ECE 592: Business of Electric Utilities Team Project-Fall 2012

DOMINION ELECTRIC UTILITY

Sarah Hambridge Sruthi Varma Patchamatla Bharadwaj Vasudevan Dinesh Baradi

INTRODUCTION: Dominion serves electric customers in Virginia and North Carolina and gas customers in Ohio and West Virginia. It is one of the nations largest producers and transporters of energy. Its portfolio consists of approximately 27,400 megawatts of generation and 6,300 miles of electric transmission lines[1].

SUMMARY OF CUSTOMER COUNTS: The electric delivery customers for Dominion Virginia power are shown below for 2011 and 2012. Dominion Virginia organizes its customer classes into four categories for retail and one category for wholesale. ELECTRIC DELIVERY CUSTOMERS in the twelve month period ENDING DECEMBER 31, 201112 [2] Customer Class Residential Commercial Industrial Governmental Total Retail Wholesale - sales for resale Total 2012 2,210,587 239,193 548 29,537 2,479,865 3 2,479,868 2011 2,180,233 236,208 560 29,371 2,435,178 3 2,435,181

SUMMARY OF TOTAL ANNUAL ENERGY DELIVERED: The annual energy delivered (in GWh) to customers of Dominion Virginia power are shown below for the year in 2011 and 2012. The energy delivered is organized by customer class. Electricity delivered (GWH) in the twelve month period ENDING DECEMBER 31, 2011-12 [2] Customer Class Residential Commercial Industrial Governmental Total Retail Wholesale - sales for resale Total 2012 31,056 34,000 8,628 11,559 85,243 1,946 87,189 2011 30,769 28,949 7,960 10,823 78,500 3,814 82,314

SUMMARY OF PEAK DEMAND FORECASTING: The Dominion Utility services are primarily divided between two zones, namely DOM LSEDominion Load Serving Entity which represents the Companys service territories in the Commonwealth of Virginia and DOM ZONE which includes other LSEs as a part of PJM interconnection. The actual peak load demands from 2007-2010 have been used to forecast the 2011 peak demand. The same is shown below [2]. LOAD (MW) 1. Summer a. Adjusted Summer Peak b. Other Commitments c. Total System Summer Peak 2. Winter a. Adjusted Winter Peak b. Other Commitments c. Total System Winter Peak 2007 17,891 150 17,741 15,765 127 15,638 2008 16,908 150 16,758 14,787 128 14,659 2009 16,067 150 15,917 15,577 132 15,445 2010 16,952 389 16,563 14,376 124 14,253 2011 17,530 431 17,099 14,577 128 14,449

GENERATION FLEET 2011: The Companys existing generating resources are located at multiple sites distributed throughout its service territory as shown [2]

Generation Resource Type Coal Nuclear Natural Gas - Boiler Natural Gas - Combined Cycle Natural Gas - Turbine Pumped Storage - Hydro Light Fuel Oil - Turbine Heavy Fuel Oil - Boiler Renewable - Hydro Renewable - Biomass Purchases Total - Owned Total REF:Doc2[Dominion VA&NCFleet]

Net Summer Capacity (MW) 5,442 3,270 316 1,606 3,353 1,802 352 1,604 318 169 1,779 18,232 20,011

Percentage (%) 27.20% 16.34% 1.58% 8.03% 16.76% 9.01% 1.76% 8.02% 1.59% 0.84% 8.89% 91.11% 100%

The Companys load forecast indicates that the region is expected to have future annual increases in energy demand of approximately 2.02% and peak load of approximately 2.01% [2]. At present, the Company has three options for meeting future increases in energy and peak demand including supply-side resources, demand-side resources, and market purchases. The Company also remains committed to meeting its renewable energy and energy efficiency goals in a cost-effective manner. The Company uses PJMs reserve margin guidelines in conjunction with its own load forecast. The decrease in reserve margin from the previous study is the result of a slight increase in the PJM/World load diversity.

Year

Net Summer Peak MW

Effective Reserve Margin % 16.10% 16.70% 13.00%

Reserve Requirement MW 2,822 3,040 2,519

Total Resource Requirement MW 20,352 21,234 21,842

2011 2012 2013

17,530 18,194 19,312

New Generation: The Companys aims to identify the mix of resources necessary to meet future energy and capacity needs in an efficient and reliable manner at the lowest reasonable cost. The Companys load forecast indicates that the region is expected to have future annual increases in energy demand of approximately 2.02% and peak load of approximately 2.01%. At present, the Company has three options for meeting future increases in energy and peak demand including supply-side resources, demand-side resources, and market purchases. The Company also remains committed to meeting its renewable energy and energy efficiency goals in a costeffective manner.

Customer Class Residential Commercial Industrial Governmental Total retail Wholesale-Sales of resale Total Table reference(Doc2) Pg.119

2012 Accounts 2210587 239193 548 29537 2479865 3 2479868

GWH 31056 34000 8628 11559 85243 1946 87189

2011 Accounts 2180233 236208 560 29371 2435178 3 2435181

GWH 30769 28949 7960 10,823 78500 3814 82314

2010 Accounts 2156473 233608 572 29184 2419837 3 2419837

GWH 32539 29224 8512 10951 81226 3311 84537

Estimated Customer Growth & GWH Consumption:

