News Summary
Virginia is witnessing an increase in electricity demand as data centers rapidly expand. This growth is putting pressure on the electrical grid and raising concerns among residents. Dominion Energy warns that the demand may conflict with state environmental commitments while also proposing the construction of a new natural gas peaker plant, which has faced opposition. Similar situations are observed in North Carolina and Ohio, highlighting the broader challenges of balancing economic growth with clean energy goals amid rising electricity prices.
Virginia Faces Growing Electricity Demand Due to Data Center Expansion
The state of Virginia is experiencing a significant increase in electricity demand driven by the rapid growth of data centers. This surge is exerting pressure on the electrical grid and raising concerns among residents and local businesses alike. Experts predict that peak power demand in Virginia could increase by approximately 5% annually over the next fifteen years.
Dominion Energy, Virginia’s major utility provider, has warned that this expanding demand may conflict with the state’s environmental commitments under the Virginia Clean Economy Act (VCEA), which mandates that all energy be carbon-free by 2045. In response, the utility has proposed constructing a new 944 MW natural gas “peaker” plant to handle the increased load, a move that has attracted opposition from clean energy advocates who argue for cleaner, renewable alternatives.
Rising Utility Costs and Grid Reliability Concerns
Local residents and businesses have expressed concerns that the surge in demand could lead to higher electricity bills and threaten grid reliability, especially as Virginia approaches its November 2025 elections. The increased expansion of data centers—companies such as Amazon and Microsoft are planning additional facilities—has been linked to anticipated price hikes in utility costs, fueling ongoing debates about balancing economic growth with environmental objectives.
North Carolina’s Energy Infrastructure Under Strain
Similarly, North Carolina is facing a substantial rise in electricity needs. The state’s utility, Duke Energy, estimates that approximately 6 gigawatts (GW) of additional capacity will be required to meet future demand, much of which is anticipated to come from even more data centers. As these facilities continue to grow, stakeholders are engaged in discussions on how to expand the energy grid sustainably while respecting statewide clean energy goals.
Policy and Infrastructure Responses
In Ohio, authorities are implementing new regulatory measures to address the challenges posed by data center expansion. The Public Utilities Commission of Ohio has introduced a new tariff structure that charges large data centers a base fee equating to 85% of their projected energy usage. This pricing model aims to ensure that data centers bear a fair share of the costs associated with upgrading the electrical infrastructure, preventing these costs from being passed onto residential consumers.
Impact on Electricity Prices and Future Outlook
The growth of data centers is playing a significant role in rising electricity prices across the region. The PJM Interconnection, which manages regional electric grid operations, reported a 22% increase in wholesale electricity prices for 2025, with data center expansion identified as the primary driver.
Forecasts for the broader United States indicate that electricity demand is expected to grow by approximately 2.5% annually through 2035, driven largely by data center operations. This trend raises questions about the future affordability of electricity for consumers, as many advocate that the cost increases benefit large corporations at the expense of residential ratepayers.
Technological and Legislative Developments
To address strains on the electrical grid, some regions are exploring microgrid technologies as a potential solution. Legislation is also being introduced to promote the development of such localized energy systems, which could alleviate pressure on traditional grid infrastructure and support a transition to cleaner, more resilient energy sources.
As regions continue to expand their data center footprint, planning and regulation remain pivotal in ensuring energy supply stability, controlling costs, and achieving environmental goals efficiently and equitably.
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Additional Resources
- JD Supra: The Rise of Data Centers and Their Impact
- JD Supra: The Site Report on Construction Law
- Business Insider: Electric Bills Rise in 13 States Due to Data Centers
- Quartz: Americans’ Electricity Bills Rise Due to Data Centers
- New York Times: AI Data Centers and Electricity Costs
- Wikipedia: Data Center
- Google Search: Data Centers Electricity Impacts
- Google Scholar: Data Centers Energy Demand
- Encyclopedia Britannica: Data Center
- Google News: Data Centers Electricity Costs
Author: STAFF HERE WASHINGTON DC
WASHINGTON DC STAFF WRITER The WASHINGTON DC STAFF WRITER represents the experienced team at HEREWashingtonDC.com, your go-to source for actionable local news and information in Washington, DC, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and regional news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the National Cherry Blossom Festival, Kennedy Center Honors, and the Washington Auto Show. Our coverage extends to key organizations like the Greater Washington Board of Trade and Destination DC, plus leading businesses in government contracting and technology that power the local economy such as Lockheed Martin and Amazon. As part of the broader HERE network, we provide comprehensive, credible insights into the dynamic landscape of the Washington metropolitan area.
