NextEra-Dominion merger: What’s in store for Virginia?

The proposed merger of Dominion Energy and NextEra Energy could create an energy giant, but it’s likely to face opposition in Virginia.

The two utility companies announced Monday they’d entered into a definitive agreement, with Florida-based Fortune 200 company NextEra Energy set to acquire Richmond utility Dominion for approximately $66.8 billion in an all-stock transaction, based on NextEra stock share prices at the close of the stock market Friday.

Analysts believe the proposal would be the largest merger of utilities in the U.S. to date.

The merged company would be the world’s largest regulated electric utility business, according to a news release, and Dominion says the new company would also be the largest renewable and energy storage operator in the world.

The combined utility would serve about 10 million customer accounts in Florida, Virginia and the Carolinas and own 110 gigawatts of generation from a mix of energy sources, with an additional 130 gigawatts in the pipeline.

The merger is large both in terms of value and service territory, noted Rob Rains, director of policy sector research and the lead energy and utilities analyst for Washington, D.C.-based firm Washington Analysis.

“Basically they’re creating a massive East Coast utility,” he said, “running all the way down from Florida into Virginia — basically in D.C.’s backyard — and then obviously NextEra has business all over the country. … They’re also the largest merchant renewables firm in the United States. It’d be a huge, huge deal, figuratively and literally.”

The companies said they expect the transaction, which both boards of directors unanimously approved, to close in 12 to 18 months, but the deal must receive approval from shareholders, state utility regulators in Virginia, North Carolina and South Carolina, and multiple federal bodies. In Virginia, the regulatory body that would consider the deal is the State Corporation Commission, which approves utility rates and major capital projects.

On the federal side, the Federal Energy Regulatory Commission, Federal Trade Commission and the U.S. Department of Justice are likely to approve the merger, analysts say. NextEra seems to have a friendly relationship with the Trump administration, having been one of several corporate donors to the White House ballroom project, so that could benefit the deal.

Battleground Virginia?

Virginia, however, could be a battleground, as state lawmakers and advocacy groups scrutinize the proposal.

“It’s our understanding that opponents of this proposed acquisition are lining up to battle in Virginia,” said ClearView Energy Partners Managing Director Timothy Fox.

Opponents to the merger have likely chosen Virginia as their venue because of growing public and legislative opposition to data center growth in the state, particularly the perception that larger campuses are contributing to rising power rates, Fox said.

Awareness of data centers’ massive use of electricity and water is spreading, especially as artificial intelligence usage spurs tech giants to build larger data center campuses. But with decades in the industry, Northern Virginia has seen public opposition to data centers for multiple years, most notably in Prince William County’s Digital Gateway fight.

Even in Loudoun County, said to have the world’s largest concentration of data centers in its Data Center Alley, supervisors have halted by-right zoning for new data center proposals and now require developers to seek approval for rezoning.

Nonetheless, Fox said Virginia’s growing power demand is very likely what makes Dominion attractive to NextEra. With nearly 650 data centers in operation and more in the pipeline in Virginia, “Dominion is perhaps the leader in terms of requested existing and new data center interconnection” among the 13 states and the District of Columbia in the regional grid operator PJM Interconnection’s market, Fox said.

Last year, Dominion reported its demand for power grows between 5% and 6% annually, up from 1% annually five years ago — and that’s due to data center growth.

“There’s a strategic logic to this,” Fox said. “Dominion brings the load growth, and NextEra brings the capital and generation machine.”

Also, most utilities own transmission lines but not power generation assets like power plants, which are instead owned by independent power producers, Fox said. Dominion, though, does own generation assets including nuclear energy and natural gas plants, as well as the Coastal Virginia Offshore Wind project underway off Virginia Beach.

“What could be so attractive to NextEra is not only that there’s this large demand in its service territory, but also, Dominion is already authorized to build generation,” Fox said. “It’s not like if they bought a different utility but then had to work with that utility to find a third party to build generation — they can just use their balance sheet to help Dominion build more faster.”

Concerns in the commonwealth

Some Virginians have expressed concern over the merger, particularly the effect it could have on electricity rates.

Utilities themselves are heavily regulated legal monopolies, Washington Analysis’ Rains said, but “as far as the rate increase concerns go, that is always a factor for these kinds of acquisitions.”

Rains also noted that the acquisition is a stock sale. “As far as I can tell,” he said, “it doesn’t appear to be using a lot of debt to make the acquisition.”