Taking into account the increase in the Industrial load in GWH, it is decided that a Nuclear plant be established at the Virginia City Hybrid Energy Centre(VHEC) which has an average life of 60 years and an estimated capacity of 585MW. Since it will operate to the base load the capacity factor is assumed to be 55% and the time of operation is calculated using the formula Time of Operation(Days)=Capacity Factor*(8760), therefore the fixed O&M and variable O&M cost are determined based in the document 8 cited in reference. Therefore it is estimated that this establishment will serve our industrial load and offset the deficit energy usage by 60%. The remaining 40% is compensated by setting up a Gas Turbine plant at Brunswick county having a demand capacity of 350MW. This is set up with an intention to serve our increase in summer peak as gas fired plant take less time to attain steady state operation. The expenses related to it are estimated in the same way mentioned for Nuclear Plant. It is assumed that the Gas Turbine plant will last for 25 years and the capital cost related to it is depreciated linearly. As per our estimation this plant will compensate for 30% increase in the GWH consumption of our total energy demand. This will primarily supply our ever-growing commercial and residential classes. The company has adapted to the changing regulatory environment and now with an intention to serve the REPS it has decided to establish a Biomass Plant at Gloucester County. With a capacity of 100MW it is expected to operate at 50% capacity factor serving 9.4% of our increased energy demand. The deficit demand of 0.6-1.00% is to be bought from the PJMs energy market. This is a drastic reduction compared to the figures from 2010 where 3% of the deficit energy demand was bought. The company believes that this forward step will eventually lead to the self sustainable future and secure its ability to serve the customers. Baseload/Peak: The graph below depicts screening curves for a variety of plants[7]. According to each plants fixed (y-intercept) and variable costs (slope), the best economical use for that plant can be determined.

In order to determine which plants should compromise the baseload and the peak power, the costs required at each hour for each plant should be considered. The Combined Cycle and Combustion Cycle are the cheapest plants to run at ~2000 h/yr. These plants will provide the peak demand, since they run economically for only a portion of the total year. The Oil/Gas Steam may contribute to the peak load if the Combined Cycle and Combustion Cycle plants are running at full capacity. As seen on the graph, the Oil/Gas Steam is the most economical running at below ~3000 h/yr. From ~2000 h/yr to ~6000 h/yr, Combined Cycle is the most economical and will provide power to the intermediate load. The baseload power will be provided by Hydroelectric and Pulverized Coal. Nuclear and Biomass are also good options for baseload power that are used by Dominion. At above ~6000 h/yr, Hydroelectric and Pulverized Coal become the cheapest plants to run. Since they are the most economical to run for the greatest number of hours per year, they become the baseload power, which is typically only switched off for maintenance. This information is summarized below. Baseload (~6000 to 8760 h/yr) Intermediate Load (~2000 to 6000 h/yr) Peak Load (~0 to 2000 h/yr) Hydroelectric, Pulverized Coal, Nuclear, Biomass Combined Cycle Combustion Cycle

Resource Biomass CC 2nd CC 3rd CT Fuel Cell Geothermal IGCC IGCC CCS Municipal Solid Waste Nuclear PC PC CCS Hydro Power Solar PV Solar Thermal Wave Power Wind-Off-shore Wind-On-Shore

Resource Type Baseload Intermediate Intermediate Peak Intermediate Baseload Baseload Baseload Baseload Baseload Baseload Baseload Intermittent Intermittent Intermittent Intermittent Intermittent Intermittent

Dispatchable Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No No No No No No

Primary Fuel Renewable Natural Gas Natural Gas Natural Gas Natural Gas Renewable Coal Coal Renewable Uranium Coal Coal Renewable Renewable Renewable Renewable Renewable Renewable

Busbar Resource Yes Yes Yes Yes No No Yes Yes No Yes Yes Yes Yes Yes No No Yes Yes

REF:Dominion VI&NC FLEET IRP 2010 The table above summarizes the resources that the company reviewed as part of the evaluation for plant establishment study. It is evident that the Uranium was the best possible choice to serve the Industrial Customers when long-term benefits were considered.

TRANSMISSION & DISTRIBUTION: According to the 2011 Dominion IR Reference Book [4], Dominion had 6,300 miles of electric transmission lines and 56,900 miles of electric distribution lines. In 2011, infrastructure investment was $0.5 billion in electric transmission and $0.2 billion in electric distribution, [totalling $0.7 billion. According to the Democratic Policy Committee [5], the cost per mile of transmission falls between $1.5 to 2 million per mile. Distribution lines can cost from $10,000 to $250,000 per mile [6]. Using this information, the miles and cost of infrastructure added in 2011 and in previous years are calculated below.

Transmission Infrastructure Distribution Infrastructure

2011 Infrastructure 250 miles Total Cost = $500 million (at $2 million per mile) 2000 miles Total Cost = $200 million (at $100,000 per mile)

Previous Infrastructure 6,300 - 250 = 6,050 miles Total Cost = $12,100 million (at $2 million per mile) 56,900 - 2000 = 54,900 miles Total Cost = $5,490 million (at $100,000 per mile)

We have assumed that for every 25 feeders we have a Distribution Substation. the cost stated above includes all these substations and the equipments associated with it. In the transmission sector, the system primarily includes 500 kV lines[19] and a number of 230 kV lines are being added in the recent past. We assume for every 150 mile of transmission line a interconnection substation is placed. Again the cost presented above has already included these substations.

