Virginia's New Data Center Accountability Framework: What You Need to Know

Virginia Gov. Abigail Spanberger signed Executive Order (EO) 22 on September 18, 2026, establishing what her administration has called "the most comprehensive and aggressive data center accountability effort in the country." EO 22 creates a Virginia Data Center Accountability Framework organized around five pillars – 1) community transparency, 2) environmental protection, 3) energy affordability, 4) clean energy and grid reliability, and 5) workforce development – and separately convenes a rapid-response Artificial Intelligence (AI) Task Force.

For developers, operators, landowners and the attorneys who advise them, this executive action signals a significant shift in how Virginia will approach data center development. The EO also raises important questions about how far executive authority extends – particularly with respect to local governments, which control much of the zoning and land use approval process on the ground.

Virginia Data Center Accountability Framework Directives

EO 22 directs the Office of the Chief Energy Officer to lead a unified statewide implementation effort. Within 120 days, that office must publish a Data Center Planning and Community Engagement Toolkit (the Toolkit) for local governments that includes model disclosure templates, guidance for evaluating project impacts (electricity demand, water use, air emissions, noise and traffic), model community-benefit agreements, and best practices for early and good-faith engagement with host communities.

Beyond the Toolkit, the EO takes several immediate actions:

Pillar 1: Transparency

The transparency provisions mark a sharp departure from Virginia's historically developer-friendly approach:

• Banning Non-Disclosure Agreements (NDAs). Executive branch agencies may no longer enter NDAs that prevent disclosure of material information about proposed data center developments, including public incentives, resource demands or community impacts. Existing commitments will be honored; national security matters are excepted.
• Exclusion from Expedited Review. The Virginia Economic Development Partnership (VEDP) must immediately stop providing site-readiness assistance through the Virginia Business Ready Sites Program or similar expedited permitting programs for data center projects with anticipated peak demand of 25 megawatts (MW) or greater – meaning hyperscale proposals will move through standard review timelines.
• Virginia Local Energy and Accountable Data Centers (VA-LEAD) Designation. The EO creates the VA-LEAD program – a tiered scoring system (similar to the Leadership in Energy and Environmental Design, or LEED) evaluating energy, water, noise, workforce and community-benefit factors. Proposed criteria are due by end of 2027, and VA-LEAD will become the baseline for state agency incentive decisions.

Pillar 2: Environmental Protections

The environmental provisions are among the most immediately consequential for developers and operators:

• Noise Regulations. The Virginia Department of Environmental Quality (DEQ) must expedite data center noise regulations, with a proposed timeline, workplan and stakeholder-engagement plan due within 180 days.
• Backup Generation. DEQ must conduct a cumulative-impact review of diesel and other backup generators at data centers – addressing emissions concentration, air quality and alternatives such as Tier IV controls, battery storage and fuel cells – with findings due within 180 days.
• Cooling Water Scarcity. DEQ must expedite regulations for designating "cooling water scarcity areas." The EO immediately designates the Eastern Virginia Groundwater Management Area as such an area.
• Responsible Siting. Virginia Energy must identify development opportunities that diversify economic benefits and minimize impacts – including brownfield redevelopment, adaptive reuse, edge data centers and co-location near existing infrastructure – with recommendations due within 240 days.

Pillar 3: Energy Affordability

The energy affordability provisions address ratepayer and grid concerns:

• Equitable Cost Allocation. Virginia's Chief Energy Officer must advocate for rate structures that prevent data center infrastructure costs from being shifted onto residential and small business ratepayers, including through PJM Interconnection's reliability programs.
• Affordable Community Energy Program. Virginia Energy must develop recommendations for a program enabling data center operators to contribute to renewable energy access for low- and moderate-income households.

Pillar 4: Advancing Clean Energy and Grid Reliability

The clean energy and grid reliability provisions focus on load management and operational standards:

• Interim Resource Adequacy Service (IRAS) Curtailment. The Chief Energy Officer must engage with the State Corporation Commission and utilities to establish emergency curtailment procedures for data centers that have not brought their own new capacity under PJM's IRAS program. Curtailment priority should favor data centers with clean energy investments, peak shaving or other beneficial measures.
• Grid Reliability Best Practices. Virginia Energy must evaluate whether to establish data center operational best practices – including ride-through and voltage protections – to improve grid reliability, coordinating with PJM, North American Electric Reliability Corp. and Virginia utilities.
• Methane Emissions. The Chief Energy Officer must develop recommendations supporting data center investment in methane emissions reductions associated with natural gas infrastructure, with findings due within 180 days.

