GOP legislators call for extension of SCC’s review time of Dominion merger

Two Republican state legislators have requested that Gov. Abigail Spanberger call a special legislative session to extend the time limit the Virginia State Corporation Commission will have to review the proposed $66.8 billion Dominion Energy-NextEra Energy merger, but the governor has not said whether she will do so.

In a statement issued this week, the governor’s office said she is “closely reviewing this proposed merger with a focus on its potential impacts on the cost of electricity for Virginia families and businesses, jobs in Virginia, and our ability to generate homegrown, renewable energy right here in the commonwealth. The governor is considering all options — to include calling a special session — to make sure the SCC has ample time and the necessary information to meet its regulatory responsibilities regarding this proposed merger.”

Sen. David R. Suetterlein and Del. Joseph P. McNamara, both Roanoke-area Republicans, sent a letter Tuesday to the governor and copies to House Speaker Don Scott and Senate President Pro Tempore Louise Lucas.  The letter notes that state law requires the SCC to make a decision whether to approve the merger — creating the nation’s largest utility — within 180 days of filing. If the commission fails to issue its opinion in time, the merger would be approved by default.

Dominion filed its application with the SCC on July 15, starting the clock on the review. According to state law, the SCC has 60 days to review the application and can request one 120-day extension, giving the three-member commission six months to make its decision. The two utilities also filed applications with North and South Carolina’s state regulatory commissions, the Federal Energy Regulatory Commission and Nuclear Regulatory Commission on the same date, although all of those bodies have longer review periods than the Virginia SCC does.

“Virginia would therefore decide first while carrying the largest consequences,” the legislators’ letter said. “Their records may expose risks, produce concessions or supply conditions unavailable to the SCC before the commonwealth’s clock runs out. Policies affecting the Dominion service area inevitably impact working Virginians’ budgets in every corner of the commonwealth. Affording the SCC the necessary time for a conscientious review is absolutely critical. Virginia should not be rushed.”

Lt. Gov. Ghazala Hashmi, a Democrat, also has stated publicly she would like the SCC to have a year to consider the merger and earlier this month proposed 64 questions she would like the two utilities to answer, including why the Florida-based NextEra chose Dominion.

“Virginians are making their voices heard. An acquisition of this size and cost deserves a transparent process and careful review to make sure it’s in the best interest of Virginia’s ratepayers,” Hashmi said Wednesday in an email. “Elected officials should continue asking tough questions and demanding answers. The decisions made now could affect families, businesses, and energy costs across the commonwealth for decades.”

Extension language in budget

Democratic Sen. Creigh Deeds, one of the Senate’s budget conferees, said the House of Delegates’ June biennial budget amendment recommendations included language giving the SCC up to a year to consider the merger and other complicated applications. However, the final budget passed at the end of June no longer included that provision.

“The House recognized the importance of this issue several months ago when we included a provision in the budget conference report extending the State Corporation Commission’s review timeline by six months,” House Speaker Scott said in a statement Wednesday.

“That provision was designed to give the commission the time it needs to fully evaluate a merger of this magnitude while keeping Virginia ratepayers front and center. As that review moves forward, our focus remains on protecting consumers and ensuring the commonwealth can meet its growing energy needs in a way that is reliable, affordable, and in the best interest of Virginians. We’ll continue working with the governor and all stakeholders to see that process through.”

Spanberger publicly supported the House budget amendments in mid-June while House Democrats and Senate Democrats had yet to reach an agreement about data centers’ sales and use tax exemption that some senators wanted to immediately repeal. The compromise budget ultimately passed without repealing the incentive but included a $1.2 billion two-year power usage tax on data center operators.

Deeds said Wednesday he is in favor of a time extension for the SCC to fully review the merger and argued for the language during the budget conference, while noting that he wasn’t sure how much support he had among fellow legislators for the extension.

A Democrat representing Charlottesville, Deeds said he had seen a text from “somebody on the SCC that they could use more time,” while noting, “That text wasn’t to me.”

Deeds also said he wasn’t sure why the extension language was included by House budget conferees and had not spoken with any of those delegates, but it had not been in an earlier version of the budget.

At the time, the legislature and governor were racing against the clock to pass a biennial budget before the July 1 deadline, so Deeds said his attention was not on the SCC review period extension language, especially since Dominion had not yet filed its application. “We really had our backs against the wall trying to get the budget done by the end of June.”

Ultimately, “the governor had the opportunity to put this language in the budget after the conference report was sent to her, and she didn’t do it,” Deeds said.

Sen. Scott Surovell, the Senate’s majority leader, said Wednesday that he is in favor of the extension and noted that the SCC indicated extra time would be welcome. “Virginia residents and businesses spend more on electricity than they do on taxes,” he said, calling the merger one of the state’s biggest policy decisions in recent history.

Clock is running

Deeds said that under General Assembly rules, the legislature is already in special session and does not require the governor to call lawmakers back to Richmond. Instead, Senate and House leadership can make the call.

Suetterlein and McNamara presumably know that rule, Deeds added, but may have been seeking publicity by sending a letter to Spanberger’s office and making it public. The governor is currently traveling in Europe for her first international trade mission.

“The General Assembly would not be able to act without this special session,” Suetterlein said Wednesday, “and we believe the special session needs to happen in August so that the new law can take effect in time.”

He added that he had spoken with one of the governor’s aides on Tuesday, “and they are going to look at [the letter], and hopefully we’ll hear back soon.”

Dominion released the following statement in response to questions about its view of a potential extension for the SCC’s review period: “Under Virginia law, the State Corporation Commission is the established, independent body with the authority and expertise to evaluate utility mergers. We believe the SCC’s longstanding, fact-based process is the appropriate venue to ensure a thorough review that protects customers.”

SCC Information Resources Director Greg Weatherford said in an email Wednesday, “Commission staff has said publicly that the experts at the commission are prepared and capable of completing a thorough review of the proposal in the 180-day timeline, and I see no reason to doubt them. These professionals are among the best in the world at what they do.

“That said, the commission’s authority in regulatory matters is delegated to it by the General Assembly. As always, the SCC will follow the laws and statutes enacted by the assembly.”