Dominion Energy must change how it allocates transmission costs so that large new electricity users, including data centers, pay directly for the infrastructure their connections require. The Virginia State Corporation Commission set the requirement in an order filed July 31.
The commission ordered a mandatory contribution in aid of construction, known as a CIAC, covering the substations and transmission lines that connect direct connect facilities to the grid. Dominion has 90 days from the date of the final order to file an amended line extension policy in a new docket.
The case grew out of Dominion's proposed increase to its Rider T-1 charge, a line item that recovers transmission investment, as the utility sought to recoup about $1.5 billion. Regulators approved an amended version of the company's 12 coincident peak demands allocation factor and trimmed the proposed monthly increase for a typical residential customer from $2.90 to $0.94, a reduction of 67.5 percent.
The order also shifts allocation between customer classes. The commission wrote that the minimum demand adjustment lowers the residential class allocation factor by 2.84 percent and raises the GS-4 class factor by 4.33 percent. The GS-4 rate class covers large commercial and industrial accounts that demand at least 500 kilowatts and take power directly from the grid.
Google and Amazon testified during the hearings and asked that any construction contributions remain voluntary. The commission made the payments mandatory.
Michael Barber, a senior energy infrastructure policy analyst with the Piedmont Environmental Council, called the ruling a step in the right direction and said his group expects wide attention on Dominion's next filing. The commission signaled it may later weigh whether direct assignment should extend to upstream transmission costs or to the GS-5 class covering users of 25 megawatts or more.
Source: Utility Dive - https://www.utilitydive.com/news/dominion-energy-scc-transmission-costs-data-center/827693/