That’s the word of Andy Power, president and CFO of Digital Realty, a real estate investment fund that owns and operates more than 290 datacenters around the world. Power shared the news, which he described as “recently broken” in an earnings call yesterday.
Dominion Energy, the leading energy supplier in that market, Power said, has reached out to Digital Realty and its other major customers in the region to inform them of a “hot spot” in East Loudoun County, Virginia, which could result in delivery delays. that extend the way to 2026 for everyone.
“If this materializes, as we have recently learned, there will obviously be a slowdown in the provision of new supply in what is our largest, largest and most consistently in demand data center market in the world,” said Power.
The apparent cause is not due to electricity generation, Power said, but to transmission – there simply aren’t enough lines to move enough energy.
Loudon County describes itself as the largest concentration of data centers in the world, and with over 25 million square feet of data center space and another four million under development, it might be right.
“Much of the world’s Internet traffic passes through Loudoun’s digital infrastructure, making us a key player in the global tech economy,” said Loudon County. Loudoun’s fiscal year 2023 tax projections foresee $ 576 million in datacenter property taxes (the largest single source and nearly a third of the county’s total tax revenue), meaning a four-year delay could be incredibly expensive. Loudoun County said the datacenter taxes are sufficient to cover the county government’s entire operating expenses.
A delay in Loudoun County could also mean that many planned data center projects in the area move to neighboring Prince William County or could cross the border into Frederick County, Maryland. Both counties have tried to market themselves as prime data center locations and also have construction projects underway.
It is unclear whether the power transmission problems affecting Loudoun County would also affect them, but Dominion, which serves much of Northern Virginia, appears to cover Prince William County based on maps of the area. [PDF]. Frederick County is not on the same grid.
PJM Interconnect, which operates the power grid in the eastern United States between Virginia and New Jersey and western Ohio and parts of Michigan, has warned of transmission problems in the Dominion North Virginia transmission zone (where it find Loudoun and Prince William).
“Datacenter Alley located in northern Virginia in the Dominion Transmission Zone is experiencing unprecedented load growth driven by the increase in datacenter load that began in 2018 and is expected to continue growing after 2027,” PJM said in a published statement. earlier this month.
The transmission problem appears to lie in how PJM planned a new network infrastructure in the Dominion area of northern Virginia: the 2027 Regional Transmission Expansion Plan (RTEP) was not ready as it was considering what projects it would need to keep up with the demand.
By the TEN of 2025, the plans that had already been proposed by Dominion were sufficient to meet the growing needs. “Once the PJM load prediction was updated for RTEP 2027, the system showed the need for reinforcement through additional sources to serve the increased load,” said PJM.
How short will the region be? According to PJM’s RTEP 2027, there could be a “drop in load of over 300 MW with all expected additional and base reinforcements incorporated”.
Digital Realty’s CFO sees energy shortages as an opportunity to win, provided it can be one of the companies coming out on top as developers struggle to bring new inventory online to the region.
According to Power, Digital Realty could acquire “a sense of greater pricing power and higher tariffs related to the sharp reduction in short-term availability.” Along with this, he sees an opportunity to emerge as a key partner in helping the Dominion solve its power issues in the region.
Power said the company is the largest and most consistent Dominion customer in the region.
“We have substations and electrical infrastructure already built on our campuses … I think we are a very important player in that market to help the power company address this problem, given our strategically important plots of land and easements.” ®
Updated to add
“The data center industry has grown significantly in Northern Virginia over the past few years and we have made significant investments in new infrastructure to meet the growing demand for electricity,” a spokesperson for Dominion said. The register.
“That growth is now accelerating, which results in transmission constraints in an East Loudoun County pocket that will impact new connections for large customers. This will have no impact on residential or small business customers. We have been actively engage with our customers and other stakeholders to raise awareness of the problem and discuss solutions to alleviate constraints as quickly as possible. “