• Dominion has 90 days from the 31 July order to propose changes to its line-extension policy for transmission facilities serving large loads
  • The commission has not yet set the final customer contribution or rules for infrastructure that later serves other users

The fact

Virginia's State Corporation Commission has ordered Dominion Energy Virginia to propose changes to its line-extension policy for transmission facilities built to serve large new loads such as data centres. Dominion has 90 days from the commission's 31 July final order to file the amendments. The order calls for the utility to address customer contributions for lines, substations and other facilities that would not otherwise be required without the new load.

The commission has not set the final contribution or cost-allocation formula. Dominion's Rider T-1 filing sought to recover about US$1.5 billion in transmission costs and initially estimated an increase of about US$2.90 a month for a typical residential customer. It later revised that estimate to about US$0.94 as its forecast changed. Dominion's next filing must set out how customer contributions would work and how costs should be treated when infrastructure later serves other users.

The assessment

The order changes how transmission costs may be assigned when a large data-centre project connects to Dominion's system. If a new line or substation is needed mainly for one large customer, Dominion's revised policy could require that customer to pay more of the cost upfront instead of recovering it through wider transmission charges.

The harder issue is what happens if that infrastructure later serves other users. A substation or transmission line may initially be built for one campus but later support another customer or become part of the wider network. Dominion will therefore need rules for adjusting the original customer's contribution when other users begin to benefit from the same infrastructure. For BTW readers, the filing will show how much transmission cost a new data-centre project may have to bear before connection and how those costs could be reallocated if the infrastructure later becomes shared.

What to watch

Watch Dominion's filing for the definition of a qualifying large load, the facilities covered by the policy, the method used to calculate customer contributions and any refund or reallocation rules when infrastructure later serves other users. The treatment of shared substations and transmission lines will show how narrowly the new policy assigns costs to individual projects.