BALANCE SHEET EXPLANATIONS: Asset Expenditure: [23] Our total asset value of the plants including the transmission and distribution infrastructure costs we end up with a total asset worth of $45,614 Million. As of 2011 the company had a debt to equity ratio of 1.519 and the total shareholders equity including the retained earnings added up to $11,446 Million. The total long term debt was $17,394 Million. Equity and Long Term Debt: (in million)

Debt Shareholder's Equity

$17394 $11446

Shares and Dividends: The total number of shares as of 2011 are 430 Million and the corresponding stock quote for the same is $26.68 [18]. Dividend Information: [24] Ex-Dividend Date Record Date March 2, 2011 May 25, 2011 Aug. 24, 2011 Nov. 30, 2011 Payment Date Amount Per Share

March 4, 2011 March 20, 2011 .4925 May 27, 2011 June 20, 2011 .4925 .4925 .4925

Aug. 26, 2011 Sept 20, 2011 Dec. 2, 2011 Dec. 20, 2011

The dividend yield as per the values mentioned above will be, Annual Dividend yield = (Dividends per share) / (Stock price) x 100% = 7.38%

Maturity Index: [20] This graphical representation gives the bonds maturity index i.e., the term of a bond and its yield depending on the term.

INCOME SHEET EXPLANATIONS: Other income expense: Given below are the schedule for plants under construction and the transmission projects added in the year 2010/2011. PLANNED TRANSMISSION ADDITIONS [2] Line Terminal Pleasant View Hamilton Chickahominy Lanexa Sub Chickahominy Old Church Garrisonville Underground Cable Uprate Pleasant View Dickerson Brambleton Pleasant View (#201) Reconductor Carson Suffolk 500 kV Line, Suffolk Transformer and Suffolk Thrasher 230 kV Line Meadowbrook Loudoun Line Ironbridge Southwest

Line Voltage (kV) 230 230 230 230 230 230 500/230 500 230

Target Date Oct 2010 Nov 2010 Mar 2011 Dec 2011 May 2011 May 2011 May 2011 June 2011 May 2011

PLANNED GENERATION UNDER CONSTRUCTION [2] COD UNIT LOCATION FUEL

Unit Type

2011 Bear Garden 2012 Virginia City Hybrid Energy Center

Buckingham County, VA Wise County, VA

Natural I Gas Uranimum B

CAPACITY (MW) Summer Winter 590 613 585 635

The expenses for all these activities are reflected in our AFUDC expenses which is accounted as the other income expense in our income statement. Income Tax Expense: For the revenue generated for the year 2010-11 we have assumed a sum of $745 million as our income tax expense [1]. Debt Amortization: includes the amortization of intangible and acquired assets. As of 30th September 2011, bonds maturing in 2011 add up to $462.5 million [10]. We have assumed an equal amount to be paid in as amortization for loan for the year 2011. The same is reflected in our income statement. Property and other taxes: $554 million is the amount paid by Dominion in the year 2011 as property and and other indirect taxes other than income taxes for the utility sector. It includes fees for licenses and other business regulations to government agencies. Purchased gas: $1764 million was purchased in the year 2011 for resale by Dominion [1]. FUEL COSTS: The total fuel cost for year comes to $1103 million. The capacity (MW), capacity factor [2] and time of operation for each plant were used to find the plant output in MWh. The fuel costs for the coal, oil/gas, CC, CT, and hydroelectric plants were calculated using the heat rate and fuel cost data below. Typical cost parameters for power plants and fuel types[7]. Technology Pulverized coal steam Oil/gas steam Combined cycle Combustion turbine Hydroelectric Fuel coal oil/gas natural gas natural gas water Heat Rate (Btu/kWh) 9700 9,500 7700 11400 0 Fuel Cost ($/million Btu) 1.5 4.6 4.5 4.5 0

The cost for uranium (nuclear) fuel was calculated at 0.77 cents per kWh [11]. Biomass fuel costs were calculated at 9 cents per kWh [12]. SMART METERS: [26] A small percentage of our total cost includes smart meters. Dominion has been demonstrating the benefits of smart metering technology since 2009. To date, we have installed more than 100,000 smart meters in portions of Midlothian, Charlottesville, Northern Virginia, Williamsburg, downtown Richmond, and in the Blue Ridge area. The smart meter demonstrations help evaluate technologies that can improve infrastructure for delivery and reliability of electric service, and provide safe, cost effective service to our customers and also to enable a two way communication between the meter and Dominion's electric distribution system.

VEHICLE MANAGEMENT: [27] Dominion ensures that its electrical infrastructure can support the expected demand from electric vehicles, which have significantly lower carbon intensity than conventional vehicles. It has added the Chevrolet Volt and Nissan Leaf to its vehicle fleet in an effort to educate about as well as study the impact on our system. The electric vehicles will help to assess how utilities can manage the new technology. The main purpose of these electric vehicles would be distribution circuit maintenance and meter reading. Fewer meter readers means fewer meter reading vehicles, less mileage, and lower insurance costs. Hence ,Vehicle Management = auto insurance savings + (reduced number of vehicles * annual miles driven * operating costs per mile) LOAD DURATION CURVE The load duration curve for Dominion is shown below [2].

Baseload generation consists of coal, nuclear, biomass, and hydro, which have the highest time of operation of the plants. Below is a breakdown of baseload capacity. Plant Type Coal Nuclear Hydro Biomass Total Total Capacity (MW) 4296 3539 3319 83 11237

The intermediate load consists of Combined Cycle plants. The total capacity for Combined Cycle is 2708 MW. The peak load consists of Combustion Turbine plants, with the lowest time of operation of the plants. The total capacity for Combustion Turbine is 1373 MW. The gas and oil steam plants support the intermediate load and peak load when needed with a total capacity of 2403 MW. Below is a table of the capacities for each load type. Load Type Baseload Intermediate Load Peak Load Gas/Oil Steam Reserve (1 Gas, 1 Coal) Total Total Capacity (MW) 11237 2708 1373 2403 2631 20352

The total capacity of 20352 MW exceeds the maximum MW of the load duration curve by 2631 MW which is equivalent to the reserve margin. Present Value: The present value has been calculated using the formula below, Co = Cn / (1+(r/t))^tn where, r = inflation rate = 1.5% t=1 n = period from the commercial operation of the plant to 2011 Depreciation: [22] The annual depreciation is given as, Annual depreciation = ( Actual cost - Residual value ) / Useful life Accumulated depreciation = (period * Annual depreciation)

