SWVA clean energy development could draw $8.5B in investments

Wise County and neighboring localities in Southwest Virginia may become home to a massive clean energy development that could attract up to $8.25 billion in capital investments, Gov. Glenn Youngkin announced Wednesday.

An agreement between Energy DELTA Lab, Dallas-based Fortune 100 energy company Energy Transfer and Wise County will involve the development of 65,000 acres of former coal mining land for “all-of-the-above” energy technology — including natural gas, nuclear, renewable energy and other emerging energy sources. That’s in alignment with the Youngkin-supported Virginia Energy Plan, which aims to fulfill the Virginia Clean Economy Act’s mandates by including a mix of energy sources beyond wind, solar and battery storage supported by Virginia Democrats.

The 2022 Virginia Energy Plan launched the nonprofit Energy DELTA Lab, which will be the primary developer of the Southwest project, and more than a dozen projects are under consideration for the land — they total $8.25 billion in potential private capital investment, according to the governor’s office, and could create 1,650 jobs and generate nearly 1 gigawatt of power. By contrast, Dominion Energy’s Coastal Virginia Offshore Wind project is expected to produce 2.6 gigawatts of power.

Energy Transfer owns the 65,000 acres, which is primarily in Wise County, and owns surface and subsurface rights, while Penn Virginia Operating Co. manages Energy Transfer’s land. Neighboring Lee, Scott and Dickenson counties and the city of Norton also could see development and have projects undergoing due diligence with the DELTA Lab.

Development could include wind, solar, nuclear, hydrogen and pumped storage hydro, as well as energy storage technologies.

“The commonwealth’s power demand is skyrocketing, and now is the time to make strategic investments in energy infrastructure to meet our growing needs,” Youngkin said in a statement. “This agreement will make Virginia energy more reliable, affordable and clean while transforming Southwest Virginia into a hub for innovation.”

The partnership plans to develop energy projects at scale, with its primary goals being creating jobs and local tax revenues. Other goals include creating career pathways for the regional workforce and manufacturing opportunities.

Readying industrial land

The Energy DELTA Lab is currently developing three industrial sites in Wise County, including on land owned by Energy Transfer: the 300-acre “Meade Fork” site, the 2,000-acre “Junction” site and the 4,000-acre “Bullitt” site.

The Meade Fork site is located near the town of Pound, and the Energy DELTA Lab is working with The Nature Conservancy and Sun Tribe Solar to locate a solar energy facility on it. The project received a $975,000 grant from the U.S. Office of Surface Mining Reclamation and Enforcement’s Abandoned Mine Land Economic Revitalization program, administered by the Virginia Department of Energy.

The Junction site, located near the town of Appalachia, will be a mixed-use development pilot combining four land uses on multiple sites of a singular property, including industrial, clean energy generation, agriculture and conservation uses. The initial focus is developing a 350-acre industrial site for a clean energy project.

The Bullitt site on the border of Lee County could hold multiple industrial projects with adjacent energy sites to power on-site demand, and the complex is situated over abandoned mines that contain nearly 10 billion gallons of water.

The team will develop the Data Center Ridge site on the Bullitt site, converting a 400-acre previously mined property to a 1-gigawatt, multitenant data center campus that will use the planned adjacent clean energy developments.

The lab’s “Oasis Mine-Based Water Cooling System,” an HVAC closed-loop water cooling system that uses water below 55 degrees Fahrenheit in underground mine cavities, can reduce energy requirements and costs for data center cooling. Data Center Ridge has a single deposit of nearly 10 billion gallons of naturally replenishing cold water.

The data center model is based on a 36-megawatt facility that would be owned and operated by the company it supports, such as Amazon Web Services, Alphabet or Microsoft. The 250,000-square-foot model has a raised floor space of 150,000 square feet to house IT equipment and servers, with remaining building space holding office space, telecom equipment, electrical/mechanical rooms, shipping/receiving areas and security.

For Wise County, one 36-megawatt facility is estimated to create $15.7 million in real estate and property tax revenues over the first five years of operation, support 2,048 jobs during the 18-month construction period, and create 40 data center jobs and support 59 additional jobs once data center operations begin, according to a Mangum Economics analysis.

“This is opening up land that otherwise would not be developed,” said Will Payne, managing partner of Coalfield Strategies, director of InvestSWVA and adviser to the Energy DELTA Lab. “That’s a huge game changer for them and their own development and the surrounding area.”

Energy Transfer is the largest operator of natural gas pipelines in the U.S. by revenue, according to Fortune, and reported $89.9 billion in 2022 revenue.

Energy DELTA (Discovery, Education, Learning and Technology Accelerator) Lab is a 501(c)3 nonprofit focused on deploying new and clean energy technologies to diversify Southwest Virginia’s economy and provide energy companies speed to market with testing and project development. The lab is a collaborative effort of energy industry companies, electric utilities, business development initiative InvestSWVA, Southwest Virginia Energy Research and Development Authority and the Virginia Department of Energy.