The utility’s proposed merger with Dominion Energy would connect it with data center-rich Virginia. Consumer and clean energy advocates are wary.
By Kathryn Krawczyk, Canary Media
This week, Florida utility giant NextEra Energy — the country’s top renewable energy developer, and a major gas plant builder — announced plans to acquire Dominion Energy, which serves Virginia and the Carolinas. If the firms secure state and federal approvals, they’d become the world’s largest regulated utility and the third-biggest energy company in the U.S.
The colossal consolidation has a clear impetus: data centers. Dominion is tasked with delivering power to what’s known as “Data Center Alley,” but as former U.S. Energy Department leader Jigar Shah told E&E News, the utility has failed to adopt grid enhancements and other technologies that would help it do so. NextEra isn’t scooping up Dominion for that outdated grid; it’s “buying the keys to America’s data center capital,” Shah wrote on LinkedIn.
So what does it all mean for customers? The utilities are promising $2.25 billion in bill credits for Dominion ratepayers, more investments in power reliability, and large-load tariffs to ensure data center demand doesn’t raise residential power bills.
But environmental and consumer advocates are skeptical. NextEra subsidiary Florida Power & Light has a “deeply troubling track record” of alleged “election manipulation, surveillance of journalists, co-optation of civil rights organizations and the use of dark money networks to capture regulators and defeat energy competition,” says the nonprofit Clean Virginia. The Energy and Policy Institute notes that Florida Power & Light customers have faced years of rate increases even as the utility pulls in record profits, and highlights Dominion’s history of massive political spending.
Plus, while NextEra has led the way on building solar and battery storage — tech that can be brought online much more quickly than gas plants — both it and Dominion have gigawatts of polluting fossil-fueled development in the works.
All those concerns will likely come up as the deal seeks regulatory approvals.
NextEra has already been lobbying to get on the Trump administration’s good side, including via inauguration and ballroom contributions. The merger’s toughest scrutiny may instead come from states, which have blocked NextEra’s attempts at acquiring three other utilities over the past few years. With energy affordability concerns and opposition to data centers already rising to a fever pitch, regulators in Virginia and beyond may just keep NextEra stuck in the present day.
