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Last Updated: April 2007
04/07:
Governor signs SB 1416 which “advances the scheduled expiration of the capped
rate period from December 31, 2010, to December 31, 2008, establishes a new
mechanism for regulating the rates of investor-owned electric utilities, and
limits the ability of most consumers to purchase electric generation service
from competing suppliers. The ratemaking procedure requires the State
Corporation Commission (SCC) to conduct a rate case for investor-owned
utilities in 2009; thereafter, the SCC will review each utility's rates, terms,
and conditions using two 12-month test periods ending December 31, 2010, though the SCC is given discretion to stagger the years in which it conducts such
reviews. In these biennial reviews the SCC will determine fair rates of
return on common equity for the utility's generation and distribution services,
using any methodology it finds consistent with the public interest…Under the
program, a participating utility that meets specified percentage goals for
sales of eligible renewable energy is eligible for a Performance Incentive that
increases the fair combined rate of return on common equity for the
utility…With regard to the ability of customers to purchase generation services
from competing providers, the measure provides that after the capped rate
period ends, only customers whose annual demand exceeds five megawatts will be
permitted to shop.”
Source: Virginia General Assembly
http://leg1.state.va.us/cgi-bin/legp504.exe?071+sum+SB1416
02/07: Legislation backed by the state's dominant power company to pull the plug on the state's experiment with electric utility deregulation was unanimously endorsed by a Senate committee Monday evening. Meanwhile, the House of Delegates gave preliminary approval to a similar but competing version of the "re-regulation" bill that contains some provisions the utility, Dominion Resources, dislikes.
Source: Associated Press authors Larry
O’Dell and Bob Lewis via Dailypress.com
http://www.dailypress.com
01/07: Virginia State Sen. Thomas K. Norment introduced legislation that would replace the state's deregulated electric power market with regulated profits at 7 percent over utilities’ long-term bond costs.
05/06: Governor Tim Kaine signed Senate Bill 262 (SB 262) which initiates the development of a state energy plan and also amends earlier legislation so that Dominion Virginia Power’s fuel rate must be adjusted annually until the rate cap expires in 2011.
Source: Virginia General Assembly
http://leg1.state.va.us/cgi-bin/legp504.exe?061+sum+SB262
09/05: The Virginia State Corporation Commission issued its 2005 status report and stated that little electrical retail competition has developed since restructuring legislation was enacted. The commission states that rules are in place to promote retail choice. However, electricity suppliers still find that there is little economic incentive to enter the retail market.
Source: Virginia State Corporation
Commission
http://www.scc.virginia.gov/division/restruct/history.htm
04/04: Governor Mark Warner signed Senate Bill 651 (SB 651) which extends the retail electricity rates cap through 2010. The bill also allows Dominion Virginia Power to hold its fuel rate at its present level until July 1, 2007, after which it can only be adjusted once more for the 3½-year period ending Dec. 31, 2010. Furthermore, the bill ends wires charges on July 1, 2007, expands local government options to form buying groups to save money on electricity for their citizens, and sets up procedures to make it easier for many large commercial and industrial consumers to switch electricity suppliers.
Source: Dominion
http://www.dom.com/news/elec2004/pr0415.jsp
08/03: The Virginia State Corporation Commission issued its 2003 status report and recommended suspending restructuring in the state. One of the commission’s concerns is that Dominion Virginia Power is earning more than it would under a cost of service program.
Source: Virginia State Corporation
Commission
http://www.scc.virginia.gov/division/restruct/history.htm
12/02: The Virginia State Corporation Commission released an Addendum to the 2002 Status Report on Competition called the Review of FERC’s Proposed Standard Market Design and Potential Risks to Electric Service in Virginia. The report advocates for rebundling of retail rates and service because competition is currently lacking. In addition, the study suggests that if Virginia reverted back to a regulated market, then the State would not be subject to the FERC’s standard market design as long as the State’s jurisdiction was upheld.
12/02: The State Corporation Commission issued an order establishing an investigation into default service for electricity customers. According to an SCC press release, “the staff will develop recommendations for establishing one or more default service programs that will be available by January 1, 2004.”
11/02: The Legislative Transition Task Force issued an order to examine utilities’ stranded cost recovery mechanisms, and convene the Stranded Costs Task Force. The task Force released a stranded costs summary, which includes information on how Virginia utilities currently collect stranded costs from customers. Customers fund stranded cost recovery through “a nonbypassable wires charge” until mid- 2007. The task force is considering two new proposals that would eliminate the wire charges for industrial and commercial customers and halt minimum stay periods. The current rate cap would be lifted so retail customers could pay market-based rates.
