Regulators in Virginia have directed the state’s primary electric utility, Dominion Energy, to develop a new transmission cost allocation policy for data centers.. The new rules would require data centers and other large load customers to pay a greater share of the high-voltage transmission infrastructure that physically serves their facilities..
04 Aug 2026. The order from the Virginia State Corporation Commission (SCC) came as part of Dominion’s latest “Rider T1” transmission rate adjustment case, where the utility argued that infrastructure required solely to connect large load customers should not be subsidized by residential ratepayers..
The SCC, in turn, instructed Dominion to develop a tariff that would “directly assign” transmission infrastructure costs to data centers and other large load customers that connect to new facilities, “with the goal of finding an acceptable and symmetrical approach towards assigning costs in these circumstances.”. The SCC said the proposed tariff should address situations in which transmission upgrades are driven solely by new large-load customers..
The decision follows growing scrutiny from the state lawmakers on who should cover the costs of expanding the electricity grid to meet the needs of the data center sector.. If approved, the new rules would be applied under Dominion’s GS-5 large-load customer rate class. The GS-5 rate class is a tariff that covers large load users, with those that fall under that designation expected to pay the transmission charges based on at least 85 percent of their highest demand, even if their usage later falls.
It is expected to come into force at the beginning of next year.. The new proceeding could permit Dominion to directly assign specific transmission projects, such as a new substation or a dedicated transmission line, to the data center customer or customers that triggered the upgrade..
The SCC cited the proposed Valley Link transmission project as an example of infrastructure that could be assigned to the rate class. The planned 115-mile (185km), 765kV transmission line is slated to run from Lynchburg to Culpeper, delivering additional power to Northern Virginia..
Environmental groups welcomed the ruling. “The decision establishes an important precedent: Virginia families and small businesses should not subsidize transmission infrastructure built solely to connect new large-load data centers,” said Chris Miller, president of the Piedmont Environmental Council.. Virginia is part of a growing tide of states enacting or seeking to enact new rules to protect ratepayers from bill hikes due to the growing energy demand of data centers..
In May, the Oregon Public Utility Commission (PUC) approved a new rate class for data centers and other large loads that will require them to cover the costs for the electricity grid infrastructure used to power their facilities.. Other states to see similar rules proposed and passed include Ohio, North Carolina, and Pennsylvania..
More in Grid Level. More in North America. 24 Feb 2026.
08 Jun 2026
