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That plea comes as the state's main power provider repeatedly hikes rates, and those repeated increases are linked to the rapidly increasing demands of data center buildouts. According to the report, Henrico County already has 37 data centers within its borders, and more are coming to the area.
The net result of this increasing demand is that Henrico County and other Virginia government entities covered by a collective purchasing body called VEGPA are facing a 24.9% rate hike starting next month, so every dollar that those local governments can save counts.
Those rising rates come from the fact that Northern Virginia has the world's highest concentration of data centers, numbering over 400 existing installations, and hundreds more are in the pipeline.
The region's proximity to Washington, DC, and the multiple submarine cables landing at Virginia Beach made it the perfect spot for byte collection, so much so that it's unofficially called Datacenter Alley.
AI data centers trigger massive 'irreversible' 76% electricity price spike in largest US region
Maryland citizens slapped with $2 billion grid upgrade bill for out-of-state AI data centers
Denmark presses pause on new data center grid connections as total requests hit 60 GW
Most Virginia counties with high data center concentrations are served by Dominion Energy, and that utility was feeding 26% of its power to data centers in 2023, a figure that certainly has increased substantially since then, especially considering that large-scale builds are becoming the norm rather than the exception.
Dominion has continued expanding its infrastructure to keep up with the demand, a costly buildout that multiple entities decry as having been borne by households, despite the fact that data centers are in a separate rate class.
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Key considerations
- Investor positioning can change fast
- Volatility remains possible near catalysts
- Macro rates and liquidity can dominate flows
Reference reading
- https://www.tomshardware.com/tech-industry/data-centers/SPONSORED_LINK_URL
- https://www.tomshardware.com/tech-industry/data-centers/virginia-county-asks-all-employees-including-schools-to-save-power-due-to-ai-driven-electricity-price-hikes-states-400-plus-data-centers-steadily-increasing-demand-grid-expansion-and-pricing#main
- https://www.tomshardware.com/subscription
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Informational only. No financial advice. Do your own research.