RICHMOND — The State Corporation Commission (SCC) has approved a new rate rider for Dominion Energy Virginia to recover a portion of costs spent to meet state and federal environmental regulations. Known as Rider E, the rate adjustment clause will take effect on or before November 1, 2019.
Since 2007, Virginia’s two largest electric companies generally recover the cost of providing service, plus a reasonable return, through three bill components – base rates, a fuel charge, and rate adjustment clauses, also known as rate riders. The approval of Rider E means there are now 15 riders, including the fuel rate, paid by residential customers of Dominion Energy Virginia.
Initially, Rider E will pay for certain environmental projects, including cleaner disposal of coal ash, at several coal-fired power plants – Mount Storm Power Station in West Virginia, Clover Power Station in Halifax County and two units in Chesterfield County (5 & 6).
The Commission denied recovery of environmental costs for two other Chesterfield units (3 & 4). The Commission found that “Dominion has not established that the cost incurred … was reasonable and prudent at the time such cost was incurred.” The record showed the company made the decision in June 2015 to invest approximately $18 million in long-term environmental compliance for units it expected to retire or retrofit within five years.
The two Chesterfield units were placed into cold storage in December 2018 and permanently retired in March 2019. The Commission said the investment was for units “… not providing benefits to retail customers. In addition, because these units are retired, the investment is not currently necessary to comply with federal regulations.”
The Commission’s final order establishes the method for recovering approved environmental expenses. The company has been directed to calculate and file its Rider E tariff within 30 days.
Case Number PUR-2018-00195