The analysis required by SB 116 if it passes would include information on how the data center industry impacts multiple things, including Maryland's natural resources; current and anticipated power supply and demands; and state and local revenues and expenses.
The Maryland House of Delegates will hear the House version of the bill, HB 270, on Thursday at 1 p.m. Del. Brian Crosby of St. Mary's County sponsored the House version.
Data centers store computing machines and server systems needed for cloud-based services and require lots of power and water to stay online 24/7 and cool their equipment. The buildings also require backup generators in the case of an emergency outage.
In Frederick County, two companies — TPG and Catellus Development Corporation — are developing a sprawling data center campus on about 2,100 acres near Adamstown on the site of the former Alcoa Eastalco aluminum smelting plant.
This campus, dubbed Quantum Frederick, will be connected to the "data center alley" in Virginia's Loudoun County by a 40-mile-long fiber optic ring called the QLoop. Loudoun County has about 43 million square feet of data centers.
Currently, two companies have announced their intent to build facilities on the campus: Aligned Data Centers and Rowan Digital Infrastructure.
Frederick County Executive Jessica Fitzwater created a work group in June 2023 to examine county law related to data centers. The group divided itself into three subcommittees to focus on different topics: siting, sustainability and community benefits.
During the work group's meetings, the members met with various stakeholders and those knowledgeable about data centers, including officials from Loudoun County and individuals who work in the electric power industry.
The work group issued a final report last March with recommendations to the county on how to regulate the data center industry.
'We needed to do more research'
State Sen. Karen Lewis Young pre-filed the data center impact analysis bill in September.
She said after a law was enacted last year that allows data centers to forgo getting a certain certificate to build backup generators, several members of the General Assembly had concerns about the industry's consequences, like noise and water usage.
While projected economic impacts for data centers in other areas have looked attractive, based on research, "we saw that the numbers that were originally projected weren't being materialized."
"A number of my colleagues felt we needed to do more research at least on the energy demands, the financial analysis and environmental consequences," Lewis Young said. "... Before we repeat some of Virginia's mistakes, I think we need to be very proactive about understanding some of these consequences."
The Maryland Tech Council, a technology and life sciences trade association, commissioned an economic impact study on the Quantum Frederick campus.
The entire campus is expected to annually generate about $41 million in Frederick County tax revenue and nearly $197 million in state tax revenue once it's completed, according to one of the Tech Council's reports.
The campus is estimated to employ about 1,700 people once it's finished.
Quantum Frederick's construction is expected to cost about $2 billion and will support over 48,000 jobs in Frederick County from 2023 to 2037.
When asked on Wednesday about the bill, Tech Council CEO Kelly Schulz said the council's studies on data centers "demonstrate that the data center industry's investments in Maryland will create tens of thousands of high-paying jobs, robust local tax revenues, and long-term economic stability for our state."
Lewis Young is aware of the Tech Council's study, but she wants another independent source to support the numbers and estimates.
"I worked in the research and consulting area for years, and I know when a client commissions a study, they also direct the questions," she said.
"Given those numbers were so attractive, we needed to have a very independent entity verify those financial forecasts in terms of both financial consequences and employment opportunities."
When asked if Fitzwater had any comment on the bill on Wednesday, county spokesperson Vivian Laxton sent a letter that Fitzwater wrote in support of the bill.
Although the data center work group she created provided several policy recommendations, Fitzwater said in her letter that "there were several matters, such as energy consumption and climate impacts, transmission infrastructure, water consumption, and sustainability practices, that should be further studied in partnership with state agencies and academic/research institutions."
What's in the analysis?
Under the bill, the Maryland Department of Legislative Services would have to submit a final data center impact report to the governor by Sept. 1, 2026.
The analysis would include an assessment by the Maryland Department of the Environment on how the data center industry could impact the state's air and water quality and its ability to meet its environmental goals like bay restoration.
The department would also look at what technologies exist that could mitigate data centers' environmental consequences, as well as how feasible it would be to install those technologies in Maryland.
Data centers can use hundreds of thousands of gallons of water a day to cool the equipment in the facilities.
In the county data center work group's final report, it said that Rowan Digital Infrastructure, which plans to build on the Quantum Frederick campus, has 440,000 gallons of cooling water a day allocated to its 156-acre parcel.
The Maryland Energy Administration would look at the energy consequences of data centers, such as how much power they require, how they may impact Maryland's power demand and supply, and how they may affect Maryland's clean energy goals.
The Energy Administration would also look at if the data center industry could affect future power infrastructure needs and the costs borne by utility ratepayers.
Power use for data centers in Virginia reached 2.67 gigawatts — or 2,670 megawatts — in 2022, as reported by the tech publication Data Center Frontier.
One megawatt can power about 800 homes, according to Jason Kalwa, the director for the Maryland Piedmont Reliability Project (MPRP).
The MPRP is a controversial proposed 500,000-volt line that will extend for about 70 miles across parts of Frederick, Baltimore and Carroll counties.
The project is being developed to help address an anticipated increase on the regional power grid that serves all of Maryland, as well as Washington, D.C., and parts of 12 other states.
Much of that expected increase is due to data centers to be sited in Maryland and Virginia.
The MPRP will cost about $424 million, according to a website about the project, and customers across the regional power grid will pay for the project under a cost allocation methodology approved by the Federal Energy Regulatory Commission.
The University of Maryland School of Business will study the potential economic and fiscal effects of data centers.
The bill would specifically require that the school look at how data centers will impact local and state revenues and how many jobs would be created during data center construction and operations.
Lewis Young said the topics that would be researched as part of the bill's analysis were inspired by a study that Virginia's Joint Legislative Audit and Review Commission conducted in 2024.
She also said that Frederick County residents' concerns helped her shape what the analysis should consist of and develop policy questions and approaches.
© 2025 The Frederick News-Post (Frederick, Md.). Distributed by Tribune Content Agency, LLC.
