On this page · 14 sections
- Status check on 12 November 2026
- What the SCC approved
- GS-5 terms at a glance
- Who lands in GS-5, and who does not
- How a Northern Virginia power request works now
- What it costs: a worked example in US dollars
- What it means for colocation tenants in Northern Virginia
- What it means for cloud and AI infrastructure buyers
- Other proceedings that stack on top
- Decision table: if you are X, do this
- How Virginia's approach compares with the UK
- Checklist for Northern Virginia buyers
- How eCorpIT can help
- References
Summary. Dominion Energy Virginia's new Rate Schedule GS-5 takes effect on 1 January 2027. The Virginia State Corporation Commission (SCC) created it in its 25 November 2025 final order in Dominion's biennial review, Case No. PUR-2025-00058. GS-5 covers customers with 25 MW or more of measured or contracted demand on a contiguous site and a load factor of at least 75%. Customers that take initial service and sign an electric service agreement on or after 1 January 2027 get a 14-year contract, which can include a ramp of up to four years, and collateral of $1.5 million per MW that established credit can cut by up to 70%. Minimum demand charges are 85% of contracted distribution and transmission demand and 60% of generation demand. They continue after year 14, and leaving early triggers an exit fee for the remaining minimums. Two pieces are still missing on 12 November 2026: a GS-5 rate sheet in Dominion's filed tariff, last revised on 1 November 2026, and the direct-connect transmission charge the SCC ordered in July 2026. The practical effect is take-or-pay power. Contract only the megawatts your IT ramp will use, and carry the same discipline into colocation leases.
About this article. For data centre developers, colocation operators and tenants, and cloud and AI infrastructure buyers with capacity in Dominion's Virginia territory. We checked every term on 12 November 2026 against the SCC's final order and news release, the SCC's Rider T1 order of 31 July 2026, Dominion's May 2026 GS-5 report and filed tariff, FERC's 9 October 2026 PJM order and UK government policy papers. The SCC website blocks access from our location, so we read its documents through Internet Archive copies captured between 1 and 3 November 2026. This is general information, not legal, regulatory or investment advice, and no vendor paid for inclusion. Researched with AI assistance and reviewed by our editorial team.
Status check on 12 November 2026
The rules are approved; the prices are not. The class, the 1 January 2027 start, the 14-year term, the minimum demand charges and the collateral terms are all in the SCC's final order. Dominion's filed tariff index, revised on 1 November 2026, and its business rates page list GS-4, Schedule 10 and the market-based rate schedule but no GS-5 schedule, so the price per kW and per kWh is not yet public. Two related pieces are pending in separate SCC proceedings: the direct-connect transmission charge and the large-load queue rules. Expect the rate sheet close to the effective date.
What the SCC approved
Dominion proposed the class in its 2025 biennial review to allocate costs more precisely for customers with very high demand and load factors. The SCC agreed while cutting the overall request. It approved base-rate increases of $565.7 million for 2026 and $209.9 million for 2027, against requests of $822 million and $345 million, and raised the allowed return on equity from 9.7% to 9.8%, short of the 10.4% Dominion sought. The SCC said the large-load minimums are meant to shield other ratepayers from the cost of building infrastructure for data centres.
The order also shows why more change is coming. In Dominion's class cost study, the customers who will form GS-5 earned an overall per-books return of 6.28% in 2024, the lowest of any class except outdoor lighting, while the remaining GS-4 customers earned 20.75%. The SCC told Dominion to bring alternative cost allocation methods to its next biennial review and to its next transmission rider filing. Amazon, Google, Microsoft, Iron Mountain Data Centers and the Data Center Coalition were among the parties that filed briefs.
