Virginia tells data centers to pay for the power lines they need

Virginia's utility regulator just told the state's 570 data centers to start paying for the power lines built to serve them, rather than letting those costs spill onto ordinary customers' bills.

The State Corporation Commission issued the order in its Dominion Energy Virginia biennial review, Case No. PUR-2025-00058. It creates a new rate class for large dedicated users that sets minimum cost responsibility at 85% of contracted distribution and transmission demand, and 60% of generation demand. Infrastructure built exclusively for a single customer's use can no longer be absorbed into the general rate base.

The decision lands as the PJM Interconnection regional grid operator reports a 76% increase in capacity-market prices. The independent market monitor Monitoring Analytics attributes most of that spike to data center demand, a load category that has reshaped Virginia's grid faster than its rate design could follow.

Virginia hosts at least 570 data centers, more than any other US state, and the rapid buildout has pushed some local authorities to ask schools and residents to cut consumption during peak hours. Governor Abigail Spanberger publicly framed the order as saving "Virginia families, small businesses, and other ratepayers hundreds of millions of dollars," language the regulator has not quantified. The American Action Forum has published a rate-class explainer laying out how the new mechanism differs from the previous demand-charge approach.

What remains undecided: how Dominion will apply the minimums to existing contracts, and whether other PJM states will follow Virginia's lead.