Wiki/Primary documents

Virginia SCC GS-5 Rate Order (PUR-2025-00058), Annotated

Editorial note on the case number. Press shorthand and several secondary sources reference this case under various dockets, and an earlier briefing document we received cited "PUR-2024-00184." The correct case is Case No. PUR-2025-00058, Application of Virginia Electric and Power Company, For a 2025 biennial review of the rates, terms and conditions for the provision of generation, distribution and transmission services pursuant to § 56-585.1 A of the Code of Virginia. The final order was issued November 25, 2025. The companion fact sheet from the Commission is dated February 2026. All citations below are to that record.

Why this order matters

The Virginia State Corporation Commission ("SCC") regulates Virginia Electric and Power Company ("Dominion Energy Virginia" or "DEV"), the utility that serves "Data Center Alley" — the cluster in Loudoun and Prince William counties that carries roughly 70% of global internet traffic and the single largest concentration of hyperscale capacity on earth. On November 25, 2025, the SCC became the first US state regulator to create a dedicated rate class for large data-center loads and to write minimum-charge provisions intended to insulate residential customers from the cost of building generation, transmission, and distribution to serve them.

The order is consequential for three reasons:

It is a regulatory precedent, not a legislative one. The structure was not imposed by the General Assembly; it emerged from a contested rate case in which Dominion itself, sixteen intervenors, and Commission Staff filed direct testimony. That makes it portable: any state public-utility commission with a similar statutory framework can copy the architecture without new legislation.
It puts a price on the "cost shift" argument. Until November 2025, the claim that data centers were subsidized by residential ratepayers was an advocacy position. The order memorializes a Commission finding that the risk exists and adopts a tariff structure to address it.
It is being treated as a floor, not a ceiling. Within weeks of the order, the 2026 Virginia General Assembly took up bills (SB 253, HB 1393) that would push further. Governor Spanberger amended those bills in April 2026. The legislative cycle is now layered on top of the SCC's tariff.

Former FERC Chair Mark Christie, who previously chaired the Virginia SCC, told E&E News that the order's reach was deliberate: "This is a very important decision by the Virginia Commission. People look to Virginia... to see how Virginia is dealing with these issues because we are the state that is the center of data center universe."

Procedural background

Filing. Dominion filed its biennial-review application on March 31, 2025. The company sought a $631 million base-rate increase, split into $458 million annually beginning January 1, 2026 and an additional $173 million beginning January 1, 2027. Dominion separately requested authority to raise its authorized return on equity from 9.7% to 10.4%. Within the application, DEV proposed "a new customer class for large-scale users of electricity including data centers" with minimum-charge provisions and collateral requirements applicable to customers with 25 MW or more of demand.

Scheduling order and intervention. The Commission's April 28, 2025 scheduling order set evidentiary hearings for September 2, 2025 in the SCC's second-floor courtroom at 1300 East Main Street, Richmond. Sixteen parties filed direct witness testimony on July 16, 2025, including:

The Office of the Attorney General's Division of Consumer Counsel (witness Scott Norwood).
Virginia Poverty Law Center, Clean Virginia, Sierra Club, Appalachian Voices, and the Piedmont Environmental Council ("PEC").
Southern Environmental Law Center ("SELC").
The Data Center Coalition ("DCC"), the trade association representing Amazon, Google, Microsoft, Meta, Equinix, Digital Realty, and others.
Walmart and the Virginia Committee for Fair Utility Rates (large industrial customers).
Synapse Energy Economics witness Jon Glick.
Commission Staff (filed separately on a Staff schedule).

Hearings. Evidentiary hearings ran September 2-12, 2025. The statutory deadline for the Commission's order was November 30, 2025; the final order issued on November 25, 2025.

Higher revenue request than briefing language suggested. While Dominion's base rate request totaled $631 million, the SCC's own press release frames the requested base-rate increases as "$822 million in 2026 and $345 million for 2027," capturing the cumulative annualized revenue requirement at full deployment. The Commission approved increases of $565.7 million in 2026 and $209.9 million in 2027 — roughly 67% of what Dominion sought across the two-year period.