GS-5 terms at a glance
Every term below comes from the SCC's final order; Dominion's May 2026 report restates the core ones.
| Term | GS-5 rule | Why it matters to a buyer |
|---|---|---|
| Threshold | 25 MW or more measured or contracted demand on a contiguous site, plus a measured or expected load factor of 75% or more | Most large single campuses qualify |
| Contract term | 14 years, which can include a ramp of up to four years with at least 20% growth a year | A long commitment from the first building |
| Distribution and transmission minimum | 85% of contracted demand for each | You pay for reserved wires whether or not tenants arrive |
| Generation minimum | 60% of contracted demand, excluding PJM capacity costs | A lower floor on the supply side |
| After year 14 | Minimum charges continue | The floor does not end if you stay |
| Exit | Fee equal to the outstanding minimums for the rest of the term, subject to capacity reassignment | Leaving early is priced in |
| Reductions | Up to 20% at no cost, plus a further 30% if another customer takes the capacity; each needs 36 months' notice | Some flexibility, but slow |
| Collateral | $1.5 million per MW, up to 70% off for established credit; guarantees and letters of credit allowed; one-fourteenth released a year; cash earns interest | A large balance-sheet item for new campuses |
| Maintenance | Exemptions from the minimums for necessary and planned maintenance | Ask how outages will be documented |
Who lands in GS-5, and who does not
GS-5 applies to Dominion's customer of record: the entity on the electric service agreement (ESA), usually the campus owner or a self-build hyperscaler. A colocation tenant in Ashburn or Manassas is not a Dominion customer and will not get a GS-5 bill. It will feel GS-5 through its lease.
Five details in the order decide exposure:
- Site, not account. Demand at contiguous locations is added together when the minimums are applied, but separate retail accounts are not aggregated.
- Load factor. The 75% test targets steady, round-the-clock loads. A site with a very uneven profile may sit outside the class.
- Signing date. The 14-year term and the collateral apply to customers taking initial service and signing an ESA on or after 1 January 2027.
- Legacy exemptions. Customers served by Dominion before 1 January 2016 are exempt from the minimum demand charges. Customers that, by 1 January 2025, bought supply from a competitive service provider, were on Schedule 10 interruptible service, or had formally told Dominion they would elect either, are exempt from the generation minimum only. New customers that buy from a competitive supplier still pay it.
- One-time step-down. Before GS-5 takes effect, existing customers who will fall under the high-load terms may lower their contracted demand once without penalty.
The minimums are set for the class, not only for new contracts, so existing qualifying customers first served in 2016 or later should expect them from 1 January 2027. The one-time step-down ends when GS-5 starts. Ask Dominion in writing, now, how each of your agreements will be treated.
How a Northern Virginia power request works now
Dominion's May 2026 report sets out the contracting path. Cash calls start years before GS-5 billing does.
- Engineering Letter of Agreement (ELOA). Signing puts the project in Dominion's large-load queue and needs a $250,000 cash payment for engineering and design. If costs run higher, Dominion issues an updated ELOA and asks for more.
- Construction Letter of Agreement (CLOA). Issued once the project has an energisation date, with 90 days to sign. It triggers cash deposits for long-lead equipment such as transformers and switchgear, and full reimbursement of Dominion's costs if you cancel before energisation.
- Electric Service Agreement (ESA). Issued within one year of energisation. This is where the tariff, now GS-5, applies, and collateral is due before the meter is set.
The queue is the real constraint. Dominion says it has given energisation dates to 25 GW of new data centres through 2031 and holds another 45 GW without dates, which it will slot in, broadly first in, first out, as transmission projects are approved. The SCC told Dominion to file its queue process for review in a separate case, and Dominion says 2026 legislation (HB 1151) confirms it can delay service where grid capacity is short.
What it costs: a worked example in US dollars
GS-5 rates are not published, so this example prices the structure per $1 of demand rate, not a real bill. Assume a 60 MW colocation campus in Loudoun County that signs its ESA under GS-5, completes its four-year ramp, and in year six has 40 MW of real peak demand because two tenants left.
Minimum demand charges.
- Distribution and transmission floor: 85% × 60 MW = 51 MW billed against 40 MW used. The unused 11 MW (11,000 kW) is pure cost.
