Dominion Energy and NextEra Energy on Monday announced a new package of “transformational” benefits that they said their merger would bring to Virginia customers, including giving residential customers two more years of monthly bill credits instead of giving bill credits to large data centers.
The companies also said that combining Dominion and NextEra would bring greater operational efficiency, faster development of solar power and battery storage, hundreds of new jobs and millions of dollars invested in Virginia’s workforce and supply chain.
The companies emphasized that even after the merger, Dominion Energy Virginia would continue to operate as a Richmond-based company, with electric rates evaluated and set by Virginia’s State Corporation Commission, and that customers “will not pay one cent” of the merger costs.
The announcement comes amid public pushback over the $67 billion merger, which would create the largest regulated electric utility business in the world. State regulators are scheduled to begin holding hearings on the merger proposal in November.
“This combination is about building something greater together for Virginia: stronger customer benefits, more jobs, more clean energy, more local investment and a utility that remains focused on the customers and communities it serves,” Dominion CEO Bob Blue said in a news release.
[Disclosure: Dominion is one of our donors, but donors have no say in news decisions; see our policy.]
The nonprofit Clean Virginia said in a statement that Dominion and NextEra’s “decision to unveil substantial changes after the merger review is already well underway is further evidence that their original application was incomplete” and underscores the need for the SCC to have more time to review the case.
The Charlottesville-based group says it advocates for “removing corporate money from Virginia politics and reforming utility regulation to put customers first.” It’s been among various voices asking Gov. Abigail Spanberger to convene a special session of the General Assembly to extend the SCC’s 180-day window to review the merger petition, which Spanberger has declined to do.
Dominion and NextEra’s announcement doesn’t change the legal standard for whether regulators approve or reject the merger, Clean Virginia said.
“Approval of this transaction is not contingent on whether Dominion and NextEra have assembled an attractive enough package of benefits — it’s whether this change in control risks reliable service at a rate Virginians can afford,” Clean Virginia Executive Director Brennan Gilmore said.
John Ketchum, NextEra’s chairman, president and CEO, said in a Monday filing with the SCC that the companies’ initial application “fully meets the standard for approving this transaction” but that the newly announced commitments are based on feedback that “focused on customer affordability, maintaining a local presence and workforce, community investment, and economic development.”
The SCC is expected to make a decision on the merger proposal in January.
Dominion and NextEra said that they anticipate the deal will be complete in the second half of 2027.
New proposal would extend residents’ bill credits
Dominion and NextEra said Monday that they now want to offer an average residential customer a $10 monthly bill credit for four years instead of the two years that they proposed in May when the companies announced their merger plan.
An average residential customer uses 1,000 kilowatt-hours of electricity per month, and the exact credit would vary based on usage.
Businesses that are smaller than large data centers and therefore classified in other rate classes, as well as churches, would receive bill credits for two years.
All of the bill credits combined would amount to a shareholder-funded $2.25 billion, with $1.78 billion of it going toward Virginia customers and the rest toward customers in North Carolina and South Carolina, according to the companies’ filings with the SCC.
The additional two years of credits for residents would be paid for mostly by shifting bill credits that would have gone to large data centers under the original plan. The companies said in SCC filings on Monday the new proposal might also require about $90 million from shareholders in addition to the shift in credits.
Shareholders of both Dominion and NextEra have backed the merger plan.
While Dominion and NextEra are proposing residential bill credits over four years, the SCC could mandate a different timeline, Dominion spokesperson Bill Murray said in an interview on Monday.
“The commission’s got discretion to shape that how they think is best,” Murray said.
Besides the approval of Virginia’s SCC, the merger requires state regulatory approval in North Carolina and South Carolina. The Federal Energy Regulatory Commission and the Nuclear Regulatory Commission must sign off on it, and the deal must clear federal antitrust review.
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 through parts of Southwest and Southside Virginia.
The pledge of more rate credits comes as Virginia customers of Dominion Energy are seeing bill increases after the SCC last year gave Dominion permission to raise the average monthly residential bill by $13.60 over two years.
The first part of that increase, amounting to $11.24 per month for the average residential customer, took effect on Jan. 1 of this year, while the next part, amounting to $2.36 per month, takes effect next year.
Dominion has separate cases pending before the SCC regarding how to charge customers for increased fuel costs and for expenses related to Virginia’s reentry into a multistate program designed to reduce greenhouse gas emissions.
Jobs, energy assistance among other pledges
Dominion and NextEra said Monday that if their merger is approved, they are committed to maintaining Dominion’s headcount of 10,431 employees in Virginia for at least five years.
NextEra will add another 600 jobs in Virginia on top of that and will work with suppliers who are expected to add 400 jobs, the companies said.
The companies’ announcement said that NextEra would build a new office tower, paid for by shareholders, next to Dominion’s headquarters on Canal Street in downtown Richmond.
Dominion and NextEra said that the combined company would deliver “long-term bill affordability” because a bigger company can buy, build and operate at a larger scale.
It would allow them to more quickly develop new power generation, including solar and nuclear, as well as battery energy storage, which stores power when it’s cheap to produce and deploys it when it would otherwise be more expensive.