11/02: The Virginia State Corporation Commission (SCC) released its 2003 average “price to compare” for Dominion Virginia Power, American Electric Power-Virginia, Allegheny Power and Conectiv. Customers can use the “price to compare” as guide to evaluating offers made by competitive service providers. On January 1, 2003, the final phase of Dominion Virginia Power’s restructuring will take effect, opening retail access to the utility’s residential customers in the Tidewater region. With implementation of this next phase, all customers of Dominion Virginia Power, AEP Virginia, Allegheny Power and Conectiv will have access to competitive energy providers.
11/02: The Virginia State Corporation Commission (SCC) issued a report to the Legislature titled “The Feasibility, Effectiveness, and Value of Collecting Data Pertaining to Virginia’s Energy Infrastructure.” Senate Bill 684 required the SCC to submit a “workgroup study” to the Legislature on this matter. According a SCC press release, the “workgroup study” found that utilities, generators and customers “generally agree that collecting information does not appear to be a problem,” but “the value and effectiveness of collecting the information is more difficult to ascertain,” especially after deregulation.
11/02: Dominion Virginia Power commissioned Chmura Economic & Analytics to conduct a report on how much a residential customer would save during the capped rate period of 1998-2007. The utility’s rates are capped until July 1, 2007. A Dominion Virginia Power press release stated “the average annual savings per residential customer range from $45 to $50 during the capped rate period.”
11/02: The Virginia State Corporation Commission increased the fuel rate from 1.31 cents per kilowatthour to 1.463 cents per kilowatthour for AEP-Virginia effective January 1, 2003. The Virginia Electric Utility Restructuring Act allows the SCC to increase rates for fuel costs even during the rate cap period.
09/02: The Virginia State Corporation Commission released its 2002 Status Report to Governor Warner and the General Assembly. The report states, “At the time of this report, only 2,500 residential consumers and 24 small commercial consumers are using an alternative supplier. The residential consumers that have switched are customers of a competitive provider offering “green” power at a premium to the incumbent utility’s price-to-compare.” Another 750,000 Virginians will have access to retail choice on September 1, 2002. The report concluded no competitive suppliers are offering a rate below the “price-to-compare,” and wholesale market power is still evident.
08/02: The Legislative Transition Task Force of the Virginia Electric Utility Restructuring Act released its 2002 Report. The Task Force considered many proposals to amend the 1999 Virginia Electric Utility Restructuring Act. The AES New Energy and Old Mill Power Company proposal suggested phasing out wire charges, which they consider an obstacle to competition. The Task Force stated that the issue of wire charges would be addressed next year when they examine whether or not the recovery of stranded costs has occurred.
06/02: According to a SCC press release, the commission approved Northern Virginia Electric Cooperative's (NOVEC) retail choice plan; set to begin after July 1, 2002. NOVEC will be responsible for delivering power to Clarke, Fairfax, Fauquier, Loudoun, Prince William, and Stafford counties, and the city of Manassas Park. In Virginia, electric cooperatives have until January 1, 2004, to implement retail choice. NOVEC must file "price to compare" information with the SCC before the plan can take effect. Since cooperatives rely on the wholesale market, "price to compare" rates can differ from month to month.
04/02: Dominion Retail is switching its 19,000 Virginia customers back to Dominion Virginia Power because it "has been unable to locate wholesale power at a competitive price." The company cites wire charges as its main obstacle because customers are required to pay this charge before leaving Dominion Virginia Power. Under Virginia's deregulation law, wire charges must be collected until 2007.
01/02: The State Corporation Commission (SCC) issued the average price to compare rates for each customer class. "The price to compare is the regulated price of generation and transmission of electricity, less any applicable competitive transition charge." Competitive service providers use these rates to determine what it must offer in order to attract customers. Eligible customers must contact their current supplier for the actual rates. According to the SCC's 2002 average "price to compare" chart, overall AEP Virginia has the lowest average rates. However, Dominion Virginia Power has the lowest average rate in the large commercial class. All AEP-Virginia, Allegheny Power, and Conectiv customers became eligible to choose an electric supplier on January 1, 2002. Dominion Virginia Power allowed only its Northern Virginia residential customers and one-third of its non-residential customers to participate in electric choice on January 1, 2002, but it will phase in electric choice by January 1, 2003 for the rest of its customers.
12/01: The SCC issued orders for each investor-owned and cooperative utility to functionally unbundle generation from delivery within each company. Virginia Electric and Power Company and American Electric Power had requested legal separation of generation assets from the rest of the company, but the SCC denied the requested plans, imposing only functional separation at this time. The orders direct each utility to maintain separate divisions along functional lines for the generation, transmission and distribution functions. Customer choice for most customers in the State will begin January 2002 and by January 2004 all customers will be able to choose their supplier for the generation portion of electric service. The incumbent utilities will continue to provide delivery service for all customers and default service for the customers who do not choose an alternative provider. The SCC will set rates for the generation portion of service provided by incumbent utilities, which will be capped during a transition period through 2007. Customers will be able to use this "price to compare" rate when deciding to remain with their incumbent utility or choose a competing supplier for generation. The Virginia Energy Choice web site provides information about the new competitive energy supply market in Virginia.
