Energy

Policy of the Commonwealth; data centers. Provides that it is the policy of the Commonwealth to encourage the responsible operation of data centers in the Commonwealth while supporting grid reliability, affordability, and the deployment of renewable resources. The bill provides that in furtherance of this policy, the Commonwealth shall (i) promote coordination between data centers, state agencies, and regional grid operators to share information on energy usage, interconnection timelines, and barriers to rapid deployment of renewable and flexible energy resources; (ii) incentivize data centers to participate in demand response programs, implement energy storage and management systems, and leverage automated technologies to reduce peak demand and support grid stability; (iii) encourage flexible energy practices that allow data centers to adjust energy consumption in real time in alignment with available renewable generation; (iv) ensure large-scale data centers pay their fair share of infrastructure investments, mitigating impacts on residential and small business ratepayers; (v) require data centers to report water and aggregated energy usage, sustainability measures, and participation in grid support programs to appropriate state and federal agencies; and (vi) promote cybersecurity, physical security, and supply chain security measures to protect Virginia data center operations from foreign adversary access or compromise.

Retail sales and use tax; exemption for data centers. Requires a data center operator, in order to be eligible for the existing data center sales and use tax exemption, to (i) beginning July 1, 2027, not use co-located generating facilities that emit carbon dioxide, other than backup generators; (ii) beginning July 1, 2029, contract for a certain percentage of energy, capacity, and renewable energy certificates from clean energy resources, as evidenced by a certification from the State Corporation Commission, or contracts and service agreements; (iii) utilize only non-carbon dioxide-emitting backup power sources, such as energy storage resources, beginning on a date dependent on the data center's initial service date; and (iv) demonstrate, for any new data center issued a final certificate of occupancy or its equivalent on or after January 1, 2030, or for any data center operator seeking an amended memorandum of understanding, sufficient investment in environmental management and energy efficiency measures to provide system-wide benefits, as defined in the bill. Finally, the bill has a delayed effective date of July 1, 2027.

Virginia Brownfield and Coal Mine Renewable Energy Grant Fund. Increases from $100 per kilowatt of nameplate capacity from renewable energy sources that are located on brownfields to $200 per kilowatt of nameplate capacity from renewable energy sources that are located on brownfields the grant amount a project developer can receive from the Virginia Brownfield and Coal Mine Renewable Energy Grant Fund. This bill is a recommendation of the Commission on Electric Utility Regulation.