Spanberger’s Dominion-NextEra Rate Freeze Is a Card Trick, Expert Says

Gov. Abigail Spanberger became the first Virginia governor to intervene as a party in a State Corporation Commission case when she filed testimony opposing the proposed NextEra Energy acquisition of Dominion Energy unless the companies accept a six-year freeze on residential base electricity rates, triple monthly bill credits to $29, and other conditions.

Steve Haner, senior fellow for energy and the environment at the Jefferson Forum, told Virginia Insider host Uriah Kiser that the freeze is “a card trick.” The SCC cannot impose it unless the companies agree. Base rates make up less than half the monthly bill. Fuel charges, new power plants, Regional Greenhouse Gas Initiative costs, and Virginia Clean Economy Act mandates would continue rising.

The proposed deal, valued around $67 billion, would make the combined company the largest U.S. electric provider. Both companies say the combined financial strength is needed to build generation and transmission for Virginia’s growing demand, driven heavily by data centers.

SCC staff, the Attorney General’s experts, and the PJM market monitor have filed testimony raising concerns that the combination could harm ratepayers or concentrate too much market power inside the PJM region. Spanberger’s office has argued the current proposal does not adequately protect consumers or advance the state’s clean-energy goals. The companies have offered roughly $2.1 billion in customer and community benefits, including smaller bill credits.

Haner said Spanberger’s real aim is to force a green-energy package. That includes faster compliance with the Virginia Clean Economy Act’s requirement that Dominion and Appalachian Power eliminate coal and natural gas by 2045, a “decarbonization incentive rate” that would lower rates for preferred heating and cooking methods while raising them for others, expanded rooftop solar and electric-vehicle subsidies, and changes to Dominion’s capital structure that would increase the debt share and lower the allowed rate of return.

He noted that customers who continue using natural gas would likely pay more under the preferred-rate structure. “The only way you can do that to give somebody a discount is to charge somebody else more,” Haner said.

The SCC was created roughly a century ago to insulate utility decisions from politics. Haner said the three current commissioners were all appointed by Democratic majorities, so the commission can simply ignore the governor’s testimony and decide the case on the statutory question: whether reliable service at fair and reasonable rates would continue under new ownership.

He described data-center demand as a major driver of the supply problem. Many facilities already built or in the pipeline cannot be stopped, and some additional ones will be built. Unregulated data centers can finance their own natural-gas or nuclear generation. Regulated utilities face heavier restrictions under the Clean Economy Act and RGGI, which the Spanberger administration rejoined after former Gov. Glenn Youngkin withdrew Virginia from the program.

Haner said a rate freeze would not deliver long-term savings. Utilities are entitled by law to recover legitimate costs. Even if base rates were held flat for six years, other charges would keep rising, and the companies would later seek to recover the difference. He also recalled that a previous Dominion rate freeze was designed to prevent rates from falling when the base rate was already too high.

The Jefferson Forum article on the case argues that expert testimony from SCC staff, the Attorney General’s office, and the PJM market monitor deserves more weight than political conditions. Haner said the central question for the SCC remains whether the merger itself makes sense for reliable service at fair rates, not whether it can be used to accelerate green-energy mandates.

Watch the full interview with Steve Haner on Virginia Insider.

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