The new GS-5 rate class — what the order actually says

GS-5 is a new optional/mandatory rate schedule layered onto Dominion's tariff. Its core terms, as approved:

Parameter	Approved value
Eligibility threshold	Customer demand of 25 MW or more
Effective date	New customers signing service agreements on or after January 1, 2027
Existing large customers	Generally grandfathered (e.g., Newport News Shipyard)
Contract term	14 years, with an optional load-ramp period of up to 4 years inside the term
Minimum charge — distribution & transmission	85% of contracted demand each month, regardless of actual consumption
Minimum charge — generation	60% of contracted demand
Minimum load factor	75%
Demand-reduction notice	Three-year notice required, with limits on the size of the reduction
Collateral	Required of new customers lacking sufficient credit, with the order contemplating coverage up to a defined portion of project costs
Exit fee	Customer in default during the contract term must pay remaining minimum charges over the balance of the term

Order, on the structure of the contract term and exit fee: "The contract term shall be 14 years. A customer may also include, within the contract term, a load ramp period not to exceed four years." And: "If the customer ceases operations or otherwise defaults on its agreement during the contract term, the customer shall be required to pay an exit fee covering any outstanding minimum charges over the remaining contract duration."

The Commission's framing of why these minimums exist — verbatim from the SCC fact sheet companion to the order:

"[L]arge-scale customers will be required to pay a minimum of 85% of contracted distribution and transmission demand, and 60% of generation demand, among other requirements" in order "to help insulate ratepayers from the costs around the rapid build-out and construction of infrastructure to support businesses such as data centers."

The 85% minimum applies regardless of whether the customer ends up building the data center or consuming the power it forecasted. That is the architectural point: the tariff binds the customer to the infrastructure that was built on the basis of its forecast, even if the forecast does not materialize. Stranded-cost risk shifts from ratepayers to the hyperscaler.

From a separate SCC staff briefing to the House Committee on Labor and Commerce (February 4, 2026), the language was tightened: GS-5 customers "must pay at least 85% of the transmission and distribution cost incurred to serve them each month regardless of their actual electricity consumption."

Cost-shift methodology — what the record showed

The contested issue at hearing was not whether serving hyperscale data centers required new infrastructure — that is conceded — but how the costs of that infrastructure should be allocated across customer classes.

The Attorney General's Division of Consumer Counsel, through witness Scott Norwood, put a number on the cost-shift the order was meant to address. From Norwood's direct testimony as summarized in the case record: serving the new data-center load would increase Dominion's system costs by approximately $22.4 billion on a net present value basis over 15 years, with the result that residential customer rates would rise roughly 12% per year, on average, over the next 15 years, absent corrective rate-design action.

Synapse witness Jon Glick, on behalf of Clean Virginia, argued that Dominion's then-existing rate design did not collect enough fixed-cost recovery from large-load customers and that the absence of a minimum-bill provision concentrated risk on residential and small-business customers.

SELC attorney Nate Benforado, after the order issued, captured the cost-allocation intent in one sentence: "These financial commitments shake out that speculative load." In other words, the 85% minimum is doing two jobs at once — it (1) deters customers from over-forecasting demand they will not use, and (2) ensures that if the infrastructure gets built anyway, the customer pays for it rather than the residential class.

The SCC did not, however, adopt a full revised cost-of-service study allocating embedded generation costs to GS-5 in this order. Instead, the Commission ordered Dominion to bring back a comprehensive cost-allocation methodology in its next biennial review (2027), effectively deferring the structural cost-of-service question. Clean Virginia framed this as a deferral: "The SCC asked Dominion to bring back a plan for transitioning to a new method in its next rate case — two years from now, which means families may keep paying more while big data centers avoid their fair share."

Residential impact — the $11.24 figure

The widely-cited "$11.24 a month" figure applies specifically to a typical residential customer using 1,000 kWh per month, and only to the base-rate component approved in this order. Components:

Base rates, 2026 increase: $11.24/month beginning January 1, 2026 (23.7% below Dominion's request of $14.73/month).
Base rates, 2027 incremental increase: $2.36/month beginning January 1, 2027 (51.2% below Dominion's request of $4.84/month).
Fuel factor (separate proceeding): An additional $8.95/month increase that took effect in July 2025 via Dominion's fuel-factor case. This is not part of the biennial review but stacks on top of the figures above on a customer's actual bill.