Accumulated Reserves for Depreciation can be given as: (in million) Generation Transmission Distribution $12,167.74 $4,242.29 $4,248.53

Total Depreciation Reserve $20,658.56 Book Value: [22] Book Value = Initial cost - Accumulated depreciation The Book values of the plants in service are: (in million) Generation Transmission Distribution Total Plants in service $32,306.87 $8,357.71 $1,441.47 $42,106.05

WACC: Capital from Bonds (Cb): $17394 million Capital from Stocks (Cs): $11446 million Required Return from bonds (rb): 2% Required Return from stock (rs): 9% WACC = (rb*Cb+rs*Cs) / (Cb+Cs) WACC= 4.7% Rate Schedule: Our Electric Revenue for the year 2011 was $14379 million. keeping that as a basis, the new income statement for the test period 2012 has been built. This includes the O&M cost for the all the new plants added and also includes the portion of money allocated for the smart meter initiative and also the addition of vehicle management. Based on this our test year revenue can up to $13,489 million[20]. Rate Base: Our rate base calculation is primarily based on the increase in operating revenue required due to the addition of new plants. It includes the Allowance on working capital and the Net utility plant available as of 2012 test period. the following were included as a part of the utility plant cost:

Utility plants in service Construction work in Progress Plants held for future use

Negation of Depreciation reserves Negation of Operating Reserves

Our Total Average Rate Base came up to $2505.51million[22]. Rate Design: Based on our operating revenue for 2012 test period which came up to $9571.51 [22] for a Return on revenue of 10.55%[22]., we have designed our rate design on the following manner: Cost functionalization: [22 sheet Functionalization] We have functionalized all our expenses into the following three broad categories: Generation costs Transmission costs Distribution costs. All our O&M costs and Tax expenses and annual depreciation expenses have been functionalized within these 3 categories.

Cost Classification: [22 sheet Cost classification] After functionalizing the cost we have classified the costs in each of the functions based on the impact that created the cost. Our primary classifiers are shown below within each functions Generation costs Demand Related Costs Energy Related Costs Transmission costs Demand Related Costs Distribution costs Demand Related Costs Customer Related Costs We have distributed our costs in the generation side on 60-40 basis between the 2 classifiers. for the transmission side there is only demand related costs and for the distribution we have divided it equally(50-50).
o o o o o

Cost Allocation: [22 sheet Cost Allocation] Based on our classifiers we have decide on 6 allocation factors to allocated costs to teach of our customer classes. All these factors have been assigned weightage primarily based on the electricity usage pattern of all the customers. Our daily load curve is shown below: Our allocation factors are listed below as a part of the classifiers: Generation costs Demand Related Costs Average Excess Demand Factor(AED) This factor is based on the excess demand made on the average demand for the class.
o

Energy Related Costs MWh Usage Factor(MWh) This factor is based on the energy usage pattern of the class.
o

Transmission costs Demand Related Costs 12 Coincidental Peak Factor(12CP) This factor considers the 12 month average coincidental peak for a class with the overall system peak.
o

Distribution costs Demand Related Costs Non Coincident Peak (NCP) This factor provides incentive for customers whose demands peaks never coincides with the system peak.
o

Customers Factor This factor considers the customer count and allocated based on the general trend in the customer counts over the coming years as predicted by the inegrated resource plan.

Customer Related Costs Weighted Costs This includes weighted costs on each customer class based on their total contribution to the revenue.
o

Here is the table showing all our cost allocation factors:

Class

Generation Factor 0.3 0.5 0 0.2

Transmission Factor 0.12 0.5 0.08 0.3

Distribution Factor 0.9 0.1 0 0

Customer Counts Factor 0.90 0.09 0.001 0.009

MWh Factor 0.37 0.40 0.10 0.13

Residential Commercial Industrial Governmental

Daily load Curve:

Finally based on the above factors and our revenue required in place we have our rate structure as shown below:

Residential Customer Count Basic charge Energy(GWh) cents/kWh* 2210587 8 31056 9.92

Commercial 239193 27.17 34000 12.11

Industrial 548 35 8628 4.18

Government 29537 10 11559 14.40

The basic charge is the minimum amount our customers are to pay based on the customer class they belong to. And based on their usage of electricity we designed a flat rate structure. On comparing with our previous year we have found that the rates have impacted each class in the following way:

Residential Commercial 2011 [25] 2012 % increase or decrease 11.40 9.92 -12.97% 8.29 12.11 46.10%

Industrial 6.91 4.18 -39.53%

Government Average 12.00 14.40 19.99% 9.46 10.18 7.66%

The average cost of electricity has changed in the following manner: Year Average Cost of Electricity 2012 10.18 2011 9.46

Balance Sheet_Dec_2011

Balance Sheet
Assets
Electric Utility Plant Net Utility Plant in Service (Book Value) Electric Plant Held For Future Use Construction Work in Progress Nuclear Fuel, Net of Amortization Total Current Assets Cash and Cash Equivalents Accounts Receivable Inventory Prepayments Other Current Assets Total Deferred Debits and Other Assets Plant, Property, Equipment Long Term Investments Other Long Term Assets and Deferred Debits Total Total Assets

Dec 2011
Amount
32746 0 175 240 33161 Current Liabilities Accounts Payable Accrued Expenses Dividends Declared Short Term Obligations Other Current Liabilities Total Deferred Credits and Other Liabilities Accumulated Deferred Income Tax Liabilities Regulatory Liabilites Other Liabilites and Deferred Credits Total Total Capitalization and Liabilities

