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Va. regulators OK partial recovery of upgrades at Dominion coal plants

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Va. regulators OK partial recovery of upgrades at Dominion coal plants

Virginia regulators granted cost recovery of environmental upgrades at certain Dominion Energy Virginia power plants while denying recovery of costs for work at two coal units.

The Virginia State Corporation Commission on Aug. 5 approved, in part, a new rider for the Dominion Energy Inc. subsidiary to recover costs to comply with state and federal environmental regulations.

Dominion Energy Virginia, known legally as Virginia Electric and Power Co., asked to recover nearly $114 million from customers from Nov. 1, 2019, through Oct. 31, 2020, for ongoing improvements at its Chesterfield, Clover and Mount Storm coal plants. The utility said the improvements are necessary to comply with the U.S. Environmental Protection Agency's Coal Combustion Residuals rule and certain Clean Water Act requirements as implemented in Virginia and West Virginia.

Dominion later lowered its request to about $107 million, but the SCC rejected a portion of the costs the company sought to collect for environmental projects at Chesterfield units 3, 4, 5 and 6. Specifically, regulators denied recovery of wet-to-dry coal ash conversion for Chesterfield units 3 and 4, which Dominion placed into cold storage in December 2018 before shutting them down permanently in March.

Regulators noted that Dominion made the decision in June 2015 to invest about $18 million in long-term environmental upgrades on units it planned to retire or retrofit within five years.

"In this regard, the commission finds that Dominion has failed to establish in the instant proceeding that it was reasonable and prudent to incur this environmental capital cost for Units 3 and 4 based on the circumstances existing at such time," the SCC wrote in its order.

Regulators added that the coal ash conversion is not providing service to the public or benefits to retail customers since the units are retired. "In addition, because these units are retired, the wet-to-dry conversion is not currently necessary to comply with federal regulations," the SCC wrote.

In a news release, the SCC pointed out that the approval of Rider E means there are now 15 riders paid by Dominion's residential customers in Virginia.

(SCC docket PUR-2018-00195)