By Matt Leonard
Capital News Service
RICHMOND – The House gave final approval Thursday to a bill that freezes Dominion Virginia Power’s base rate for five years but prevents the state from forcing the company to reimburse customers if the utility earns excessive profits.
Senate Bill 1349 passed the House on a vote of 72-24 with two abstentions. It now goes to Gov. Terry McAuliffe, who hasn’t said whether he will sign it into law.
The bill caused substantial debate while working its way through the Virginia General Assembly. Dominion assured the public and legislators that the bill would keep rates low and help the state comply with new federal regulations, others think Dominion could use the bill to avoid state regulation and boost its profits.
When the bill passed the Senate, Sen. Chap Petersen, D-Fairfax, called it a “major victory” for power companies and expressed concern over the effect on customers. Meanwhile, Dominion has been circulating press releases that say, “SB 1349 enables Dominion’s residential customers to benefit from a rate reduction of about 5 percent this spring.”
Under the current regulatory structure, the State Corporation Commission conducts biennial reviews and can make Dominion refund customers if it finds that the utility has earned excessive profits.
Under the legislation, the reviews would be suspended. The bill has been amended to give the SCC the ability to look into the financial standing of Dominion at any time, but refunds would not be an option.
While Dominion’s base rate – which makes up just over half of customer’s bills – would be frozen, electric bills still could rise if the company increases fuel charges or other riders.
Dominion officials said the U.S. Environmental Protection Agency’s Clean Power Plan – which requires states to reduce carbon output by various amounts by 2030 – will be a burden on the company and Virginia. They said that they could be forced to close power plants to comply and that SB 1349 would make sure shareholders, not customers, shoulder the resulting costs.
After the House vote, Del. Terry G. Kilgore, R-Scott County, told the Richmond Times-Dispatch that the bill would not affect customer bills.
“People said in 2007 when we did re-regulation that rates would skyrocket. It didn’t happen,” Kilgore said.
Del. Monty Mason, D-Williamsburg, agreed that the bill would be good for customers.
“I kept looking … for some nefarious, underlying story,” Mason told The Daily Press of Newport News. “I did a bunch of research for it. I didn’t find it.”
How They Voted
Here is how the House voted Thursday on SB 1349 (“Electric utility regulation; suspension of regulatory reviews of utility earnings”).
Floor: 02/12/15 House: VOTE: PASSAGE (72-Y 24-N 2-A)
YEAS – Adams, Albo, Anderson, Austin, BaCote, Bell, Robert B., Bloxom, Bulova, Campbell, Cline, Cole, Cox, Davis, DeSteph, Edmunds, Fariss, Filler-Corn, Fowler, Garrett, Gilbert, Greason, Habeeb, Head, Helsel, Herring, Hester, Hodges, Hugo, Ingram, James, Kilgore, Knight, LaRock, LeMunyon, Lindsey, Lingamfelter, Loupassi, Marshall, D.W., Mason, Massie, McClellan, McQuinn, Miller, Morefield, Murphy, O’Bannon, O’Quinn, Orrock, Pillion, Plum, Pogge, Poindexter, Preston, Ramadan, Ransone, Robinson, Rush, Rust, Scott, Sickles, Spruill, Stolle, Taylor, Torian, Toscano, Tyler, Villanueva, Ward, Watts, Wright, Yancey, Mr. Speaker – 72.
NAYS – Bell, Richard P., Berg, Byron, Carr, Futrell, Hope, Joannou, Keam, Kory, Krupicka, Landes, Lopez, Marshall, R.G., Minchew, Morris, Morrissey, Peace, Rasoul, Simon, Sullivan, Surovell, Ware, Webert, Wilt – 24.
ABSTENTIONS – Jones, Leftwich – 2.
NOT VOTING – Farrell, Yost – 2.