Capitalization And Liabilities

Capitalization Common Stock Holders Equity Long Term Debt Total

Amount
11446 17394 28840

102 1198 1156 262 1683 4401

1250 678 242 3293 1927 7390

2100 3804 2148 8052 45614

5216 128 4040 9384 45614

Income Statement (Proxy)

Dominion Power As of 31st December 2012
Financial Statements in million U.S. Dollars

Operating Revenue
Electric Revenue 13489

Operating Expenses
Electric fuel and other energy-related purchases Purchased electric capacity Purchased gas Operations and maintenance Depreciation & Amortization Other unusual operating expenses Property & Other taxes Total Expenses Income from Operations 1196 842 1812 3581 1354 0 554 9339 4150

Non-Operating Expenses
Other Income(expense) Interest expense(non-operating) Total Other Income Income before tax Income Tax Expense Net Income 241 845 (604) 3546 1118 2429

Income Statement
Dominion Power As of 31st December 2011
Financial Statements in million U.S. Dollars

Operating Revenue
Electric Revenue 14379

Operating Expenses
Electric fuel and other energy-related purchases Purchased electric capacity Purchased gas Operations and maintenance Depreciation Amortization Other unusual operating expenses Property & Other taxes Total Expenses Income from Operations 1103 829 1764 966 575 925 0 554 6715 7664

Non-Operating Expenses
Other Income(expense) Interest expense(non-operating) Total Other Income Income before tax Income Tax Expense Net Income 175 850 (675) 6989 745 6244

operating income from Electricity Generation - Cost Allocation

Distribution Primary/Line Tr./Sec Meters Demand Customer 712.16 712.16 125.28 NCP 0.12 0.50 0.08 0.30 1.00 0.90 0.10 0.00 0.00 1.00 Customers 0.90 0.09 0.00 0.01 1.00 7.00 7.00 175.39 1.60 1.60 75.17 Weighted Costs 0.90 0.09 0.00 0.01 1.00

Particulars Revenue Req. Cost Excluding Fuel Fuel Costs Total Rate Base Allocation Factors Residential Commercial Industrial Government Total Allocated Rev. Req. Residential Commercial Industrial Government Total Allocated Rate Base Residential Commercial Industrial Government Total

Total 8,976.91 541.00 9,517.91 2,505.51

Demand

Generation Energy 4,837.42 4,837.42 2,004.41 2,343.49 541.00 2,884.49

Transmission Demand 1,075.24 1,075.24 125.28

S/S Demand

AED 0.30 0.50 0.00 0.20 1.00

mWh 0.37 0.40 0.10 0.13 1.00

12 CP

3,293.46 4,195.85 360.74 1,667.86 9,517.91

1,451.22 2,418.71 0.00 967.48 4,837.42

1,064.51 1,167.53 274.71 377.73 2,884.49

129.03 537.62 86.02 322.57 1,075.24

640.95 71.22 0.00 0.00 712.16

6.30 0.63 0.01 0.06 7.00

1.44 0.14 0.00 0.01 1.60

954.60 1,099.92 10.27 440.72 2,505.51

601.32 1,002.21 0.00 400.88 2,004.41

0.00 0.00 0.00 0.00 0.00

15.03 62.64 10.02 37.58 125.28

112.75 12.53 0.00 0.00 125.28

157.85 15.78 0.18 1.58 175.39

67.65 6.76 0.08 0.68 75.17

operating income from Electricity Generation - Cost Classification

Generation Demand related Energy Related Revenue Requirements O&M (million $) Generation Transmission Distribution S/S,Lines, Tr Meters & Services O&M Subtotal Fuel Net Operating Income & Taxes & Annual depreciation Total

Transmission Distribution Demand related Demand related Customer Related

Total

3,250.80

2,167.20 17.50 7.00 7.00 1.60 8.60

3,250.80

2,167.20 541.00

17.50

7.00

5,451.10

1,586.62 4,837.42

176.29 2,884.49

1,057.74 1,075.24

705.16 712.16 8.60

3,525.81 9,517.91

operating income from Electricity Generation - Functionalization

Total O&M Expense Generation Transmission Distribution Total O&M Depreciation Expense Intangible Generation Transmission Distribution Total Depreciation Expense Taxes Taxes other than Income Income Tax Returns Debt Related Equity Related Total Returns 5,418.00 17.50 14.00 5,449.50

Generation 5,418.00

Transmission

Distribution

17.50 5,418.00 17.50 14.00 14.00

209.40 1,318.17 340.20 373.10 2,240.87

1,318.17 340.20 1,318.17 340.20 373.10 373.10

554.00 1,117.50

277.00 558.75

166.20 335.25

110.80 223.50

2,087.00 451.00 2,538.00

1,565.25 338.25 1,903.50

313.05 67.65 380.70

208.70 45.10 253.80

operating income from Electricity Generation - Rate Base Description Allowances for Working Capital Materials & supplies Cash Working capital(Lead Lag) Deferred Fuel Net Total Allowances for Working Capital Net Utility Plant Utility Plant in Service CWIP Plants held for Future Use Less: Depreciation Reserves Less: Operating Reserves Total Net Utility Plant Rate Base Deductions Less: Accumulated Deferred Income Tax Total company per books 807.00[1] -373.00 541.00

975.00

0.00 13.25 195.60[2] 4,470.00 -4,261.16

3,024.00

Total Rate Base Deductions Total Rate Base

3,024.00 -6,310.16

operating income from Electricity Generation - ROR statement Total Company (Million $) Cost of Service After Proposed Increase Proposed Change Before Increase $9,517.91 -$930.09 $10,448.00

