In Southern Maryland, Data Center Bid Prompts Larger Debate

For nearly four hours, residents living near the site of a proposed data center in Charles County, MD, approached a microphone inside a mostly full auditorium. One by one, they lectured, thundered, exhorted and pleaded against an ordinance that would pave the way for data centers to be built in the Southern Maryland county.

But the prevailing sentiment may have been best encapsulated by a shout from a female voice that rang out during one of the meeting’s many emotional crescendos: “You’re playing with fire! You’re playing with our lives!”

The June 1 meeting — an opportunity for the county planning commission to weigh in on the proposal for the second time in three months — was a microcosm of the state’s larger debate about data centers.

From the Atlantic Ocean to the Allegheny Mountains, residents have been turning their hostility toward public officials whenever data centers are the topic of conversation. The “hyperscale” complexes often sprawl across hundreds of acres. While they’re seen as vital to artificial intelligence and maintaining the digital economy’s growth, they are just as often criticized for their massive consumption of public resources, including electricity and water.

That political pressure is starting to yield results, with Harford County in June enacting the state’s first outright ban on their development. And at least six other Maryland counties — Baltimore, Carroll, Howard, Montgomery, Prince George’s and Queen Anne’s County — as well as Baltimore city have approved temporary pauses, all within the last several months.

Charles County is different. There, data centers are already effectively banned because the county’s zoning codes don’t mention them explicitly. County commissioners must pass a zoning text amendment to make construction possible.

The issue is heading to a high-stakes vote in the coming weeks by the county commissioners. It will be the second time that the measure has come before them.

The planning commission urged denial of the first version of the amendment in March while suggesting a raft of tighter restrictions. Those included limiting data center development to industrial zones, banning the use of drinking water sources for cooling and requiring the companies to pay for any infrastructure costs. In April, county commissioners voted 3-2 to send those changes back to the planning board for another hearing — resulting in a second denial recommendation at the June 1 meeting.

 How do data centers impact the environment?

The debate comes amid a developer’s double-pronged proposal for a 355-acre site on the Potomac River near the small community of Newburg: to build what would be Maryland’s largest data center and to power it by converting the old coal plant on the site to natural gas.

Nearby residents fear that the development will compete for their drinking water reserves, raise electricity bills and pollute the air whenever the facility fires up its backup diesel generators.

“I’m sure this represents a huge opportunity for revenue in the county,” Kevin Corcoran told the planning commission at the June meeting. “But it needs to be done in a way that’s going to completely safeguard our community. I think you’re hearing from our community right now that’s not being done.”

About 200 people attended the hearing. Dozens demonstrated outside beforehand, many waving yellow placards emblazoned with a large “X” over the phrase “data centers.”

Inside, energy remained high. Chants of “No data centers!” ebbed and flowed. The board’s chairman, Kevin Wedding, admonished the audience a handful of times to return to peace.

“This is what it sounds like when you dismiss people,” Whitney Ingram, a La Plata resident, shot back during her turn to speak.

Alana Davis, coordinator of the Charles County Against Data Centers Coalition, said that a big reason for the pushback is that the massive, warehouse-like buildings are often proposed in communities already plagued by pollution. The census tract surrounding the proposed Newburg site is listed as “overburdened,” according to the Maryland Department of the Environment’s environmental justice mapper.

“They target vulnerable communities,” she said in an interview.

Much of Newburg’s environmental woes are tied to the existing power plant, the Morgantown Generating Station. Past violations include illegal storing and handling of toxic coal ash at the site.

The power plant opened in 1970 and operated six oil generators and two coal generators at its height. GenOn Holdings, the facility’s current owner, shut down the coal generators in 2022, citing adverse market conditions and high environmental compliance costs. The oil-fired units are still running.

TeraWulf, the company behind the Newburg proposal, didn’t return messages seeking comment. The firm is based in Easton on Maryland’s Eastern Shore and is tied to Paul Prager, whose private real estate investments have spurred a makeover of the community’s downtown.

The company has announced plans to “repower” the Morgantown plant with the addition of up to 1 GW of natural gas-derived energy. But that could pose a technical challenge, according to opponents like the advocacy group Public Citizen, because the closest natural gas transmission line is 20 miles away. Either a new pipeline will be needed or gas tankers will have to deliver the fuel by way of the Potomac River to a newly built terminal at the facility.

The company’s efforts received a boost in December when Gov. Wes Moore’s administration pledged to “expedite” the review process of the redevelopment of the Morgantown facility.

Serena McIlwain, secretary of the Department of the Environment, told TeraWulf officials in a letter that their plans to clean up the site’s pollution represent a “great benefit” to the state. She vowed to “expedite as efficiently as possible” reviews of those remediation plans as well as those for any necessary permits, including securing rights of way for natural gas pipelines.

The letter has drawn strong criticism, including from Angie McCarthy, clean energy campaign manager for the DC-area group Nature Forward. “Permitting is one of the strongest tools in our toolbox, and I’m disheartened that our MDE … has perhaps a difference of opinion with us on energy sources,” she said.

MDE spokesman Jay Apperson told the Chesapeake Bay Journal that the agency is “currently engaged in technical discussions” surrounding the redevelopment proposal. He added that those reviews will adhere to “Maryland’s stringent environmental standards, specifically concerning land remediation, air quality and water protection.”

The Federal Energy Regulatory Commission is expected to decide later this summer whether to sign off on TeraWulf’s acquisition of the Morgantown plant. Several prominent groups, including the market monitor for PJM, which operates the regional power grid, and the Maryland Office of People’s Counsel have called on the federal agency to reject the proposed transaction.

The OPC, the state’s official consumer watchdog, told regulators that TeraWulf’s operational and financial history put the project on shaky ground. Net losses of more than $660 million in 2025 and further losses on its balance sheets in 2023 and 2024 raise questions about whether the company can afford the debt it would incur from the purchase, the OPC said.

Furthermore, the OPC letter points out that 90% of TeraWulf’s revenue comes from its bitcoin-mining operations, a sector with high financial volatility.