UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date of
report (Date of earliest event reported) November 5, 2009
Virginia
Electric and Power Company
(Exact
Name of Registrant as Specified in Its Charter)
|
Virginia
(State
or other jurisdiction
of
incorporation)
|
1-2255
(Commission
File
Number)
|
54-0418825
(IRS
Employer
Identification
No.)
|
|
120
Tredegar Street
Richmond,
Virginia
(Address
of Principal Executive Offices)
|
23219
(Zip
Code)
|
Registrant’s
Telephone Number, Including Area Code (804) 819-2000
(Former
Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of
the registrant under any of the following provisions (see General Instruction A.2.
below):
o Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item
7.01. Regulation FD Disclosure.
Proposed
Rate Settlement
On July
1, 2007, legislation amending the Virginia Electric Utility Restructuring Act
(the Regulation Act) and the fuel factor statute became effective, which
significantly changed electricity regulation in Virginia. Pursuant to the
Regulation Act, the Virginia State Corporation Commission (Virginia Commission)
entered an order in January 2009 initiating reviews of the base rates and terms
and conditions of all investor-owned utilities in Virginia. During
2009, Virginia Power submitted base rate filings and accompanying schedules to
the Virginia Commission, which, as amended, propose to increase our Virginia
jurisdictional base rates by approximately $250 million annually.
On
November 5, 2009, Virginia Power and the Office of the Attorney General of
Virginia, Wal-Mart, Kroger, Chaparral (Virginia) Inc., MeadWestvaco Corp.,
International Paper Company, and the Apartment & Office Building
Association, filed a Stipulation and Recommendation (settlement agreement) for
consideration and requested approval by the Virginia Commission that would
resolve the pending proceeding to set base rates in Virginia, the Virginia fuel
case proceeding and the authorized return on equity for the rate adjustment
clauses for the Virginia City Hybrid Energy Center, the Bear Garden power
station and the demand-side management (DSM) programs. The
recommended settlement, if approved by the Virginia Commission, would reset base
rates at levels existing prior to September 1, 2009 (except that certain
transmission costs are now recovered through a separate rate adjustment clause),
and would require Virginia Power to refund base rate amounts collected on an
interim basis since September 1, 2009, with interest. In addition, Virginia
Power’s rate of return on common equity would be set at 11.9% for base rates,
inclusive of all available incentive adders, and 11.3% for the DSM and
generation rate adjustment clauses discussed above, exclusive of any applicable
incentive adders. Further, Virginia Power would credit to
customer bills through December 31, 2010 a total of $268 million that had been
collected from 2008 base rate revenues. If charges through December 31, 2010
related to the generation riders discussed above and certain transmission costs
exceed $268 million, the balance would be written off by Virginia Power and not
charged to customers. In addition, Virginia Power would credit $129 million related to fuel revenues
and benefits from financial transmission rights (FTRs) from July 1, 2007 through
June 30, 2009 as a one-time credit to residential customer bills and as a credit
to fuel factor rates for the period December 1, 2009 through June 30, 2010 for
all other customer classes. For customers who are not Virginia
jurisdictional customers but have agreed to pay rates that are either approved
by the Virginia Commission or are based on the same ratemaking methodology, the
proposed settlement would result in approximately $31 million in total credits
to these customers’ rates.
It is
expected that a final decision on the proposed settlement by the Virginia
Commission may be reached in the fourth quarter of 2009 or early
2010. Possible outcomes of the settlement proposal include the
Virginia Commission’s approval of the settlement and related adjustments to
rates, their denial of the settlement and continued review of our base rates and
rate adjustment clause filings (which could include a rate increase, a rate
decrease, and/or a refund of earnings more than 50 basis points above the
authorized ROE), or the Virginia Commission could propose changes to the terms
of the proposed settlement.
A copy of
Dominion Resources, Inc.’s press release regarding the proposed settlement is
attached as Exhibit 99.
Item
9.01 Financial Statements and Exhibits.
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Exhibit
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99
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Dominion
Resources, Inc. press release dated November 5,
2009
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SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized.
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VIRGINIA
ELECTRIC AND POWER COMPANY
Registrant
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/s/ Carter M. Reid
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Carter
M. Reid
Vice
President – Governance and Corporate
Secretary
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Date: November
5, 2009