Hampton Roads Is Regulating a Data Center Boom That Hasn’t Arrived

Chesapeake, Hampton, Suffolk and Virginia Beach are rushing to write rules or impose restrictions. The statewide concerns are real. The local project pipeline is not.

Across Hampton Roads, local governments are preparing for an invasion that, at least for now, does not exist.

The Chesapeake Planning Commission has recommended making data centers a conditional use in industrial districts, giving the City Council authority to review every proposed facility. Commissioners amended the proposal to require a half-mile setback from existing homes and limit data center noise to 60 decibels during the day and 55 at night.

Hampton has hired the Southeastern Institute of Research under a $52,000 contract to help write a data center policy, even though City Manager Mary Bunting says the city has not received a single development proposal. City officials describe the work as an effort to avoid being caught “behind the eight ball” should an application eventually arrive.

Suffolk is pursuing a temporary moratorium while it develops regulations. Newport News has explored the idea of attracting a data center near Fort Eustis, but city officials said in December there was no concrete proposal.

Virginia Beach has gone further. Mayor Bobby Dyer declared that the city was “saying hell no to data centers,” and the City Council unanimously backed restrictions on large and hyperscale facilities. The rhetoric suggested Virginia Beach was beating back an imminent wave of server farms. In reality, no publicly announced hyperscale campus was moving through the city’s approval process.

That raises a basic question: Why is Hampton Roads panicking about an industry that has shown little evidence it is coming here?

Virginia’s data center boom is real. But it is overwhelmingly concentrated in Northern Virginia, with another expanding cluster around Henrico County and the Interstate 95 corridor.

Northern Virginia represents approximately 13% of reported global data center capacity. Its dominance was built over decades through dense fiber networks, access to large customers, relatively inexpensive electricity, available land and state tax incentives. Virginia’s Joint Legislative Audit and Review Commission expects significant future growth outside Northern Virginia, particularly along the I-95 corridor into Central Virginia. It does not identify Hampton Roads as the next major hyperscale market.

The Virginia Department of Environmental Quality’s list of issued data center air permits illustrates the difference. As of July 13, the list contained dozens of facilities in Loudoun, Fairfax and Prince William counties and a growing number around Henrico. In Tidewater, the only listed permit was for a Sentara Healthcare facility in Virginia Beach dating to 2015. No data center air permits were listed for Hampton, Newport News or Chesapeake.

Hampton Roads does have digital infrastructure. Virginia Beach is the landing point for transoceanic fiber-optic cables and is home to smaller colocation and cable-landing facilities operated by companies including Telxius and Globalinx. The Virginia Beach Development Authority recently approved an $800,000 grant to help Globalinx expand.

But a cable landing station is not the same as a 1,000-acre hyperscale campus consuming hundreds of megawatts.

Much of the capacity arriving through Virginia Beach is carried west to the established network ecosystem around Henrico’s White Oak Technology Park. Richmond gained the concentration of carriers, interconnection points, land, power infrastructure and existing operators needed to create a major commercial data center market. Virginia Beach became the gateway. Henrico became the hub.

Newport News also broke ground this year on the Jefferson Lab Data Center. That 30,000-square-foot facility will support the Department of Energy’s High Performance Data Facility and scientific research. It is a significant technology investment, but it is not a speculative commercial cloud campus or a collection of hyperscale warehouses.

Treating every facility that contains servers as the same land-use threat obscures the actual issue.

The lack of a Hampton Roads boom does not mean local governments should ignore the industry.

Chesapeake learned that lesson in 2025 when a developer proposed a 350,000-square-foot facility near the Etheridge Lakes community in Great Bridge. Residents objected to its proximity to homes, and the City Council rejected the rezoning.

The proposal also exposed a larger zoning problem. Data centers were already permitted by right in several business, office and industrial districts. Chesapeake calculated that more than 27,000 residentially zoned parcels were within 500 feet of land where a data center could potentially be developed without City Council approval.

Removing that by-right entitlement is reasonable. A modern data center can bear little resemblance to the smaller computer facilities envisioned when many zoning ordinances were written.

