Dominion Energy and the Virginia State Corporation Commission last week began a multiday hearing to evaluate a proposed energy rate increase for homeowners.

The proposed energy cost increase is part of a biennial review that could see homeowners paying a combined $21 more per month on their energy bill. 

These costs will be split, with an initial rate increase of $8.51 per month starting Jan. 1, 2026, and another $2 per month the following year. Dominion has also proposed a nearly $11 increase in fuel rates for homeowners. 

As it currently stands, Dominion’s household power bills remain below the national average, according to the U.S. Energy Information Administration. 

The VSCC began its hearing on Sept. 2 to evaluate this proposal. 

“Primarily, the fundamental reason why we’ve proposed new electricity prices is because electricity costs significantly more today than it did two years ago,” said Dominion Energy spokesperson Aaron Ruby. 

Additionally, power demand has grown at historic levels. 

“We set 10 all-time records this year for single day power demand in Virginia,” Ruby said. 

Virginia uses more energy than it can generate, and leans on the regional energy grid for additional support, according to the U.S. Energy Information Administration. 

As a result, Dominion is putting funds toward creating new energy sources. 

Dominion’s Coastal Virginia Offshore Wind farm, a $10.7 billion project, aims to bring power to more Virginians as demand increases. It will generate enough power for 660,000 homes and businesses when it’s finished next year, according to Ruby. 

“It’s a big part of our … strategy to reliably serve growing demand,” Ruby said. “We’re building the largest offshore wind project in the country off the coast of Virginia Beach.” 

A similar, nearly finished project off the coast of Rhode Island was recently shut down by the Trump administration. Other projects had funding pulled by the Department of Transportation, according to WHRO. 

When asked if Dominion’s project could also be affected, Ruby declined to comment, stating that he would not address hypotheticals. 

Data centers are at the forefront of this demand increase, not homeowners or offices. Residential use accounts for one-third of all energy consumption. The commercial sector, which includes data centers, accounts for 56% of all energy use in the state. 

This type of usage has skyrocketed in the state in recent years, while residential use is at a 20-year lowpoint, based off of a recent data visualization from the Virginia Public Access Project. 

Concerned citizens submitted hundreds of comments opposing the rate increase. 

“As a residential ratepayer, I urge the SCC to protect consumers like myself from unfairly subsidizing the exploding energy demands of data centers,” stated one comment, though many others echoed the sentiment. 

Dominion also proposed a new rate class for high energy users, such as data centers, with the goal of protecting the average customer from “stranded costs.” 

A majority of the data centers are concentrated in Northern Virginia, which is also projected to have 37% of the state’s population in the coming years, according to the Weldon Cooper Center for Public Service at the University of Virginia. 

Environmental advocates are concerned by the resources data centers require and project even higher consumer costs. 

“A single facility can use the same energy as up to 80,000 households,” said Lee Francis, chief program and communications officer with the Virginia League of Conservation Voters. “A recent study showed that if we don’t take action, data centers could drive up Dominion electric bills by more than $400 a year by 2040.” 

Lower-income and fixed-income residents already struggle with energy costs. 

Nonprofit organization project:HOMES helps individuals and families secure and maintain affordable housing. They provide varying services like weatherization to help lower energy bills for households that meet the income threshold, according to Bryan Burris, vice president of energy conservation programs with the organization. 

An energy auditor is sent to assess the homes of approved applicants and then the organization determines “the most cost-efficient, cost-effective upgrades that would help the client,” Burris said. That could mean anywhere from a 15% to 30% reduction. 

The VSCC hearing could stretch through the week, with a decision not expected until December, according to the Virginia Mercury.