By RUSTY DENNEN
It's not just the cost of a gallon of gas that has spiked. Fallout from rising global energy prices will soon hit Virginians' electric bills.
Dominion Virginia Power yesterday announced that it will seek permission from the State Corporation Commission to pass surging fuel costs along to customers, including those in the Fredericksburg area.
The typical monthly residential bill--based on 1,000 kilowatt hours--would rise 18 percent, or $16.61, from $90.59 to $107.20.
According to the Edison Electric Institute, the national average monthly bill is $113.56.
If approved by the SCC, the proposed increase would take effect July 1.
"This is a large increase. We realize that," said Mark F. McGettrick, president and chief executive officer of Dominion Generation.
"It's happening pretty much across the board," he said in teleconference from Richmond. "All utilities are facing the same pressure because of fuel."
Last year, Dominion got a fuel rate adjustment of about 3.9 percent, the first since 2004.
McGettrick said that since 2004, prices for oil have increased 224 percent; coal, 143 percent; and natural gas, 129 percent. Electricity purchased from other suppliers went up 130 percent.
Dominion is proposing several steps to lessen the financial impact on customers--from deferring a portion of the fuel costs to new billing options and energy savings.
The company said it would defer recovery of about $700 million in fuel costs incurred since the July 2007 increase. Dominion would delay collecting that amount over three years, from July 2009 to June 2012. Without the deferral, the requested increase would have been 22 percent.
An additional $5 million would be funneled into Dominion's EnergyShare program, which provides emergency grants to customers needing help paying heating and cooling bills.
Dominion would make it easier for residential customers to enroll in its budget-billing program. It would offer a similar billing option for small and medium-size businesses, most nonprofit groups and churches, allowing them to equalize monthly payments.
Energy-saving pilot programs would be expanded, such as remote controls on air conditioners.
"An important way to counter some or all of the fuel increase impact is to conserve energy," said David A. Heacock, president of Dominion Virginia Power. "That is why we are providing discounts on up to 5 million energy-saving compact fluorescent light bulbs at The Home Depot stores and are continuing to educate our customers about how to use energy wisely."
McGettrick said that the steep rise in global energy prices points to the need for a more diverse source of fuels--from wind power to coal and nuclear generation.
He said most of the new generation plants in the works are gas-fired. Dominion has filed an application with the Nuclear Regulatory Commission to add a third nuclear reactor at North Anna Power Station in Louisa County.
The company aims to build wind turbines to provide 750 megawatts of electricity at its Mount Storm power plant on the West Virginia-Maryland line.
And it has proposed new coal-fired and biomass--waste material--units in Southwest Virginia.
Opponents argue that expanding coal and nuclear generation have unacceptable environmental consequences.
Rusty Dennen: 540/374-5431
Email: rdennen@freelancestar.com