Dominion Virginia Power Says It Will Not Seek Increase In Base Rates For At Least Next Two Years

Thu Mar 28, 2013 3:00pm EDT

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-- Efficiency improvements have kept company's base rates down for more than 20
years
RICHMOND, Va.,  March 28, 2013  /PRNewswire/ -- Dominion Virginia Power today
proposed holding its base rates unchanged for at least another two years despite
encountering more than  $450 million  in costs in 2011 and 2012 related to major
storms, an earthquake and other factors.

Base rates make up about 60 percent of a typical residential bill and cover the
company's non-fuel operational costs, salaries and part of its earnings. This
part of the bill can only be adjusted every two years and has not increased
since 1992.

"Holding down our base rates over this 20-year plus period reflects our
continuing focus on operating as efficiently as possible," said  Paul D. Koonce,
chief executive officer.  

The total Dominion monthly bill for a typical residential customer who uses
1,000 kilowatt-hours is now  $107.22  -- only  two cents  higher than it was in 
July 2008. This same bill has gone up 25 percent since 1992, while fuel oil has
increased 325 percent, gasoline 198 percent and the average national electricity
rate 57 percent over the same period.

All changes in the company's electric rates must be approved by the Virginia
State Corporation Commission. The biennial filing made today, which is required
under state law, allows the SCC to review the company's base rates for 2011 and
2012.  

Other components of rates, including the cost of fuel for power stations, energy
conservation programs, transmission facilities and new power stations, comprise
the remaining 40 percent of a typical residential bill and are adjusted
periodically during the year.

For example, an increase of  98 cents, or 0.9 percent, on a typical 1,000
kilowatt-hour residential bill will go into effect in April to cover an increase
in the cost of four separate power projects.  The company sought the increases
last June and they were approved earlier this month.

Over the past two years, the company experienced significantly higher costs from
damage primarily caused by Hurricane Irene in  August 2011, the earthquake that
shutdown North Anna Power Station, and severe summer storms, including the
derecho in June 2012.  The planned closing of six coal-fired generating units
because of new environmental regulations also caused impairments to company
earnings.

In spite of these challenges, Koonce said, the company made major infrastructure
investments, achieved superior generating unit performance, improvements in
reliability, faster storm response and overall enhanced customer service. Over
the next three years the company plans to invest approximately  $8 billion  to
continue infrastructure improvements and meet ever-growing customer demand.

"At the end of the day, our public service obligation revolves around what I
like to call our three R's -  Reliability,  Responsiveness and  Reasonable
rates," said Koonce. "This is what we focus on and it helps us keep rates down
even as we strive to improve service."

With the filing today and the non-base rate adjustments expected to occur over
the rest of the year, the company's electric rates would still be among the
lowest in  Virginia  and well below national and regional averages.  Current
company projections place the impact of all other rate adjustments this year at
about 3 percent.

Dominion (NYSE: D) is one of the nation's largest producers and transporters of
energy, with a portfolio of approximately 27,500 megawatts of generation.
Dominion operates one of the nation's largest underground natural gas storage
systems and serves retail energy customers in 15 states. For more information
about Dominion, visit the company's website at  www.dom.com.   

Follow us on Twitter  at:  http://www.twitter.com/DomVAPower.
'Like' us on Facebook  at:  http://www.facebook.com/dominionvirginiapower

SOURCE  Dominion Virginia Power


Media: David Botkins, 804) 771-6115, David.B.Botkins@dom.com; Analysts: Nathan
J. Frost, (804) 819-2187, Nathan.J.Frost@dom.com

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