Virginia HB30 conference report / $0.011 per kWh / July 1 2026 effective date / $600M annual revenue cap / supply-agnostic — utility + co-op + competitive + self-supplied / SCC collection / first return due Sep 2026 / 2-year sunset Jul 1 2028 / Spanberger expected to sign / first-in-the-nation per-kWh data center tax

Plain-English version of what just happened. Virginia is the data center capital of the world. Northern Virginia's Loudoun County alone hosts more data center capacity (~3.5 GW operating, another ~7 GW in the queue) than any other county on earth, and Dominion Energy — the investor-owned utility serving most of NoVa — has roughly half of its total system load going to data centers. The political fight over who pays for the grid build-out has been the dominant Virginia legislative story for two years, with the core dispute being: data centers get a state sales-tax exemption on their IT equipment (estimated at $1.4B-$2B annually), and the cost of new power lines and generation built to serve them has historically been spread across all ratepayers (so residential bills go up to pay for hyperscaler load growth). The 2026 General Assembly session went into special session over this. Three approaches were debated: (1) repeal or narrow the sales-tax exemption (favored by environmental groups, opposed by Dominion + the data center industry + economic-development bureaucrats); (2) make data centers pay for the grid upgrades they cause via a separate rate class at the State Corporation Commission (the SCC already approved this in January 2026 — see prior coverage); (3) introduce a brand-new electricity consumption tax tied directly to kWh consumed. Option 3 is the compromise the budget conferees landed on. It preserves the IT-equipment sales-tax exemption (which is the politically untouchable piece because Dominion + JLARC + Loudoun's economic development office defend it) but adds a new revenue stream tied to actual power consumed. Mechanical details from the budget conference report (HB30, 3-5.24). - **Rate:** $0.011 per kWh of all electricity consumed at each data center in Virginia, charged on a monthly basis. - **Supply source: ALL OF THEM.** The conference language explicitly states the tax applies 'regardless of whether the electricity is provided through an incumbent electric utility, an incumbent electric cooperative, a competitive service provider, or is self-supplied.' This is the critical structural point. A data center cannot escape the tax by building its own on-site gas turbine or signing a behind-the-meter PPA with an SMR developer. Self-supplied power is taxed at the same rate as Dominion-supplied power. That decision was made specifically because the colocation + behind-the-meter generation pattern (Talen-AWS-Susquehanna, Microsoft + Chevron Project Kilby) is now the dominant new-build pattern. - **Revenue cap:** $600M annualized. Any revenue above the cap goes into a special non-reverting fund and is refunded to data center operators pro rata based on their share of tax payments. - **Collection authority:** State Corporation Commission (SCC), not the Virginia Department of Taxation. This is unusual — using the energy regulator to collect a tax — and ties the tax operationally to the SCC's existing rate-design proceedings. - **First return due:** September 2026 (Q3 2026 consumption). - **Sunset:** July 1, 2028. The tax is a 2-year experiment, after which the General Assembly has to re-authorize it. Gov. Spanberger's role and signing posture. Per her June 22 statement: 'This is a compromise proposal — one my administration helped craft — and it builds a strong foundation for further discussions about the future of [the data center] industry in Virginia on issues like environmental and community impact.' She has 7 days from delivery to sign or line-item veto. Expected outcome: clean sign, given her direct involvement in the compromise and her prior public 'I'm not going to break a contract the state has signed' framing of the underlying sales-tax exemption. That means the July 1 effective date is essentially certain to hold.

Primary source · Virginia Mercury — Virginia legislators advance $205B budget including new tax on data centers (Jun 22 2026) + Data Center Knowledge — Virginia approves first-ever data center power tax + Kiplinger + HB30 Conference Report Item 3-5.24 (budget.lis.virginia.gov) + Bisnow — Virginia keeping data center tax breaks adding tax energy use ↗