West Virginia's new coal-first stance reshapes data center power battle
West Virginia's TerraSpark coal plan could reset how states court data centers as Virginia's backlash kills its largest project.
Pennsylvania Governor Josh Shapiro is facing a familiar squeeze. Public backlash against data center build-out is hardening within his own party, even as his administration courts the multibillion-dollar projects that promise jobs and tax revenue. The tension, described by E&E News on Monday (2026-06-08), is playing out in Democratic governors' offices from Harrisburg to Richmond as they set new ground rules for an industry that now touches nearly every state grid.2
The stakes crystallize in West Virginia, where the Department of Energy has awarded an $89 million grant to TerraSpark's proposal to build a new coal plant. The pick, disclosed in June, signals a deliberate pivot: the state is positioning itself as the fossil-fuel answer to data center demand that other states are increasingly shunning.3
That positioning is not academic. FirstEnergy's utilities have contracts to serve 6.4 GW of data center load by 2035, up 50% from the first quarter, CEO Brian Tierney said on an earnings call Wednesday (2026-07-29). The company expects another 1.5 GW in signed deals within two weeks.8
The contrast with Virginia could not be starker. Blackstone-owned QTS Realty Trust withdrew its appeal to the Virginia Supreme Court on July 2, ending a three-year fight over the Prince William Digital Gateway, a planned 2,100-acre campus with an estimated $100 billion price tag at full build-out. Co-developer Compass Datacenters, backed by Brookfield, dropped its own appeal in April, and the county board withdrew the same month after spending nearly $2 million defending the project.5
The Virginia retreat came days after Blackstone handed Digital Realty full ownership of three built-and-leased Northern Virginia data centers valued at $7.8 billion, in a $3.5 billion cash-and-stock deal. QTS insisted Virginia remains central to its business, citing $5 billion in ongoing investment in the Richmond region.5
But the political math has shifted. A Gallup survey released in May found 71% of Americans oppose data center construction in their area, with 48% strongly opposed — opposition running higher than toward a local nuclear plant. Virginia's Democratic lawmakers have responded not with restrictions but with a new tax, raising $1.2 billion over two years. Critics call the figure a rounding error for one of the wealthiest industries in the world, and note the bill included no climate rules.5
One northern Virginia Democrat, whose district borders Data Center Alley, pushed a bill this year to require batteries as the first resort for backup power, cap diesel generator use at 500 hours per year, and permit only the lowest-polluting generators available. It did not advance.4
Indiana's Jasper County offers a preview of the coal-versus-data-center dynamic. Residents there are caught between a coal plant that anchors the local economy and the data center boom that could extend its life. The county's story, documented by Canary Media in May, is one of communities weighing near-term jobs against long-term pollution.1
Texas is moving in the opposite direction of Virginia. Under Senate Bill 6, any large load over 75 megawatts connecting after the end of 2025 can be ordered to curtail when the grid is tight. Analysts at Aurora think as much as half of Texas's data center capacity could function as a genuine reliability resource by 2030, cutting its own draw when Dallas or Houston need the electrons more.6
Wisconsin shows the review process breaking down. Regulators are weighing two new gas plants proposed by Inveneer, which We Energies plans to acquire outright to serve hyperscale tenants including a Microsoft campus and a Vantage project leased to OpenAI and Oracle. Maria Chavez, a senior energy analyst at the Union of Concerned Scientists, argues that by the time a utility must demonstrate public need, "there's already a gas plant set for construction and lined up to serve a data center." UCS estimates data centers could account for 68% of Wisconsin's projected electricity demand growth by 2030, with related investments totaling about $30 billion by 2050.7
The West Virginia TerraSpark bet pairs with a Trump administration coal vision that picked two proposals for new coal plants, including the Alaska project. Whether the coal plant ever gets built for data center load depends on financing that looks increasingly shaky as public opposition firms up and states like Virginia retreat.3
The signal for traders is the widening regional divergence. Virginia's demand growth narrative has cracked. West Virginia's coal revival is built on federal grants and political will. Texas is forcing flexibility on its largest loads. Which model wins will show up in power price curves and gas basis differentials over the next two years. The Gallup numbers cut hardest in moderate districts, and governors facing primaries in 2027 are already recalibrating.2