Dominion taps EVLO for Data Center Alley storage projects

Dominion Energy and Hydro-Quebec subsidiary EVLO are teaming up on the deployment of three separate grid-scale storage projects in Virginia, the pair announced today.

The three projects are located in southeast and south central Virginia, where massive amounts of infrastructure to support the country’s artificial intelligence boom is both currently online and in the works — hence the region's moniker of “Data Center Alley.” In total, they will offer more than 300 megawatt-hours of capacity, and are set to be commissioned in 2025 and 2026.

Dominion, which has more than 50 discrete data center customers, is forecasting around 15 additional gigawatts of data center load by 2040. The utility has more than 50 substations in construction for data centers alone, according to data center lead Steve Blackwell, and is currently fielding up to 50 GW of load letter requests. 

Managing that growth alongside Virginia’s mandate for a carbon-free grid by midcentury is requiring the utility to plan for a patchwork of generation, including new natural gas peaker plants, and further out, small modular reactors.

Battery energy storage systems, like those set to be deployed by EVLO, are another key element of that patchwork. The new projects, which were first announced in September, won’t directly power data centers, EVLO CEO Sonia St-Arnaud told Latitude Media, but are key to ensuring reliable clean power in the region as AI load expands.

“Energy storage demand continues to rise to enhance grid resilience and optimize peak load management to face additional power requests from data centers,” St-Arnaud said, nodding also to loads like electric vehicle charging. Utility interest in energy storage solutions like those EVLO offers, she added, is increasing as they better understand the potential of batteries to address a significant increase in power demand.

Of EVLO’s three projects in Dominion’s territory, one will be sited at a facility microgrid, and another will be a standalone storage project. The third, a solar PV project at “a major transportation hub,” will be the state’s largest battery energy storage project, with 225 MWh of capacity.

The collaboration to bring those projects online started several months ago, St-Arnaud said, and in its early days involved scoping and then engineering upgrades requested by Dominion, including fire safety enhancements.

Despite sector-wide uncertainty post-election, St-Arnaud isn’t concerned about EVLO’s decision to expand its operations into the U.S. from Canada. AI-driven demand for grid-scale storage isn’t dependent on federal policy initiatives, she said, such as potential changes to tax incentives in the Inflation Reduction Act and the Chips Act. 

“AI data centers are placing significant pressure on energy grids, and we believe front-of-the-center solutions need to play a role to support the sector’s growing demands while also enhancing grid resilience for the surrounding communities,” she added.