Dominion Energy and Florida-based NextEra Energy intend to combine companies to create what they said would be the largest regulated electric utility business in the world.
The companies said Monday that they expect the deal to close within a year to 18 months. It will require state and federal regulatory approval, including from Virginia’s State Corporation Commission, the Federal Energy Regulatory Commission and the Nuclear Regulatory Commission.
If the merger is approved, Dominion customers in Virginia, North Carolina and South Carolina would receive $2.25 billion in bill credits over two years after the deal closes “from the scale, operating and capital efficiencies this combination unlocks,” John Ketchum, chairman, president and CEO of NextEra Energy, said in a news release.
“We are bringing NextEra Energy and Dominion Energy together because scale matters more than ever — not for the sake of size, but because scale translates into capital and operating efficiencies,” Ketchum said. “It enables us to buy, build, finance and operate more efficiently, which translates into more affordable electricity for our customers in the long run.”
[Disclosure: Dominion is one of our donors, but donors have no say in news decisions; see our policy.]
The combined company would operate under the NextEra Energy name while maintaining headquarters in both Virginia and Florida and operational headquarters in South Carolina, according to the release.
It would have approximately 10 million customer accounts, own 110 gigawatts of power generation and have more than 130 gigawatts of “large-load opportunities” in its pipeline.
Dominion serves the largest data center market in the world in Northern Virginia. Company officials said on an earnings call earlier this month that Dominion has about 51 gigawatts of data center capacity in some stage of contracting.
Under the terms of the proposed all-stock transaction, said to be valued at approximately $67 billion, shareholders of Dominion Energy (NYSE:D) would get 0.8138 shares of NextEra Energy (NYSE:NEE) for each Dominion share they own.
Clean Virginia, a Charlottesville-based nonprofit created to oppose electric utility monopolies in Virginia, said in a statement Monday that regulators should proceed with “extreme caution” and ensure that the merger won’t result in higher bills for customers.
“Virginians don’t choose their electric utility,” Clean Virginia Executive Director Brennan Gilmore said in a statement. “That’s why the law requires utilities to serve the public interest — and precisely why any merger must be judged by one standard: does it make life better for the people who have no other option?”
Richmond-based Dominion Energy has more than 3.6 million customers in Virginia, North Carolina and South Carolina. Of those, more than 2.5 million are in Virginia, including in Central and Southside Virginia and the Alleghany Highlands.
Juno Beach, Florida-based NextEra Energy is a Fortune 200 company that owns Florida Power & Light. A subsidiary, NextEra Energy Resources, owns approximately one-third of the Mountain Valley Pipeline, a 303-mile natural gas pipeline that runs from Western Virginia to southern Virginia.
