Does Spartanburg data center project need SC regulators approval?

Does Spartanburg data center project need SC regulators approval?

Baker Maultsby

Spartanburg Herald-Journal

Aug. 10, 2026, 8:19 a.m. ET

On Aug. 13, the South Carolina Public Service Commission will take up whether plans by NorthMark Cloud and Compute -- also known as Valara Holdings -- to construct a 450-megawatt power plant on the site of its Spartanburg data center must be subject to the commission's review.

Commission members are weighing interpretations of the state's Utility Facility Siting and Environmental Protection Act, which requires developers of power plants with a capacity greater than 75 megawatts to gain the commission's approval.

Frank Holleman, an attorney representing Concerned Citizens of Spartanburg County and the Southern Alliance for Clean Energy, argued at an Aug. 5 hearing in Columbia that the law requires Valara to seek the Public Service Commission's certification before moving forward with construction of its proposed power facility.

Holleman pointed to the commissioners' "plain language" of the statute: "No person shall commence to construct a major utility facility without first having obtained a certificate issued with respect to such facility by the Commission."

The word "person," he argued, includes those involved with the Valara project.

Arguing on behalf of Valara, attorney Andrew D'Antoni said the Siting Act was intended to provide Public Service Commission oversight of utilities that serve the public.

The Valara data center, located on the site of the old Kohler plant, is for "purely private self-generation."

Unlike, say, Duke Energy power stations, it won't serve residential or business customers or connect to the power grid. It will provide power only for the data center.

D'Antoni asked commissioners to deny the Concerned Citizens of Spartanburg County's request for additional review.

The recent hearing drew a crowd of Spartanburg residents who oppose construction of the $2.8 billion data center and power facility.

Chairman Justin Williams said it was the largest number of attendees at a commission meeting since 2018.

Williams closed the meeting without taking a vote or offering further input, except to say that he appreciated the arguments put forth by attorneys on both sides. "And to the folks who traveled near and far to come to the hearing, thank you for that," he added.

A possible clue looking ahead to the commission's Aug. 13 discussion of the Valara project might come from the opinion given by members of the South Carolina Office of Regulatory Staff.

The office represents the public interest on matters coming before the Public Service Commission.

At the Aug. 5 hearing, Office of Regulatory Staff deputy executive director Ben Mustian said he agreed with the position that the Valara project falls within the commission's jurisdiction.

Spartanburg attorney Gary Poliakoff, who has worked on numerous environmental law cases in recent years, said the opinion of Benge and Mustian should matter to commission members.

"Deference to state agencies is usually a pretty big deal. This is a major action in favor of the citizens' side," he said.

Attorneys on all sides of the issue agreed during the Aug. 5 hearing that the commission's decision about the Valara project could have implications for future data centers—and other private business—developments needing to generate electricity.

"We can expect South Carolina, like the rest of the country, and as we are now seeing in Spartanburg, to see a number of these major power plant constructions in South Carolina for data centers and similar facilities," Hollman said.

"If we're not careful, what we're going to have is this alternative, unexamined power system drawing on our energy sources without any overall consideration of its impact on local communities and our overall energy needs."

Commissioner David Britt did not take part in the Aug. 5 hearing. He served on the Spartanburg County Council when a fee-in-lieu-of-taxes incentive package was approved in 2025 to support the Valara development.

Britt was an enthusiastic proponent of the project.

NorthMark/Valara spokeswoman Sarah Knox said in an email that the company has "worked to build this project in compliance with applicable laws, permits, and regulatory requirements in coordination with state and local authorities, and we remain confident that our approach is consistent with South Carolina law."

Knox added, "We are proud of the investment, jobs, and opportunities we are bringing to Spartanburg, and we remain committed to being a good neighbor and responsible member of the community for the long term."

In a June 24 teleconference, Mike Dobeck, vice president of real estate development with NorthMark, told the Herald-Journal he doesn't know what will happen if state regulators ultimately deny the request for the 450-megawatt power generation. "I can't answer that right now."