Press accounts that cite a "$16/month" total typically combine the base-rate increases and the prior fuel-factor increase. Inside Climate News reports the typical residential bill landing at approximately $165/month for the two-year period.

Return on equity. The Commission approved an ROE of 9.8% — a token 10-basis-point increase over the prior 9.7%, but well below the 10.4% Dominion sought. Commission Staff and intervenors had recommended ROEs as low as 9.3%-9.4%.

Capacity vs. energy split. The order maintains the conventional bifurcation: demand charges (distribution, transmission, and generation capacity, with the 85%/60% minimums for GS-5) and energy charges (per-kWh, recovered on actual consumption). The Commission rejected Dominion's proposal to shift PJM capacity-auction payment obligations from base rates into the fuel-factor mechanism, citing "exploding capacity costs now expected to remain elevated."

Opposition and defense

Dominion's defense. Spokesperson Aaron Ruby framed the result as a bipartisan win on customer protection:

"There's broad, bipartisan recognition that the protections approved by the SCC are a win for consumers."

Dominion's central argument throughout the case was that the GS-5 minimum-charge structure was its own proposal, not something imposed on it, and that the company supports rate design that "ensures large customers pay for the infrastructure built to serve them." The Commission largely adopted Dominion's GS-5 architecture, while trimming the revenue requirement and ROE.

Environmental intervenors — supportive but unsatisfied. Multiple intervenors praised the GS-5 framework while objecting that the order stopped short of full cost-of-service reform.

Peter Anderson, Appalachian Voices: "Residential customers should not be subsidizing these wealthy companies, and Virginians are relying on the commission to address these questions of fairness."
Chris Miller, Piedmont Environmental Council: "The SCC's decision is still unfair and does not go far enough to protect ratepayers."
Nate Benforado, Southern Environmental Law Center: "These financial commitments shake out that speculative load."

Clean Virginia. Executive Director Brennan Gilmore issued a same-week statement that read in part:

"Yesterday's decision shows why Virginia urgently needs a utility system that puts people first."

"This decision highlights a bigger systemic problem. Our current rules don't work in a world where data centers are rapidly changing our entire energy system."

Clean Virginia further objected that the order did not require data centers to pay the full costs of projects constructed to serve them and that the deferral of methodology to the next biennial review would extend the cost-shift two more years.

Attorney General. AG witness Scott Norwood's $22.4 billion NPV cost-impact estimate was the most-cited number in intervenor briefing. The AG's office did not oppose creation of GS-5 itself; it objected to (a) Dominion's requested ROE, (b) the size of the revenue requirement, and (c) the inclusion of approximately $350 million of speculative project revenue, which the Commission ultimately removed.

Data Center Coalition. The DCC participated as an intervenor and filed its own alternative proposal, which was less stringent than Dominion's GS-5 — lower minimum-charge percentages and shorter contract terms. The Commission did not adopt the DCC's counter-proposal. The DCC has not, as of this writing, issued a public statement directly criticizing the November 25 order. The trade association's positioning has shifted toward the 2026 legislative session, where it has argued against further cost-shift bills.

Industrial customers. Walmart and the Virginia Committee for Fair Utility Rates intervened primarily on revenue-requirement and ROE issues. Existing large industrial loads (Newport News Shipyard is the canonical example) are generally not subject to the GS-5 minimum-charge regime because the order applies prospectively to new service agreements executed on or after January 1, 2027.

What's next

Cost-of-service methodology. The Commission directed Dominion to file an updated cost-of-service study and rate-design proposal in its next biennial review (statutorily due in 2027). That proceeding will determine how much of Dominion's embedded generation and transmission cost is allocated to GS-5 versus other classes — i.e., the structural version of the question this order answered tactically.

2026 Virginia General Assembly. The legislature did not wait. Two bills moved in 2026:

SB 253 (Sen. L. Louise Lucas, D-Portsmouth) and HB 1393 would extend low-income weatherization and bill-assistance programs and would empower the SCC to shift additional categories of cost — notably the full price of PJM capacity-auction obligations and new distribution infrastructure serving GS-5 customers — onto the GS-5 class.
The SCC estimated the Lucas-amendment effect: typical residential customers would see rates reduced by approximately 3.4%, or $5.52/month on a 1,000 kWh bill, while GS-5 customer rates would rise by approximately 15.8%.

