Regulators to decide if Georgia law allows data center’s pop-up gas power plant

Regulators at the Public Service Commission have elected to examine whether the first data center in the state to plan to use on-site gas engines for around-the-clock power is allowed to do so under Georgia law.

The PSC voted unanimously Tuesday to hold hearings on the legality of the arrangement Houston-based firm VoltaGrid is planning about 40 miles east of downtown Atlanta.

The company plans to assemble 33 gas-burning engines next to a Covington data center under construction by the developer Serverfarm. But instead of sending the electrons they generate onto the grid, they will deliver them directly to the adjacent data center.

VoltaGrid had already begun assembly, but last month it was ordered to halt construction and cited by state officials for allegedly building the generators without a permit. Sara Lips, a spokeswoman for the Georgia Environmental Protection Division, confirmed that its separate investigation into VoltaGrid and Serverfarm is still active.

Representatives from VoltaGrid did not immediately respond to a request for comment on the PSC’s investigation or the unpermitted construction allegations. Serverfarm did not immediately respond to a request for comment on the PSC inquest.

Metro Atlanta is among the fastest growing data center markets in the U.S., according to data from commercial real estate services firm CBRE, and the race to start new projects has sent companies grappling to find huge sums of electricity to power and cool the computing complexes.

The PSC probe comes after Commissioner Peter Hubbard, a Democrat who is seeking reelection, called for an investigation into the so-called “pop-up” power plant last month. Hubbard cited reporting from The Atlanta Journal-Constitution documenting the alleged infractions from the rush to install the engines.

Soon after, the Southern Environmental Law Center asked the PSC to take up the case. Their petition was filed on behalf of the local nonprofit, Sustainable Newton, and several residents who live near the data center.

An aerial view of off-grid generators being installed at the data center on Thursday, June 25, 2026, in Covington. (Hyosub Shin/AJC)

Maurice Carter, the nonprofit’s president and co-founder, said he was pleased the PSC is looking into the issue.

“Ultimately, we need a public decision about whether VoltaGrid’s proposal is violating state energy laws so that all energy providers in Georgia are playing by the same rules,” Carter said in a statement. “This is an important step closer to that goal.”

The crux of their argument is that using on-site generators to power the data center violates two of the state’s bedrock energy and electricity laws: the Georgia Territorial Electric Service Act and the Cogeneration and Distributed Generation Act.

The Cogeneration Act allows facilities to generate electricity “for industrial, commercial, heating, or cooling purposes,” as long as all the power is consumed by the facility itself.

But that’s not what’s happening here, the petition argues. In this case, VoltaGrid will generate the power and the Serverfarm data center will consume it. The companies described themselves as separate entities in their permit applications to Georgia environmental regulators.

Certain large energy users in the state can choose who their electricity provider is. But while VoltaGrid is set to function as an “electric supplier” under the Territorial Act, it doesn’t qualify as one, the petition argues. The data center it’s poised to supply is also located in Georgia Power’s designated service territory, further prohibiting VoltaGrid from providing power to the data center.

Georgia Power did not immediately respond to a request for comment on the dispute.

In a rebuttal filing, attorneys for VoltaGrid argue that the generator fleet does not violate the state’s laws and say the petitioners don’t have proper standing to initiate the investigation.

Now that the PSC has opened its investigation, the case will be assigned to a hearing officer to gather testimony and hold hearings. Then, the hearing officer will make a recommendation to the five commissioners, who will vote to either adopt or reject the officer’s recommendation