- Generation floor: 60% × 60 MW = 36 MW. Actual demand of 40 MW is above it, so there is no shortfall.
- Each $1 per kW-month of combined distribution and transmission demand rate costs 11,000 × $1 = $11,000 a month, or $132,000 a year, for capacity nobody used.
Exit at the end of year six. Eight years (96 months) remain. The exit fee covers the remaining minimums: 51,000 kW × 96 = 4,896,000 kW-months of distribution and transmission demand, and 36,000 kW × 96 = 3,456,000 kW-months of generation demand. At $1 per kW-month on each, that is $8,352,000, about $8.35 million, before any capacity reassignment reduces it.
Collateral. 60 MW × $1.5 million = $90 million at the full rate. With the maximum 70% credit reduction, the customer posts 30%, or $27 million. One-fourteenth is released each year: $27 million ÷ 14 = about $1.93 million a year.
Right-sizing instead. A 20% reduction (12 MW) costs nothing but needs 36 months' notice. Filed at the start of year three, it takes effect at the start of year six. The distribution and transmission floor falls to 85% × 48 MW = 40.8 MW, close to the 40 MW actually used, and the generation floor to 60% × 48 MW = 28.8 MW.
The expensive mistake under GS-5 is over-contracting, not running a well-sized campus below its peak.
What it means for colocation tenants in Northern Virginia
Your landlord now carries 14-year, take-or-pay power obligations and possibly tens of millions of dollars of collateral. Expect that risk to move into leases. In our view, tenants signing or renewing in 2027 should check six clauses:
- Committed power. Whether your contracted kW becomes a minimum payment, and at what percentage.
- Ramp schedule. Whether your ramp mirrors the operator's ramp of up to four years, or is faster.
- Pass-through. How changes in Dominion's tariff, riders and the GS-5 rate reach you, and whether you can audit them.
- Term. Whether the landlord asks for longer terms to match its 14-year exposure.
- Credit support. Whether you are asked for deposits, letters of credit or parent guarantees.
- Reduction and exit. Whether you can step down capacity with notice, and what happens if another tenant takes it.
Wholesale tenants leasing whole halls should expect the closest pass-through of GS-5 terms; retail tenants in shared halls have less exposure and less bargaining power.
What it means for cloud and AI infrastructure buyers
If you only buy cloud services in Virginia regions, GS-5 does not change your contract. Cloud list prices are not set per utility tariff, and none of the sources we reviewed tie a cloud price change to GS-5. The indirect effects are slower new capacity, because projects must commit capital earlier, and tighter sizing of Virginia expansions. Our Azure East US 3 guide covers one hyperscaler adding an eastern region outside Virginia.
For dense GPU deployments, GS-5 rewards a credible ramp plan. At 100 kW per rack, 250 racks already reach 25 MW, and training clusters tend to run at a high, steady load, so most new AI campuses in Dominion territory will fall into the class. Model the minimums alongside rack density and power distribution choices, such as those in our 800 VDC data centre power guide.
Other proceedings that stack on top
- Rider T1. The SCC's 31 July 2026 Rider T1 order (Case No. PUR-2026-00056), effective for service from 1 September 2026, approved a transmission cost allocation that counts large-load customers at no less than the 85% transmission minimum from 1 January 2027. It also lists the 14-year term among the large-load reforms the SCC has approved.
- Direct-connect transmission. The same order told Dominion to file, within 90 days, a line extension policy with a mandatory contribution in aid of construction (CIAC) for direct-connect facilities: generally the substations and lines that link one large-load customer to the bulk grid. Expected transmission revenue is netted off and the customer pays the rest, and Dominion and SCC Staff must consider how a CIAC could offset collateral. The 90 days ended on 29 October 2026. DataCenterFeed reported that the filing belongs in Case No. PUR-2026-00131, opened on 25 August 2026, and that none had appeared by 22 October. We could not open the docket to check since.
