Virginians deserved better from senators on electric rates

By Will Cleveland

America’s eyes and hearts turned to Texas last month when a devastating energy crisis brought about by unexpected winter weather left at least 24 people dead and millions stranded without power and water for days. Now, armchair pundits are on the hunt for a scapegoat, even though none of them has all the facts. The reality is that a confluence of multiple failures at multiple levels likely caused the catastrophe, and we will not know the full cause for a long time to come.

One thing the Texas disaster has crystalized, however, is that access to electricity can be a matter of life and death, and a system that prioritizes company profits over safe, reasonably-priced electricity is untenable. Energy prices in Texas erupted last week, and customer bills followed suit. CPS Energy, the utility that serves San Antonio, Texas for instance, recently announced a plan that would have customers paying off one week’s worth of sky-high energy prices over a period of 10 years or more. No one should have to carry 10 years of debt in order to safely heat their homes during a deep freeze, yet that is exactly where Texas energy policy has left its customers — protecting energy company profits at customer expense.

While Virginia does not have Texas’s fully deregulated retail energy market, neither does the commonwealth have a properly regulated regime. In fact, Virginia, much like other southeastern states, has a deeply entrenched utility structure that favors investor-owned monopoly utility shareholders at customer expense. Last year, Virginia passed landmark legislation to decarbonize the power grid while ensuring reliability, but the legislature has missed the other half of the equation, which is to ensure access to that clean energy at a fair price. According to the Virginia State Corporation Commission, Dominion Energy — Virginia’s largest monopoly utility — has not had its retail electricity prices set by regulators since 1992, even though its high prices routinely generate hundreds of millions in excess, unauthorized revenue each year. Those same regulators reported that between 2017 and 2020 alone, Dominion over-charged its customers by more than $500 million, and not a single penny has been returned to customers.

Bipartisan coalition looks to reform Virginia’s system of electric utility regulation

At the same time that Texas’s grid almost collapsed, the Virginia Senate ruthlessly killed five different proposals that would have rebalanced the playing field in favor of the customer. Some of the bills targeted past over-charges, ensuring customers received 100 percent of what they were owed. Others looked to the future, empowering the State Corporation Commission to set utility rates that were just and reasonable while still providing the utility an opportunity to earn its authorized profit margin. Each of these five bills sailed through the Virginia House of Delegates on broad, bipartisan votes but then ran into equally bipartisan opposition from Dominion’s key champions in the Senate. Though from opposing political parties, these legislators continue to march in lock-step when it comes to utility issues — choosing Dominion over their constituents every single time.

The events in Texas hammer home the truth that electricity is a public necessity, not a luxury item, and state policy must prioritize the availability of that necessity at a reasonable price.

Thanks to a handful of state senators, Virginians are unlikely ever to get their money back and the regulator has not regained any of its traditional authority to set fair electricity rates for the future, meaning more overcharges are all but certain. After a year of global pandemic and economic recession, Virginians deserved better.

Will Cleveland is a senior attorney with the Southern Environmental Law Center.