ENERGY EXODUS - Big businesses want the option to - Virginian-Pilot, The (Norfolk, VA) - February 24, 2019 - page ID February 24. 2015 | Virginian-Falot. lotonline.co It's a power struggle, On one side, Dominion Energy of Virginia, the dominant Richmond-based utility, which like any business wants to keep as many paying customers as possible. On the other, several retailers who want the freedom to buy their energy from someone else. Walmart, Costco, Target, Harris Teeter, Kroger and Safeway have all petitioned regulators with the State Corporation Commission to get out from under Dominion's bills, signaling a potential mass exodus from Virginia's power grid. Cable giant Cox Communications and coal mining company Contura Energy did the same earlier this month. Dominion attorneys have argued that any customer allowed to buy its own electricity in a competitive market is one less paying customer, leaving those energy users who remain with higher bills. Retailers have used their filings to point out Dominion's outsized revenue above and beyond the state's minimum guarantees, more than $300 million worth according to a commission report from August. Appalachian Power brought in about $30 million above and beyond its authorized rate of return, according to the filings. When taking those amounts into consideration, "the impact from Wal-Mart's petitions is but a drop in the bucket and establishes, quite clearly, that neither the utility nor its customers are going to be adversely impacted in a manner contrary to the public interest." Walmart's attorney Carrie Harris said, according to a hearing transcript. Walmart plans to buy the energy from itself, effectively, now that its wholly owned Texas Retail Energy LLC is licensed to sell in the state. Costco's attorney in the matter, Cliona Robb, who is also representing Cox Communications, was blunt in her. argument to regulators. 'Dominion's logic boils down to saying that having a three-cent impact on a customer's monthly bill under the improbable assumption that the only impact influencing the customer's bill will be Costco's aggregation petition, " she said, according to a transcript of one hearing. "This is nonsense." 'Regarding the impact on the utility itself, it is Costco's assessment that reducing overly generous earnings by shareholders is right and proper." So far, it's looking good for the retailers. In mid-january, a hearing examiner recommended the commission approve Walmart's petition saying it "would have no adverse effects on either Appalachian or Dominion Energy." The average residential customer, though, might expect higher bills by about 5 cents under Appalachian and 13 cents via Dominion. Walmart pointed out that Dominion's average residential customer using 1,000 kilowatt hours a month pays about $115 a month. By replacing a single 100-watt light bulb with an equivalent 14-watt LED bulb, those customers could save more than 10 cents a month, the retailer said. "They're right." said Irene Leech, a Virginia Tech professor and consumer advocate who leads the Virginia Citizens Consumer Council. But, she added, the problem for residential ratepayers is the cumulative impact to their bills, including riders that have been added over the years. A few pennies here and there doesn't make much difference, but combined, they do. She's been watching the cases but hasn't gotten involved. She said she doesn't begrudge companies wanting the freedom to buy their own energy, but she'd like residential customers to have the same opportunity. "And nobody seems to think that's appropriate." she said. "Yes, in Virginia, we're open for business and we want to have the best business environment possible. But we need to make sure that businesses altogether pay their fair share." She said it was "absolutely reasonable" to suggest the utilities use some of their over-earnings to ensure the residential customers who remain aren't burdened with higher bills as a result. It's getting to be a breaking point. We've got to be fair to everybody. Not just business friendly," she said. "It's not so anti-business to say: wait-a-minute, consumers can't pay for all this."The commission could rule at any time. Applications from the other retailers are still waiting for a hearing examiner's opinion. Large corporate energy users were already allowed to shop around for their power as long as they used more than 5 megawatts in the prior year. But since 2007, businesses with multiple accounts - like retailers with numerous stores and locations recording less than that - have also been allowed to combine their use as long as it added up to at least that much, freeing them up to shop for their own energy, too. What took so long? Testimony in the cases indicate the market has matured and several sellers have lined up at the ready as evident by the firms offering comments in support of the petitions. The only caveat before leaving to find a new power source was that their total usage couldn't exceed percent of the utility's peak demand and that their departure wouldn't be "contrary to the public interest," according to the code's language Dominion's view? That it's not in the public interest for any of its customers to leave. Gregory Morgan from Dominion has maintained that any aggregation above zero is "too much" according to his reading of the subsection of the code that allows it. He's also argued that retailers wanting more renewable energy options, which Walmart has, can already make those arrangements through the utility, doing so without aggregating its accounts and shopping around. Asked for a general comment about the cases, Dominion Energy spokesman Dan Genest said, "While some customers desire to test the market, we believe the potential savings are small and not justified by the risks involved. In addition, great care needs to be taken to protect remaining customers from having to absorb the. costs of aggregators leaving our system." But the utility is also concerned about how the loss of its customers to a competitive market might be viewed by its investors. The utility has long been looked at favorably on Wall Street. 'The Company relies on equity and fixed income investors to provide the capital necessary for safe, reliable, and affordable electric service for customers, and competes with other utilities for a finite amount of equity and fixed income capital," Dominion said in its testimony, adding that its ability to compete for those dollars successfully is "enhanced" because "investors conclude that the Virginia regulatory framework is supportive of the Company's financial health including the timely recovery of a return on prudently invested capital." Letting its customers leave to buy their electricity elsewhere could erode that investor confidence, the company argued. Reynolds Group, a New Zealand-based packaging company with Richmond-based operations, was the first to test the rule more than a decade after it was put on the books, winning approval in February 2018. Its energy use at its combined accounts amounted to 10.12 megawatts via Dominion, or about 0.06 percent of the utility's peak demand. Regulators, in a brief four-page conclusion, said Reynolds' departure would not adversely affect Dominion's remaining customers and any impact would be so minuscule it wouldn't register. After its win, the applications poured in. Walmart, the state's second largest employer behind the Department of Defense, was already in the queue. Then came Costco in June, Kroger - which also owns Harris Teeter - and Target in September and then Albertsons which operates Safeway grocery stores in Northern Virginia. Cable provider Cox Communications filed earlier this month asking that 4.837 retail customers have their Dominion Energy accounts combined. Contura Energy, which has three coal-mining operations in Appalachian Power's service area in Virginia, wants to combine its 5 megawatts of use and shop for energy, too. If just the retailers' petitions are approved, what could it do to the bill of Dominion's average residential customer using 1,000 kilowatt hours a month? Walmart's departure could mean 13 cents more per month, Kroger and Harris Teeter a combined 8 cents. Target 5 cents, Costco 3 cents and Safeway a single penny. Combined, that's 30 cents more per month. Kimberly Pierceall, 757-446-2588, kimberly pierceall@pilotonline.com CITATION (APA STYLE)