Spanberger amendments. In April 2026, Governor Abigail Spanberger amended SB 253 and HB 1393 to remove the explicit cost-shift mechanism and substitute softer language directing the SCC to ensure data-center costs are not being subsidized by other customers. She added a provision capping Dominion's ROE at 9.3%, with any over-earnings refunded to customers. On April 22, 2026, the General Assembly rejected most of those amendments and re-sent the original bills to her desk.

Subsequent proceedings. Several adjacent dockets continue:

Dominion's PJM-related cost-recovery proceedings.
A Commission-initiated load-flexibility conference (2025-2026), exploring whether the GS-5 framework should incorporate demand-response and curtailment obligations.
A pending generation-resource proceeding involving the Chesterfield combined-cycle gas units that the SCC approved alongside the biennial review on November 25, 2025.

Regulatory diffusion. The American Action Forum analysis flags that Ohio and Oregon "approved similar measures to require data center customers to pay a minimum percentage share" of estimated electricity needs prior to Virginia's order. Virginia's GS-5 is the most comprehensive of the three, combining the minimum-charge percentages, a 14-year term, a 75% minimum load factor, collateral, exit fees, and a 25 MW eligibility threshold in a single tariff schedule.

Sources

Primary record — Virginia SCC Case PUR-2025-00058

SCC Final Order, November 25, 2025 (PDF in the SCC docket system): https://www.scc.virginia.gov/docketsearch/DOCS/89g601!.PDF
SCC News Release, "SCC Issues Order on DEV Biennial Review 2025" (November 25, 2025): https://www.scc.virginia.gov/about-the-scc/newsreleases/release/scc-issues-order-on-dev-biennial-review-2025/scc-rules-in-dev-biennial-review-case.html
SCC Scheduling Order news release (April 28, 2025): https://www.scc.virginia.gov/about-the-scc/newsreleases/release/scc-schedules-hearing-on-dominion-2025-biennial-review/scc-schedules-hearing-on-dominion-2025-biennial-review.html
SCC Fact Sheet, "SCC Data Center Initiatives: Ensuring Data Centers Pay Their Own Costs" (February 2026): https://www.scc.virginia.gov/media/sccvirginiagov-home/about-the-scc/fact-sheets/scc-data-center-initiatives-02-2026.pdf
Piedmont Environmental Council, Direct Testimony filed July 16, 2025: https://www.pecva.org/wp-content/uploads/PUR-2025-00058-PEC-Direct-Testimony-7.16.25.pdf
Synapse Energy Economics (Jon Glick), Direct Testimony filed July 16, 2025: https://www.synapse-energy.com/sites/default/files/Glick%20Direct%20(Public)_BaseandFuel%2025-056.pdf

Intervenor and stakeholder statements

Clean Virginia press release, "State Corporation Commission Approves Dominion Rate Hike, Punts on Data Center Costs" (November 26, 2025): https://www.cleanvirginia.org/2025/11/26/news-state-corporation-commission-approves-dominion-rate-hike-punts-on-data-center-costs/
Southern Environmental Law Center press release, "Dominion customers to see rate increase, though SCC takes steps designed to ensure data centers pay fair share" (November 2025): https://www.selc.org/press-release/dominion-customers-to-see-rate-increase-though-scc-takes-steps-designed-to-ensure-data-centers-pay-fair-share/
Sierra Club, "Data Center State Policies, 2026": https://www.sierraclub.org/sites/default/files/2026-01/policies-for-data-centers-2026.pdf