Pillar 5: Workforce Development

The workforce provisions emphasize local hiring, job quality and sustainable procurement:

• Workforce Best Practices. The Virginia Secretary of Labor must develop best practices for quality jobs and local workforce opportunities – in consultation with VEDP, community colleges, labor organizations, contractors and local governments – for incorporation into the Toolkit and VA-LEAD program.
• Workforce Reporting. Virginia Works must develop project-level workforce data collection criteria within 180 days – covering quality jobs, workforce needs, training programs and outcomes – to be incorporated into the VA-LEAD program.
• Local and Sustainable Procurement. The Virginia Department of Forestry must develop procurement best practices encouraging sustainable products (mass timber, local wood products), locally sourced materials and sustainable development practices for incorporation into the Toolkit and VA-LEAD program.

The AI Task Force

The EO's second major component is a rapid-response AI Task Force, co-led by the Chief Transformation Officer, Counsel to the Governor and Secretary of Administration. The AI Task Force is directed to evaluate existing enforcement and regulatory options under Virginia law, assess cybersecurity threats from AI agents and bots, and coordinate with frontier AI developers and other state and federal leaders. Though less directly tied to land use, the AI Task Force is relevant insofar as AI-driven demand is a primary driver of data center growth – any future state-level AI regulations could indirectly shape the pace and scale of development in the Commonwealth.

Practical Implications for Land Use and Permitting

For land use practitioners, the most significant development may be the combination of the NDA ban, exclusion from expedited review programs and push toward community-benefit agreements. Taken together, these measures represent a deliberate recalibration of the relationship between data center developers and host communities – one that will feel most immediate in Northern Virginia jurisdictions such as Loudoun, Prince William and Fairfax Counties, where large-scale proposals have generated significant community opposition.

The exclusion of large data center projects (25 MW or greater) from state site-readiness and expedited review programs means that developers will no longer be able to rely on fast-track permitting pathways for projects of significant scale. Combined with the broader Data Center Accountability Framework's stated goal of eliminating "by-right" approvals and requiring public hearing and approval processes, the EO previews a legislative push in the 2027 General Assembly session that could fundamentally reshape the entitlement process for data center projects statewide.

The responsible-siting provisions also have direct land use implications. Virginia Energy's directive to evaluate brownfield redevelopment, adaptive reuse sites, edge data centers and regional diversification could steer future projects away from Data Center Alley and toward less-concentrated areas of the Commonwealth – reshaping which sites gain or lose favor in the competitive development landscape.

What EO 22 Requires of Local Governments

This is one of the most important – and least resolved – questions raised by EO 22. The EO is directed at state executive branch agencies, departments, boards, commissions and employees under the governor's supervision. It does not, by its terms, impose binding obligations on Virginia's counties, cities or towns, which are not part of the executive branch and derive their land use authority from the Dillon Rule and enabling statutes enacted by the General Assembly.

That said, the EO has several indirect mechanisms that will shape local government behavior:

• Community Engagement Toolkit. The Toolkit will provide model disclosure templates, model community-benefit agreements and best practices that localities will face pressure to adopt – even if compliance is technically voluntary. Once the Toolkit becomes the state-endorsed standard, local officials who deviate from it may face political and legal scrutiny.
• NDA Ban. The ban applies only to executive branch agencies, not to local governments. But the EO's strong rhetoric against "secrecy" in data center development could embolden localities to impose their own transparency requirements or decline to enter into NDAs with developers. Whether localities have independent authority to ban NDAs under Virginia's Dillon Rule framework – absent specific legislative authorization – is an open question.
• VA-LEAD Program. Once established, the program will serve as the baseline for how state agencies "align incentives and administrative services." Localities seeking state economic development support may find that their projects must meet VA-LEAD criteria to qualify, creating a de facto compliance pathway even without a direct mandate.
• Legislative Preview. The governor has expressly stated her intent to seek legislation in the 2027 General Assembly session codifying the framework's standards – including the elimination of by-right approvals and requirement of public hearing and approval processes for large data centers. If enacted, such legislation would directly constrain and expand local government authority in ways the EO alone cannot.

The bottom line: EO 22 itself does not override local zoning authority, but it sets in motion a series of state-level actions – toolkits, designation programs, siting recommendations and forthcoming legislation – that will increasingly define the parameters within which localities make land use decisions about data centers. Practitioners should not assume that the EO's current lack of a direct local mandate means localities are unaffected.

Holland & Knight's D.C. and Northern Virginia Land Use Team and Data Center Team have been tracking the ongoing evolution of data center regulations in Virginia. If you have questions about this EO, including how it may affect your property or development in Virginia, please contact the authors or your Holland & Knight relationship attorney.

Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem, and it should not be substituted for legal advice, which relies on a specific factual analysis. Moreover, the laws of each jurisdiction are different and are constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular fact situation, we urge you to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.