How to think about energy

Data centers are energy-intensive facilities, often requiring the same amount of electricity as tens of thousands of homes, depending on size and configuration.

A single large data center campus can demand hundreds of megawatts at full buildout, reflecting the growing scale of cloud computing, artificial intelligence, and digital services that support everyday life and business operations.

Since 2019, more than 100 data centers have connected to Dominion Energy’s grid with capacity of more than 5 gigawatts (GW) of electricity, or enough power to roughly 3-4 million homes at peak usage.

Twenty-seven percent of Dominion Energy’s output powered data centers as of 2025.

Powering these data centers require a reliable, resilient, and increasingly diverse energy mix.

Electricity remains the primary source of power for data centers from a variety of sources:  nuclear, natural gas, solar and other renewable energies.

As demand for digital services grows, thoughtful energy planning is essential to balance reliability, speed to market, cost, and environmental goals.

From an energy standpoint, location matters. Data centers sited near existing electric transmission lines and substations can often be powered more quickly, reducing both development timelines and infrastructure costs. Less developed areas — particularly those outside dense residential or urban cores — tend to have fewer grid constraints and permitting challenges, which can further accelerate power delivery.

Because data centers typically scale their energy use over time, utilities work with developers to align infrastructure buildout with a facility’s planned growth in demand.

Providing electric service to a data center is not a one-size-fits-all process. Smaller facilities, generally those requiring less than 50 megawatts, can often connect to existing electric distribution infrastructure and come online within one to two years.

Larger projects frequently require new transmission lines and substations, which both add complexity and time. In many cases, utilities deploy “bridging solutions” that allow data centers to begin operations with interim power while permanent infrastructure is constructed — in parallel with local permitting and facility construction.

Throughout this process, utilities work closely with customers to develop site-specific short- and long-term power plans that match operational needs.

Who pays?

Data center operators in Virginia are paying their own way for their electrical needs. Under a recent ruling by the Virginia State Corporation Commission, a new utility rate class was established specifically for large data center customers.

This framework ensures that the costs of new electric infrastructure and generation needed to serve data centers are borne by the data center customers themselves — rather than being shifted to residential or small business ratepayers.

Rising electricity use and costs in Virginia aren’t solely or directly caused by data centers.

A recent Washington Post analysis notes that although data centers do consume large amounts of electricity and represent a growing share of demand in Virginia (the world’s largest data center markets), overall electricity prices are influenced much more by broader grid costs — including fixed infrastructure costs for poles, wires, and system maintenance — rather than just increased demand from data centers alone. That article points out examples where rising demand didn’t correspond to higher prices and explains that electricity pricing doesn’t behave like ordinary commodity markets.

Other energy uses

Natural gas and renewable energy also are essential components of the data center energy ecosystem.

Natural gas supports grid reliability by fueling power plants that can respond quickly to changes in demand, helping stabilize electricity supply during peak usage or when renewable generation fluctuates.

Natural gas also presents a significant opportunity to support data center growth in the next several years. Increasingly, natural gas providers are seeing strong interest from large commercial users — particularly data centers — in deploying on-site, behind-the-meter generation that operates independently of the electric grid, allowing facilities to reliably meet their own energy needs.

Renewable resources — such as solar and offshore wind — are increasingly integrated into data center power strategies, either through direct procurement, power purchase agreements, or utility-scale generation. Together, these resources contribute to a more flexible, resilient energy system capable of supporting the rapid growth of data centers while advancing sustainability objectives.

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