SCC approves Dominion settlement, refunding $330M to customers
9.35% rate of return set, along with $50M in annual rate reductions
The State Corporation Commission approved a settlement with Dominion Energy Virginia in which the Richmond-based utility will refund customers $330 million and reduce rates annually by $50 million, the SCC announced Thursday.
For a residential customer using 1,000 kilowatt hours per month, the rate reduction will result in a decrease of about 90 cents per month, beginning within 60 days of the SCC’s order, and residential customers will receive about $67 in refunds over the 2022-2023 period, the statement said. The utility will refund $255 million over a six-month period and $75 million over three years, according to an earlier announcement by Dominion.
As part of the settlement, the SCC authorized a rate of return on common equity (ROE) for Dominion of 9.35%, which will be used for rate adjustment clauses and for Dominion’s next triennial review.
Last month, Dominion Energy Inc. announced it had come to a comprehensive settlement agreement with the SCC and the state attorney general’s office after the utility brought in nearly $1 billion in excess profits between 2017 and 2020, according to SCC staff and the attorney general. Dominion’s return on equity rate for shareholders has been 9.2%, and it previously requested a return of 10.8%. The 9.35% rate is included in the compromise. Under the federal Grid Transformation and Security Act, enacted in 2018, the $50 million reduction in rates is the maximum allowed.
Also in the agreement is $309 million in revenue to be used to offset costs of the Coastal Virginia Offshore Wind pilot project off Virginia Beach, deployment of smart meters and a customer information platform.
“We thank all parties to the case for working cooperatively for a good outcome for customers, an even more reliable grid, economic development and the environment,” Dominion Energy Virginia President Ed Baine said in a statement Thursday.