Press coverage

Virginia Mercury, "SCC approves Chesterfield gas plant and Dominion rate hike, creates new rate class for data centers" (November 25, 2025): https://virginiamercury.com/2025/11/25/scc-approves-chesterfield-gas-plant-and-dominion-rate-hike-creates-new-rate-class-for-data-centers/
Inside Climate News, "Virginia Regulators Approve New Dominion Rates, Assign More Costs to Data Centers" (January 7, 2026): https://insideclimatenews.org/news/07012026/virginia-regulators-approve-new-dominion-rates/
E&E News (Politico), "Virginia to treat data centers differently on the grid": https://www.eenews.net/articles/virginia-to-treat-data-centers-differently-on-the-grid/
DataCenter Dynamics, "Virginia regulators approve new rate class for data centers and other large loads": https://www.datacenterdynamics.com/en/news/virginia-regulators-approve-new-rate-class-for-data-centers-and-other-large-loads/
Loudoun Now, "SCC Approves New Data Center Rate Class for Dominion": https://www.loudounnow.com/news/scc-approves-new-data-center-rate-class-for-dominion/article_02d5fa0c-1ed8-4771-b57d-c24765739854.html
RTO Insider, "Virginia SCC Approves Rate Increase, New Large Customer Class for Dominion" (paywalled): https://www.rtoinsider.com/120600-virginia-scc-approves-rate-increase-new-large-customer-class/

Analysis

American Action Forum, "Virginia's New Data Center Electricity Rate Class": https://www.americanactionforum.org/insight/virginias-new-data-center-electricity-rate-class/
Thomas Jefferson Institute for Public Policy, "The SCC Decides: Dominion's Rates and Profits Go Up, New Rules on Data Centers": https://www.thomasjeffersoninst.org/the-scc-decides-dominions-rates-and-profits-go-up-new-rules-on-data-centers/
ReisingerGooch, "Virginia Energy Regulatory Updates (September 2025)": https://reisingergooch.com/virginia-energy-regulatory-updates-september-2025/
Citizen Portal AI, summary of SCC staff briefing to House Labor and Commerce (February 4, 2026): https://citizenportal.ai/articles/7371359/virginia/2026-legislature-va/state-corporation-commission-orders-new-gs5-rate-class-for-large-datacenter-customers-sets-85-minimum-charges-and-14year-contracts

Legislative follow-on (2026 Virginia General Assembly)

Virginia Mercury, "Bill would put more energy costs on data centers, slash residential customers' rates" (February 10, 2026): https://virginiamercury.com/2026/02/10/bill-would-put-more-energy-costs-on-data-centers-slash-residential-customerss-rates/
VPM, "Senate bill would shield Dominion customers from some data center-related costs": https://www.vpm.org/news/2026-02-10/louise-lucas-data-center-infrastructure-costs-dominion-energy-apco-scc-pjm-virginia
Virginia Mercury, "Governor amends bills that shift costs onto data centers. Critics say her tweaks weaken them." (April 16, 2026): https://virginiamercury.com/2026/04/16/lawmakers-dominion-say-spanbergers-amendments-weaken-bill-to-shift-costs-onto-data-centers/
Cardinal News, "General Assembly rejects more than a dozen of Spanberger's amendments" (April 22, 2026): https://cardinalnews.org/2026/04/22/general-assembly-rejects-more-than-a-dozen-of-spanbergers-amendments/

Verbatim excerpts from the order (added from the PDF)

The full final order (30 pages, Doc. Con. Cen. No. 251140150) is at https://www.scc.virginia.gov/docketsearch/DOCS/89g601!.PDF. The agent draft above relied on press summaries; the following are quoted directly from the order text.

On the rate-increase magnitude (p. 2):

"As proposed by the Company across the two applications—exclusive of fuel costs but inclusive of capacity costs—a typical residential customer would experience a monthly bill increase of $14.73, or 9.8%, in 2026 and an additional $4.84, or 2.9%, in 2027."

The "$11.24" figure widely circulated in press coverage is therefore not the full picture. The Commission documents the total monthly impact at $14.73 in 2026 and a cumulative $19.57 by 2027 (before fuel-factor changes in the parallel proceeding PUR-2025-00059).

On the parties of record (p. 2):

"Post-hearing briefs were filed by Dominion, Staff, and the following respondents: Office of the Attorney General's Division of Consumer Counsel ('Consumer Counsel'); Amazon Data Services, Inc.; Apartment and Office Building Association of Metropolitan Washington ('AOBA'); Appalachian Voices ('APV'); Clean Virginia; CloudHQ LLC; Data Center Coalition ('DCC'); Google, LLC ('Google'); Iron Mountain Data Centers, LLC; Microsoft Corporation; Piedmont Environmental Council; Retail Energy Advancement League; Sierra Club; U.S. Department of Defense and all other Federal Executive Agencies; Virginia Committee for Fair Utility Rates ('Committee'); and Walmart Inc. ('Walmart')."

