Lawmakers told data centers could be key to improving West Virginia's water issues

What potential revenue could a McDowell County data center bring?

A member of the Morrisey administration told lawmakers Tuesday that data centers can improve the water quality and infrastructure in West Virginia, where brown fluid, chemical smells and more have plagued residents turning on their taps — particularly in the southern coalfields.

Ongoing water issues have plagued Southern West Virginia, prompting Gov. Patrick Morrisey to hold a “Beautiful, Clean Water” listening tour last month in the area.

In Mingo County, residents have questioned why a proposed power plant and data center could potentially have access to new water sources while they go sometimes weeks without water. They fear that the amount of water needed for the proposed development could affect how much local water is available.

Nicholas Preservati, director of the state’s Office of Energy, appeared before the Joint Committee on Energy and Public Works on Tuesday at the State Capitol to field questions about coal operations and mining jobs.

Del. Mark Zatezalo, vice chair of the House Energy and Public Works Committee, asked Preservati if there’d been any consideration for the southern coalfields’ water when it came to mining.

“I’m sure you’ve been following the news with all these water problems that we’ve been having down there. So I would say that that might be something that we might want to look at,” said Zatezalo, R-Hancock.

In response, Preservati turned the conversation to data centers, saying, “I think the whole issue on water has been mischaracterized.”

“Water issues in West Virginia are not a quantity issue. Generally speaking, it’s a quality issue,” Preservati said, clarifying that he wasn’t speaking on behalf of the governor’s office. “The data centers aren’t going to be affecting the quality; they can be utilized to improve quality. So, I see the data centers and the revenue they generate to be able to increase the efficiency, to bring in revenue to southern coalfields.”

Maria Russo, policy specialist at West Virginia Rivers Coalition, said there needs to be an honest look at the cumulative impacts of data center development. She supports investment in water infrastructure across the state.

“These projects can create significant challenges and risks for water quality, water quantity and flooding as we have seen in Mason County,” she said. “We cannot look at the potential revenue from development without also accounting for the costs and compounding burdens that development will place on communities and water systems.”

Preservati’s comments at the Capitol come amid friction over data centers; residents worry about the impact on their communities while many elected officials are excited for economic development in the job-stressed state.

Many data centers need a lot of water to function to generate electricity and cooling systems use water to keep the equipment from overheating. Some data centers can use up to 5 million gallons of drinking water a day.

Data centers’ water demand has been increasing due to growth in artificial intelligence services and cloud software.

Across the country, communities located next to new data center developments have reported taps drying up or water contamination.

“We were glad to hear that clean water was raised in the meeting during conversations about coalfield and workforce development at interims today,” Russo said. “As West Virginia looks at opportunities for investment in Southern West Virginia, any conversation that involves development in the southern coalfields must include clean water infrastructure now.”

Preservati said in West Virginia, generally, data centers will use “a closed-door system” that won’t use a tremendous amount of water.

Data centers in the southern coalfields, he said, could “get the tax revenue moving into the counties so that they can use tens of millions of dollars every year” to upgrade water infrastructure and prevent sewage from going into local water supplies.

“I view the data center issue and the water issue as a potential opportunity to solve one of our biggest problems, not a creator of problems, and we’d be happy to work with the Legislature on helping make that happen,” Preservati said.

Zatezalo told West Virginia Watch that he wants to make sure water quality remains a focus in the southern coalfields.

“We have to make sure that safeguards are in place to support water resources,” he said. “Having said that, West Virginia is one of the wettest states in the country. We have plenty of water. We may not have it every place that we want it. When you get into the mountains, down in the coalfields, it’s tough. That’s why it was kind of just a cautionary question. Did he answer it? He answered it to a degree, and that’s fine for now.”

A data center in McDowell County could bring in a lot of money, he noted, though water supply in the area may not support it.

“But you know, I just wish they’d all come to Weirton because we have the Ohio River. We have 13 trillion gallons that come by Weirton every year, and we have plenty of water,” Zatezalo said.

Russo said she hopes that communities across West Virginia benefit from a proposed 5% allocation from data center revenue that was outlined in lawmakers’ pro-data center legislation in 2025.

The revenue “could be a key part to solving West Virginia’s water infrastructure challenges,” Russo said.

“We hope it is a transparent process that ensures communities benefit from this proposal. We need to know how those funds would be used and allocated, who would make those decisions, and how communities would have a voice,” she said.

Public hearing scheduled involving HB 2014 rules The state has seen a wave of proposed data center projects, including a recent one announced by Morrisey for Mason County. A Florida-based real estate developer is spearheading a data center and natural gas plant there, and the project is still going through the state’s permitting process. The data center plans to run on a closed-loop cooling system, which generally uses less water than other systems.

Lawmakers passed their hallmark data center legislation — House Bill 2014 — with the hope of incentivizing data center development. Morrisey is all in on bringing data centers to West Virginia.

Opponents of HB 2014 said the bill stripping communities of local control and tax revenues related to data centers. Morrisey, in turn, has said he wants to make local input a part of the data center development process.

Earlier this year, while lawmakers debated proposed rules related to the data center legislation, they declined to approve a pair of amendments seeking to protect local water supplies in West Virginia.

An amendment by Del. Evan Hansen, D-Monongalia, would have required developers seeking to construct data centers to share specific details on where they would draw water from for operations. Developers would have been required to share how much water they thought they’d use and what impact that could have on local residents’ water supply. Hansen’s amendment was voted down 23-70.

A pair of Republican House members, Dels. Henry Dillon, R-Wayne, and Chris Anders, R-Berkeley, also tried to put guardrails on water use for data centers, introducing an amendment to limit how data center developments use groundwater and adding “guardrails” to ensure that private wells and other groundwater sources were not impacted by “thirsty data centers.”

Anders cited constituents’ concerns about local wells running dry.

The Dillon-Anders amendment failed 6-87.

The rules bundle for HB 2014 is still out for public comment.

The Public Service Commission of West Virginia has scheduled a public comment Sept. 28, 9:30 a.m., in Charleston on proposed rules governing electric generating capacity requirements established under HB 2014. Members of the public who wish to participate in the hearing must notify the Public Public Service Commission by Sept. 18.

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Lawmakers told data centers could be key to improving West Virginia's water issues

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