Virginia data centers face new power infrastructure costs
Virginia's State Corporation Commission has ruled that data centers, not residential customers, must bear the costs for new electric transmission upgrades needed to serve their facilities. Governor Abigail Spanberger stated this decision is projected to save Virginians hundreds of millions of dollars. The ruling comes amidst growing resident opposition to data center developments and a state senator's call for a moratorium on new growth.
The Virginia State Corporation Commission (SCC) has issued a significant order requiring data center companies to pay for new electric transmission upgrades and substations exclusively used for their operations, rather than passing these costs onto residential customers. Dominion Energy, the utility company, had initially sought permission from the SCC to charge residents more for these infrastructure projects needed to power Virginia's rapidly expanding data center industry, which includes over 600 facilities.
Virginia Governor Abigail Spanberger announced that this decision is expected to save Virginians hundreds of millions of dollars, ensuring that data centers cover the full cost of the transmission infrastructure their developments demand. The ruling addresses widespread concerns from residents across Northern and Central Virginia, many of whom have voiced strong opposition to data centers and high-voltage transmission lines near their homes, citing potential impacts on property values. Specific projects mentioned include a proposed data center and substation on the border of Fairfax County and the city of Alexandria, and new transmission lines in Loudoun, Orange, Culpeper, and Fauquier counties.
While the SCC's order shifts infrastructure costs, it does not halt the construction of these necessary power lines. In response to broader concerns about data center growth and rising energy costs, a bipartisan group of Virginia lawmakers is urging Governor Spanberger to convene a special legislative session. State Senator Glen Sturtevant has specifically proposed that the Governor issue an executive order to enact a moratorium on new data center development. Dominion Energy confirmed it will amend its line extension policy to include more protections for residential customers, ensuring energy-intensive customers pay their fair share.