A planned data center along the Potomac River in Southern Maryland would sap more energy than all of Baltimore.

Could that be good for the region’s buckling power grid? Its developer thinks so.

TeraWulf, a fledgling tech company backed by Google and based on Maryland’s Eastern Shore, insists it’s a good data center developer. The company says that its massive complex would bring good-paying jobs to an area in need, wouldn’t draw water from the Potomac, and, crucially, wouldn’t compound the grid’s problems.

Its venture, called “Chesapeake Data Campus,” would be among the biggest data centers in Maryland, and could test a region-wide effort to manage the consequences of this energy-hoarding industry. The power grid operator has warned that booming data center demand could soon push its system to the brink of failure. And as the industry looks to expand in Maryland — large-scale projects have cropped up from the Washington suburbs to Calvert County — state leaders have tried to impose guardrails that encourage developers to pay for grid upgrades and, like TeraWulf, supply their own energy.

Gov. Wes Moore’s administration seems to back TeraWulf, but a debate over its implications for the power grid has turned heated in filings before federal regulators.

“It sounds nice, but the devil’s in the details,” said Jon Gordon, senior director for the trade group Advanced Energy United.

Gordon has watched closely as the region’s grid operator, PJM Interconnection, tries to manage the enormous demand from data centers and said that even if TeraWulf delivers on its promises to generate its own power, the project could create new vulnerabilities for the power system.

Chesapeake Data Campus would require the largest fossil-fuel development the state has seen in years. The company reached a deal in February to purchase a former coal plant, Morgantown Generating Station, and reboot it with natural gas to power a gigawatt of data centers. The company says an additional 500 megawatts of battery storage would allow the project to feed excess energy into the grid, boosting much-needed supply.

But TeraWulf’s attorneys have urged federal regulators not to consider its data center ambitions in reviewing the company’s plant acquisition. TeraWulf’s deal with current plant owners needs approval by the Federal Energy Regulatory Commission.

How TeraWulf intends to reboot Morgantown with natural gas remains unclear: The plant is roughly 15 miles from any natural gas pipeline, according to federal mapping.

Morgantown’s coal units once produced over 1,400 megawatts of power, but since their 2022 retirement, the plant today generates just 220 megawatts from a set of 1970s-era oil units.

Gordon said other parts of TeraWulf’s plan lack important specifics.

For example: Does TeraWulf intend to take those oil units offline while it builds natural gas capacity? Does the company expect to run its data centers during periods of peak demand on the grid? And what happens if TeraWulf’s units go down, as happens periodically at natural gas-fired plants?

Even 500 megawatts of storage isn’t enough to back up a data center of that size, and if it resorts to the grid, Gordon said, “that is really a crisis.”

TeraWulf chief strategy officer Kerri Langlais didn’t address these questions in emails last week, saying it would be “premature” to get into operational specifics while FERC reviews the sale. She said TeraWulf is focused on meeting regulatory standards and community priorities.

“Our long-term vision is centered on the thoughtful redevelopment of this brownfield site in a way that supports Maryland’s evolving energy needs, delivers local economic benefits, advances environmental remediation, and leverages existing infrastructure,” Langlais said in an email.

Gov. Wes Moore’s administration seems on board with the idea, even pledging to help hook Morgantown up to natural gas.

In a letter sent to TeraWulf CEO Paul Prager in December — months before TeraWulf reached a deal to acquire Morgantown — Moore’s Secretary of the Environment Serena McIlwain promised to expedite any necessary permits, including for cleaning up extensive coal pollution at the site and “obtaining natural gas right-of-ways.”

Moore spokeswoman Rhyan Lake said in an email that state support for TeraWulf’s proposal will depend on its impacts on local communities and on the grid. For Maryland to meet its climate goals, Lake said, new data centers will need to bring clean energy, pay for infrastructure upgrades and be “net-positive” energy contributors — measures new Moore-backed legislation aims to encourage.

Under this new legislation, TeraWulf or its clients would have to pay for any transmission upgrades their data center requires, and the project would not qualify for fast-tracked permitting, which the state plans to provide to data centers that acquire clean energy to supply at least 80% of their needs.

In Maryland’s emerging data center ecosystem, TeraWulf is a strange beast.

Headquartered in Easton, the publicly traded company formed as a Bitcoin miner in 2021 has since transitioned to data center development. In addition to its Southern Maryland project, TeraWulf is pursuing data center ventures in Texas, Kentucky and upstate New York. The company said it’s backed by Google, which has acquired rights to buy equity in TeraWulf at a later date.

Prager’s companies have developed energy projects around the world since at least 1990, according to TeraWulf’s website. Prager and his wife, Joanne, are active political donors in Maryland: They have contributed to numerous recent Democratic campaigns and together gave $24,000 to Moore and Lt. Gov. Aruna Miller last year.

To Cassady Craighill, technical education director for the policy group GridLab, TeraWulf’s plan to use natural gas is a head-scratcher. Wait-times for new natural gas turbines have stretched over five years, and even then, Craighill said, the volatility of the fossil fuel’s prices could leave TeraWulf susceptible to cost overruns — which could hurt ratepayers in the region.

“I feel like I have more questions for them than answers,” Craighill said.

In filings before federal regulators, the grid’s watchdog and a state-appointed ratepayer advocate have both raised concerns about impacts on energy prices and reliability.

PJM’s Independent Market Monitor argued in FERC filings that the company has left these impacts unaddressed. Claims of “net-positive” impacts for the grid are vague, the watchdog said, and don’t reveal specifics about the timing, cost or magnitude of power they expect to feed into the grid.

In a response last week, TeraWulf and Morgantown’s current owner, GenOn Holdings, said the grid watchdog has tried to turn this into “a referendum” on data centers, “regardless of the facts and the law.” The companies argue that the data center plans are irrelevant to FERC’s decision.

Tyson Slocum, energy program lead for Public Citizen, is skeptical that the company can pull off this engineering feat — much less that it will benefit the grid.

If Moore’s administration wants to remediate coal pollution at Morgantown, officials should press the current owners to handle the job, argued Slocum, who opposes the sale.

“We don’t need to bring in a crypto-miner with these grandiose plans to clean up the coal mess,” he said.

It’s easy to lose sight of the mind-boggling scale of this data center boom, added Gordon, the energy analyst. Sprawling campuses that consume the energy of large cities have become commonplace, he said, but “there’s absolutely nothing typical about this.”