On May 1, 2026, Dominion Energy Virginia (“Dominion”) filed an application to increase its transmission cost rider revenue requirement by $124.7 million. Under Va. Code § 56-585.1(A)(4), Dominion is allowed to recover the costs of transmission services provided by PJM, including administrative expenses and new facility construction costs, through a rate adjustment clause. Dominion’s transmission costs are recovered through a combination of base rates and the utility’s transmission rate adjustment clause, designated Rider T1. The application, if approved, would result in an increase to the Rider T1 monthly bill for a typical residential customer using 1,000 kWh by $2.90.
On June 11, several intervening parties, including data centers and consumer and environmental advocates, filed expert witness testimony. The parties addressed several issues, including whether Dominion should change the way it allocates costs among its commercial, industrial, and residential customer classes. The Piedmont Environmental Council filed expert testimony urging the SCC to require data centers to pay for all transmission costs that the utility incurs specifically to serve such customers. Amazon Data Services filed testimony suggesting that data centers should not be required to pay for such costs, but should have the option to make voluntary payments. The Amazon witness cited potential negative economic impacts, arguing that “mandatory direct cost allocation could discourage beneficial projects, create uncertainty, or incentivize inefficient siting and planning decisions.”
Several witnesses explained that, as of February 2026, Dominion reported approximately 70,000 MW of delivery point requests to serve large load data center customers. These delivery point requests, if energized, would require over 200 new substations at a capital cost of between $6 billion and $12 billion.
Other issues in the case include Dominion’s continued use of the 12 coincident peak (“12-CP”) method for allocating costs among rate classes. The Sierra Club and other environmental advocates recommend that Dominion should be directed to transition to a different methodology, called the Summer/Winter Peak and Average (“SWPA”). The Sierra Club’s witness testimony argues that SWPA is more consistent with principles of cost causation because it allocates costs based on both peak demand and overall energy usage, rather than focusing primarily on contribution to monthly system peaks.
The SCC will hold an evidentiary hearing on July 14, 2026. Pursuant to the statute, the SCC must publish a final order within three months of the filing, or by August 1, 2026.
