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Virginia Plan Flags Long-Duration Storage for Rising Demand
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Virginia Energy’s 2026 Energy Plan lays out how the commonwealth intends to meet rapidly rising electricity demand while trying to keep power reliable and affordable. The plan puts long-duration storage alongside solar, batteries, advanced nuclear and offshore wind as a longer-term option to firm variable renewables and help avoid steep bill increases. It also quantifies the scale of data-center growth—about 20 gigawatts of projected demand—and flags how electricity costs from that growth could shape grid investments and household bills.
Key takeaways
- Virginia Energy’s 2026 Energy Plan lists long-duration energy storage as part of the state’s longer-term clean-firm portfolio alongside advanced nuclear and offshore wind.
- Serving projected data-center demand could account for roughly half of new systemwide costs under the plan’s moderate growth outlook, or about $200 billion.
- About 17% of Virginia households—more than 550,000—spend over 6% of income on home energy, and utilities project residential electricity prices could rise about 60% for Dominion Energy customers and about 17% for Appalachian Power customers during the next decade.
- The plan estimates the buildout to meet demand and clean-energy goals could require 5,000 to 20,000 construction jobs each year and roughly 20,000 permanent operations jobs.
Table of contents
Why long-duration storage is on Virginia’s list
Virginia Energy projects that the state will need to more than double existing power-generation capacity to meet rising demand and its clean-energy goals. To bridge gaps when solar and short-duration batteries cannot supply power, the plan includes long-duration storage as a source of clean firm capacity alongside advanced nuclear and offshore wind.
Long-duration storage is a class of technologies designed to discharge electricity for many hours, not just minutes, to cover extended periods of low renewable output. The plan treats these systems as a way to reduce reliance on high-cost, high-emission peaking resources and to firm a grid that must absorb large volumes of variable solar and wind.
By listing long-duration storage explicitly, the plan creates a pathway for regulators and utilities to test procurement mechanisms, cost estimates and siting policy that would support multi-hour or multi-day capacity in parallel with the expansion of solar and short-duration batteries.
How data-center growth changes the bill calculus
Virginia Energy’s modeling finds that serving projected data-center demand could account for roughly half of new systemwide costs in a moderate growth scenario, about $200 billion in the plan’s estimate. That concentration of incremental cost is the reason the plan focuses on how new large customers are charged.
The brief notes that an average 1-gigawatt data center pays about $700 million a year for electricity under current cost-allocation rules and that, at roughly 20 gigawatts of projected demand, new data centers could generate about $265 billion in electricity revenue through 2050. The plan argues those revenues could help fund generation and grid investments if cost assignments reflect the grid impacts data centers create.
To limit bill shock for households and small businesses, the plan recommends requiring new large data centers to demonstrate the ability to reduce or shift electricity use during high-demand periods or grid emergencies, and to accept cost-allocation that bears a fair share of grid upgrade costs.
Affordability, grid planning and practical constraints
The plan foregrounds household affordability: about 17% of Virginia households—more than 550,000—spend over 6% of income on home energy. To avoid the utility-projected price rises the plan recommends prioritizing lower-cost generation, energy-efficiency upgrades and better use of the existing grid.
Under status quo utility plans, residential electricity prices could rise about 60% for Dominion Energy customers and about 17% for Appalachian Power customers during the next decade as equipment is replaced and infrastructure is added to serve rising demand. The plan’s suite of recommendations aims to blunt those projected increases but requires regulatory and legislative action to change cost-allocation and procurement.
That reliance on policy change is a practical constraint: deploying long-duration storage at scale will depend on capital costs, permitting, interconnection timelines and whether state and utility frameworks create clear revenue streams for multi-hour resources.
| Topic | Plan detail | Figure |
|---|---|---|
| Projected data-center demand | State projection through 2050 | About 20 GW |
| Electricity revenue from new data centers | Projected cumulative to 2050 | $265 billion |
| Share of new systemwide costs | Moderate growth outlook | Roughly half (~$200 billion) |
| Households facing high energy burdens | Spend >6% of income on home energy | About 550,000 (17%) |
| Utility price projections | Next decade under status quo | Dominion ~60%; Appalachian Power ~17% |
The case for and against the plan’s approach
The case for
- If procurement and cost-allocation change as the plan recommends, revenues from large customers could fund new generation and grid upgrades and limit bill increases for households.
- Long-duration storage could supply multi-hour firming capacity that enables higher shares of low-cost solar and reduces reliance on fossil peakers, lowering system fuel costs over time.
The case against
- If regulatory or legislative changes do not occur, the plan’s cost-allocation goals may not materialize and households and small businesses could shoulder a larger share of grid upgrade costs.
- Deployment of long-duration storage at the scale implied by a more-than-doubled system depends on capital costs, supply chains and permitting timelines that could push costs and delay benefits.
What to be careful about
- Data-center demand growth concentrates incremental grid costs; without changed cost allocation, those costs could be shifted to households and small businesses.
- Long-duration storage technologies face uncertain capital and operating costs and may not reach commercial scale on a timeline that matches projected demand growth.
- Key recommendations require action by regulators, utilities and the General Assembly; failure to act would leave the status quo allocation and procurement frameworks in place.
The bottom line
Virginia’s 2026 Energy Plan places long-duration storage in a practical portfolio of options to meet fast-growing demand while trying to protect household affordability. The plan pairs technical recommendations with policy steps—changes to cost-allocation, procurement and demand-response requirements for large users such as data centers—that are necessary to realize those benefits. Implementation, however, depends on decisions by regulators, utilities and the General Assembly, and the timeline for commercial-scale long-duration storage remains a key uncertainty that will determine how quickly the plan’s affordability goals are met.
What to watch
- Watch for the General Assembly to consider legislation or rule changes on data-center cost allocation; no date has been set.
- Watch for utilities’ integrated resource plans and filings that respond to the 2026 Energy Plan recommendations; no date has been set.
- Watch for Virginia Energy to publish follow-up guidance or procurement frameworks for long-duration storage; no date has been set.
Frequently asked questions
What is long-duration storage and why does Virginia include it?
Long-duration storage refers to technologies that can discharge electricity for many hours to cover extended periods of low renewable output. Virginia Energy’s 2026 Energy Plan includes it as a clean-firm option alongside advanced nuclear and offshore wind to help firm variable solar and reduce dependence on high-cost peaking resources.
How much could data centers add to grid costs or revenue?
The plan’s modeling shows serving projected data-center demand could account for roughly half of new systemwide costs—about $200 billion—and that roughly 20 gigawatts of data-center demand could produce about $265 billion in electricity revenue through 2050, with an average 1-gigawatt center paying about $700 million a year.
Will the plan stop electricity bills from rising?
The plan aims to reduce projected bill increases by prioritizing lower-cost power and efficiency, but under status quo utility plans residential prices could rise about 60% for Dominion Energy customers and about 17% for Appalachian Power customers during the next decade; achieving lower increases depends on regulatory and legislative changes.
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