Virginia re‑joins RGGI, carbon surcharge set to lift residential electricity bills
Governor Abigail Spanberger directed Virginia to rejoin the Regional Greenhouse Gas Initiative (RGGI) in July 2026, reinstating a carbon allowance surcharge that Dominion Energy says will raise residential electricity bills beginning March 2027.
The decision undoes former Gov. Glenn Youngkin’s 2024 withdrawal, which his administration claimed saved consumers almost $1 billion over two years, and it accompanies an energy plan that critics say will add additional fees, regulations and mandates, potentially increasing costs for ratepayers for decades.
RGGI is a multi‑state cap‑and‑trade program that requires fossil‑fuel power plants to purchase allowances for carbon‑dioxide emissions. Allowance prices have climbed from $9.30 per ton five years ago to $37.65 per ton in 2026, according to state Sen. Glen Sturtevant. Dominion Energy’s director of regulation, Robert Hines, testified to the Virginia State Corporation Commission that the surcharge will appear on bills starting in March 2027, before any rebates are applied.
"Five years ago, RGGI’s carbon price was $9.30 a ton. Today it’s $37.65," Sen. Sturtevant said, noting the rapid rise in costs for consumers.
The broader energy plan also proposes to raise or eliminate the cap on net‑metering credits, limit data‑center developers from building their own natural‑gas plants, and require utilities and regulators to assess zero‑carbon alternatives before committing to long‑lived fossil‑fuel facilities. Critics argue these measures would shift the cost of efficiency programs and electrification incentives to all ratepayers, even those who do not directly benefit.
Analysts estimate that the RGGI surcharge could add roughly $13 per month to a typical residential bill, on top of Dominion’s previously projected $11‑month increase for its 2026 rate adjustment. The combined impact could push average household electricity costs higher at a time many Virginians are already facing inflation pressures.
The policy shift also raises concerns about Virginia’s economic competitiveness. Neighboring states such as North Carolina and Florida, which have not adopted similar carbon‑pricing mechanisms, may appear more attractive to businesses and data‑center investors.
The State Corporation Commission is slated to review the surcharge and related provisions later this year, and its decision will determine whether the projected cost increases are implemented as outlined in Spanberger’s plan.
