- Residential customers would pay 5.5 percent less due to reduced fuel and generation construction costs
RICHMOND, Va., Feb. 27, 2015 /PRNewswire/ -- A typical Dominion Virginia Power residential customer could expect to see an overall reduction of 5.5 percent in electric rates beginning in April.
"This is good news for family budgets and Virginia businesses," said Robert M. Blue, president of Dominion Virginia Power. "With the passage of Senate Bill 1349, sponsored by Sen. Frank Wagner of Virginia Beach and signed into law by Gov. Terry McAuliffe on Tuesday, our customers will receive immediate savings beginning with their April bills."
The bulk of the reduction stems from the new state law that gives consumers the benefits of lower fuel costs immediately and protects them from potential price spikes related to federal mandates to reduce carbon emissions. In the fuel filing made today, Dominion asked the Virginia State Corporation Commission to approve a reduction related to fuel costs beginning April 1 rather than waiting until July 1. This will result in a $6.12 per month reduction in the typical residential bill for a customer who uses 1,000 kilowatt hours of power. Commercial and industrial customers could realize a savings of about 7 percent and 10 percent, respectively.
Also scheduled to take effect April 1 is an additional decrease of 28 cents to a typical monthly residential bill that reflects reductions in generation construction costs associated with the Bear Garden and Warren County power stations, Virginia City Hybrid Energy Center and the conversion of three former coal plants to biomass. These reductions are related to filings made last year. With these additional reductions, the typical residential monthly bill would decline a total of 5.5 percent from $115.95 per month to $109.55 per month, making rates 18.8 percent below the national average of $134.90.
The company noted that one reason for the lower fuel costs is the recent construction of highly efficient natural gas-fired power stations. Bear Garden Power Station, a gas-fired, combined cycle facility in Buckingham County, went into commercial operation in May 2011. Warren County Power Station, a larger facility, entered into commercial operation in December 2014. Another gas-fired combined cycle facility in Brunswick County is expected to go into commercial operation in May 2016.
Monthly bills are largely made up of base charges plus fuel charges. The fuel portion is passed through at no markup or profit. Other rate adjustments for transmission and generation projects can fluctuate up and down. The base rate portion accounts for approximately 60 percent of the residential bill. Under SB 1349, base rates will be frozen through 2019 to protect customers from certain costs the company may incur to comply with stricter federal regulations on carbon emissions, as well as any costs to make repairs and restore service after a major storm or other severe event.
For more information on Dominion Virginia Power's rates, visit www.dom.com/varates.
Dominion (NYSE: D) is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 24,600 megawatts of generation, 12,400 miles of natural gas transmission, gathering and storage pipeline, and 6,455 miles of electric transmission lines. Dominion operates one of the nation's largest natural gas storage systems with 949 billion cubic feet of storage capacity and serves utility and retail energy customers in 12 states. For more information about Dominion, visit the company's website at www.dom.com.
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SOURCE Dominion Virginia Power
For further information: Le-Ha Anderson, (804) 771-6115, Le-Ha.Anderson@dom.com, Bonita B. Harris, (757) 857-2700, Bonita.B.Harris@dom.com, Chuck Penn, (703) 796-9308, Charles.Penn@dom.com