- Cost allocation. The biennial review order told Dominion to develop alternatives to its current method of allocating plant costs for its next biennial review, which will set base rates after 2027.
- PJM. On 9 October 2026 FERC accepted PJM's definition of a large load, built on a 50 MW cumulative peak threshold, and a large-load registry, both effective 12 October 2026. It rejected PJM's other proposals, including an interim resource adequacy service that could curtail new large loads and rules for bringing your own new capacity. PJM capacity prices also feed generation costs; our Three Mile Island restart guide explains how nuclear deals in PJM are structured.
- Ownership. The SCC is reviewing the planned merger of Dominion Energy Inc. and NextEra Energy Inc. in Case No. PUR-2026-00112, with an evidentiary hearing set to start on 17 November 2026. GS-5 is an approved tariff, and nothing we read links the merger to its terms.
Decision table: if you are X, do this
| If you are | Do this | By |
|---|---|---|
| An existing large Dominion customer | Decide on the one-time penalty-free cut to contracted demand; get Dominion's view in writing | Before 1 January 2027 |
| A developer with a CLOA or ESA in progress | Check the ESA signing date against 1 January 2027; model the 85% and 60% floors on your real ramp | Before signing the ESA |
| A developer planning a new campus | Size contracted demand to signed tenant demand, not land capacity; budget collateral at up to $1.5 million per MW | Before the ELOA |
| An operator with tenant churn risk | File 20% reductions early; each needs 36 months' notice | As soon as the risk is known |
| A wholesale colocation tenant | Negotiate the committed-power percentage, ramp, pass-through audit rights and step-down rights | At signing or renewal |
| A retail colocation tenant | Ask your provider how GS-5 changes power pricing and term | First renewal after 1 January 2027 |
| A cloud-only buyer | No contract change; watch new-region timing and capacity limits | Ongoing |
How Virginia's approach compares with the UK
The two markets put the risk in different places. Virginia puts it on the large customer through minimum charges, collateral, exit fees and a long term, so other ratepayers are covered if a campus stalls. The UK forecasts that it needs at least 6 GW of AI-capable data centre capacity by 2030, about three times what it has today, and is offering incentives instead. Its AI Growth Zones policy promises electricity cost reductions from April 2027, subject to legislative timetables, of up to £24/MWh in Scotland, £16/MWh in Cumbria and £14/MWh in the North East, plus connection support. Both still expect operators to carry their own costs: the UK's Data Centre Covenant, published on 28 October 2026, says data centres should cover the energy costs they create so households and other businesses do not pay them. Our UK AI Growth Zones 2027 guide covers the sites. For multinational buyers, the comparison is not only the price per MWh. It is how much capital you must commit, and for how long, before the first rack goes live.
Checklist for Northern Virginia buyers
- By 31 December 2026: list every Dominion site and agreement, its contracted MW and its stage (ELOA, CLOA or ESA).
- By 31 December 2026: decide on the one-time penalty-free reduction for existing agreements, and get Dominion's written view on which GS-5 terms apply to each.
- January 2027: download the GS-5 rate sheet when it appears in Dominion's tariff, and price your floors.
- First quarter of 2027: re-run tenant ramp forecasts and file any 20% reduction early, given the 36-month notice.
- First quarter of 2027: review colocation contracts for pass-through, committed power and step-down clauses.
- Through 2027: follow the direct-connect CIAC docket, the queue case, the NextEra merger case and Dominion's next biennial review.
How eCorpIT can help
eCorpIT is a Gurugram-based technology organisation, founded in 2021, assessed at CMMI Level 5 and MSME certified, with senior-led engineering teams working across AWS, Microsoft and Google platforms. We help infrastructure buyers compare colocation, cloud and hybrid options and plan connectivity between Northern Virginia sites and cloud regions through our data centre and cloud networking services. Talk to us at /contact-us/.
Last updated: 12 November 2026.
