Tweet First, Check Your Notes Later

by Steve Haner

It doesn’t matter what you say, only what they say you said. This was demonstrated once again this morning as the State Corporation Commission’s hearing on Dominion Energy Virginia’s profit margin unfolded in Richmond courtroom.

While Dominion’s lead attorney droned on in his opening statement, Sarah Vogelsong of Virginia Mercury – doing running commentary on Twitter – posted this: “He also seems to be taking a swipe at “half the Democrats in the General Assembly” and what they think about utility rates, which seems unusually political for these hearings.”   

Now your reporter was probably staring at his own phone and half-heard the comment about the letter 36 Democratic legislators put into the record on this case, discussed in an earlier Bacon’s Rebellion report. It’s not in my notes. Nor do I follow Vogelsong on Twitter. But during the first break, an advocate organizing the effort to stir public interest on this case called it to my attention. He wanted to be sure it made it into my Bacon’s Rebellion piece. Well, be careful what you ask for.

By the time I saw Vogelsong’s post, it was already being recirculated with added negative comments. “Lawyer in this hearing gets very partisan and slams (Virginia House Democrats and Virginia Senate Democrats) for wanting greater oversight of Dominion….” And the person who approached me, Albert Pollard, was recirculating it as well. One of the legislative signers, Del. Alphonso Lopez of Arlington, had already reacted badly in yet another Tweet.

Here is how Blue Virginia is playing it already.

So, at the second break, I asked Vogelsong what the lawyer’s actual statement was. At that moment, as the Twitterverse was at work proliferating the meme, she said she didn’t have it in notes either and couldn’t recall it exactly.  “I need to listen to the recording,” she said.

After lunch, and perhaps after my question, she did. Attorney Joseph Reid had said that the SCC had a duty to come to a reasoned decision on the case, “regardless of what the forum commentators say in this case, and frankly regardless of what half the Democrats in the General Assembly say to the Commission in this case.” She sent out the full quote perhaps two hours after the first Tweet.

(Note:  The initial post incorrectly identified attorney Joseph Reid III as David Reid, an error I should not have made given his regular appearances at the SCC.)

So now that we have the quote, you can judge whether he was “taking a swipe” or making the legal point that law, evidence and precedent should determine the outcome, not public sentiment. Virginia Mercury has continued through the day to dribble out snippets on the hearing, sometimes on testimony and sometimes on how a judge moves his head.  But that one exchange will live on a while.

These cases do routinely include an opportunity for public comment, and an organized effort has produced a strong crop of people complaining about Dominion’s request to raise its authorized profit margin (return on equity) from 9.2% to 10.75%. Economics and environmental advocacy have become mixed, with one public witness today complaining from the stand about Dominion “expanding use of fossil fuel” and “demanding that Virginia ratepayers pay for their own demise.” Death seldom stalks the halls at the SCC.

The public testimony is scintillating in comparison to the actual case, with dueling economists arguing over the Discounted Cash Flow Model, Capital Asset Pricing Model, Comparable Earnings Model, risk premiums over the 30-year Treasury Bill interest rate, Moody’s commentary on risk and other ways to determine the return rate Dominion needs to attract investors. There is no sign the current 9.2% return is inadequate. State law requires the SCC to keep Dominion’s profit margin in line with its peers but allows endless legal wrangling about which other utilities should be counted.

Here is the Big Thing being ignored by all. While the ROE is set at 9.2%, there is a band around it. Dominion can keep the first 70 basis points of excess profits above that target automatically. So, 9.2% is really 9.9%, and 10.75% would really be 11.45%. The bottom ROE amount suggested in this case, 8.6%, is really 9.3%.  (Remember, the SCC says that Dominion is already earning 13.5%.)

If the SCC changes the current 9.2% return on equity, up or down, it will have an impact on the rate adjustment clauses in 2020 and 2021. SCC staff’s financial testimony underlines just how much the RAC portion of the bill has grown, and it represents about one-third of the money being argued about. Should Dominion get its requested 10.75% return rate, that would add about $48 million in revenue annually on the RACs, more than just a rounding error on customer bills. Not even Dominion really expects that outcome.

