The Surge in Prince William Data Storage

Data centers continue to be the biggest economic development game in Virginia. The sector is dominated by Loudoun County, which spotted the potential earlier than anyone else and moved quickly to gain competitive advantage. Now Loudoun’s next-door-neighbor, Prince William County, is coming on strong.

The data center industry has brought 31 projects to the county to date, injecting $6.2 billion in capital investment and 912 jobs into the local economy, reports Virginia Business magazine. Most of the tax revenue goes to the county’s bottom line. For every $1 in county services the industry requires, data centers yield about $4.30 in tax revenue to Prince William.

Prince William is close to Ashburn in Loudoun County, which is known as Data Center Alley because of its concentration of more than 10 million square feet of data centers that are either in operation or under development.

As of December, Northern Virginia was the leading North America data center market with more than 30% of the market share and a record of 113.0 megawatts absorption of the total 357.85 megawatts in the top U.S. markets, according to JLL’s 2017 Data Center Outlook.  That’s nearly double the total for the nearest competing market, Northern California, which had 59.1 megawatts.

In its latest report on data centers, JLL notes that Northern Virginia has all six major data center REITs (real estate investments trusts) and the top five cloud providers developing in the market.

The area has 12.6 million square feet of data center space, with 190 megawatts of new electric power under construction. JLL credits the area’s fiber-rich Internet infrastructure and affordable cost of electricity — an average of 5.2 cents per kilowatt hour for data centers — as competitive advantages.

Bacon’s bottom line: The data-center boom has a long way to go. Market analysts forecast continued growth as Big Data and the Internet of Things, among other factors, create demand for ever more data storage. Meanwhile, the shift from decentralized, in-house storage to Cloud storage will tend to concentrate the storage of data geographically in super-efficient facilities with access to abundant fiber-optic cable and a supply of cheap, preferably green, electricity. The main limit on the ability of Northern Virginia to accommodate more data centers may be the ability of Dominion Energy and the Northern Virginia Electric Cooperative to supply the region with power.

Dominion needs to upgrade its electric transmission capacity to serve Northern Virginia, but homeowners are not happy at the prospect of large towers and lines despoiling their views. As it happens, Prince William is ground zero for this conflict, where local residents are up in arms over Dominion’s proposed transmission line to serve a proposed Amazon Web Services data center in the Haymarket area. If Virginia wants to continue reaping the economic advantages of Northern Virginia’s data center boom, someone needs to figure out how to mediate these seemingly irreconcilable differences.

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7 responses to “The Surge in Prince William Data Storage

  1. “someone needs to figure out how to mediate these seemingly irreconcilable differences.”

    That’s been done. There is opposition to ratepayers being required to fund Amazon’s personal extension cord to a data center located in the wrong place, so Prince William designated a Data Center Opportunity Zone Overlay District in 2016 so the power-hungry facilities would be located where power is already available.

    There are 10,000 acres of land in Prince William offering obvious and suitable places for data centers, not “irreconcilable differences.”

    Check out the news release at http://www.pwcgov.org/news/pages/prince-william-county-solidifies-data-center-opportunities.aspx

  2. Then how about sending those data centers to SW Va and kill two birds with one stone – jobs and internet for those areas!

    Why not? There already is one in Lebanon, Va…. for VITA/ McDonald Douglas… the subject of a dispute about data backup services for the State of Virginia.

    But the essential point is that if NoVa does not want data centers or powerlines..or solar panels… or wind turbines.. then offer them to SW Va…. If those folks were fine with blowing off the tops of mountains.. surely they’d be fine with putting solar panels and wind turbines on top of what is left of those mountains, eh?

    • A number of years ago I negotiated a data transport agreement (fiber optic cable) for a large financial institution that wanted to connect backup databases and computing capacity at an outstate location for security purposes. Since that was readily doable, why not more in SW VA as Larry suggests?

  3. Seems the issue grows more widespread:

    A Roanoke-based lawyer representing 17 plaintiffs who own 10 properties along the current route of the proposed Mountain Valley Pipeline contend that the federal agency tasked with reviewing interstate pipelines should not be able to grant the power of eminent domain to a private company for its pursuit of “private pecuniary gain.”

    http://www.roanoke.com/news/virginia/landowners-along-pipeline-route-sue-ferc-and-mountain-valley-pipeline/article_d62df8dc-d3c1-51fa-930d-5a5a27784eaa.html

  4. Maybe easier to ask who wants this stuff and then put it there.

  5. so here is the Headline: ” State agency, Northrop Grumman settle access to data center
    The Associated Press

    July 28, 2017 12:08 PM
    LEBANON, Va.

    The Virginia Information Technologies Agency and Northrop Grumman have settled a legal dispute out of court involving access to a data center in southwest Virginia.”

    So the major backup sites for Virginia are in Chester and Lebanon… and as I recall… the SW Va site was part of an original deal with Northrop Grumman.

    That relationship has never been good . Bacon blogged about it in 2009 I think..

    but the point is that you CAN put such a data center in SW Va…

    however… just like wind, solar, natural gas plants… AND pipelines, etc.. not a big job generator… and the reality is there are no silver bullet solutions … it’s going to be a little here and a little there. and some folks get good educations and leave for the cities… for work.

    Maybe some retirement communities.. maybe a pump-storage facility mated with a gas plant, and wind/solar…

    Ironically – it’s health care that has the potential to generate a lot of health care jobs… both professionals and occupational certificates, etc… if we can ever agree on how it will be funded… or not..

    The deal with the pipeline… read the article – is eminent domain… and the issue is whether it is a true “public need” or just a company that sees a market demand and chooses a for-profit company rather than a regulated monopoly…

    but yeah.. if you want to see REAL Opposition – propose a pipeline up in NoVa!!!!

  6. Getting off the subject, here? This data center issue in the aggregate is what’s driving Dominion’s growth estimates in its annual IRP which, you may recall, are significantly higher than PJM’s independent estimate of the same factors. http://baconsrebellion.com/39608-2/ ;
    http://baconsrebellion.com/why-would-dominion-want-a-19-billion-nuclear-plant/ I’d like to know if this “surge” in data center construction supports the Dominion IRP estimates, or PJM’s, or neither.

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