The companies would put $100 million through 2038 into Dominion’s shareholder-funded program providing financial assistance to low-income customers.
That money would be on top of the range of $156 million to $204 million in funding through 2038 that is required by state legislation passed during this year’s General Assembly, Murray said.
The companies said they would put $100 million toward workforce development in Virginia by working with union partners and creating a new independent organization to manage a workforce development fund.
They also would commit to spending up to $1 billion over five years to contractors, suppliers and service providers who do business in Virginia.
The combined company would hold an annual “global energy summit” in Virginia bringing together executives and policymakers focused on energy infrastructure.
Elected officials react to announcement
Del. JJ Singh, D-Loudoun County, said on social media that because the additional two years of residential bill credits would be in lieu of bill credits for large data centers, Monday’s announcement addresses one point he had raised.
“While this is a positive development, I still have serious concerns. The purported benefits are temporary, while the merger is permanent. The merger still deserves significant scrutiny,” Singh said.
Sen. Louise Lucas, D-Portsmouth, said on social media that the SCC “now has more positives to consider” with the shift of credits from data centers to residents.
“As always, I stand with the people of the Commonwealth and I want data centers to pay their fair share,” Lucas said.
Virginia House Republican leaders on Monday said the companies’ announcement marked “a step toward making life more affordable for Virginia families” and said it showed that Dominion is committed to expanding power generation and energy infrastructure in Virginia.
“Reliable, abundant, affordable power is the foundation of affordability,” House Minority Leader Terry Kilgore, R-Scott County, said in a statement.
House GOP leaders also praised the companies’ pledged $100 million investment in workforce development.
“Creating new jobs while aggressively investing in energy generation will reduce Virginians’ monthly power bills and support much-needed job growth across Virginia,” said Del. Scott Wyatt, R-Hanover County.
U.S. Rep. Eugene Vindman, D-Prince William County, said that the proposed merger is “a bad deal for Virginians, plain and simple.”
“No ‘incentives’ package can make up for the higher utility costs that will hit Virginia families as a result of this merger with a Florida-based company that isn’t going to put Virginia first. We deserve better,” he said.
Regulators to hear case in November
The SCC’s standard under the law for approving the merger is to ensure that “adequate service to the public at just and reasonable rates will not be impaired or jeopardized,” according to Williams Mullen, a law firm that tracks Dominion-related regulatory cases and publishes analyses of them.
SCC cases are treated as court cases with judges and witness testimony.
In November, the commission will hold a series of hearings in Richmond, first to receive public comments and then separately to hear that evidence and testimony.
On Wednesday, the SCC announced that it also will hold two in-person hearings outside Richmond, at locations yet to be determined, to provide more opportunities for public comment.
Samuel Towell, who is one of the SCC’s three commissioners, made a point to state that while he supports the additional hearings, in-person comments do not carry greater weight than comments submitted in writing or by phone.
“Comments have been filed in the docket that suggest that only via in-person statements can a ratepayer have ‘a real chance to be heard’ in this case. Or that ‘having a phone number to call’ is not ‘a meaningful opportunity to be heard’ or is somehow not a valid manner to ‘participate in a process,” Towell wrote in Wednesday’s order announcing the additional hearings.
“While the authors of these comments may subjectively believe that to be the case, from the Commission’s perspective, it is inaccurate.”
As of Monday, the SCC had received more than 800 written comments from state lawmakers, local government officials and members of the public.
Many are opposed to the merger, citing concerns that include increased electric bills and the expectation of job losses.
“This merger would be bad for all Virginians,” wrote John Ancilloti of Burke. “We know that after a sweet little honeymoon period, this will cost Virginians more money down the road.”
Other comments are supportive. Benjamin Beakes, president of the Metallurgical Coal Producers Association, said in a letter to the SCC that the deal would boost “the economic well-being for the coalfields of southwest Virginia.”
Dominion’s Virginia City Hybrid Energy Center in St. Paul produces power using reclaimed waste coal called gob, a process that Beakes said improves the environment.
“Additionally, the merger points to new development and economic growth. The vast majority of coal mined in Virginia today is metallurgical coal, used to make steel. More development requires more steel which, subsequently, requires more metallurgical coal,” Beakes said.
A number of parties have filed with the SCC to intervene in the merger review case. Intervention goes beyond making a public comment, and those who formally intervene become active participants who can submit evidence, cross-examine witnesses or appeal the SCC’s final decision to the Supreme Court of Virginia.
Among those intervening is Democratic Gov. Abigail Spanberger, whose participation marks the first time a Virginia governor has taken such action in an SCC case.
Spanberger has said that she is “deeply skeptical about whether selling our primary, state-regulated utility to an out-of-state company is good for the commonwealth.”
On Monday, a spokesperson for Spanberger said that the governor’s office is reviewing the latest filing.
Other intervenors include the Virginia Poverty Law Center, the Piedmont Environmental Council, the International Brotherhood of Electrical Workers, the NAACP and multiple governing bodies of Virginia cities and counties.