For more detail on the case, try this dispassionate account from the Richmond Times-Dispatch.  Its reporter picked up on the real news in Reid’s opening statement, and that was a clear message the company knew 10.75% was a stretch and would count it as a win to see something in the 9.4% range.

But base rates, two thirds of the money involved, hiding place for excess profits, cannot change until the 2021 rate review and likely will not change then. An existing state law, voted for by many of the legislators, states that no matter how much excess profit Dominion earns, that case cannot lower base rates more than $50 million. All this talk of “saving” customers $147 million is, as previously stated, legerdemain. Do not build your 2021 household budget on rate rebates from Dominion.

By greatly exaggerating the impact of this pending case, likely to be decided post-election in November, Democrats and others hope to portray a strong stand on behalf of Virginia consumers. Along with the letter filed in the record, the effort includes a rally Monday outside Dominion’s headquarters, a Richmond Times-Dispatch guest editorial Sunday, even sponsorship of the Virginia Public Access Project daily news clips by an advocacy group, timed to the case.

Perhaps cynicism is unwarranted. Perhaps at least some of the legislators who have followed Dominion’s arguments like sheep previously are suddenly awakening to the impact of their bad decisions and will seek to repair the damage starting in the 2020 General Assembly. But this case underlines several inconvenient truths about the state of the law thanks to their previous sell-out of customers. The new Assembly may continue to seek to regulate Dominion directly, leaving the SCC in a subsidiary role. That’s not progress.

One reason to worry: Their deep concern for consumers dissolves when the higher costs are tied to their environmental goals, including the carbon tax that will be imposed when Virginia joins the Regional Greenhouse Gas Initiative. Irony of ironies, that tax works out to about $150 million dollars a year, as well, and would have the same potential cost to consumers as the 10.75% ROE.  There will be no letter from 36 Democratic legislators protesting that.

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36 responses to “Tweet First, Check Your Notes Later

  1. An outstanding and insightful article.

  2. The brutal truth is that the average person in Virginia does not understand how transportation or education or health care “works” and they know and understand even less about Dominion’s monopoly “works” which turns the whole issue over to lawyers and “insiders”… not to mention the obscene spectacle of the SCC “processing” the issues as if they had any real power.

    It’s not hard to read between the lines of your narratives which and flavored with cynicism and irony.

    So what if some the Dems and Virginia Mercury decide to do something different than what the GOP (and other Dems) and conventional media have done?

    Would it be so awful – if a counter-Dominion force rose up to speak for consumers?

    Oh wait… it can’t be anything by a cynical political trick if it’s the Dems and Virginia Mecury – right? 😉

    • Not much is between the lines. It’s pretty much out there. 🙂 But this episode today, Tweet first but check the tape only when challenged…..that wasn’t good. Hated to call her out, and probably wouldn’t have if they were not going to town with it.

      • Just another counter puncher?

      • when I read what was said – I had no second thoughts at all when Dominion invoked the name – Democrats. I might have had to go
        back and re-read the exact passage for a question but the core of the speech was crystal clear – Dominion was putting itself between the GOP and the Dems… which is no surprise at all to be honest and given the SCC’s ability to do anything – Dominion was just talking trash for all present to hear…

        I admire your dedication and perseverance in continuing to attend the SCC and report on it after your retirement – it’s a real benefit to us ordinary schmucks who have no clue about it other than when the media gets a yearning to cover.

        But you also have to admit – nothing is going to happen in the current scheme of things… I hear almost no GOP saying they made
        a mistake and need to re-do anything – as a party – they seem just fine with what they did to the SCC and Dominion basically mocking the precedings with political trash talk.

        surely you will abandon this foolish loyalty to the GOP! 😉

  3. So, does this mean that Dominion wants to raise the rate in order to cover the cost of paying their carbon tax for the RGGI? It’s confusing.

    Sorta turns the idea of a carbon tax upside down. The point is to raise the price of fossil fuels so they are not competitive and will have to be closed. They probably won’t be called on from PJM.

    We still have coal plants with no phase out date and nsatural gas on the drawing board. Here is the latest from Bloomberg talking about the new RMI report on natural gas …
    “The economics of natural gas-fired power plants will be crushed by wind, solar, and batteries by 2035, a Rocky Mountain Institute study finds.”

