New budget includes ineffective studies, massive tech subsidies, and dangerous incentives targeting low-income communities

RICHMOND, VA – Following the release on Friday of the latest state budget agreement, environmental advocates are doubling down on calls for an immediate moratorium on new data center approvals across Virginia. The updated budget once again fails to implement meaningful safeguards against data centers’ adverse impacts, instead relying on further studies, costly subsidies for major tech companies, and troubling incentives that could disproportionately burden low-income communities. The new budget will now go to Governor Abigail Spanberger for her signature. 

Despite mounting public opposition and clear evidence of environmental and economic strain, lawmakers have advanced a plan that includes a noise and water study commission rather than enforceable protections. At the same time, the budget allocates an estimated $600 million per year in energy consumption tax for major tech companies. That funding, environmental advocates say, is an insignificant cost for these wealthy companies and will do little to incentivize efficiency or reduce the industry’s skyrocketing energy demand, which is driving massive expansion of gas infrastructure. Equally concerning, new language in the budget seeks to incentivize data center development in low-income communities, raising alarms among environmental justice advocates who warn this effectively puts a target on communities already overburdened by pollution and infrastructure impacts.

Chesapeake Climate Action Network (CCAN) Action Fund is joining partner organizations in emphasizing its demand for an immediate halt to all new data center permitting, approvals, and grid connections until strong, enforceable protections are enacted.

Victoria Higgins, Virginia Director of CCAN Action Fund, issued the following statement:

“Virginia lawmakers are once again choosing delay and half-measures over real leadership. This budget doubles down on a failed approach, offering more studies instead of solutions, handing out hundreds of millions in subsidies to some of the wealthiest corporations in the world, and opening the door to targeting low-income communities for harmful development.

Let’s be clear: a noise study will not lower utility bills. A water study will not protect families already facing rising costs and strained infrastructure. And $600 million a year in subsidies will not make Big Tech more efficient; it will continue the unchecked growth.

Virginia is still racing forward with no guardrails and no regard for the people most affected. Lawmakers must act now, not after another study, not after more damage is done. We need an immediate moratorium on new data centers until real protections are in place to safeguard our communities, our environment, and our energy future.”

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Chesapeake Climate Action Network (CCAN) Action Fund is dedicated to driving change in public policies at the local, state, and national levels to address the climate crisis. Through voter education, lobbying, and participation in the electoral process, we seek to advance our country’s leadership in the global movement toward clean energy solutions — focusing our efforts primarily in Maryland, Virginia, and Washington, DC. We know that a vibrant democracy is central to our success so we work to defend democratic integrity wherever we can.