Electric Operating Revenue Operating Revenue Deductions Operating & Maintanance Depreciation & Ammortization Income Taxes Other taxes Gain/loss on disposition of property Total Operating Revenue Deductions Total Operating Income Plus: AFUDC Less: Other Interest expense Interest Expense on Customer Deposits Charitable Donations Adjusted Operating Income Total Average Rate Base % Rate of Return Earned on Avg. Rate Base Total stockholders Equity Return on equity

$3,581.10 $1,354.31 $1,117.50 $554.00 $100.00 $6,706.91 $2,811.00 $13.25 $2,550.00 $0.00 $10.00 $264.25 $2,505.51 10.55% 2,936.11 9.00%

$98.10 $285.31

$383.41

$3,483.00 $1,069.00 $1,117.50 $554.00 $100.00 $6,323.50 $4,124.50 $13.25 $2,550.00 $0.00 $10.00

-$1,313.50

$1,577.75

doc6_Unit_wiseO&M_Fuel_Costs

Plant/Unit Name

Unit/Plant Location

Primary Fuel

Capacity Factor(%)

Time of Operation (Capacity Factor*8760)Hour

2899.56 1787.04 1909.68 4134.72 4625.28

Plant/Unit Capacity(MW)
63 3003 590 267 71 156 1300

Plant Output(Time of Plant Costs Operation*Capacity) Fuel Cost ($) MWH Fixed O&M Cost $ Variable O&M Cost
(2010) $(2010)
776357.19 0 1748904.041 124756.235 3066560.64 2657881.674 0 0 17667500.004 4271372.496 10498460.544 0 9266833.89 9464903.622 14495033.592 19692770.832
182672.28 5366481.12 2266110

Altavista Bath County(Units1-6) Bear Garden CC Bellemeade CC Bremo3 Bremo4 Brunswick County(proposed) Chesapeake1 Chesapeake2 Chesapeake3 Chesapeake4 Chesapeake CT1
Chesapeake CT2

Altavista, VA Warm Springs, VA Buckingham Co., VA Richmond, VA Bremo Bluff, VA Bremo Bluff, VA Brunswick Co., VA Chesapeake, VA Chesapeake, VA Chesapeake, VA Chesapeake, VA Chesapeake, VA Chesapeake, VA Chesapeake, VA Chester, VA Chester, VA Chester, VA Chester, VA Chester, VA Clover, VA Clover, VA Richmond, VA Richmond, VA Richmond, VA Richmond, VA Chesapeake, VA Roanoke Rapids, NC Gordonsville, VA Gordonsville, VA Surry, VA Surry, VA Surry, VA Surry, VA Surry, VA Hopewell, VA Kitty Hawk, NC Ladysmith, VA Ladysmith, VA Ladysmith, VA Ladysmith, VA Ladysmith, VA Covington, VA Clarksville, VA Clarksville, VA Mt. Storm, WV Mt. Storm, WV Mt. Storm, WV Mineral, VA Mineral, VA Mineral, VA Bayard, WV Lively, VA Hurt, VA Dumfries, VA Dumfries, VA Dumfries, VA

Coal Water Gas Gas Coal Coal Gas Coal Coal Coal Coal Coal Oil Oil Gas Gas Gas Gas Coal Coal Coal Gas Gas Gas Gas Gas Water Gas Gas Gas Gas Gas Gas Gas Coal Oil Gas Gas Gas Gas Gas Oil Coal Coal Coal Coal Coal Uranium Uranium Water Coal Oil Other/Biomass Gas Gas Gas

33.1 20.4 21.8 47.2 52.8

509884.56 293543.82 721543.68

40360320 8490100 3842130

2553870 5611320

18707000 636895.8 650508.84 996222.24 1353455.04

3992670 3992670 5611320 7805490 2194170

65.5 66.9 72.9 71.2

5737.8 5860.44 6386.04 6237.12

111 111 156 217 61 61

2706807.15 2764662.57 4233944.52 5752183.92

Chesterfield CC7 Chesterfield CC8 Chesterfield3 Chesterfield4 Chesterfield5 Chesterfield6 Clover1 Clover2 Darbytown CT1 Darbytown CT2 Darbytown CT3 Darbytown CT4 Elizabeth River CT(1,2,3) Gaston(1,2,3,4) Gordonsville CC1 Gordonsville CC2 Gravel Neck CT1 Gravel Neck CT3 Gravel Neck CT4 Gravel Neck CT5 Gravel Neck CT6 Hopewell(Polyester) Kitty Hawk CT(1,2) Ladysmith CT1 Ladysmith CT2 Ladysmith CT3 Ladysmith CT4 Ladysmith CT5 Low Moor CT(1,2,3,4) Mecklenburg1 Mecklenburg2 Mt. Storm1 Mt. Storm2 Mt. Storm3 North Anna1 North Anna2 North AnnaHydro North Branch Northern Neck CT(1,2,3,4) Pittsylvania Possum Point CC(Unit 6) Possum Point CC3 Possum Point CC4

42.6

3731.76

197 200 100 166 325 652 431 434 84 84 84 84 348

39.1 49.6 55.2 84.6 76.8 92.8 92.9 1.2 1.1 1 0.8

3425.16 4344.96 4835.52 7410.96 6727.68 8129.28 8138.04 105.12 96.36 87.6 70.08

735156.72 685032 434496 802696.32 2408562 4386447.36 3503719.68 3531909.36 8830.08 8094.24 7358.4 5886.72