11/01: The phase-in of retail access in Virginia was issued by the SCC earlier this year. As of January 1, 2002, all customers of AEP-Virginia, Allegheny Power (Potomac Edison), and Conectiv (Delmarva Power), as well as residential customers of Dominion Virginia Power (DVP) in Northern Virginia and 1/3 of DVP's non-residential load throughout its service territory, will receive retail access to competitive electricity suppliers. On September 1, 2002, DVP's residential customers in Central Virginia and another 1/3 of its non-residential load will have retail access. On January 1, 2003, DVP's customers in Eastern/Tidewater Virginia and the remaining 1/3 of non-residential customers will receive retail access. On January 1, 2004, Kentucky Utilities (Old Dominion Power Company) and the 13 electric cooperatives' customers will receive retail access.
10/01: The SCC issued an order regarding customer minimum stay periods (the time a customer must remain with the incumbent utility upon returning from competitive supplier service). When returning to a capped rate or default service after receiving service from a competitive service provider, customers with an annual peak demand of 500 kW or greater will be required to remain with the default supplier a minimum of 12 months. However, if the competitive service supplier leaves Virginia, the minimum stay period will not apply to the affected customers. The complete set of rules governing retail access to competitive energy services including minimum stay periods is located on the SCC's website.
09/01: The SCC staff presented to the 2001 Legislative Transition Task Force the required annual report on the status of development of a competitive retail electricity market within Virginia. According to the report, the pilot programs currently underway in Dominion Virginia Power, American Electric Power, and Rappahanock Electric Cooperative are not as successful as anticipated. Although some customers in Dominion Virginia Power’s area have switched to competitive suppliers, none switched in AEP or Rappahanock’s areas, and no competitive suppliers are currently making offers for service in any area. The report also examines other retail electricity markets in surrounding regions and found most to be under stress and undergoing decreasing participation. The report includes recommendations by interested parties to facilitate competition in retail electricity markets. One suggestion, the elimination of price caps and wires charges, was rejected by the SCC since these mechanisms are intended to protect both consumers and incumbent utilities.
06/01: The SCC adopted rules to advance a competitive energy supply market and protect customers that shop for alternative electric suppliers when the retail market opens in January 2002. The SCC ruled that utilities will be required to provide lists of all eligible customers to competitive service providers. Customers will have the opportunity to have the information withheld, known as the "opt-out" provision. Utilities will also be required to unbundle charges on customer bills into the following components: distribution service, competitive transition charge, electricity supply service, state and local consumption tax, and local utility tax. Bills will also include a customer's monthly energy consumption for the previous 12 months, a "price to compare" for shopping comparison to energy service providers prices, descriptions of charges, and notices of any rate changes. Rules also provide numerous consumer protections and rights to information. The Virginia Energy Choice web site provides information about the progress toward developing a competitive energy supply market in Virginia.
03/01: Senate Bill 1420, a bill concerning the designation of a default supplier and a mechanism for establishing default service rates, was enacted. The bill designates the SCC as the deciding agent for supplier of last resort in a competitive retail market for electricity. Potential suppliers could bid to provide the service, and the SCC can set the rates for default service, based on market rates. Other points contained in the bill: transfer or sale of generating assets would be subject to SCC approval; competitive metering and billing, scheduled for 2002 and 2003, could be delayed; and suppliers would be allowed to recover the costs of implementing competitive metering and billing through tariffs.
12/00: Pilot programs in Virginia have fallen short of full participation, but regulators feel there are enough participants to provide information and experience needed for expanding the projects and eventual beginning of retail competition statewide in January 2002. About 18,000 out of 33,000 eligible participants have switched to competitive suppliers in the Richmond area pilot program. The Northern Virginia area will begin its pilot program on January 1, 2001.
08/00: The State Corporation Commission (SCC) has approved Rappahannock Electric Cooperative's plans for a pilot program. The program will allow 900 customers to choose an alternative power supplier beginning January 1, 2001.
07/00: AEP will begin its pilot program by offering about 8,000 customers retail choice by October 1, 2000. Another 8,000 AEP customers will be added on March 1, 2000. The SCC will establish a "price to compare" by considering the prices at 5 nearby trading hubs and calculating an average of the prices at the two hubs with the highest prices.
