Virginia Data Center Load Jumped 30 Million Megawatt-Hours in Six Years, Forcing a Tax Reckoning
Virginia's grid added nearly 30 million MWh of commercial load in six years, and the state now levies $600 million annually on data center power use.
Virginia's commercial electricity sales climbed by nearly 30 million megawatt-hours between 2019 and 2025, EIA data show, with the state's enormous concentration of data centers accounting for most of that growth. The Energy Institute's 2026 Statistical Review of World Energy, released on Thursday (2026-08-27), put the scale in global terms: worldwide data center electricity consumption hit 787.8 terawatt-hours in 2025, up from 410.8 TWh in 2020, a 92% rise in five years equivalent to roughly 14% average annual growth.7,8
The US carries most of that load. American data centers consumed 312.6 TWh in 2025, or 39.7% of the global total. US consumption rose by 63.5 TWh in a single year, meaning the United States alone accounted for roughly 49% of the net increase in global data center power demand in 2025, the Energy Institute found. China ranked second at 205.7 TWh, Europe third at 144.6 TWh.8
Virginia sits at the center of that US concentration, and the grid effects are already visible. Energy consumption in the state has increased by around 15% because of the AI boom, and the price of a RGGI pollution permit has doubled over the past five years, rising from $8 to $16 per ton, according to Canary Media reporting from May (2026-05-05), costs that generators pass through to ratepayers.1
The political response arrived in June. Virginia Democrats struck a deal on Friday (2026-06-19) to impose a temporary tax on data center power use estimated to cost the industry $600 million per year, ending a monthslong budget standoff that had threatened the state's first government shutdown. The arrangement caps the levy at $600 million annually for two years, with excess collections refunded proportionately. It preserves the industry's sales tax exemptions worth nearly $2 billion a year, which had been the core of the intraparty dispute.4
The Data Center Coalition said the deal would "raise costs on Virginians and Virginia businesses, drive away investment." The Virginia Senate had proposed a harder measure: an emissions-linked impact fee estimated to raise $1.7 billion over two years — a figure that signals how far some legislators are willing to push.4
Public opinion is running against the industry. A 2026 Pew Research Center poll found 38% of Americans believed data centers' impact on home energy costs was mostly bad, compared with just 6% who said mostly good. The Virginia Senate passed a separate budget provision stripping a $1.6 billion equipment tax break from the sector. In Texas, which has proposed 32 gas-fired projects partly to serve new data center load, 55% of voters oppose further data center construction, according to data cited by Oilprice.com.5
Grid capacity costs are becoming concrete. PJM, the regional transmission organization covering Virginia and 12 other states, announced capacity auction results in the week of Monday (2026-07-13), with analysts expecting the outcome to add billions of dollars in electricity costs across the region as data center loads stress supply margins.6
Utility ownership is shifting in response. A consultant at Gasilov Group told POWER magazine in May (2026-05-18) that the proposed NextEra-Dominion deal represented "the clearest signal yet that data center electricity demand is definitively restructuring utility ownership in the United States." Dominion Energy is the dominant power provider in Virginia's data center corridor.2
Natural gas is the marginal generation fuel across most of the PJM footprint. NYMEX Henry Hub front-month was at $2.86 per MMBtu on Tuesday (2026-09-01), down 0.69% on the day. Atlantic Council analysis notes that a 4-to-6-gigawatt data center complex consumes roughly 1 billion cubic feet per day of natural gas, a meaningful pull on regional supply but not large enough for gas price moves to offset the capacity costs now flowing through PJM to power buyers.3
Virginia's two-year tax sunset is the pressure point developers should be watching. Once the temporary levy expires, the preserved $2 billion in annual equipment exemptions remains an obvious target for a legislature that has already shown it will act against the sector when ratepayer costs climb. Whether operators respond by curtailing inference loads during peak periods, as Atlantic Council analysts flagged as technically viable, or pass costs on to end customers will shape how other data-center-heavy states design their own frameworks.3,4