The Virginia General Assembly has introduced House Bill No. 2684, aimed at addressing the financial implications of electric service provision to data centers. Proposed by Delegate Lovejoy on January 16, 2025, the bill mandates that Phase II Utilities develop and submit a plan every two years to mitigate the risk of stranded generation and transmission infrastructure costs that may burden existing customers.

The bill stems from a recommendation by the Joint Legislative Audit and Review Commission, which highlighted concerns regarding the rapid growth of data centers in Virginia and their impact on the electric grid. As these facilities require substantial energy resources, the legislation seeks to ensure that the costs associated with expanding infrastructure to accommodate new data centers do not unfairly fall on current utility customers.

Key provisions of the bill include the requirement for Phase II Utilities to file their plans with the State Corporation Commission as part of their biennial review process. This aims to create a structured approach to managing the financial risks associated with the increasing demand for electricity from data centers.

While the bill has garnered support for its proactive stance on utility cost management, it may face scrutiny from stakeholders concerned about the potential financial implications for existing customers. Critics argue that the bill could lead to increased rates if not managed properly, while proponents assert that it is a necessary step to ensure equitable cost distribution.

The economic implications of HB2684 are significant, as Virginia has become a hub for data centers, attracting substantial investment and job creation. However, the challenge remains to balance this growth with the financial responsibilities of existing utility customers.

As the bill progresses through the legislative process, its outcomes could set a precedent for how states manage the intersection of utility infrastructure and the burgeoning data center industry. The next steps will involve committee discussions and potential amendments as lawmakers weigh the bill's implications for Virginia's energy landscape.