Virginia officials approved a $207 billion [1] two-year spending plan in June 2026 that introduces a first-of-its-kind energy tax on data centers.
The legislation seeks to balance the rapid growth of artificial intelligence infrastructure with the state's energy stability and resident affordability. As AI data centers increase power consumption, the tax is designed to ensure the tech industry contributes to the costs of maintaining the electrical grid.
Governor Abigail Spanberger (D-VA) said she is emphasizing an affordability agenda while discussing the budget amendments. The spending plan was finalized amid a high-pressure timeline, with lawmakers approving the measures one day [2] before a potential government shutdown.
Other reports indicate the budget was approved with less than 48 hours [3] remaining before the start of Virginia's new fiscal year. This narrow window ended a months-long impasse within the General Assembly regarding how to fund the state's priorities ahead of the 2026 midterm elections.
Spanberger said the energy tax addresses the specific crisis created by the energy-intensive nature of modern data centers. By targeting these facilities, the administration aims to prevent rising energy costs from being passed on to average Virginia consumers.
The budget total of $207 billion [1] covers a wide range of state services, and infrastructure projects. The timing of the approval varied across reports, with some citing June 22 and others citing June 29, 2026, as the final date of passage.
“Virginia officials approved a $207 billion two-year spending plan”
Virginia's decision to tax data center energy marks a significant shift in how states manage the infrastructure requirements of the AI boom. By shifting the financial burden of grid upgrades from taxpayers to the companies driving the demand, Virginia is creating a potential blueprint for other states facing similar energy crises as the tech industry expands.
