Governor Abigail Spanberger has urged Virginia state regulators to mandate that data centers bear the full cost of new transmission infrastructure necessitated by their operations, aiming to shield families and small businesses from increased electricity bills.
Last week, Governor Spanberger called on the State Corporation Commission (SCC) to ensure data centers cover these significant infrastructure expenses. Her Chief Energy Officer, Josephus Allmond, submitted a filing to the SCC on July 9, stating, "It is a core policy of the Administration of Governor Abigail Spanberger… to foster an affordable, reliable and clean energy system." This direct involvement from the Governor's office in such a case is considered unusual. Since taking office in January, Spanberger has also signed an energy consumption tax on data centers and enacted laws for stricter backup generator requirements.
The administration, alongside consumer advocates like PEC and Old Dominion Electric Cooperative, supports a "but-for" test, proposing that if a transmission line would not have been built without a data center, that facility should pay the entire cost upfront. Deputy Chief Energy Officer Louise White further testified, "Any network or substation upgrades that would not have been triggered but for a large load customer should be assigned directly to that customer, shielding regular Virginia families from subsidizing commercial extension." A group of Democratic lawmakers also sent a letter to the SCC backing the Governor's appeal.
The SCC is currently deliberating on how to allocate the costs of Dominion Energy's request to recover approximately $1.5 billion in high-voltage transmission investments, largely driven by the escalating demand from data centers. The commission's decision will determine whether these substantial costs are broadly shared among all customers or primarily borne by the data centers themselves.