Virginia Gov. Abigail Spanberger asked state regulators on Oct. 19 to require a six-year freeze on residential electricity rates and triple customer bill credits before approving a proposed $67 billion merger of Dominion Energy and NextEra Energy.
In testimony filed with the State Corporation Commission on behalf of the governor and Virginia Chief Energy Officer Josephus Allmond, energy economist Richard McCann said the companies have not met the legal standard for approval.
Under Virginia law, the commission must find that a utility transfer will not impair or jeopardize “adequate service to the public at just and reasonable rates.”
McCann said the commission should reject the merger unless the companies agree to the additional conditions or offer alternatives.
“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.
Speaking to reporters on Oct. 20, Spanberger, a Democrat, said the deal in its current form “is not nearly good enough for Virginia or for Virginians.”
She called her conditions aggressive but realistic.
“A rebate without a rate-hike freeze, you are going to raise rates and then give a rebate that could—net—still be painful for the Virginians who get their electric bill,” she said.
She said the proposal freezes rate increases only. If rates would otherwise fall, the commission could still review them and lower them, she said.
Dominion and NextEra announced the all-stock merger in May and asked the commission to approve it in July.
Dominion’s Virginia utility serves about 2.7 million customers, according to the commission’s order setting hearings in the case.
NextEra, based in Juno Beach, Florida, owns Florida Power & Light.
The companies have offered $2.25 billion in bill credits across Virginia, North Carolina, and South Carolina, with about $1.78 billion expected to go to Virginia customers, according to the commission.
For a typical Virginia household, that works out to $10 a month.
A later company filing extended the credits from two years to four, according to the governor’s testimony.
The companies have also pledged to keep customers from paying any merger-related costs, protect Dominion jobs for 18 months after closing, and make Richmond a second corporate headquarters.
They told the commission the combined company’s size and purchasing power would help lower long-term costs.
The governor’s testimony calls for no increase in residential base rates through the first three biennial rate reviews after the merger closes.
It also asks for a $29 monthly credit for four years, funded at a level equal to the $6.52 billion fee in the merger agreement.
Other proposed conditions include stronger protections against shutoffs, a shift in how costs are divided between customer classes that McCann said would cut the residential share by 25 percent, and a separate company, walled off from other customers, to build clean energy for large data centers.
McCann also asked the commission to recommend that lawmakers lift the state’s cap on rooftop solar.
Spanberger said the last proposal is meant to keep data center demand from raising costs for households.
She said the companies have not provided the numbers behind the savings they expect from the merger, which makes any promises hard to enforce.
The commission’s staff also recommended on Oct. 19 that regulators reject the merger as proposed.
In testimony, staff said the deal would expose Dominion’s Virginia utility to “the additional financial and business risks of NextEra’s unregulated, competitive businesses.”
They listed 57 conditions the companies should meet for approval, including protections for the Virginia utility if NextEra goes bankrupt.
Staff advise the three-member commission but do not decide the case.
Spanberger intervened in the case in August, becoming the first Virginia governor to do so at the commission, according to her office.
Dominion and NextEra did not respond to requests for comment from The Epoch Times by publication time.
