Introduction: Affordability Becomes the Defining Energy Question

Energy affordability has become the central challenge shaping Virginia’s clean energy debate as Governor elect Abigail Spanberger prepares to take office with a mandate centered on clean energy and cost containment. Electricity demand in the state is projected to rise sharply over the coming decade, driven largely by the rapid expansion of data centers and broader electrification trends. At the same time, households and policymakers remain highly sensitive to energy costs, particularly as utilities plan major investments in generation, transmission, and grid resilience. Against this backdrop, Virginia’s clean energy discussion has shifted toward cost management, long term planning, and consumer protection rather than narrow emissions targets. This shift sets the stage for renewed attention on policy tools that can support affordability while guiding the energy transition.

Rising Power Demand and a Political Reset Create Momentum for Action

Virginia’s energy system is entering a period of structural change. State analysis has warned of an immense increase in electricity demand, with data centers accounting for a significant share of expected load growth. Meeting this demand through traditional fossil generation alone would expose ratepayers to fuel price volatility and long lived infrastructure costs. At the same time, recent election outcomes have created a political reset in Richmond. Democrats now hold the governor’s office as well as majorities in both legislative chambers, giving lawmakers the ability to advance a coordinated clean energy agenda. This alignment allows policymakers to pair renewable energy expansion, storage deployment, and interconnection reform with a clear focus on keeping electricity affordable as demand rises.

What RGGI Is and Why Virginia Stepped Away

The Regional Greenhouse Gas Initiative is a multistate, market based program that caps carbon dioxide emissions from the power sector and requires generators to purchase allowances for their emissions. Proceeds from allowance auctions are returned to participating states, which can reinvest the funds in energy efficiency, bill assistance, and resilience programs. Virginia joined RGGI in 2021 but exited the program in 2023 under the previous administration. The withdrawal was justified on the grounds that participation increased electricity costs, even though allowance costs represented a relatively small portion of overall power prices. The exit removed a dedicated source of funding for efficiency and affordability programs and introduced uncertainty into the state’s clean energy policy framework.

Why Rejoining RGGI Aligns With an Affordability First Strategy

Rejoining RGGI aligns closely with Virginia’s renewed emphasis on affordability. While the program places a modest cost on power sector emissions, it also generates predictable revenue that can be reinvested to lower energy bills over time. Efficiency upgrades, weatherization for low income households, and demand reduction measures supported by RGGI proceeds directly reduce electricity consumption and peak load growth. As demand from data centers and electrification increases, these investments help avoid more expensive system upgrades and new generation capacity. RGGI also provides a clear planning signal that encourages cleaner and more efficient generation, supporting long term cost stability rather than short term price suppression.

From Withdrawal to Re Entry: A More Durable Energy Framework

The plan to rejoin RGGI under the incoming administration represents a recalibration of Virginia’s energy strategy. Rather than framing the program solely as a climate policy, lawmakers are positioning it as part of a broader affordability and system planning toolkit. Re entry would restore regulatory certainty, provide a stable funding stream for consumer focused programs, and align emissions policy with the realities of rising electricity demand. As Virginia navigates a period of sustained load growth and major infrastructure investment, a durable and cost conscious policy framework will be essential. RGGI fits into that framework by linking long term affordability with clean energy deployment and disciplined market signals.

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