Dominion Power seeks to cut electric rates

Dominion Virginia Power, which delivers power to 839,109 customers in Northern Virginia and 2.4 million statewide, filed a rate decrease request Tuesday that, if approved, would lower a typical residential customer’s bill by $3.70 a month.

The proposed cut in the fuel rate charge would reduce the cost of power for someone who uses 1,000 kilowatt hours per month from $112.05 to $108.35. Business and industrial customers would see greater savings, since the fuel rate makes up a larger portion of their bills.

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Dominion asked the State Corporation Commission that the change take effect Dec. 1.

“While the next adjustment in the fuel charge is not required for another seven months, we believe the circumstances in this case warrant passing along the savings to our customers as soon as possible,” Paul Koonce, Dominion’s chief operating officer, said in a prepared statement. “We recognize that many customers are facing financial challenges in this difficult economy.”

The charge pays for fuel Dominion uses in its power stations to produce electricity, including natural gas, coal and uranium. Milder-than-expected weather and lower commodity gas prices than expected this year led to the request, said Dominion spokesman Chuck Penn. While the utility would have been required to refund any overcharge, that adjustment would not have come until July, Penn said. This request is “a mid-year course correction,” he said.

The utility spends nearly $2 billion a year on fuel and related expenses; this request will return more than $140 million to Virginians.

If approved, Dominion’s residential rates will be 8 percent below the Virginia average, 16 percent lower than both the D.C. area and national average, and 22 percent lower than the East Coast average. Its commercial customers will pay 15 percent below the national average and 17 percent below the D.C. area average, the company said in its filing.