    “Natural gas-fired power plants, which have crushed the economics of coal, are on the path to being undercut themselves by renewable power and big batteries. … By 2035, it will be more expensive to run 90% of gas plants being proposed in the U.S. than it will be to build new wind and solar farms equipped with storage systems, according to the report Monday from the Rocky Mountain Institute. It will happen so quickly that gas plants now on the drawing boards will become uneconomical before their owners finish paying for them, the study said.”

    No wonder Dominion needs s raise …

    • The RGGI tax would either be collected through the fuel factor or on the Rider E for environmental costs, not in base rates.

    • My distinct impression is that Dominion intends to charge all it can and more – including profit for ANYTHING that is in addition to fossil fuel generation.

      whether it’s RGGI, solar, wind, demand side, whatever – they’re going to get top dollar for it plus a profit…and the GA is totally on board with it to the point of neutering the SCC so that they still “function” but cannot do anything but approve these proposals.

    • RGGI, carbon taxes or trading carbon credits will harm the general public and drag down economic growth. Power Companies will pass along the costs to consumers who really don’t have much choice in where they get their energy. Large-volume users will have both alternatives and purchasing power to avoid many of these extra costs. Everyone else will see their disposable income and quality of life decline.

      The goal needs to be the use of disruptive technology that operates at lower cost than traditional fossil fuel generation and can drive incumbent technology out of the market. Anything else will simply constitute self-assassination of the American public.

  4. Thanks for an entertaining view from the inside on how the sausage is made… and how it is commented on in this social media era.

  5. Steve. Your excessive put down of sarah vogelsong is cruel and unfair. I regard her very highly. When she writes something, I can understand it. Frankly, i can’t say the same about your work . Best regards peter galuszka

    • Happy to keep you confused, Peter. I’m not writing for the masses….

      Vogelsong has objected to my characterization of our exchange, and I may reflect on it some more. I was simply curious, and if she’d said “he told the Commission to disregard the Democrat letter” that would have been fine. The fact is she said she’d have to review the tape to know what he said. And the political exploitation of what the lawyer “seemed” to her to say was galloping away on Twitter in the meantime. I suspect if she’d really had the quote captured initially, the word “regardless” would have been in it.

      This is really about the dangers of this modern excuse for “news gathering”, this business of Tweeting out snippets and impressions (of a boring SCC hearing for goodness sake). And given how eager the Dominion critics in the room were to get me to do the same thing, and try to gin up outrage over his comment, it was clear the big spin was in motion. The key person, Albert Pollard, is probably even more angry with me than Vogelsong.

      I came away from the episode with less respect for Virginia Mercury. They won’t care. I don’t know Vogelsong. I guess this is just the world as it is now, but to say the lawyer took “a swipe” is the kind of opinion/commentary that is highly appropriate for a policy blog but is not balanced journalism, especially when you can’t even call up the key word from memory.

      Larry, in a way that General Assembly disdain for the SCC and misunderstanding of how it works is on full display. They did couch it as an endorsement of the SCC staff’s position on the issue, but this case does involve complicated accounting and investing principles. There are key legal issues. The SCC can hear what the public says, but can’t base its decision on that. When the public comments work best, they include evidence and legal argument relevant to the case, not just “don’t raise my rates” or “the utility is bad.” Their letter was election year politics (says the kettle to the pot….)

  6. Steve, i have read the two accounts —early summation and the full quote and don’t see a hell of a lot if difference. You are nit picking.

    • Could be she just got lucky? The quote once recovered could be read to support her opinion as Tweeted? If you or I had the same experience, and the city editor walked up holding our story in the first edition and asking for the quote, would the city editor have accepted – I can’t remember exactly so let me check the audiotape? No bloody way in Hell. If you are going to REPORT minute to minute, you’d better back it up minute to minute. Some call it new journalism, some call it fake journalism, but it isn’t what you, I and Jim grew up in.

