Who Pays? The Cost Question at the Heart of Rural America’s Energy Future

When hyperscale data centers arrive in a cooperative’s territory, the cooperative has no legal choice but to serve them. The real question is whether the members who’ve been paying their bills for decades end up carrying the cost.

Growth arrives. Someone absorbs it. The question is never whether the cost lands somewhere—it always does. The question is where.

In Part One, BARC CEO Bill Buchanan and Shenandoah Valley VP Jason Carter described what the AI buildout looks like from where they sit: a single hyperscale data center drawing 95% more electricity than Augusta County’s largest manufacturing facility, and a handful of potential facilities that could exceed the entire existing load of Shenandoah Valley’s membership. In Part Two, the conversation turns to who pays for it—and what the people running these cooperatives are doing right now to make sure the answer isn’t simply: everyone.

You Can’t Say No

Most people don’t know this: an electric cooperative has no legal right to refuse service. It doesn’t matter how large the load is. If a customer shows up in a cooperative’s territory and asks to connect to the grid, the cooperative must serve them.

“We’re legally obligated to serve anyone that comes. We don’t have the ability to pick and choose who we serve.”
— Jason Carter, VP External & Member Relations, Shenandoah Valley Electric Cooperative

That obligation is the same principle that brought electricity to rural communities private utilities wouldn’t touch. It is one of the cooperative model’s great strengths. It is also, in the context of hyperscale data centers, its most significant vulnerability—because connecting a facility that draws more electricity than your entire membership requires infrastructure that runs into the tens or hundreds of millions of dollars.

If that cost gets spread across existing members, every farmer and family in the territory pays for something that exists solely because of someone else’s facility.

Building the Protection

Shenandoah Valley Electric is not waiting for that to happen. Jason Carter, who handles the cooperative’s legislative and regulatory work in Richmond, described a proposed new tariff before the State Corporation Commission.

“It’s going to require that they outright own the facilities that it takes to serve them—so that the rest of the cooperative membership doesn’t have to share in that cost.”
— Jason Carter

The logic is straightforward: if you need something extraordinary to connect to the grid, you own what it takes to connect you. The hyperscale customer carries the infrastructure cost that exists because of their facility—not the member who’s been paying a monthly bill for thirty years.

The Costs That Still Trickle Down

The tariff protects against direct connection costs. It does not protect against everything. At the generation and transmission level, costs are already rising in ways that flow downward regardless of what any single cooperative does. Bill Buchanan was direct about it.

“Virginia is a large importer of energy. We’re certainly not seeing less demand. We’re just not seeing an increase in the supply the way we probably need to over time. There are some costs that are going to trickle down and get the end user.”
— Bill Buchanan, CEO, BARC Electric Cooperative

Jason Carter was equally honest about what the next two to five years look like for his members. The cooperative hasn’t needed significant rate adjustments in a decade. That is unlikely to continue.

“The cost of doing business for us has just risen over the years. I do think it’s fair to say in the next couple of years, we’ll have to see some of that happening.”
— Jason Carter

What They’re Working For

Both men were asked what they wanted their members to take from this. Jason Carter’s answer didn’t reach for comfort. It reached for something more durable.

“We don’t forget who we work for. While we can’t make 100% of the people happy 100% of the time, we can make every effort 100% of the time to give people an answer.”
— Jason Carter

In a cooperative, that isn’t a slogan. The members own the system.

Bill Buchanan, 35 years in the industry, closed on something unexpected—not anxiety, but something closer to opportunity. He described the possibility of a more distributed data center future, smaller facilities that work with rural systems rather than overwhelming them, as something he’s watching with genuine interest.

There is a question underneath everything these conversations described. When infrastructure gets reshaped by forces moving faster than regulation, faster than planning cycles, faster than the grid itself—who is responsible for the people caught in the middle?

The cooperatives didn’t create this problem. But they will be the ones standing between what’s coming and the members who depend on them.

What’s Ahead

In Parts Three–Five, we talk to Jon Judah—digital strategist, Georgetown professor, and Bath County High School graduate—about what’s driving this buildout from the inside.

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This reporting is supported by the Listening Post Collective, with funding from the John D. and Catherine T. MacArthur Foundation through Internews.