A buried provision in HB1393 prevents Dominion Energy Virginia from spreading data center infrastructure costs to small business ratepayers.
Most Virginia manufacturing owners don't realize that a provision tucked into HB1393—a bill ostensibly about energy assistance and weatherization—fundamentally changes how Dominion Energy Virginia allocates certain infrastructure costs. And it directly protects small manufacturers from subsidizing the power needs of massive, high-demand customers.
HB1393 directs Dominion Energy Virginia to propose a specific cost allocation method in rate proceedings. The key: capacity procurement and distribution infrastructure costs must be allocated to the "high-demand, high-load-factor customer class"—defined as customers with peak demand of 25 megawatts or greater and a load factor of 75 percent or higher. In practical terms, this means data centers.
Why does this matter? Historically, utilities can spread infrastructure costs across all ratepayers. That means small manufacturers on standard rate schedules help pay for the grid upgrades needed to serve one massive customer. Under this provision, those costs stay with the customer that actually drives the need for them.
The result: small and mid-sized manufacturers avoid bearing a portion of the infrastructure bill for serving hyperscale data operations.
This provision applies to manufacturing facilities served by Dominion Energy Virginia that operate on standard commercial or industrial rate schedules—essentially, any plant that doesn't fall into the 25+ MW, 75%+ load factor category. If your operation draws steady, moderate power, you're protected.
Data centers, cryptocurrency operations, and other ultra-high-demand facilities are the intended targets of the cost allocation change.
The provision becomes effective July 1, 2026. However, the actual impact begins when Dominion files a rate case. The law applies to any rate proceeding commencing after January 1, 2027, and before July 1, 2033. This means the first rate case filed in that window will trigger the new cost allocation method.
If Dominion files a rate case in late 2027, for example, the new allocation would apply. If the company delays until 2032, it still applies. The seven-year window ensures the provision has teeth without being indefinite.
For most manufacturing owners, this is good news on two fronts. First, it removes uncertainty: you won't face surprise rate increases driven by infrastructure costs you didn't create. Second, it signals that Virginia's regulatory framework recognizes the difference between baseline industrial operations and extreme-load customers.
If you're evaluating long-term energy costs or expansion plans in Virginia, this provision provides some protection against cost-shifting. Your rates won't absorb the infrastructure premium of serving data centers.
The provision appears on page 1, paragraph 3 of the Summary as Passed for HB1393. It's a small detail in a larger bill, but it's one worth understanding as you plan capital and operational budgets.
Source: HB1393—Electric utilities; pilot program for energy assistance and weatherization for certain individuals. Summary as Passed, page 1, paragraph 3.