  7. Steve. You’d better get used to it. Cell phone technology has changed everything. I covered the mcdonnell trial for bloomberg. I would file headlines through the day and then go through several rewrite throughs. The post
    Had as many as four reporters tag teaming coverage. They would leave the courtroom to file. They’d later caucus in a write through.
    I did something similar when i lead a reporting team during a bloody coup in moscow. We’d tag team color gathering on the streets and send new york a steady stream of files. This served two purposes. If the coup went the wrong way we could lose our communications. Or we could grt wounded or killed in the combat. The
    Mission was to get an early, rough draft out as fast as you could. That way new york would have enough to put together a final piece. it’s not the old city room in Roanoke, Steve

  8. I bow to your moral and professional superiority….my deep apologies. Shall I salute when I see you, or do you want a part of your anatomy kissed?

  9. Give me a break. Don’t be such an old fart.

  10. Jeeez you media types have thin skin. Her Tweet was a bit off base but hardly inflammatory. I’ve read this post three time trying to work myself up to moral indignation over some liberal reporter for Virginia Mercury. Just can’t do it. Meanwhile, the SCC is being neutered by the paid-for clowns in the General Assembly and Jim Bacon is claiming that the endless flow of money in Virginia politics isn’t the problem, transparency is the problem. Ok, now I’m feeling the moral outrage. That’s better.

  11. A group of students and I listened to part of the hearing as an educational experience yesterday. I hope they got my message that this may be boring but it’s where important decisions are made and consumers need to be at the table. There are so many cases these days that it is hard to keep up when you’ve got other things happening – as most people do.

    Have to admit I thought the political reference by Dominion was inappropriate. We weren’t tuned in when it was made but I heard about it from a source other than Twitter and the gist was about what was reported. Things are changing but as Steve pointed out, the process is so difficult for people to follow – much less contribute to – that it’s hard to get folks engaged so that there IS more than one perspective present. It’s hard for most to feel they understand enough to comment, even on the law which is now close to Dominion’s ideal. I’m grateful that some are taking interest in finding a way to rebalance the playing field. It’s desperately needed.

    On another note, I found myself thinking that as the SCC was ahead of other state agencies adding the audio stream, it’s now behind in not having video with it. Since folks aren’t identified easily in audio if you don’t already know them, my students would have benefited from a video stream, too. Tomorrow we’ll stream the medical surprise billing hearing in another class. Students are reading documents and media reports to prepare.

  12. Agree with you Ripper. This is slicing and dicing something very small while ignoring what’s really important. I read several news accounts of the SCC this morning and am still kinda of amazed that Dominion’s lawyer says what consumers think doesn’t matter.

  13. I am coming to this debate late. Like Steve, I worry about this “running commentary” reporting. We, the public, have gotten so used to 24-hour instant news that reporters feel they have to feed the beast. There is no time to reflect; no time to check their notes; no time to verify. Just because the technology exists does not mean that it has to be used if using it produces an inferior product. And, yes, Peter, I guess that makes me an old fart. It wouldn’t be the first time I earned that label.

  14. Dick,
    Regretfully, there is no choice. I hate it as much as anyone.It’s been this way for 20 plus years and I’ve been in the business for 45 years. Also, I am not sure that in this case,m there is an inferior product, however. I read Sarah Vogelsong’s reporting and could not understand what Haner’s big concern was. There’s a growing tendency on this blog to say some thing is “Dark Money” or “Fake News” or “Liberal Reporting” when that’s all pretty much bullshit. I also don’t always remember the great old days being great old days.

  15. Steve, I can’t see how they got it wrong, and I certainly can’t see why this is so frustrating. The “frankly” in the quote makes me thing of the “With all due respect” line from Talledega Nights. Absolutely dripping with condescension.

    • No idea what you are referring to. Oh, you mean Reid’s “frankly?” Hey, I’m not saying it was a smart thing to say, and like everybody these days he has to be aware that quotes will be used without context. If she had sent out the full quote from the start, or if one of the Democrat operatives in the room had pretended some outrage and tweeted it out, no problem. But the reality is, this is a court case, and the public comments do not have the same weight as law, evidence or precedent. You don’t poll the audience in a criminal case, and even there citizen evidence has to be under oath and subject to cross.

