This story was reported and written by our media partner the Virginia Mercury.
The debate over whether Florida-based NextEra Energy should be allowed to acquire Dominion Energy and create the largest regulated utility in the country heated up Tuesday, with Virginia Lt. Gov. Ghazala Hashmi pledging her opposition to the $67 billion merger.
She is the first elected official at the statewide level to formally oppose the creation of the energy titan.
“After engaging in discussions with experts and industry officials, after reading analyses of the proposed merger, and after listening to the perspectives of hundreds of Virginians … I’ve concluded that the proposed takeover of Dominion Energy with NextEra is not in the best interest of Virginians,” Hashmi said at a press conference at Virginia’s Capitol in Richmond.
The lieutenant governor recently completed a five-city tour across the Dominion coverage area to hear firsthand Virginians’ concerns over the merger. The clearest feedback, Hashmi said, was that citizens are worried the deal could make their utility bills skyrocket, citing increased energy costs in recent years.
“The public wanted assurances that this most essential public good will remain safe, and will remain reliable,” Hashmi said. “They want assurances that this merger is going to bring a public benefit, rather than increased financial hardships, to our ratepayers.”
Hundreds of people at each event in Loudoun County, Norfolk, Richmond, Charlottesville, and Roanoke expressed that there are not enough protections for ratepayers who would have to bear the cost of infrastructure buildouts, Hashmi said.
The merger will allow the companies to buy energy infrastructure in bulk, which they said would save money and increase credit ratings. That alone doesn’t prove that energy rates will remain affordable, Hashmi countered Tuesday.
State Sen. Mike Jones, D-Richmond, also stated his opposition to the merger at Tuesday’s press conference. His stance, he said, is based on concerns that the utility companies’ priority is to serve data centers, not residents.
A recent amendment to the merger filing that expanded the companies’ promises to extend customers’ bill credits to four years and to build a headquarters office in Richmond – but Jones said those steps don’t guarantee long-term solutions for ratepayers.
“A promise and a press release is not protection on a power bill. When the commitments expire, it will not be the shareholders who pay, it will be everyday working Virginians,” Jones said
At the event, Hashmi released a report that summarized the comments and concerns from constituents at each of the listening tour stops.
In Loudoun, residents questioned who benefits from the energy infrastructure expansion that they see from the data center buildout and who should have to pay for it.
Norfolk residents posed queries about storm resilience and financial vulnerability. An Army Corps of Engineers study found the Hampton Roads city is at heightened risk for severe flood damage and city officials are hammering out a $6.1 billion coastal storm risk management plan.
In Richmond, residents asked about the six-month condensed timeline of the review of the merger and whether the commitments made by the two companies are enforceable.
In Charlottesville and Roanoke residents had questions about regional cost allocation and clean energy commitments.
Ahead of the official filing for the merger, Hashmi released a list of 64 questions about the project that she urged the companies to answer. The companies have not responded to those questions, with Dominion officials stating that they believed many would be answered in the case proceedings.
Energy officials, lawmakers question NextEra’s past dealings
In a hearing of the Energy Commission of Virginia on Tuesday, lawmakers questioned NextEra Vice Chairman Armando Pimentel about past failed attempts to acquire other utilities in Texas, Hawaii, and South Carolina.
Sen. Scott Surovell, D-Fairfax, brought up questions from experts that were presented to the commission in August about adequate ring fencing, or financial protections.
“One of the questions we got was that whatever the (State Corporation Commission) does, if it’s approved, it needs to make sure there’s adequate protections around things like excess dividend transfers, to make sure that NextEra or merger company affiliates don’t have undue advantage in procurement for different projects that are going to be constructed, et cetera,” Surovell said.
Pimentel responded that only one of the past acquisition attempts had questions relating to ring fencing, and that those concerns did not apply in other cases.
SCC moves forward with merger review
On Oct. 2, a SCC examiner determined that NextEra’s records concerning the company’s attempted takeover of a Florida utility company be included in the regulators official review of the case. A motion from clean energy advocacy group Clean Virginia prompted the move.
Meanwhile, several state lawmakers and Attorney General Jay Jones have called for the SCC’s review period of the merger to be extended.
Neither Gov. Abigail Spanberger nor lawmakers have called a special session to address the review timeline for the case.
Spanberger said she declined because she opted to be an official intervenor in the case, allowing her to partake in cross examinations and have access to confidential documents.
The General Assembly is technically still in a special session – which would allow them to call themselves back to Richmond to pass a policy that would allow the SCC to extend the timeline. But House and Senate leadership have not signaled that would happen.
The SCC recently responded to increased public interest in the merger case by adding three in-person hearings to obtain public testimony. That is in addition to the three days of telephonic testimony that will be collected and any written statements that are submitted.
State regulators have until Jan. 11 to approve or reject the deal, unless they opt to extend the review time period.