877790 2834830 2878000 1439000 2388740 4676750

23452440 15503070 15610980

1208760 1208760 1208760 1208760 5007720

2521587.55 2349659.76 1490321.28 2753248.378 8261367.66 18642401.28 14890808.64 15010614.78 30287.1744 27763.2432 25239.312 20191.4496

25473180.348 23736358.8 18987475.2 35077829.184 105254159.4

63822809.088 50979121.344 51389281.188

452983.104 415234.512 377485.92 301988.736 0 0 4764269.664 4466502.81 0 2673858.6 2291878.8 0 0 2143971.018 2239300.404 2442873.168 4268736.612 3738908.16 3235593.6 5127252.966 5012923.14 61066784.754 59559848.82 58176292.23 56548384.2 17665.6788 0 0

13.9 14.4 13.5 0.7 0.6

1217.64 1261.44 1182.6 613.2 525.6

220 109 109 12 85 85 85 85

267880.8 137496.96 128903.4 52122 44676

2956800 1568510 1568510 172680 1223150 1223150 1223150 1223150

2266110

0 471614.57 442138.66 178778.46 153238.68

26.7 3.3 3.6 5.9 5.2 4.5 58.3 57 85.1 83 80.5 90 93 29.1

2338.92 289.08 315.36 516.84 455.52 394.2 5107.08 4993.2 7454.76 7270.8 7051.8 7884 8146.8 2549.16

63 31 151 151 161 160 160 48 69 69 563 563 567 931.5 931.5 0.9 74 47

147351.96 43651.08 47619.36 83211.24 72883.2 63072 352388.52 344530.8 4197029.88 4093460.4 3998370.6 7343946 7588744.2 2294.244

626245.83 149723.2 163334.4 285414.55 249989.376 216336.96 1497651.21 146255.9 17837376.99 17397206.7 16993075.05 14981649.84 15481038.17 0

446090 2172890 2172890 2316790 2302400 2302400 690720

2481930 2481930 20251110 20251110 20394990

82670625 82670625 12096 2661780 676330

59.8 40 11.9 9.6

5238.48 3504 1042.44 840.96

83 559 96 220

434793.84 1958736 100074.24 185011.2

28044870 8044010 1381440 3165800

7234969.498 6718464.48 343254.64 634588.41

39131445.6 67870202.4 3467572.416 6410638.08

doc6_Unit_wiseO&M_Fuel_Costs
Roanoke Rapids(Hydro) Rosemary CC Possum Point CC 5 Remington1 Remington2 Remington3 Remington 4 Southampton Surry1 Surry2 Virginia City Hybrid Energy Center Warren County(under construction) Yorktown1 Yorktown2 Yorktown3
Roanoke Rapids, NC Roanoke Rapids, NC Dumfries, VA Remington, VA Remington, VA Remington, VA Remington, VA Roanoke Rapids, NC Southampton, VA Southampton, VA Surry, VA Virginia City, VA Yorktown, VA Yorktown, VA Yorktown, VA Water Gas Oil Gas Gas Gas Gas Gas Uranium Uranium Uranium Coal Gas Gas Oil

33.1 88.4 0.1 2.6 1.4 2.2 1.7 37.5 88.5 97.2

2899.56 7743.84 8.76 227.76 122.64 192.72 148.92 3285 7752.6 8514.72

95 165 786 153 151 152 152 63 838 838 585 1329

275458.2 1277733.6 6885.36 34847.28 18518.64 29293.44 22635.84 206955 6496678.8 7135335.36

1276800 2374350 11310540 2201670 2172890 2187280 2187280 906570 74372500 74372500 51918750

0 4382626.24 23616.78 119526.17 63518.93 100476.49 77640.93 709855.65 13253224.75 14556084.13

0 44273469.24 238577.724 1522826.136 809264.568 1280123.328 989186.208 9043933.5 50024426.76 54942082.272 0 0 36459397.692 42377288.4 2191981.512 1103.0901239388 million

59.9 67.5 0.7

5247.24 5913 61.32

159 164 818

834311.16 969732 50159.76

76276188.624

2288010 2359960 11771020

2861687.27 3326180.76 172047.97

Coal nuclear hydro

cc green

number 16 4 4
10

mw

mwh

4296 3539 3319 2708

1373

25858140.9 28564704.36 5912114.364 5724914.04

3969313.68

3318.9

727649686 956696184.4172 956.6961844172 76276188.624

229046498.4172

ct oil/gas

12 1723

2403 83 17721

5812207.44 76276188.784

Plant/Unit Name

Unit/Plant Location

Primary Capcity Fuel Factor(%)

Time of Operation Plant/Unit (Capacity Capacity Factor*8760)Hour (MW)

Plant Output(Time of Operation*Capacity)MWH

Plant Costs
Fixed O&M Cost $ (2010) Variable O&M Cost $(2010)

Fuel Cost ($)

Virginia City Hybrid Energy Center Brunswick County(proposed) Gloucester Biomass Plant

Surry, VA Brunswick Co., VA

Uranium Gas Biomass

55 45 50

4,818 3,942 4,380

585 350 100 1,035

2,818,530 1,379,700 438,000 4,636,230

51,918,750 5,036,500 33,879,000 90,834,250

5,749,301 4,732,371 7,288,320 17,769,992

44,993,117.89 47,806,604.99 92,799,722.88

doc7_Plant_Amort&DeprecCosts
Estimated Capital Cost (Million $)
1600

Plant Name

Year

Location

Fuel

Capacity (MW)

Present Value (Million$) 1,072.02 342.32 432.42 891.83 188.97 134.63 136.15 72.67 61.96 61.96 61.96 754.00 775.45 711.86 0.00 0.00 281.18 293.70 448.24 1,315.65 253.19 278.43 627.23 287.43 122.00 85.43 73.95 209.04 1,412.88 1,173.59 1,039.78 716.91 396.45 724.37 541.37 1,283.01 42.55 38.61 25.60 326.69

