co-founder of now defunct Fossil-Free Fredericksburg and other 22401 stakeholders, questioned at the City Council mic how a vote for DATA CENTERS would not meet the Fossil-Free Fredericksburg goal that is in the 12-10-2019 Resolution passed by Council.
Limited Oversight:
The study also points to a lack of state-level oversight and enforcement of sustainable practices within the data center industry.
Did you know that the Manassas City Council thought it was getting millions of dollars in DATA CENTER promised monies?
Nope, they got stuck with the classic DATA CENTER MO 'bait and switch': The tenant put a bank inside the DATA CENTER so no BPOL 'business property taxes' revenue will be coming in as expected for hood-winked Manassas: https://www.insidenova.com/headlines/secret-data-center-tenant-in-manassas-not-subject-to-business-property-taxes/article_ec6c7a6b-a233-4e46-befe-6dc56adcd61d.html#google_vignette
Recommendations:
The JLARC report suggests the need for STATE-LEVEL OVERSIGHT and discussions about the impact of data centers on Virginia's citizens, ratepayers, communities, and natural resources, according to The Piedmont Environmental Council.
Finally, the 12-9-24 JLARC study on DATA CENTERS in Virginia also recommends that the state consider ways to ensure that the COSTS OF INTRASTRUCTURE DATA CENTER DEVELOPMENT ARE NO LONGER UNFAIRLY BORNE BY BUSINESSES and HOUSEHOLDS -WE RATEPAYERS, WE STAKEHOLDERS, WE RESIDENTS OF 22401.
Yep, this was a good one.
Only a couple of things give me pause, and they have little to do with the underlying theme of the article.
In that - the data released from this administration comes with an asterisk due to both the changes in methodology - which should give any layman pause without clear, non-biased summaries of what was changed and it's effects; and also the clear and continual partisan views expressed by the current Secretary of the DOE, Chris Wright.
Not to mention the unprecedented suppression of studies by this Republican administration, chaotic approach to scientific funding, and general antipathy in general to science and knowledge.
Remember, these are folks who have fired their Inspector Generals, have a rubberstamp Congress, and a partisan Supreme Court that routinely issues its most profound rulings in shadow dockets where they need not and do not explain themselves nor the law.
Hardly conditions which promote confidence.
And under all administrations, I've often wondered of how true numbers are when they limit themselves. I believe in capitalism. If chopping wood and throwing it on the wood stove is the way to go, so be it.
But for capitalism to work, shouldn't it be honest capitalism?
If we are giving the cost of coal, and we do not include the costs of benefits for black lung or coal ash dumps into the Dan River (not that that is something that would ever happen) - should we have the risk of those things considered in the price?
Nuclear has to be stored for 10000 years, without being weaponized, chain reacted, or causing cancer in the meantime. Our country is the leader of the world. We're a mere 250 years old, recorded history is only 5000 years old, and I'd say we are leaning more toward a less stable model than more - and we still have 9750 years to go? Are those risks factored into the costs? Of a Fukishima, Chernobyl both past and current (as war routinely threats its safety), or a Iran or Nagasaki? If it is, I don't see it.
The cost of methane from zombie oil wells leaking into atmosphere, as Republicans arbitrarily ignore 50 years of science because it is inconvenient to the petrochemical donors.
Yet even with all of those glaring omissions, the chart still skews towards renewables. With the math working ever more in their favor.
On the one hand, you've got renewable technology currently following Moore's law of tecnology efficiency - as it adapts. As is the supporting technologies of energy storage and transmission.
Whilst non-renewable sources have increasing costs due to ever diminishing supply (it takes a while to make 50 million year old liquid exploding dinosaurs), which become ever more inaccessible, while the damages from their usage accumulate in us and everything we depend upon - whether it be the air, water, or earth.
So yeah, thanks for the thoughts and info, but personally - when I look at the data, I think its worse than we realize.
Not for Mother Earth of course. Old girl's going to continue plodding along whether we're part of the story or not. At least for a while. But that doesn't mean I wouldn't rather we are a part of the story for as long as possible. And for that to happen, I think its better to go by what our teachers used to say, rather than partisan members of a cult built upon our basest emotions.
Honesty is the best policy, and I'm not sure a government led by a man with over 30000 public lies during the time when they used to count, convicted of over 30 felonies that involved fraud, etc, etc - and who has surrounded himself with sycophants who seem to outdo themselves on making their positions be more about what pleases him than what is true, of which Mr Wright seems to be one of the worst - is who I'm trusting all that much for information.
But that's just me. Still, interesting article. Thanks.