The companies have proposed $2.25 billion in bill credits for Dominion customers in Virginia and the Carolinas that would be spread over the next two years after closing. State regulatory commissions would make the final decisions on bill credits.

Rains said this is “designed to kind of assuage concerns about rate increases, but a lot of folks that follow the utility space would tell you that the rate credits themselves are … temporary,” and that “rates will inevitably go up” once the two years are up and the utility has to maintain and update their equipment to handle demand.

NextEra and Dominion, however, said Monday that the combined utility’s scale would benefit customers, driving “affordability in the long term by leveraging scale and operating and capital efficiencies as the company makes smart investments on behalf of its customers to meet growing power demand.”

NextEra Chairman, President and CEO John Ketchum added that the larger company “enables us to buy, build, finance and operate more efficiently, which translates into more affordable electricity for our customers in the long run.”

Not so fast, says Clean Virginia, a clean energy advocacy group founded by Charlottesville investor Michael D. Bills to counter Dominion’s influence on Virginia legislators. Bills has become the largest individual campaign donor to candidates who don’t accept funding from the utility.

“This deal would hand control of Virginia’s electric grid to a company with a deeply troubling track record,” Clean Virginia Executive Director Brennan Gilmore said in a statement. “Before Virginia ratepayers are locked into a relationship with NextEra Energy, every policymaker and regulator in the commonwealth needs to understand what NextEra has done in Florida and ask hard questions about whether Virginians can expect anything different.”

Among Clean Virginia’s concerns, it listed NextEra subsidiary Florida Power & Light’s approximately $6.9 billion rate increase in Florida, which opponents claimed was the largest rate hike in U.S. history, according to Florida Phoenix’s reporting. In November 2025, the Florida Public Service Commission approved a four-year settlement for the rate hike. FPL provides electricity to about 12 million people in Florida and is billed as America’s largest electric utility.

“Virginians don’t choose their electric utility,” Gilmore added. “That’s why the law requires utilities to serve the public interest — and precisely why any merger must be judged by one standard: Does it make life better for the people who have no other option?”

SCC considerations

For the merger to move forward, it must receive approval from at least two of Virginia’s three SCC commissioners, and Chair Kelsey A. Bagot could potentially recuse herself, as she was a senior attorney at NextEra before the Virginia General Assembly elected her commissioner.

“What we expect is a highly contentious fight at the Virginia State [Corporation] Commission that centers on whether or not NextEra would hold too much influence and power over both Virginia and the larger PJM region,” Fox said.

Another factor here is that Virginia Attorney General Jay Jones’ office could participate in the process, representing ratepayers. Of note, Jones received $400,000 from Clean Virginia during his Democratic primary campaign in 2025.

“The Virginia Attorney General’s Office serves as the commonwealth’s designated ratepayer advocate,” OAG spokesperson RaeAnn Pickett said in a statement. “We take this role very seriously, and we will scrutinize the associated regulatory filings to protect ratepayers and evaluate the claims referenced in the announcement.”

Gov. Abigail Spanberger’s office did not respond to a request for comment this week. Spanberger received $250,000 from Clean Virginia and received its endorsement last year, but she accepted a $100,000 donation from Dominion for her inauguration fund, according to state reports.

“A lot of utility mergers that go forward,” Rains said, “they typically will have to find areas of agreement and reach settlements with different parties in order to get approval, and so that is foreseeable in this kind of case, that they would need to reach out to a subset of stakeholder groups and try to get them on board with the idea of this tie-up.”

That could occur, for example, if advocacy groups seek to participate in the approval process as intervening parties and argue that the merger does not meet the state’s standards and puts too much risk on taxpayers, he added.

In his statement Monday, Clean Virginia’s Gilmore said: “Virginia has spent years fighting to reform a utility monopoly that puts shareholders ahead of customers. We cannot allow this merger to make that problem larger, more powerful and harder to fix. The SCC process is the moment Virginia gets to set the terms.”

Typically, settlements center around protections for the acquired utility from the parent company, such as requiring a set portion of the utility’s board to be composed of independent members, Rains said. Sometimes settlements have “stay-out periods,” where utilities agree not to file a rate case for a set amount of time.

Ultimately, Rains added, “utility commissions in general increasingly view the review process, and even potentially an initial denial of a merger, as a point of negotiation for potentially seeking more favorable terms for ratepayers.”