Virginia SCC weighs Dominion data center transmission cost allocation

If you're a Dominion Energy customer in Virginia, a case now before state regulators could affect your monthly bill. Dominion wants to raise a charge called Rider T-1, which recovers costs for transmission line upgrades, to collect about $1.5 billion. The company says this would add roughly $2.90 a month to the average residential bill. Much of the new transmission spending is tied to the rapid growth of data centers in the state, and the real fight is over how much of that cost gets spread across all customers versus charged directly to the data center companies causing it.

At a hearing this week, Virginia Gov. Abigail Spanberger's office, tech companies including Google, Amazon, Microsoft and Meta, Loudoun County officials, and consumer advocates all argued over the fairest way to divide these costs. Options on the table include requiring data centers to make upfront payments toward construction costs, changing the formula used to calculate each customer class's share of transmission expenses, and directly billing large data center customers for upgrades built specifically to serve them. A state commission attorney testified that no matter which method is chosen, ordinary ratepayers are still subsidizing new large data center customers.

The State Corporation Commission must rule by August 1. The outcome won't change anything about home energy upgrades or rebates, but it will help determine how much of the cost of powering Virginia's data center boom lands on residential electric bills.