SCC rejects Dominion’s proposed profit rate and drops it to 9.2 percent

Business

RICHMOND, Va. (WAVY) — The State Corporation Commission has rejected a proposal by Dominion Energy setting its profit rate at 10.75 percent.

Instead, the SCC approved a return on equity (profit) rate of 9.2 percent, the SCC announced in a news release Thursday.

“The return on equity is effectively the allowed profit that Dominion’s shareholders receive on their investment in Dominion’s equity,” the release said.

Electric customers will see impacts to two future parts of their bills.

It will change the future adjustment clause causes, which is where Dominion collects from its customers money for capital projects.

“In an annual report to the General Assembly last August, the SCC reported that Dominion is planning new capital expenditures of more than $12 billion between 2019 and 2023. If the capital expenditures are approved by the Commission, Dominion is eligible to collect a return on equity on the projects through its Virginia customers’ rates,” the release said.

The return on equity figure will also be used during the 2021 review of Dominion Energy’s earnings on base rates between 2017 and 2020.

The SCC said Dominion’s proposed rate of 10.75 percent did not represent the “actual cost of equity” in the marketplace. It added the proposed rate was not consistent with public interest.

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