"In this time of economic uncertainty, an increase in energy costs could compel individuals and families to choose between putting food on their table and paying their energy bill."
As a Vice-President prospect, this is a heartening development. Sen. Webb is willing to take on one of the most powerful energy corporations in his own state. Dominion's influence in Virginia politics is systemic, including as a top donor to Governor Kaine. That former boxer, Sen. Webb, is willing to wade into the fray and challenge Dominion's power is a testament to his commitment to social justice.
With $4 gas prices squeezing rural US, Virginians face rising gas prices on one side and higher electricity costs on the other; oil and coal are rapidly becoming energy sources of the past. Why should Virginians, who are willing to start moving toward cleaner energy, shell out money to support Dominion's addiction to dirty energy? Dominion needs to start moving toward cleaner energy, create opportunities for green jobs, and make investments in energy efficiency. By starting to make investments in clean energy, not coal, Dominion has the potential of creating over 336,000 of good, local, green jobs that will help move Virginia's economy into the future.
What Sen. Webb didn't mention, and what we hope he will, is that Dominion's proposed plant in Wise County will further raise rates. The $1.8 billion "investment in Wise County" is going to be paid for by the ratepayers of Virginia. The poorest in the state, already reeling from increased rates at the pump and on their energy bills, can't afford to pay for another dirty plant using coal that is already one of the most expensive in the country and which will only rise in cost as congress puts a price on carbon.
EDIT: Here's the full text of Sen Webb's statement.
June 11, 2008The Honorable Judith Williams Jagdmann
Virginia State Corporation Commission
Post Office Box 1197
Richmond, Virginia 23218Dear Judge Jagdmann:
I am writing to express my concern about Dominion Virginia Power's request to increase its fuel factor, which would increase the average consumer's bill by 18.3 percent or $16.61 per month. My office has heard from many families in Virginia who are concerned regarding this potential rate increase.
There have been reports indicating that the proposed increase could raise a consumer's average monthly bill from $91 to $107. I have concerns regarding the effect these potential increases will have not only on individuals and families, but also on small businesses. Moreover, as you know, high electricity rates disproportionately affect low income families living on fixed incomes. Furthermore, in this time of economic uncertainty, an increase in energy costs could compel individuals and families to choose between putting food on their table and paying their energy bill.
Last year the State Corporation Commission authorized a four-percent rate increase for Dominion Virginia Power. An 18.3-percent increase would be the largest one-time rate increase since 1970 for Dominion Virginia Power. While I appreciate that the soaring costs of energy have impacted all sectors of the economy, including the utility sector, many families across Virginia already have difficulties meeting their basic needs.
As you consider Dominion Virginia Power's request, I ask that you carefully consider what an additional rate increase will do to the residents of Virginia. I would appreciate your affording my concerns every appropriate consideration in accordance with all applicable rules, regulations and statutes.
Sincerely,
Jim Webb
United States Senator
Kudos to the Senator for once again, shining a light on an issue so long in darkness.
By state law, there is not much the SCC can do here. Utilities are not allowed to make money on fuel costs, they are supposed to be a direct pass-through to the consumer. By the code:
Upon investigation of such estimates and hearings in accordance with law, the Commission shall direct each company to place in effect tariff provisions designed to recover the fuel costs determined by the Commission to be appropriate for that period, adjusted for any over-recovery or under-recovery of fuel costs previously incurred.
To me that means if Dominion can prove higher fuel costs which shouldn't be difficult, then the SCC has to implement tariff provisions that would recover those costs. They can certainly scrutinize Dominions numbers and defer the under-recovery of cost from the period of June 1, 2007 to 2008. But I wouldn't hold out hope that they are going to disallow any of DVP's fuel costs as imprudent expenditures. And I don't know that they will be able to fully counter that DVP's fuel costs have not substantially increased and will continue to do so. So, by law, it would seem the most likely outcome is approval of substantially if not exactly what DVP is asking for.
If you don't like the law, you can ask your legislators to revisit Electric Utility Regulation as they did in 2007. But fat chance of them making any changes that would hurt Dominion, and it makes no difference if they are a Democrat or a Republican in this matter.
Webb has the potential to become our Teddy Roosevelt -- sans the imperialism!