Now that the State Corporation Commission has finally approved Dominion Energy Virginia’s Rider U, mandated by the General Assembly to force us all to pay for underground lines serving just a few customers, let me explain how perfectly this scheme put the company ahead of its customers. (For case details, the Richmond Times-Dispatch has this good story, picking up some themes from an earlier Bacon’s Rebellion post.)
Set aside discussions of the “Strategic Underground Program” because the merits do not matter for this illustration. Start with the information that Rider U is a stand-alone line item on your bill, a financial silo on Dominion’s books, with a guarantee that the utility will recover in full the cost of construction with a profit margin over time. No risk to the shareholders.
Any benefit to the customers, and there will be some certainly, shows up as reduced maintenance and repair costs and fewer interruptions. Those maintenance and repair costs are covered by the main portion of your bill, the base rates, outside the Rider U silo. Say it’s a one-to-one ratio, and the $70 million spent putting lines underground saves $70 million over five years in repair costs. The fewer interruptions also add base rate revenue outside the silo.
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The State Corporation Commission Thursday rejected in large part the highly-touted Dominion Energy Virginia proposal to rebuild its transmission grid, approving only the elements improving cyber and physical security. Those were the least expensive and least controversial pieces of its application.