  16. I know there is no choice, that is the way it is. But I still can complain.

    I did not have any problem with Sarah Vogelsong’s comment, especially since she noted that it was “unusually political” in that setting. I do share Steve’s concern–tweeting live about an event without any backup notes. I have been in hearings in which I thought I heard something, only to discover later that I misheard it or misunderstood it.

    Another problem–this tweeting one’s impressions really blurs the line between reporting and opinion.

    I follow Scotusblog. When the Supreme Court announces its decisions, the reporters on that platform will have someone in the courtroom reporting “live” the action, while others outside rush down to the document room, get the hard copies of the opinions, scan them, and then post their analyses. All in order to get the news and analyses out right away. As good as they are, I worry about it; Supreme Court decisions often include a lot of nuance that is not apparent on the first, hurried reading.

  17. On the one hand, Sarah Vogelsong’s tweet can be seen as much to do about nothing. I get that. In the grand scheme of things, it’s not a big deal.

    On the other hand, it raises an issue that is near and dear to my heart. VA News has excluded Bacon’s Rebellion news reporting by Steve and myself on the grounds that Steve and I also do commentary. In the how-many-angels-dance-on-the-head-of-a-pin ruling of VPAP Executive David Poole, the fact that Steve and I wear two hats might be confusing to readers. Therefore, everything we write is excluded, both news and commentary.

    Now it turns out that, in a least one instance, a reporter whose work is regularly highlighted in VA News, tweets out something that sure looks like commentary.

    This is commonplace in the national media. Reporters now routinely appear on cable TV to provide commentary, and they make their partisan sympathies very clear in their tweets. I don’t know the extent to which this occurs in Virginia. It might be worth looking into. I’m saying such tweeting is wrong. But I am saying that it shreds David Poole’s logic for keeping Bacon’s Rebellion content out of VA News.

    • I perused the last couple of months of Vogelsong’s tweets. While it’s clear that she accepts the environmentalists’ perspective in the way she frames the issues, I found her tweets to contain little overt commentary. The tweet Steve cited was probably an anomaly. That doesn’t make it right, but it doesn’t seem to be symptomatic of a larger problem.

      It would be worth checking other Virginia journalists active in the public-policy arena.

  18. The point is not just her tweet. The point is that her tweet on what Reid “seemed” to say within minutes, if not seconds, had taken on a life as a partisan political weapon, and we didn’t even really know what the man had said! Whatever it was, it slipped right by me. (I perked up at the phrase “half the Democrats in the General Assembly.”) But BAM, it’s circulating around the state, and suddenly he “slammed” the Democrats, and I had Albert Pollard spinning me to get it out there, and pointing me to Delegate Lopez’s already angry response that Dominion “didn’t care” what the Democrats thought. I have no idea how far it has spread, but it won’t die now. That’s the part of the story Peter and others are conveniently ignoring.

    This is crap, pure crap, not journalism. Was she a party to the game or merely being used? No idea. Will I be a party to this behavior, or just ignore it, when it is obviously the most important lesson to be learned from yesterday? No. My guess, if you keep following VM tweets, more of them will based on the quote and not the reporter’s impression of what somebody “seemed” to say.

    Oh, and who is the chairman of the VPAP board that treats you and me as tainted non-credible journalists? That same Albert Pollard.

  19. Steve, at least she got Reid’s name right. Shame on you for being such a bully. Peter

  20. I can live with myself. Because of what was done with her Twitter post, it became a key part of the story. There still is no full account of the hearing or case on that outlet, just the long Twitter feed…

  21. Steve, well, maybe you can fix that. I’d try to help but it us beyond my area of competence

  22. If the SCC had received a letter signed by a number of legislators urging it to RAISE the company’s return on equity, do you think Mr. Reid would have told the Commission to ignore it?

    Hah!

    • Of course not, but the other side would have!! One reason I attended the hearing in person was to see if any surprise public witnesses (including legislators) did appear in favor of the request. Dominion has certainly “recruited” public witnesses in support of its wacky positions in the past. None did. In fairness, Dominion never thought it would get 10.75, asked for it last time and didn’t get it, and nobody in that courtroom thinks it will happen. But they’ll be thrilled if asking for so much gets them something.

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