Virginia Governor Abigail Spanberger wants a six-year rate freeze if the Dominion-NextEra merger is approved, and also wants regulators to raise Dominion's debt share of its capital structure from 48% to 60% to lower its rate of return.
Virginia Gov. Abigail Spanberger, D, has proposed a six-year rate freeze as part of a suite of conditions she says state regulators should impose if they approve a proposed merger between Dominion Energy and NextEra Energy that could create the largest regulated electric utility in the world.
Spanberger's stance comes amid review of the $67 billion merger, which has prompted intense pushback from other state officials and local communities.
"Any proposed merger involving Virginia's primary state-regulated utility must benefit families, small businesses, and Virginia's workforce — not just the shareholders of these multi-billion-dollar corporations," Spanberger said in a statement Monday.
"That's why I am calling for a six-year freeze to Virginians' base residential electricity rates, a tripling of monthly bill credits for ratepayers, and additional commitments to lower energy costs and meet our long-term clean and homegrown energy goals if the State Corporation Commission is to approve this merger," she added.
Expert witness testimony filed by Spanberger's office with the State Corporation Commission outlined a plan to increase monthly bill credits to $29 a month for four years. It also proposed increasing the debt share of Dominion's capital structure from 48% to 60% to lower its rate of return.
The witness, Richard McCann, an environmental consultant with M.Cubed, also called for requiring a "probability of dispatch" cost allocation method, improving disconnection policies and several other energy efficiency and clean energy commitments.
"Mandatory, Comprehensive Enforceability provisions must be imposed to hold the Joint Petitioners fully accountable for any violation of commitments, including the labor and workforce commitments," wrote McCann. "Unless these additional commitments are substantially addressed or alternative solutions are identified, the Commission should reject the joint petition."
The filings coincide with filings from Virginia's attorney general and SCC staff opposing the deal unless terms they propose are also agreed to.
Dominion and NextEra proposed the merger in May, saying it would facilitate a more cost-effective buildout of Virginia's electric grid to serve rising demand from large-load data centers.
The utilities initially proposed customer bill credits amounting to $10 a month for two years. But as pushback mounted, including from Lt. Gov. Ghazala Hashmi, the utilities increased the proposed timeline to four years. The utilities also made assurances for more clean energy, in line with the state's decarbonization law, the Virginia Clean Economy Act.
"As expected in a proceeding of this size and significance, today's testimony reflects a wide range of viewpoints and interests," Dominion and NextEra said in a joint statement following the governor's announcement. "We are reviewing the filings and will address the issues raised through the Commission's established process."
Spanberger plans to hold a call with the media Tuesday afternoon to discuss her proposal.