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Virginia Lawmakers Accept Governor's Data-Center Cost-Shift — But Reject Her Cap on Dominion's Profit Margin
VA
Fiscal / Data Centers / State Legislation
April 23, 2026
Source: Virginia Mercury (States Newsroom)
In a closely watched veto-session vote Wednesday, the Virginia General Assembly split the difference on Gov. Abigail Spanberger's amendments to SB 253 and HB 1393 — the two major data-center cost-shift bills passed earlier this year. The outcome is Virginia's first statutory acknowledgment that hyperscalers should bear their own grid costs, with the profit-side lever on Dominion Energy's balance sheet left untouched.
Accepted. Lawmakers accepted Spanberger's substitute language directing the State Corporation Commission (SCC) — Virginia's utility regulator — to determine whether data centers and other high-load customers are paying “their fair share” of distribution and PJM capacity costs. The shift routes the cost-allocation question through commission review rather than legislative fiat, but it keeps the cost-shift principle in statute for the first time.
Rejected. Lawmakers rejected two of Spanberger's more aggressive proposals:
- A cap on Dominion Energy's allowed return on equity at 9.3%, down from the current 9.8% — a half-point reduction that, on Dominion's Virginia rate base, translates into hundreds of millions of dollars in annual profit the utility would have forgone.
- A cap on costly underground-line burial at 2% of the distribution rate base — an amendment aimed at a practice that has added tens of millions annually to Dominion's recoverable spending without corresponding reliability gains.
Sponsors said the original SB 253/HB 1393 package, had it passed as introduced, would have saved the average residential customer about $5.52 per month. Spanberger's substitute version routes that savings — in principle — through the SCC's determination. Whether the $5.52 figure survives in the SCC's application of the cost-shift standard is the open question.
For context on what the ROE cap would have meant: Dominion's parent company, Dominion Energy Inc., reported $3.0 billion in operating earnings in 2025, with Virginia making up roughly 70% of its customer base. A half-point reduction in allowed ROE is a material number — the kind of change that moves shareholder-return calculations and analyst models. Rejecting it keeps Dominion's profit-margin structure intact while accepting a cost-shift framework that the SCC will have to operationalize in future rate cases.
The same session also rejected the governor's amendments to a separate health and labor bill. That vote is outside the energy beat but signals that the Democratic-controlled chambers are not rubber-stamping the first-year Democratic governor's line on every issue.
What You Can Do
If you live in Virginia:
- The State Corporation Commission (SCC) is now the venue where the cost-shift question will actually be decided. SCC proceedings, dockets, and public comment windows are posted at scc.virginia.gov. Cases involving Dominion Energy Virginia, Appalachian Power, and large-load tariffs are where SB 253/HB 1393 will be applied.
- The Office of the Attorney General's Division of Consumer Counsel represents the public in SCC proceedings involving utility rates. Contact at oag.state.va.us.
- Contact the Governor's Office — Spanberger's stated position on ROE and burial-cost caps remains on the public record; continued pressure on the profit-margin half of the fight is where the rejected amendments could re-emerge in 2027 legislation. Contact at governor.virginia.gov.
- Your state senator and delegate votes on SB 253/HB 1393 and on the governor's amendments are public record. Find your legislators at whosmy.virginiageneralassembly.gov.
If you live in a state watching Virginia as a template:
Virginia is the country's largest data-center market by a wide margin, and what the SCC does with the cost-shift language in SB 253/HB 1393 is likely to become the reference case every other state-level fight is compared against. The procedural path to watch: SCC opens a proceeding applying the new “fair share” standard → utilities file testimony on cost allocation → intervenors (consumer counsels, environmental groups, industrial customers) file counter-testimony → commission issues a ruling. That arc typically runs 12–18 months from filing. The first SCC proceeding to apply SB 253/HB 1393 is the document to bookmark.
Community Takeaway
This vote has two readings, both correct.
The optimistic reading: Virginia now has the first statutory language in the country directing a utility regulator to determine whether data centers pay their fair share of grid costs. That is a real change. Before this session, the cost-allocation question was entirely at the SCC's discretion under general rate-making principles. After this session, the SCC is directed by statute to answer it.
The skeptical reading: “Fair share,” as a legal standard, is whatever the SCC decides it means. Utilities have deep experience arguing cost-allocation methodology before state commissions. Data centers have the financial resources to intervene on their own behalf. Consumer advocates have smaller legal budgets and narrower attention spans. The cost-shift only bites if the SCC rules the right way, and Dominion's ROE — the backstop on the profit-margin side — remains at 9.8%.
Both readings matter for states watching. The Virginia vote is progress, and the progress is limited to exactly what's in the text. For Ohio, Pennsylvania, and other states considering similar legislation: the lesson is that the cost-shift language and the profit-margin language are separable, and the political economy of a veto-session vote favors separating them. A cost-shift bill can pass on bipartisan bill-reduction rhetoric. An ROE cap runs into the utility's most organized lobbying. Plan the legislative package accordingly.
Source: Virginia Mercury (States Newsroom), April 23, 2026.