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SB 1197

Electric cooperative subsidiaries; customers exceeding 90 megawatts demand.

2025 Regular Session Introduced by Creigh Deeds

Virginia law now permits electric cooperatives to form subsidiaries serving industrial customers exceeding 90 megawatts demand, expanding market access and potential competition effective July 2025.

Acts of Assembly Chapter text (CHAP0598)
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Bill Summary · SB 1197

Legislative bill overview

SB 1197 allows electric cooperatives in Virginia to establish subsidiaries that can serve large commercial and industrial customers with electricity demand exceeding 90 megawatts. This represents an expansion of cooperative authority beyond their traditional service territories and customer base. The bill became effective July 1, 2025, following gubernatorial approval.

Why is this important

Large industrial customers currently have limited options for power procurement in Virginia and may face higher costs or service restrictions. This legislation could increase competition in wholesale power markets, potentially lowering rates for major industrial consumers while allowing cooperatives to diversify revenue streams and grow their operations beyond residential and small business customers.

Potential points of contention

  • Market concentration concerns: Creating subsidiary structures might allow cooperatives to bypass existing regulatory oversight designed to protect consumers and ensure fair competition in electricity markets
  • Rate impact on existing members: Profits from serving mega-industrial customers through subsidiaries could be directed away from traditional cooperative members or used inconsistently, potentially affecting rates for residential customers
  • Regulatory ambiguity: The bill's framework for subsidiary governance, profit allocation, and oversight mechanisms between parent cooperatives and subsidiaries remains unclear and could create compliance challenges

Compiled from official sources — confirm details with the bill’s official record.

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