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Mild Winter Prompts Dominion Va. Power To Seek Rate Reduction Customers

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credit: Guang Niu/Getty Images

credit: Guang Niu/Getty Images

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RICHMOND, Va. (CBSDC/AP) — Dominion Virginia Power is asking state regulators to lower what the utility charges customers to recover its fuel costs.

The company Wednesday asked the State Corporation Commission to reduce the fuel rate starting July 1. If approved, the change would lower the average monthly bill of a typical residential customer using 1,000 kilowatt-hours by $5.83.

Virginia law allows Dominion to bill its customers for the company’s cost of fuel used to generate electricity and the power the utility company buys.

“The mild weather that Virginia has experienced since last summer was not expected when the fuel rate was set last year,” said Dominion Virginia Power CEO Paul D. Koonce in a press release. “The abundance of natural gas also has driven the price down, and we have taken full advantage of this at our new Bear Garden Power Station. This highly efficient, natural gas-fired station is projected to save our customers approximately $122 million in fuel costs from June 1, 2011, through June 30, 2013, when compared with other fuel sources.”

Dominion has about 2.3 million customers in Virginia. It says last year 33 percent of its electricity was purchased through the regional electric grid or by contract, 28 percent came from nuclear, 26 percent from coal, 12 percent from natural gas, and 1 percent from other sources like oil.

The company also is asking to lower monthly bills by $2.67 starting Sept. 1 because of changes to transmission-related costs. The decreases will be offset by rate adjustments for energy efficiency programs, costs for the Virginia Hybrid Energy Center and the expiration of a customer credit from its base rate review.

Overall, if all the rate changes are approved by regulators, Dominion says the monthly bill for a typical residential customer would decline about 4 percent from $110.24 to $105.90 on Sept. 1. That’s lower than the average bill on Jan. 1, 2009.

(TM and Copyright 2012 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2012 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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