The 2025 General Assembly Again Fails to Take Meaningful Action on the Accelerating Impact of Data Centers on Virginians

A statement from PEC President Chris Miller

WARRENTON, Va., February 27, 2025 – A bi-partisan group of state legislators introduced around 30 bills in this year’s General Assembly session to manage the accelerating and uncontrolled growth of data centers in Virginia. Despite their common sense and constructive recommendations, only two bills passed, and they were substantially watered down. Now, Governor Youngkin will decide if they become law.

The 30 data center reform bills introduced this year included a number of improvements, such as:

Promoting accountability and transparency by requiring the industry to report energy use, water consumption and emissions.
Ensuring responsible data center growth that protects the state’s energy and natural resources by adding a statewide regulatory review for larger projects.
Protecting residents and businesses from subsidizing the data center industry’s energy infrastructure.
Tying nearly a billion dollars in state sales tax exemptions received by the data center industry annually to clean energy and efficiency standards.

The General Assembly chose to avoid addressing the mounting financial and environmental risks and costs to all Virginians. It’s not clear why. But what is clear is that Dominion Energy and the five largest and richest companies in the world have opposed data center reform and they have immense resources to support their position.

Our state legislators have kicked the can down the road another year, but their inaction will have consequences. The Virginia electorate is becoming more aware and informed about the impact of data centers on their electricity bills and legislators will soon feel the pressure. The question remains: who’s going to pick up more than $200 billion¹ to build out the power generation and transmission lines data centers will need by 2050? The numbers are stunning and should speak for themselves. No one wants their electricity bills to double, especially when the increase is almost exclusively from data centers.

The “facts of the case” for data center reform remain constant.

Data centers are the main reason energy demand will nearly triple by 2050.
Residential ratepayers could see a doubling of their electricity bills² over the next fifteen years if nothing is done.
Dominion Energy’s plan to generate or transmit the amount of power required is unrealistic. The projected power generation for current and projected data centers only exists on paper and depends on untested technologies, unprecedented levels of expansion, and importing much higher levels of power from an already strained energy market.
Data centers already get a rate subsidy and substantial tax exemptions: data centers pay 8 cents per kilowatt hour versus residential ratepayers who pay almost 15 cents per kilowatt hour³ and data centers saved nearly a billion dollars through state tax exemptions last year.
The infrastructure to generate and transmit the additional power required for data centers will cost more than $200 billion⁴. Because no ratepayer protection bills were passed, under current rate structures that assume all rate classes share generation and transmission costs. That means Virginia households, other businesses, schools, and hospitals will pick up a large portion of the costs. Virginia should not be subsidizing the richest companies in the world.

Now all eyes are on the State Corporation Commission, which has direct jurisdiction on rate setting and has the opportunity to act as early as this spring. But, if the General Assembly and SCC won’t act – then we need to look to Virginia’s 2025 gubernatorial and delegate candidates and ask, “Are we going to let the richest companies continue to ride on the backs of Virginia’s hard working families and small business?”

Media Contact: Mike Doble, mdoble@pecva.org, (703) 579-7963