Most Virginia manufacturers don't realize a 2026 utility rule change could reduce their electric bills—if they understand how it works.
Here's what most Virginia manufacturing owners don't know: buried in HB1393, a bill ostensibly about energy assistance for low-income households, is a provision that could reshape how Dominion Energy Virginia allocates the cost of building and maintaining the power infrastructure that serves different types of businesses.
The provision directs Dominion to propose a new cost-allocation method in its next rate case filing. Specifically, it requires the utility to propose that capacity procurement and distribution infrastructure costs be assigned to the "high-demand, high-load-factor customer class"—industry shorthand for data centers and similar operations that run continuously at high power levels.
Why does this matter to you? Under current rate structures, those infrastructure costs are typically spread across all customer classes, including small manufacturers and other general-service businesses. By concentrating those costs on data centers instead, the bill structurally shields smaller manufacturers from bearing those expenses on their electric bills.
Data centers consume enormous amounts of electricity around the clock. Building the transmission and distribution infrastructure to serve them is expensive. Today, some of those costs flow through to your rate class. Under this new allocation method, they wouldn't.
This is not a guarantee of lower bills—rate cases involve many variables, and the State Corporation Commission must approve any proposal Dominion makes. But the structural shift is real: costs borne by one customer class today will be borne by another tomorrow.
For manufacturers, the practical effect depends on your facility's load profile and your utility's rate design. A facility running steady, high-demand operations may see modest relief. A smaller shop with variable demand may see a different outcome. The key is that your cost allocation will no longer subsidize the infrastructure serving data centers.
The provision takes effect when Dominion files its next rate case on or after July 1, 2026, and before July 1, 2033. The utility must include a proposal for this new cost-allocation method in that filing. The State Corporation Commission then reviews and approves or modifies the proposal. Once approved, the new allocation takes effect.
This is a long lead time. If you're planning capital investments, facility expansions, or long-term energy contracts, understanding this timeline helps you model future costs more accurately.
The provision appears in HB1393, Summary as Passed, Page 1, paragraph 2, under the bill text.
For a detailed breakdown of how rate-class cost allocation works and what to watch for in Dominion's 2026 filing, contact your industry association or local business council—many are preparing member guidance on this change.