Bipartisan Legislation Extends Capped Rate Protection
Through 2010
RICHMOND, Va. - Virginia Gov. Mark Warner announced Thursday
that he has signed Senate Bill 651 into law. The centerpiece of the legislation
was a proposal from the governor and attorney general that keeps retail electricity
rates capped in Virginia until Dec. 31, 2010.
"This law sends a strong signal that Virginia is moving
forward with the restructuring of the electricity market and is committed to
securing a robust energy future for our customers," said Thomas F. Farrell
II, Dominion president and chief operating officer. "It allows restructuring
to continue in Virginia in a careful, methodical and deliberative way, all while
saving customers money."
The Virginia Electric Utility Restructuring Act, as amended
by SB 651, now guarantees stable prices for Dominion Virginia Power customers
for the next 6½ years. The 2004 General Assembly voted decisively to
keep the company's capped base rates, which cover all costs except fuel, in
place through the end of 2010. The extension will provide more time for development
of the Restructuring Act's goal of robust, competitive retail markets for the
supply of electricity. As part of Virginia's efforts to restructure the electric
industry, the company's base rates are capped—essentially frozen—at
1993 levels.
The law also holds the company's fuel rate at its present
level until July 1, 2007, after which it can only be adjusted once more for
the 3½-year period ending Dec. 31, 2010. Prior to SB 651, Dominion could
seek an annual adjustment in the rate that customers pay to purchase fuel used
at the company's electric generating power stations.
With strong support from Warner, Attorney General Jerry Kilgore,
and a broad-based coalition of industries and associations, the Senate passed
the bill, 29-10. It was then amended and passed overwhelmingly by the House
of Delegates, 68-32. The Senate accepted the House version, 31-8.
SB 651 also:
Ends wires charges on July 1, 2007. Wires charges are set
by the SCC and are collected from customers who choose another supplier. It
helps Dominion recover investments made while it was expected to serve all
customers.
Expands local government options to form buying groups,
or aggregations, to save money on electricity for their citizens.
Promotes the construction of new generation in the southwest
Virginia coalfield region.
Sets up procedures to make it easier for many large commercial
and industrial consumers to switch electricity suppliers.
Dominion is one of the nation's largest producers of energy
with an energy portfolio of more than 24,000 megawatts of generation. Dominion
also serves 5.3 million retail energy customers in nine states. For more information
about Dominion, visit the company's Web site at www.dom.com.
