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Dominion Pursues Another Rate Hike

Utility Requests 6.9% Increase for Costs And Boost to Profits

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Washington Post Staff Writer
Wednesday, April 1, 2009; Page B01

RICHMOND, March 31 -- Dominion Virginia Power is seeking to raise electricity rates 6.9 percent during the next 14 months to pay for equipment, salaries, plant construction and conservation projects.

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The request comes a year after the state's largest energy provider raised rates by 18 percent to cover fuel costs, the largest one-time rate increase in three decades.

Virginians, already confronting the economic downturn, would face a phased-in increase between September and January.

"This is one more issue that low-income folks have to worry about in this economy," said the Rev. C. Douglas Smith, executive director of the Virginia Interfaith Center for Public Policy, which logged many complaints about last year's increase.

Before Dominion won approval for last year's boost, the average home electric bill was $91. If the Virginia State Corporation Commission approves this one, the average monthly bill will hit $116 by May 2010.

"I know 6.9 percent is going to be tough for some people," said Dominion President David Heacock. "But this will allow us to keep our rates as low as possible into the future. It's a long-term investment."

Dominion, which serves nearly 2.4 million homes and businesses statewide, including 800,000 customers in Northern Virginia, filed the request with the three-member regulatory panel Tuesday afternoon.

Even with the increase, Dominion customers will pay, on average, less than customers across the nation, according to the Edison Electric Institute, an association of U.S. shareholder-owned electric companies that represents about 70 percent of the nation's electric power industry.

Institute spokesman Jim Owen described Dominion's request as "quite modest."

"One wants to be sensitive to any pain out there, but it's a relatively mild increase,'' he said.

Gas and electric bills have been rising in Maryland and the District since rate caps imposed with deregulation were lifted, starting in 2004.

Customers of Baltimore Gas and Electric were hit with the biggest increase, 72 percent, in 2006. The average bill for Pepco customers in Montgomery and Prince George's counties jumped 86 percent between June 2005 and June 2008, officials with the utility said. The increase was 65 percent for customers in the District. Maryland's average Pepco bill was $168 in January.

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