Henrico County, Virginia, is urging its employees, including school staff, to reduce electricity use due to anticipated power cost increases. Starting July 1, electricity expenses for government and school facilities are expected to rise nearly 25%, totaling an additional $5 million in the next fiscal year.
In a June 26 email, County Manager John Vithoulkas informed employees of the imminent increase in electricity rates. He also warned of further hikes in the coming years. Henrico, home to numerous data centers, is facing rising fuel costs, though these have not been explicitly linked to data centers.
Vithoulkas emphasized the need for collective energy savings by suggesting actions such as turning off lights, shutting down computers, adjusting blinds, unplugging unused appliances, and minimizing space heater usage. He highlighted that a single space heater could cost the county up to $300 annually in electricity. He noted that conserving energy allows for reinvestment into staff and community services.
The Henrico Citizen reported that the electricity rate increase affects not only Henrico but also around 170 members of the Virginia Energy Purchasing Governmental Association. This group negotiates electricity contracts with Dominion Energy for government entities.
Henrico Communications Director Ben Sheppard described Vithoulkas’s energy-saving email as both fiscal and environmental stewardship.
Virginia’s Data Center Expansion
Virginia hosts the world’s largest concentration of data centers. According to the National Association of Counties, the state contains 35% of all known hyperscale data centers. The Joint Legislative Audit and Review Commission reported that data center costs might elevate residential electricity bills significantly by 2030 and 2040.
The utility rate structures currently in place are not designed to handle large cost increases due to new infrastructure needed for data centers. Data centers in Northern Virginia consumed nearly 2 billion gallons of water in 2023, with a 63% increase since 2019. Loudoun County, renowned as the “Data Center Capital of the World,” has 53.3 million square feet of data centers either operational or under development.
The Brookings Institution highlighted that data centers contribute to rising residential electricity prices as they require upgrades to the transmission and distribution infrastructure. Electricity costs have risen 42% since 2019, compared to a 29% increase in the overall Consumer Price Index.