Constitution challenge over utility rates in Virginia begins this week

Following the dismissal of a bill in the legislature, a controversy over who sets and reviews rates for Virginia’s utilities moves to the state Supreme Court.

Briefs are due at the court by this Thursday for the challenge to a controversial 2015 law that protects electric utilities from rate reviews by regulators for five years.

By many accounts, it could be the strongest affront thus far to monopoly utilities which have benefited by long-running support from state lawmakers.

At issue are provisions of the law pushed successfully by Dominion Virginia Power and Appalachian Power. It originated as Senate Bill 1394 and enabled the utilities to earn higher profits without answering to biennial rate reviews, in return for a freeze on base rates.

Previous rate reviews have produced significant refunds to ratepayers. The cumulative total of refunds owed ratepayers during the period Senate Bill 1349 is in effect could exceed $1 billion, according to James C. Dimitri, a member of the three-person State Corporate Commission (SCC).

Critics of the law received a boost December 14 when Dimitri and his fellow commissioners, Mark C. Christi and Judith Williams Jadgmann, confirmed what ratepayer advocates argued when Senate bill 1349 was introduced and have continued arguing since then.

Critics note that while base rates would be frozen, foregoing regulators’ rate review allows Dominion and Appalachian Power to earn whatever profits they can generate while tacking on additional “riders,” or rate adjustment clauses, that further drive up the bills customers pay.

Read more (Southeast Energy News)