The State Corporation Commission (SCC) of Virginia held a technical conference on December 16 to address the impact of data centers on the state’s power infrastructure and economy. This conference followed the release of a comprehensive report by the General Assembly’s Joint Legislative Audit and Review Commission (JLARC) on December 9.
Key Points from the Conference
Data Center Growth and Infrastructure Needs
The conference focused on the challenges posed by the rapid growth of data centers in Virginia, particularly:
- The need for additional power infrastructure
- Potential impacts on average ratepayers
- The role of the SCC in regulating the industry’s expansion
Cost Allocation and Ratepayer Protection
SCC Judge Kelsey Baggot raised concerns about fair cost allocation and protecting ratepayers from:
- Stranded costs
- Load forecasting errors
- Changing energy prices
Expert Panels
The conference featured three panels of experts representing various stakeholders, including:
- Dominion Energy
- Data Center Coalition
- Appalachian Power Company
- Loudoun County government
- Virginia Manufacturers Association
- Electric cooperatives
Load Forecasting and Planning
Dominion Energy’s Director of Data Center Practice, Stan Blackwell, explained their forecasting process:
- Utilizes data from connected data centers
- Collaborates with entities like PJM Interconnection
- Uses monetary commitments to filter out speculative projects
Cost Allocation Concerns
The JLARC study found that regular ratepayers have not subsidized data centers to date, but this could change as more infrastructure is needed. Experts discussed potential future pressures on ratepayers due to:
- Increasing infrastructure costs
- Tightening reserve margins in the power system
Proposed Solutions
Several ideas were proposed to address the challenges:
- Creating a separate rate class for data centers
- Reconductoring existing transmission lines
- Implementing demand-response programs
- Collocating generation facilities near data centers
However, each proposal faced potential obstacles, such as regulatory hurdles and industry opposition.
Conclusion
The SCC’s technical conference highlighted the complex challenges Virginia faces in balancing the economic benefits of data centers with the need for sustainable power infrastructure development. As the industry continues to grow, finding equitable solutions that protect ratepayers while supporting economic development remains a priority for state regulators and policymakers.
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