The Bulletin

Norfolk mayor joins Dominion’s push to kill bipartisan utility rate review bill

By: - March 2, 2020 3:53 pm
Dominion Energy's downtown Richmond building. (Ned Oliver/Virginia Mercury)

Dominion Energy, Virginia’s largest electric utility and a major U.S. energy company, is headquartered in Richmond. (Ned Oliver/Virginia Mercury)

Norfolk Mayor Kenny Alexander appeared at a Senate Democratic Caucus meeting in Richmond Monday to advocate against the Fair Energy Bills Act, a proposal being spearheaded by Del. Jay Jones, D-Norfolk, and Del. Lee Ware, R-Powhatan, that is opposed by Dominion Energy.

Alexander’s involvement infuriated Jones, who suggested Monday that his city’s mayor, a former state senator, was intervening on Dominion’s behalf as part of a full-court press to block the legislation — which passed the House with broad bipartisan support — in the Senate.

“They are threatened because their business as usual and their status quo is about to go away,” Jones said.

The legislation, which would set new ground rules for a regulatory review of Dominion’s base rates in 2021, faces a key vote in the Senate Commerce and Labor Committee Monday afternoon.

Del. Jay Jones, D-Norfolk, speaks on the floor of the House of Delegates. (Photo by Ned Oliver/Virginia Mercury)

Virginians’ electric bills include both base rates, which are more directly tied to customers’ actual usage, and rate adjustment clauses (or riders) that utilities can charge for specific projects such as electric line undergrounding or the construction of new power plants. Base rates have gone unchanged for years, even as riders have driven up customer bills, which the State Corporation Commission estimates have risen 25 percent since 2007.

But although the SCC has calculated that Dominion has earned hundreds of millions of dollars more than it is permitted, under current law the utility could potentially avoid refunding most of that. That’s because the 2018 Grid Transformation and Security Act allowed utilities to recoup the costs of grid investments all at once rather than over a number of years, significantly decreasing the amount of money that can be considered overearnings.

By directing regulators to use a different approach, the Fair Energy Bills Act would give the SCC the right to spread those costs out when it conducts the 2021 rate review.

Regulators have estimated that if Dominion’s 2017 overearnings were refunded, the average customer using 1,250 kilowatts per month would see a $9 reduction in their bill, while a refund of 2018 overearnings would reduce the average monthly bill by $7.

In a text message, Alexander said he was looking out for his region and the goal of making Hampton Roads “a hub for the offshore wind industry in Virginia.”

“I am trying [to] consolidate all of the green and renewable energy office jobs and the leadership of these in Hampton Roads,” Alexander said.

Asked why Jones would assume he was working with Dominion, Alexander said he had “no idea,” insisting his only interest in the matter was bringing jobs to his region.

“I don’t come up here for the politics,” Alexander said.

Jones said Alexander contacted him directly to try to convince him to pull the bill from consideration. In response, Jones asked to speak to Dominion CEO Tom Farrell. In a text message exchange Jones shared with the Mercury, Alexander told Jones Farrell “isn’t a registered lobbyist to speak on legislation during session.”

Dominion Energy CEO Tom Farrell. (Ned Oliver/Virginia Mercury)

“Bill Murray assures me that Tom will call you after session,” Alexander said, referring to the company’s senior vice president for corporate affairs and communications.

Alexander said he considered Jones’ request “unusual,” but he passed it along to a local Dominion representative. He added that he had met Farrell during his time in the General Assembly but has “no communication” with the Dominion leader.

In an interview, Jones pointed out that Farrell is, in fact, a registered lobbyist and is free to speak to legislators on a variety of topics.

“I would love to talk about the mechanics of my bill and why their opposition is misguided. But clearly he’s working every lobbyist at his disposal — their phalanx of lobbyists — to kill this bill,” Jones said.

Dominion would not respond to Jones’ accusation, citing its policy of not providing comments to the Mercury.

Staff writer Sarah Vogelsong contributed to this story.

Our stories may be republished online or in print under Creative Commons license CC BY-NC-ND 4.0. We ask that you edit only for style or to shorten, provide proper attribution and link to our web site. Please see our republishing guidelines for use of photos and graphics.

Graham Moomaw
Graham Moomaw

A veteran Virginia politics reporter, Graham grew up in Hillsville and Lynchburg, graduating from James Madison University and earning a master's degree in journalism from the University of Maryland. Before joining the Mercury in 2019, he spent six years at the Richmond Times-Dispatch, most of that time covering the governor's office, the General Assembly and state politics. He also covered city hall and politics at The Daily Progress in Charlottesville.