# Virginia data center expansion and energy impacts

> Live situation record from CLSTR: https://clstr.news/situations/virginia-data-center-expansion-and-energy-impacts
> Updated: 2026-08-18T20:04:00.000Z. Sources: 4. Developments: 2.

The rapid expansion of data centers in Virginia is creating a dual economic impact characterized by significant tax revenue gains and rising utility costs. In Loudoun County, approximately 250 data centers operated by major companies like Amazon, Microsoft, and Google are projected to generate $1.3 billion in tax revenue for fiscal year 2027, accounting for roughly 40% of the county’s total tax revenue. This windfall, driven by taxes on land and computer equipment, has supported public infrastructure and contributed to a 30% reduction in residential property taxes over the last decade.

Local benefits from this influx of capital include the funding of multiple schools, a $102 million recreation center, and a $22 million park conversion of the former James Monroe estate. Additionally, the industry has expanded the local workforce by approximately 15,000 people. Buddy Rizer, the executive director for economic development in Loudoun, noted that residents recognize these facilities as the “primary reason for maintaining low taxes and funding public services.”

Conversely, the surge in electricity demand for AI infrastructure and cloud computing is driving up energy expenses. Fuel costs for Dominion Energy’s Virginia Electric and Power unit are projected to rise from $2.31 billion in 2021 to $4.35 billion by June 2027. This growth has increased reliance on the volatile PJM Interconnection wholesale electricity market. While regulatory filings suggest residential electricity bills could increase by as much as 13%, potential utility bond issuances may cap those increases at approximately 5%.

Political leaders have noted the situation, with Virginia Governor Abigail Spanberger indicating intent to intervene in the regulatory review of the proposed $66.8 billion merger between NextEra Energy and Dominion to advocate for clean energy investments, job protections, and residential power affordability.

## Timeline

### 2026-08-18: Loudoun County expects $1.3B tax windfall from data centers

Loudoun County, Virginia, expects $1.3 billion in tax revenue from 250 data centers next year, helping fund schools and public projects while reducing residential property taxes by 30% over the last decade.

4 sources. https://clstr.news/cluster/virginia-data-center-boom-drives-tax-windfalls-and-rising-utility-costs

### 2026-08-11: Dominion Energy faces rising costs amid Virginia data center boom

Data center growth in Virginia has driven Dominion Energy’s fuel costs up nearly 90% in five years, increasing exposure to volatile wholesale electricity markets.

2 sources. https://clstr.news/cluster/dominion-energy-faces-rising-costs-amid-virginia-data-center-boom

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Cite as: Virginia data center expansion and energy impacts. CLSTR, https://clstr.news/situations/virginia-data-center-expansion-and-energy-impacts