Amazon’s cloud computing provider, AWS, has unveiled plans to invest $35bn in data centres in Virginia, as the US state looks to build on its data centre prowess.
Virginia’s governor, Glenn Youngkin, announced the company’s investment on January 20, stating that AWS already has a “significant presence in Virginia” and that he is “excited that AWS has chosen to continue its growth and expand its footprint”.
Roger Wehner, director of economic development of AWS, said that the company has invested more than $35bn in Virginia since 2006 and that “building on these successful beginnings, we plan to invest an additional $35bn in Virginia by 2040 and create 1000 jobs”.
The state government is designing a Mega Data Center Incentive Programme that, if approved, will yield AWS up to 15 years of extended tax exemptions on equipment and software. It is also looking to give the company a $140m grant.
Such an investment comes amid a rising tide of mega deal tickets into the US, following a record 2022 with $134bn invested in projects worth $1bn or more, according to fDi Markets.
The state’s Data Centre Alley, in and around Ashburn in Loudoun county, is renowned for having the world’s highest concentration of data centre clusters, including businesses and government organisations. It is estimated that 70% of the world’s internet traffic goes through Data Centre Alley every day.
Among US states and globally, Virginia has tracked the second-highest amount of capital expenditure in data centre investments on record, according to fDi Markets, after Texas. Besides Amazon, other big US companies have invested in data centres in the state, namely Google, Iron Mountain and Vantage Data Centers.
One of the big pulls is therefore the talent pool the state has to offer. “With the highest concentration of tech talent in the US, Virginia boasts one of the largest data-centre workforces in the nation — an advantage that sets us apart and directly benefits an industry leader like AWS,” secretary of commerce and trade Caren Merrick said in a statement.
In 2018, Amazon pledged to invest $2.5bn in Virginia as part of the establishment of its second corporate headquarters, Amazon HQ2, in Arlington county.
Separately, Mr Youngkin in January said that he had axed the possibility for a joint venture battery plant between US carmaker Ford and Chinese battery maker CATL. “I would have loved to have had Ford come to Virginia and build a battery plant, if they were not using it as a front for a company that is controlled by the Chinese Communist Party,” he told Bloomberg TV on January 20.