Dominion Energy Virginia on March 31 filed for its first base rate increase in decades, citing pressure from inflation and the need to reliably serve a growing customer base.
The request would raise the typical residential customer’s bill by $8.51/month starting Jan. 1, 2026, and another $2/month starting Jan. 1, 2027, Dominion said in an application filed with the State Corporation Commission (PUR-2025-00058). The new rates would mark the first increase in base rates since 1992. Dominion said its residential rates have increased by 40% lower than the rate of inflation over the past decade.
“We’re focused on providing exceptional value for our customers every single day,” Ed Baine, Dominion president of utility operations, said in a statement. “Outside of major storms, we deliver uninterrupted power 99.9% of the time, and we’re significantly reducing storm-related outages as well. This proposal allows us to continue investing in reliability and to serve our customers’ growing needs.”
The last biennial rate case came in 2023, and since then the company has faced higher costs of labor and materials including cables and wires, poles, transformers and power generation equipment.
In a separate application to the SCC (PUR-2025-00059), Dominion asked to move higher power capacity costs from its base rate to the annual fuel rate that would take effect on July 1 and raise the monthly fuel rate paid by a typical residential customer by $10.92. The higher bills also include the fuel cost from extended cold weather this January and a $3.99 fuel credit from a previous rate case. Dominion just passes through those costs and does not earn a profit on them.
Moving capacity expenses to fuel will increase the fuel factor by $1.98 for the typical residential customer, but it leads to a drop in base rates of $6.22 starting Jan. 1, 2026, according to the firm’s public application with the SCC.
Separating out PJM capacity prices into base rates and energy market costs in its fuel rates predates Dominion’s membership in the RTO and likely would not be done today given how much the company has to pay under the Reliability Pricing Model.
The delays in running auctions also prompted Dominion to make the request as it cannot accurately forecast what the price will be through the end of 2027, with two more auctions yet to run and one that will come after its rate case, it told the SCC.
On top of the new rates, Dominion also proposed creating a new rate class for high energy users that would cover data centers, and ensuring that those high-use customers pay their full cost of service and others are protected from stranded costs. Under the proposal, high energy users would have to make a 14-year commitment to pay for their requested power, even if they use less.
The Piedmont Environmental Council said that because the General Assembly failed to pass any meaningful reforms to how data centers are handled, the SCC’s review of Dominion’s rate case and its integrated resource plan are important to ensuring their growth is handled while keeping prices reasonable and environmental goals within reach. The group said it would work to ensure data centers pay their fair share.
“Virginia is in danger of falling behind and becoming the ‘how not to’ example that other states are using to avoid what has happened here. Ohio, Georgia, Texas, Indiana, Washington and Maryland are doing what Virginia’s policymakers and regulators have failed to do thus far,” PEC President Chris Miller said in a statement. “The SCC has the opportunity to take action now — and ensure data centers won’t overwhelm the power grid, drain statewide water resources and further intrude on areas never meant to be industrialized.”