Can Clean Energy Data Centers Revitalize Southwest Virginia’s Economy?

September 16, 2024

Virginia’s bold initiative to repurpose old coal mines into clean energy data centers represents a substantial shift in both environmental and economic policy for the region. Former state energy office bureaucrats turned private-sector consultants Will Payne and Will Clear are spearheading this project, known as Data Center Ridge, as part of the nonprofit Energy DELTA (Discovery, Education, Learning & Technology Accelerator) Lab. The larger vision, backed by Republican Gov. Glenn Youngkin’s administration, aims to transform 65,000 acres of former mining land in Southwest Virginia into test sites for innovative energy solutions. The project not only strives to usher in a new era of renewable energy but also seeks to rehabilitate a region economically devastated by the decline of coal.

The Vision: From Coal to Clean Energy

Payne and Clear’s central idea revolves around attracting tech companies to build solar-powered data centers on reclaimed mine lands, specifically starting with 2,000 acres of the defunct Bullitt Mine in Wise County. These data centers are designed to utilize underground mine water for cooling, a naturally cool water source available beneath the surface. The long-term plan envisions incorporating other renewable energy sources, including wind turbines, pumped hydro storage, and possibly small nuclear reactors, to create a diversified clean energy portfolio. This multifaceted approach underscores a growing industry trend of seeking data center sites that can be powered by 100% clean energy, thus drawing significant interest from tech companies focused on sustainability.

The rationale behind this ambitious project is multi-layered. Data centers demand substantial amounts of power, and there is a growing industry trend of seeking sites powered by 100% clean energy. Additionally, the decline of the coal industry has left a significant tax revenue gap in the local economy, impacting essential public services such as safety, health care, and education. By establishing data centers, Payne and Clear aim to rejuvenate the local economy, providing new job opportunities and creating a steady stream of tax revenue. The proposed renewable energy solutions ensure that the region’s transition from coal is both economically beneficial and environmentally sustainable, promising a brighter future for Southwest Virginia.

Political and Economic Support

Glenn Davis, director of the Virginia Department of Energy, emphasizes that Southwest Virginia, once the energy capital of the East Coast, has the potential to regain this status through renewable energy innovation. Although projects under the DELTA Lab won’t count toward the Virginia Clean Economy Act’s carbon-cutting mandates due to the area being served by a different power company, this does not deter the state’s commitment. Youngkin’s administration is primarily driven by the potential for job creation, business development, and improved quality of life in the region. The alignment of state political leadership with the aspirations of Payne and Clear adds a critical layer of support to the initiative.

Dallas-based Energy Transfer owns the land for the DELTA Lab and coordinates development efforts with Wise County officials. Although parts of the property are still being mined for metallurgical coal, portions like the Bullitt Mine are undergoing reclamation. The ultimate vision for the lab includes multiple projects projected to generate over 1,600 jobs, contribute 1 gigawatt of new power, and attract up to $8.25 billion in private investments. This substantial investment underscores a robust commitment to revitalize the region, leveraging newfound political will and economic opportunities to turn theoretical aspirations into tangible progress. The support from high-level political and economic figures is vital for gaining momentum and ensuring the longevity of this ambitious venture.

Community and Environmental Considerations

Key stakeholders advocate for community-wide support and sustainability. Virginia state Sen. Danica Roem supports Southwest Virginia becoming a hub for data centers, provided these projects are aligned with community interests, powered by renewables, and do not necessitate extensive clearcutting of forests that function as carbon sinks. There’s also broad concern over the financial burden for expanding transmission infrastructure; it should not fall on utility customers. Addressing these community and environmental considerations is crucial for the project’s acceptance and integration into the local fabric, ensuring it benefits both the residents and the environment.

Data center expert Josh Levi of the Data Center Coalition mentions that Southwest Virginia’s landscape might not inhibit data center development, as these facilities are moving into more diverse and “tertiary markets.” He acknowledges existing interest but notes potential hurdles and suitability challenges for specific use cases, suggesting the region might be more apt for federal data backup rather than functions requiring real-time data processing. Levi’s perspective emphasizes the need for tailored solutions to maximize the region’s potential, ensuring that any development aligns with both industry needs and the unique attributes of Southwest Virginia. Encouragingly, these insights indicate room for strategic planning and adaptability.

Technological and Environmental Innovations

One of the notable advantages of situating data centers atop old coal mines is the presence of large volumes of naturally cooled underground mine water. Payne and Clear’s vision includes a closed-loop system for using this water to cool data centers, ensuring it can be pumped back underground and reused. Initial drilling to study and exploit this water resource is funded by the federal government and managed by the U.S. Department of Energy. This innovative use of existing natural resources highlights the project’s focus on sustainable and efficient energy solutions, turning a potential environmental liability into an asset.

However, transforming this vision into reality involves significant challenges, especially in securing reliable grid connections, energy storage, and robust communication infrastructure. Any sustainable solutions for providing continuous power when renewable sources like solar and wind are unavailable are essential. While diesel-powered generators currently serve as backups, long-term sustainable alternatives need to be considered. Addressing these technological hurdles is vital for the project’s success, requiring advanced planning, innovative engineering, and substantial investment. The emphasis on sustainability ensures that the data centers will not only be economically viable but also environmentally responsible.

Collaborative Efforts and Future Prospects

Payne and Clear’s determination is evident as they engage in ongoing discussions with Kentucky Utilities, which services the region as Old Dominion Power, to upgrade and add necessary infrastructure. This involves extensive planning and coordination with local officials to meet future energy demands efficiently and sustainably. The collaborative efforts of various stakeholders, including utility companies, local officials, and federal agencies, demonstrate a shared commitment to overcoming the challenges and realizing the vision of a revitalized Southwest Virginia.

Despite the optimistic forecast for economic revitalization through job creation and improved tax streams, skepticism remains. Overcoming the entrenched stereotype of Appalachia as a region struggling with poverty and addiction issues is one of the many hurdles Payne and Clear face in attracting developers and convincing them of the viability and potential of their project. Yet, the positive indicators, including advanced planning, strong political backing, and community engagement, provide a promising outlook. The concerted effort to align economic development with environmental stewardship marks a transformative approach that could redefine the region’s future.

Conclusion

Virginia’s ambitious initiative to convert abandoned coal mines into clean energy data centers marks a significant change in both environmental and economic policies for the area. This groundbreaking project, known as Data Center Ridge, is being led by Will Payne and Will Clear—former state energy office officials who are now private-sector consultants. The initiative is part of the nonprofit Energy DELTA (Discovery, Education, Learning & Technology Accelerator) Lab’s mission. Supported by Republican Gov. Glenn Youngkin’s administration, the overarching plan aims to transform 65,000 acres of old mining land in Southwest Virginia into testing grounds for cutting-edge energy solutions.

This project’s goals are twofold: to advance renewable energy and to rejuvenate a region that has suffered economically from the decline of the coal industry. Not only does this endeavor seek to introduce sustainable energy practices, but it also aims to breathe new life into communities hit hard by the economic downturn associated with the loss of coal-related jobs. By turning derelict mining facilities into hubs for innovation and technology, the state hopes to create new job opportunities and stimulate local economies, all while contributing to cleaner energy practices.

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