From the Stan Scott for State Senate campaign:
Democratic Party Nominee Stan Scott Challenges Senator Ryan McDougle to Oppose Dominion Rate Increase
Candidate writes his State Senator on a Key Economic Issue in the District
August 26, 2019
Mechanicsville – Stan Scott, Democratic nominee for State Senate in Virginia’s 4th Senate District, this morning wrote Senator Ryan McDougle asking him to oppose the 10.75% return on equity rate increase Dominion Energy has requested from the State Corporation Commission. Scott has already submitted comments to the Commission opposing the increase.
Pointing out that the regulated monopoly already over-earns $300 million per year due to General Assembly interference, Scott wrote, “Since you sit on the committee that oversees Dominion I am sure you are aware that the US Navy’s testimony called this proposed increase “excessive and unwarranted,” and that the Virginia Poverty Law Center (VPLC) said in court filings the rate increase was, “excessive, unjustified, and unreasonable.”
Scott added, “To be clear, Dominion rakes in hundreds of millions of dollars that the firm hasn’t actually earned. It makes these profits off the backs of hard-working Virginians in our District and across the Commonwealth who live paycheck to paycheck.”
Dominion Energy filed its request for an ROE increase from 9.2% to 10.75% with the State Corporation Commission in the spring of this year. Several businesses, organizations, and activist groups, from Walmart to retirees, have submitted comments opposing the increase. Public comment on the request is open until September 3rd and the SCC will hold hearing on September 10th.
Background: The Virginia State Corporation Commission established a procedural schedule for determining the new rate of return on common equity (“ROE”) to be applied to Dominion’s rate adjustment clauses going forward. This ROE will also be used to measure Dominion’s earnings in the 2021 base rate earnings review. When setting a utility’s ROE, the SCC judges will consider the return a typical investor would require in order to purchase stock in a company with a similar risk profile and a variety of other issues. Dominion asserts that it requires a 10.75 percent rate of return, which the company states is “the return required to invest in a company with a risk profile similar to Dominion.” Typically, the higher the ROE, the riskier a monopoly investment is. The current ROE for Dominion’s RACs is 9.2 percent which is in range with where the Poverty Law Center, the US Navy and the Attorney General recommended it be.
About Stan Scott: Stan Scott retired from the United States Army in 2002 with the rank of Sergeant First Class. During his military career Scott earned multiple awards, including a Meritorious Service Medal, while serving as a Tank Commander, Tank Platoon Sergeant, and Staff NCO. Scott also served Virginia for two years as Executive Director of the Virginia National Defense Industrial Authority. After leaving public service Stan built a successful business career as a consultant for two environmental service firms and formed his own small business, Crux Analytics, LLC. He holds degrees in Political Science, Economics, Public Policy and International Relations.