The experience in Northern Virginia also provides legitimate warnings.

JLARC found that unconstrained electricity demand, driven primarily by data center development, could double Virginia’s power demand within approximately a decade. Serving that load would require massive investments in generation and transmission. A typical Dominion residential customer could eventually pay an additional $14 to $37 per month by 2040 in generation and transmission costs, although the eventual increase will depend on how much projected demand materializes and how the infrastructure is financed.

Data centers can also be difficult neighbors when placed too close to homes. JLARC found that about one-third of Virginia data centers are near residential areas. Cooling equipment and generators can produce continuous low-frequency sound that may not violate traditional noise ordinances but can still affect nearby residents.

And despite their enormous capital investment, data centers are not major permanent employers. JLARC estimated that a typical 250,000-square-foot facility may employ about 50 people, including contractors. The largest employment benefits occur during construction, when approximately 1,500 workers may be on site at the project’s peak.

Localities therefore have every reason to examine power consumption, tax revenue, water use, noise, buffers and the opportunity cost of industrial land before approving a project.

Planning is prudent. Panic is something else.

The biggest limitation on Hampton Roads becoming a major data center market may not be whether city councils welcome the industry. It may be whether developers can obtain sufficient electricity on a commercially acceptable schedule.

Dominion Energy says facilities requiring less than 50 megawatts can frequently connect through existing distribution infrastructure, usually within one to two years. Projects above 50 megawatts will probably require transmission extensions and a new substation. Sites near existing transmission lines and substations, particularly in less congested areas, generally have shorter delivery timelines.

That distinction matters.

A small edge facility supporting local companies, military installations, health systems or cable infrastructure could be viable in Hampton Roads. A hyperscale campus requiring several hundred megawatts is a fundamentally different proposition.

Such projects need more than industrial zoning. They need large contiguous sites, redundant fiber, major transmission access, water or advanced cooling systems, substations, backup generation and a utility commitment measured in years. They also compete for the same power and industrial property Hampton Roads needs for advanced manufacturing, shipbuilding suppliers, defense technology and maritime industries.

Hampton’s own consultant acknowledged that the city likely has room only for smaller-scale facilities. Yet the public discussion repeatedly invokes the massive campuses found in Prince William and Loudoun counties.

The region is debating the most extreme version of the industry before establishing whether that version is commercially realistic here.

Chesapeake’s proposed approach is largely sensible. Requiring a conditional use permit gives the public, planning commissioners and City Council an opportunity to review a project before it is built. Noise standards, setbacks, water-use information and neighborhood meetings should be established before an applicant controls the timetable.

Hampton is also justified in doing its homework before a proposal appears.

Virginia Beach’s sweeping rhetoric is more difficult to reconcile with its economic development strategy. The city wants subsea cables, cable landing stations and colocation facilities. It has provided public support to expand that infrastructure. Those operations are parts of the data center industry, even if they are smaller and less disruptive than hyperscale campuses.

The solution is not to pretend all data centers are identical. It is to define them accurately.

A regional policy should distinguish among cable landing stations, edge facilities, enterprise data centers, scientific computing facilities, colocation centers and hyperscale campuses. Requirements should escalate based on acreage, electrical load, water use, generator capacity and proximity to neighborhoods.

Small facilities supporting the region’s defense, health care, research and telecommunications sectors should not face the same rules as a 500-megawatt campus. Large facilities should never be permitted by right or placed beside established neighborhoods.

Most importantly, Hampton Roads should approach the issue as one market. Developers do not view Hampton, Newport News, Chesapeake, Suffolk and Virginia Beach as isolated economies. Seven separate municipal debates will produce conflicting definitions, political grandstanding and loopholes that shift projects from one jurisdiction to another.

For now, Hampton Roads is not confronting a data center boom. It is confronting the possibility that one could eventually arrive.

That is enough reason to establish rules. It is not enough reason to declare a regional emergency.

The region should plan carefully, protect its neighborhoods and preserve its most valuable industrial assets. But it should stop acting as though the server farms are already at the gates.

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