RICHMOND — The State Corporation Commission (SCC) has approved a new fuel rate for Dominion Virginia Power that will increase an average residential bill by 4 percent. The increase will become effective for electricity used on and after July 1, 2007.

The SCC’s order issued on June 26, 2007, allows Dominion Virginia Power to raise its fuel factor to 2.232 cents per kilowatt hour (¢/kWh) from 1.891 ¢/kWh. A residential customer using 1,000 kWh in a month will see an increase of $3.41 on a monthly bill.

Dominion Virginia Power said the increase was necessary to cover the higher costs of fuel used to generate electricity. In its application, the company projected an annual increase in fuel expenses of approximately $662 million above the current fuel recovery level. However, the company’s recovery of its forecasted fuel cost increase is limited to approximately $219 million in the 12-month period beginning July 1 as the result of legislation passed during the 2007 session of the General Assembly.

Actual fuel expenses not recovered by the newly approved fuel factor, projected to be approximately $443 million, will be recovered through fuel rate cases the company can file in 2008, 2009, and 2010.

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Case Number PUE-2007-00025