BY CHARLIE PAULLIN

(VM) – Dominion Energy Virginia customers would see no increase in base rates for electric service over the next two years under an agreement between the utility and ratepayer, environmental and other groups announced Tuesday evening.

In addition to maintaining current base rates — the primary component of customers’ electric bills, based on how much power they use — the settlement would increase the profit level Dominion is allowed to earn from 9.35% to 9.7% and require that $15 million be credited to customers by the end of September 2024.

The Office of the Attorney General, State Corporation Commission staff, Appalachian Voices, the Data Center Coalition, the Department of the Navy, Google, Harris Teeter, Walmart and the Virginia Committee for Fair Utility Rates all signed onto the agreement, which must still be approved by the State Corporation Commission to go into effect.

Dominion Energy Virginia President Ed Baine in a statement described the proposal as “fair and reasonable.”

The settlement proposal follows sweeping legislation passed by the Virginia General Assembly this year to overhaul the state’s system of electric utility regulation.

Prior to the legislation, the State Corporation Commission reviewed Dominion’s rates and earnings every three years. Under the new law, reviews will occur every two years.

Additionally, the legislation required that Dominion’s profit margin be set at 9.7% for the next two years — an outcome reflected in Tuesday’s agreement — and that the utility roll $350 million worth of riders, which are added to customer bills to cover the costs of specific projects, into base rates.

This year’s review found that Dominion’s profit level over the past three years was 9.04%, below the 9.35% mark the SCC authorized during its last review. That level fell within a range known as an earnings collar. According to state law in place for the last decade-plus, if earnings exceeded the upper limit of that collar, the utility had to issue refunds; if they fell below the lower limit, rates had to increase. If earnings were within the collar, rates would go unchanged.

The collar was used for the last time in this case before new legislation gets rid of it. In the future, regulators will compare earnings directly against the profit level and set future rates as they see fit.

Several groups involved in this year’s rate review did not sign onto the agreement but are not opposing it. They include the Virginia Poverty Law Center, which has praised steps Dominion has agreed to take to be more transparent about disconnection practices but wants the utility to provide more payment plan options with longer terms to help low-income customers struggling to pay their bills.

“I think they missed an opportunity to work with their customers,” said Dana Wiggins, director of consumer advocacy at the Virginia Poverty Law Center.

The commission will review the agreement and is expected to make a decision early next year.