RICHMOND — State regulators on Friday denied a new request from Dominion Virginia Power to keep some financial information secret during an upcoming public review.
Dominion’s request came just weeks after the General Assembly took away the State Corporation Commission's authority to order customer rate cuts or refunds through 2022.
The new request is opposed by Attorney General Mark R. Herring (D), as well as environmental and customer advocates. They argue that Dominion is going back on its promise to continue the normal inspection of its books even with the new legislation, which allows it to skip certain financial reviews that sometimes lead to rate cuts.
Dominion President Robert M. Blue has argued that the legislation was necessary to protect consumers from the cost of implementing new federal regulations of coal plants. He and Dominion lobbyists have also said that the company will continue to open its books to state regulators.
“Now Dominion wants to hide the very financial information that would allow the SCC and the public to determine the cost of implementing the EPA rule and the extent to which Dominion is overcharging its customers,” said Glen Besa, Virginia director of the Sierra Club.
On Friday, the SCC, which regulates utilities in Virginia, ruled against Dominion’s latest request and ordered the company to submit a complete financial filing in time for its 2015 financial review.
Dominion spokesman David Botkins said the SCC approved a similar waiver in 2011, when all participants agreed the information was unnecessary. The company does not plan to appeal the latest decision, he said.
“The commission did not grant that request, and we will comply,” he said.
Herring, the Sierra Club and the Virginia Committee for Fair Utility Rates opposed Dominion’s motion.
The new law, which Gov. Terry McAuliffe signed last month, frees Dominion from routine financial audits that sometimes lead to rate refunds or reductions for customers. Opponents objected generally to the lack of protections for consumers, but also to the law not preventing Dominion from requesting rate increases even as state regulators are blocked from demanding cuts when overcharging or underestimation of costs warrant it.
As the bill worked its way through the General Assembly, Blue responded to criticism that the measure would shield Dominion’s books from public scrutiny.
“Nor would Dominion’s books be closed to SCC inspection, as some contend,” Blue said in a letter posted on the company’s Web site. “The base rate review scheduled for this year would go on. Beyond that, we would continue to provide the SCC with full access to our financials.”
Dominion argued that complying with a federal proposal to regulate greenhouse-gas emissions from power plants could cost billions of dollars and possibly force coal plants to close.
The bill easily passed both chambers, and McAuliffe signed it Feb. 24.
Three days later, Dominion asked for the “partial waiver,” which would have allowed it not to disclose forecasting information during its 2015 review, which under the new legislation will be its last for seven years. The company argued that the information would be irrelevant because the new legislation frees the company from financial reviews until 2022.
During a biennial financial review, the SCC sets the amount of profit Dominion can make. If the profit exceeds that amount in one cycle, the SCC can order a refund to customers. If it exceeds that amount in consecutive two-year cycles, the SCC can order a rate reduction.
In its motion, Dominion argued that there is no need to spend “significant time and resources to develop and analyze” the documents and supporting testimony, when the new law says base rates will be temporarily frozen.
The company said the new law limits the 2015 analysis to a “review of the company’s earnings” for 2013 and 2014, and a determination of whether credits are due to customers.
Information related to “forward-looking adjustments to determine the company’s projected costs and revenues” and information “that otherwise relate to a change in base rates” are irrelevant, the company said.
SCC staff members, in a March 9 letter to commissioners, said the agency needs to document Dominion’s projected earnings to assess the company’s ability to absorb the potential costs of complying with the Environmental Protection Agency rules, as well as severe weather and natural disasters.
They argued that the new law does nothing to change the 2015 biennial review reporting requirements. And even if it did, the law does not take effect until July 1. Dominion’s filing is due three months earlier, on March 31.
“The Commission, all participants in the proceeding, and the public interest will benefit from a complete set of filing schedules accompanying the 2015 biennial review,” the SCC said.