More Work Remains to Determine Who Pays Billions in Other Data Center-Driven Costs

WARRENTON, Va. (August 3, 2026) – The Virginia State Corporation Commission (SCC) issued a major ruling Friday that, going forward, will help protect consumers’ pocketbooks from the impacts of the data center boom and related energy infrastructure buildout in Virginia. In a July 31 ruling governing utility rates, the SCC concluded that new large-load data centers are the cause of massive transmission lines costs. Up to this point, the costs associated with transmission development solely to serve data centers have not been borne by the data centers, but have been applied across all customers’ electricity bills – including residents, farms and small businesses. As Virginia prepares to build hundreds of new substations and thousands of miles of transmission lines to serve data centers, those costs could have potentially been passed on to those other ratepayers.

Despite objections of Dominion and the data center industry, the SCC found that large-load data center customers must pay for transmission facilities that are constructed solely to serve them. After years of debate, the Commission has now established an important principle for the state: transmission costs should follow long-established cost causation principles. Put simply, the user(s) that cause a utility or system to incur specific expenses should be the ones who pay for them. 

The Piedmont Environmental Council (PEC) brought critical testimony to the SCC case, which the Commission cited in its July 31 order, showing that Dominion’s existing policies do not adequately protect consumers from the costs and risks of the data center buildout. 

“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. “It’s an important first step, but more work remains. The ruling appears to apply  only to substations and the other transmission infrastructure that connect data centers to the bulk power system. It does not resolve who should pay for the billions of dollars in other supplemental and regional transmission projects driven by unprecedented data center growth in Virginia. The ruling also does not address the substantial new generation resources – including multiple natural gas-fired power plants – that Dominion has proposed to build to meet this rapidly growing demand.” 

PEC is encouraged that the SCC seems to recognize that future reforms will be necessary, as its ruling mentions the need for future proceedings to determine whether large-load customers should also bear responsibility for additional upstream transmission costs, including supplemental transmission projects and reliability projects needed to meet regional demand.

Now that the SCC has made this critical decision, the order requires Dominion to coordinate with SCC staff to file a new cost assignment proposal consistent with the SCC’s directives. That proposal must be filed within 90 days.

Media Contact: Mike Doble, Piedmont Environmental Council, [email protected]
For more on The Piedmont Environmental Council, visit: pecva.org/datacenters

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The Piedmont Environmental Council (PEC) works to protect and restore the lands and waters of the Virginia Piedmont, while building stronger, more sustainable communities. Founded in 1972, PEC is a locally based, community-supported 501(c)3 nonprofit and accredited land trust. At the core of PEC’s approach is a focus on educating, engaging and empowering people to effect positive change in their communities.