Notable: Amazon, Google, Microsoft each filed individually in addition to the Data Center Coalition. Walmart and the Department of Defense intervened on the industrial-customer side. Iron Mountain Data Centers was the only colocation REIT to file directly.

On the GS-5 rate-of-return diagnosis (p. ~17):

"The Company's A&E class cost of service study, updated to reflect the newly proposed GS-5 rate class, demonstrates that customers that will make up the GS-5 rate class contributed an overall per books rate of return of 6.28% for the end-of-test period ending December 31, 2024, which is the lowest return for all rate classes other than outdoor lighting."

"[The] remaining GS-4 class customers pay relatively higher rates of return of 20.75% (overall per books) and 22.41% (transmission). Given the relatively low rate of return illustrated by the current cost of service study, with respect to the transmission function, for the new GS-5 rate class, the Commission anticipates examining transmission cost allocation."

This is the load-bearing empirical finding. The order documents that the customer segment now being moved into GS-5 was returning 6.28% — versus 20.75–22.41% for the GS-4 class that remains. The Commission's own cost-of-service study, in other words, finds that large data-center loads were under-paying for cost of service before the new tariff. The order does not quantify the historical subsidy in dollars; it adopts the tariff change as the prospective fix and defers a fuller transmission-cost-allocation review.

On the public-comment record (verbatim, p. ~6):

"Two themes in particular were often repeated: (1) that the motivating factors underlying the Company's request for a rate increase that would impact residential customers was designed primarily to subsidize data centers; and (2) that, given the price increases in food, shelter, and consumer goods generally over the last few years, any rate increase at this juncture should be disallowed. Other portions of this order will address the specifics associated with large-load customers, including data centers. The Commission endeavors at every opportunity to allocate costs appropriately across all customer classes to ensure a reasonable result. The same holds true in this case."

On the GS-5 contract terms (p. 24):

"The contract provisions shall apply to customers taking initial service and signing an ESA on or after January 1, 2027. The contract term shall be 14 years. A customer may also include, within the contract term, a load ramp period not to exceed four years (with a minimum annual ramp of 20%)."

"The Commission approves Dominion's proposed minimum demand charges: (1) minimum distribution charge of 85% contracted demand; (2) minimum transmission charge of 85% contracted demand; and (3) minimum generation charge of 60% contracted demand."

The 85/85/60 split is precise: transmission and distribution carry the higher (85%) commitment because their fixed costs are sunk at interconnection; generation carries a lower (60%) commitment because some of the marginal cost is dispatchable. The 20% minimum annual ramp prevents a customer from contracting for 100 MW and ramping over a decade.

On Rate Schedules MBR and SCR (the existing market-based escape hatch, p. ~21):

"Rate Schedules MBR and SCR generally permit large loads — oftentimes data centers to obtain generation service at a rate other than the cost-of-service rate. Rather, generation rates charged to Schedule MBR and SCR customers reflect the wholesale market rates — and not retail rates based on the Company's generation cost of service."

This is an important contextual fact the agent's draft and most press coverage skip: data centers already had a route to wholesale-priced generation through MBR (Market-Based Rate) and SCR (Special Contract Rate) tariffs. The new GS-5 class is layered on top of these existing options, not a replacement.

On the large-load interconnection queue (p. ~25):

"Large Load Interconnection Queue. There was testimony at the hearing regarding the Company's new interconnection queue process for large load customers. Although the Commission has exercised its discretion not to address comprehensive transmission planning or the allocation of transmission costs as part of this biennial review proceeding, we recognize, as noted in the concurrence of Case No. PUR-2024-00135, that such issues loom large."

The Commission explicitly defers the larger transmission cost-allocation question to a separate proceeding — confirming the Clean Virginia "punt" framing that the agent's draft summarizes from press accounts. The deferral is on the record.

Last updated: May 10, 2026.