Dominion Energy Virginia Proposes New Rates for Reliable, Clean Energy
In separate filings with the Virginia State Corporation Commission (SCC), Dominion Energy Virginia has proposed adjustments to its base and fuel rates to ensure continued delivery of reliable, affordable, and increasingly clean energy to its customers. If approved, these rate changes will mark the first base rate increase since 1992, reflecting economic shifts, inflationary pressures, and the company’s commitment to modernizing its infrastructure.
Proposed Rate Adjustments
Dominion Energy Virginia has requested base rate increases that will impact residential customers incrementally. The proposal includes an $8.51 monthly increase in 2026 and a $2.00 monthly increase in 2027 for a typical residential customer. Over the past decade, Dominion Energy’s residential rates have risen at a pace approximately 40% lower than the rate of inflation, demonstrating the company’s efforts to maintain affordability despite rising operational costs.
The requested increases account for inflationary pressures since 2023, when the company filed its last biennial case. These pressures include heightened costs for labor, materials, and equipment—such as cables, wires, transformers, and power generation infrastructure. The rate adjustment also supports necessary investments to reliably serve a growing customer base as energy demand continues to rise.
Commitment to Reliability and Customer Support
“We’re focused on providing exceptional value for our customers every single day,” said Ed Baine, President of Utility Operations at Dominion Energy Virginia. “Outside of major storms, we deliver uninterrupted power 99.9% of the time, and we’re significantly reducing storm-related outages as well. This proposal allows us to continue investing in reliability and to serve our customers’ growing needs.”
Recognizing the financial burden on some customers, Dominion Energy Virginia has reaffirmed its commitment to supporting those in need. The company’s Energy Share program provides extensive bill assistance, including free home energy efficiency upgrades designed to lower energy consumption and reduce monthly expenses.
Fuel Rate Adjustments and Power Capacity Costs
To enhance rate stability, Dominion Energy Virginia is proposing to shift power capacity costs from the base rate to the annual fuel rate. These costs, determined by PJM—the regional electric grid operator—are assigned to Dominion Energy Virginia based on increasing power demand across the region. The proposed change, coupled with extended cold weather in January 2025 and rising fuel commodity prices, is expected to result in a $10.92 monthly increase in the fuel rate for a typical residential customer.
This total includes the scheduled expiration of a $3.99 fuel credit from a prior fuel case. Importantly, Dominion Energy does not earn a profit from fuel or power capacity costs, ensuring that these adjustments reflect actual market conditions rather than corporate gains.
If approved, the new fuel rate will take effect on July 1, 2025, while the revised base rates will be implemented on January 1, 2026, and January 1, 2027.
Addressing High Energy Users and Consumer Protections
In addition to these rate changes, Dominion Energy Virginia has proposed a new rate class specifically for high energy users, including data centers. This classification aims to balance the increasing energy demand from such facilities with fair cost distribution across all customers. The proposal includes consumer protections ensuring that high-energy users pay the full cost of their service, preventing stranded costs from being passed on to other ratepayers.
Under the proposed framework, high-energy users would be required to commit to a 14-year payment agreement for their requested power, even if their actual usage declines. This measure ensures financial stability and cost predictability for both the company and its broader customer base.
Economic and Environmental Considerations
Dominion Energy Virginia’s proposed rate adjustments align with broader industry trends, as utilities nationwide grapple with rising costs, aging infrastructure, and the shift toward cleaner energy sources. While traditional power generation methods remain essential, investments in renewable energy, grid modernization, and energy storage solutions are critical for long-term sustainability.
Additionally, the proposal supports the company’s ongoing clean energy transition. Dominion Energy Virginia has been actively expanding its renewable energy portfolio, including wind, solar, and battery storage projects, as part of its commitment to achieving net-zero emissions. The rate adjustments will facilitate continued investment in these initiatives, ensuring a more resilient and environmentally responsible power grid.
Public and Regulatory Review
As with all rate adjustment proposals, the SCC will conduct a thorough review, allowing stakeholders—including consumers, advocacy groups, and government officials—to provide input. Public hearings and comment periods will be scheduled to ensure transparency and consumer participation in the decision-making process.
While no rate increase is ever welcomed without scrutiny, Dominion Energy Virginia’s proposal reflects a strategic balance between maintaining affordability, enhancing reliability, and investing in a cleaner energy future. Customers are encouraged to explore available energy efficiency programs and assistance options to mitigate the impact of potential rate changes.