07/00: Phase I of Virginia Power's pilot program, Project Current Choice, has begun enrolling volunteers in the City of Richmond and Hanover, Henrico, and Chesterfield counties, and the Town of Ashland. Plan A of the pilot includes over 35,000 small consumers, residential and churchs / synogogues in the above areas. Larger commercial and industrial consumers statewide are included in Plan B, which will allow over 250 million kilowatt-hours of power to be supplied by alternative suppliers. Pilot participants should begin receiving power from alternative suppliers by September 1, 2000. Phase II will enroll small and residential consumers in several Northern Virginia locations. Phase II participants are scheduled to begin volunteering in October 2000 and receive power from alternative providers by January 2001. Phase-in of the entire State is scheduled to begin by January 2002.
02/00: The SCC issued rules for the pilot programs, requesting comments by February 24, 2000. Rappahanock Electric Cooperative filed a plan for a pilot program with the SCC. And, AEP may expand its planned pilot program to include as many as 8,000 customers initially. Pilot programs are expected to begin in AEP and VA Power territories by spring 2000.
12/99: Virginia Electric and Power Company’s (VEPCO) website includes a new page on its forthcoming pilot program for a competitive electricity market. The program, Project Current Choice, will be one of the largest in the Nation, allowing about 700,000 consumers, or 400 MW of load, retail direct access. The pilot program is expected to begin by mid- 2000.
09/99: Virginia Power reached a compromise with the SCC that will expand VEPCO's pilot project by about 3 times the original plan. The pilot program will include customers from both Northern Virginia and Richmond.
09/99: AEP filed an outline for its pilot program with the SCC. AEP proposes to allow about 17,500 participants in a pilot program beginning in March 2001.
06/99: Legislation passed in June 1999 proposes to allow recovery of stranded costs through utility rates that will be capped through mid-2007, and a special wires charge on customers who choose to leave their utility for a competitor.
06/99: The SCC is working on formulating rules for pilot programs in the State. A task force is discussing rules that will ensure that utilities do not take advantage as distribution companies to assist an affiliated competitive power supplier, or use their transmission and distribution business to subsidize an affiliate competitive energy supplier.
06/99: Two cooperatives, Mecklenburg and Rappahanock Electric Cooperatives, are proposing to develop retail access pilot programs. Cooperatives are not required, as investor-owned utilities are by the restructuring legislation, to develop pilot programs.
03/99: The Virginia Electric Utility Restructuring Act, Senate Bill 1269, passed the General Assembly and was signed into law by the Governor. Highlights of the bill include: creation of a regional transmission entity by January 1, 2001; deregulation of generation by January 1, 2002; phase-in of consumer choice between January 1, 2002 and January 1, 2004; rates capped through July 2007 for those who remain with the incumbent utility; recovery of stranded costs through capped rates for customers staying with the incumbent utility and through a wires charge for those who switch to competitive suppliers; and consumer protections such as universal service, education programs, fuel and emission disclosure requirements, and allowing aggregation for small consumers.
11/98: Virginia Power and American Electric Power have proposed pilot programs to the SCC. VP's Plan I program will involve about 17,000 residential and 1,700 small commercial customers in the Greater Richmond area; Plan II will be for large industrial customers. AEP's plan will involve about 2 percent (3,200) of its Virginia customers.
08/98: The SCC approved more than $700 million in refunds and rate reductions. A total of $150 million in refunds will be provided by November 2, 1998. In return for the refund/rate cuts, Virginia Power will use $220 million in revenue to reduce debt on generation assets.
06/98: In an agreement between regulators, government, and business and Virginia Power, VEPCO will refund $920 million, the biggest rate adjustment in Virginia history, in rate cuts and refunds over the next 5 years. The rate reduction refund agreement is subject to approval by the SCC. A public hearing is scheduled for July 21, 1998 on the proposed settlement.
04/98: Restructuring legislation, House Bill 1172, was signed into law. The law establishes a schedule for retail competition beginning January 2002 and completion by January 2004. Also, the law requires establishment of an independent system operator and allows recovery of net stranded costs. The General Assembly will deal with details of restructuring issues such as stranded costs and public benefits programs in the 1999 session.
03/98: The SCC ordered investor-owned utilities to begin work on change to introduce retail competition to the State including the creation of an independent system operator, power exchange, and plans for pilot programs. Utilities are to report on their previous activities and future plans by April 15, 1998.
11/97: The SCC issued a study on electric industry restructuring and a model for competition. The draft model recommends a five-year transition to full retail access. Phase I, from 1998 to 2001, would involve unbundled rates and bills, a study of stranded costs, formation of an independent system operator and PX, and pilot programs to study retail wheeling. Phase II, from 2000 to 2002, would involve decision-making for a competitive industry and utility plans for restructuring. Full competition would then be phased-in through 2005.
11/96: The SCC issued an order calling for more study on competition in the industry. The SCC asked that the state move slowly toward retail competition.