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Henrico Mandates Power Savings Amid 25% Rate Hike

Published Jul 4, 2026
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Summary:
  • Electricity rates for Henrico County and other VEPGA members jumped 25% on July 1, 2026.
  • The increase will cost Henrico's government and schools an extra $5 million next fiscal year.
  • More than a quarter of all U.S. data centers sit in Northern Virginia, driving up energy demand.

Henrico County employees are being asked to turn off lights, shut down computers, pull blinds closed, and unplug chargers to save energy.

The Rate Shock

County manager John Vithoulkas announced the change in a June 26 email to county employees.

Vithoulkas added that the county anticipates "more rate increases for electricity in the years ahead."

To cut power use, Vithoulkas instructed staff to turn off lights when leaving, shut down computers, close blinds, and unplug chargers.

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Each county department must find ways to reduce expenses by 3% in next fiscal year's budget. Vithoulkas compared the request to the county's efforts during the Great Recession. "Those of you who have been here long enough will recall the many cost-saving measures we implemented to help navigate the Great Recession more than 15 years ago," he wrote. "We are seeing this same innovation and creativity as each department seeks ways to reduce expenses by 3% in next fiscal year's budget."

Why Data Centers Drive the Hike

Although Vithoulkas did not directly mention the rapid growth of data center construction in Virginia as a cause, a 2023 report from the Joint Legislative and Audit Review Commission of Virginia (JLARC) found that the boom in data center construction across the state has substantially driven up electricity demand. JLARC also warned that the rising energy use from data centers is expected to raise system costs for all customers, not just data centers.

JLARC observes that as Northern Virginia reaches its capacity, central Virginia regions such as Richmond are taking in new construction and emerging as a center for new facilities.

This surge in data center construction places immense strain on the state's power grid, prompting utilities to raise rates across the board. The strain has also spurred discussions about expanding transmission lines and building new power plants, though no immediate solutions are in place. For Henrico, the additional $5 million cost will likely force cuts in non-essential programs and delay capital projects. The county is also exploring renewable energy options and efficiency upgrades to mitigate future hikes, though no specific plans have been announced.

According to county officials, these belt‑tightening measures are necessary to offset the immediate financial impact while longer‑term solutions are evaluated. The county is also considering partnering with other VEPGA members to negotiate better rates or invest in community solar projects, but these discussions are preliminary.

Budget Cuts and What's Next

All counties belonging to VEPGA, encompassing most Virginia towns and cities north of Richmond, are subject to the 25% hike.

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