Overnight Capital cost (Million$) 670.01 649.56 603.09 1,031.02 585.05 593.09 986.63 981.98 983.46 983.46 983.46 1,288.89 669.65 650.10

Depreciation (Million$) 18.576 6.111 8.316 10.035 3.744 2.628 1.602 0.855 0.729 0.729 0.729 6.786 13.437 12.708 0 0 11.142 5.733 5.274 15.48 2.979 3.276 7.38 2.511 2.052 1.548 1.602 3.168 12.528 12.258 10.386 11.88 3.96 8.523 5.571 14.013 0.486 0.468 0.315 3.96

Accumulated Depreciation 854.496 293.328 440.748 170.595 205.92 141.912 32.04 17.1 14.58 14.58 14.58 0 591.228 622.692 0 0 11.142 68.796 47.466 665.64 26.811 65.52 81.18 37.665 36.936 34.056 36.846 69.696 -37.584 -49.032 83.088 154.44 67.32 323.874 295.263 518.481 19.926 19.188 12.915 194.04

Book Value (Million $) 1209.504 385.672 483.252 944.405 210.08 150.088 145.96 77.9 66.42 66.42 66.42 754 901.772 789.308 0 0 607.858 568.204 538.534 1054.36 304.189 298.48 738.82 241.335 191.064 137.944 141.154 282.304 1429.584 1411.032 1070.912 1165.56 372.68 623.126 323.737 1038.519 34.074 32.812 22.085 245.96

Mt. Storm Chesterfield(Units 3-6) Chesapeake Clover Yorktown(Units 1, 2) Bremo Mecklenburg North Branch Altavista Southampton Hopewell(Polyester) Virginia City Hybrid Energy Center Kincaid Brayton Point Salem Harbor*
Rumford*

1966 1964 1959 1995 1957 1958 1992 1992 1992 1992 1992 2012 1968 1963 1951
1975

Mt. Storm, WV Chester, VA Chesapeake, VA Clover, VA Yorktown, VA Bremo Bluff, VA Clarksville, VA Bayard, WV Altavista, VA Southampton, VA Hopewell, VA Virginia City, VA Kincaid, IL Somerset, MA Salem, MA Rumford, ME Buckingham Co., VA Remington, VA Dumfries, VA Chester, VA Dumfries, VA Chesapeake, VA Ladysmith, VA Richmond, VA Gordonsville, VA Roanoke Rapids, NC Surry, VA Richmond, VA Warren Co., VA Brunswick Co., VA Fairless Hills, PA Elwood, IL Providence, RI Yorktown, VA Chesapeake, VA Dumfries, VA Lively, VA Covington, VA Kitty Hawk, NC Somerset, MA

Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Coal Gas Gas Gas Gas Gas Gas Gas Gas Gas Gas Gas Gas Gas

527 717 865 323

227

138 74 63 63 63 585 1158 1095

2064 679 924 1115 416 292 178 95 81 81 81 754 1493 1412

Bear Garden CC Remington CT Possum Point CC(Unit 6) Chesterfield CC Possum Point CC(Units 3, 4) Elizabeth River CT Ladysmith CT Bellemeade CC Gordonsville CC Rosemary CC Gravel Neck CT(Units 3-6) Darbytown CT Warren County(under construction) Brunswick County(proposed) Fairless Works CC Elwood CT Manchester Street Yorktown(Unit 3) Chesapeake CT Possum Point CT Northern Neck CT Low Moor CT Kitty Hawk CT Brayton Point

2011 2000 2003 1969 2003 1992 2001 1997 1994 1990 1989 1990 2015 2016 2004 1999 1995 1974 1959 1975 1971 1971 1971 1963

590 608 559 1640 316 348 783 267 218 165 170 336 1329

619 637 586 1720 331 364 820 279 228 172 178 352 1392 1362 1154 1320 440 947 619 1557 54 52 35 440

476.58 483.06 801.86 802.22 801.22 800.08 801.06 1,076.53 559.63 517.77 434.99 622.15 1,063.12 902.76 881.17 531.05 881.00 885.54 755.05 953.91 905.40 804.34 825.88 751.00

Gas Gas Gas Gas Oil Oil Oil Oil Oil Oil Oil

1300 1180 1350 450 818 717 1345 47 48 31 435

doc7_Plant_Amort&DeprecCosts
Salem Harbor* Brayton Point Pittsylvania North Anna Surry Millstone Kewaunee* Bath County Gaston Roanoke Rapids Fowler Ridge Wind Farm NedPower Mount Storm 1951 1963 1994 1978 1972 1975 1974 1985 1963 1955 2007 2009
Salem, MA Somerset, MA Hurt, VA Mineral, VA Surry, VA Waterford, CT Carlton, WI Warm Springs, VA Roanoke Rapids, NC Roanoke Rapids, NC Benton Co., IN Mt. Storm, WV Oil Other Other/Biomass Uranium Uranium Uranium Uranium Water Water Water Wind Wind

7.6 83
1,863 1,676

2097 556 3003 220 95 301.3 264

4 654 1300 1160 11187 3753 275 118 610 530

0.00 4.37 598.11 1,103.61 927.83 6,545.40 0.00 2,228.78 153.87 66.02 341.31 263.25 29,928.06

575.50 7,206.15 592.38 553.60 3,121.32 0.00 742.18 699.41 695.00 1,132.80 997.17

0 0.036 19.62 11.7 10.44 100.683 45.036 3.3 1.416 7.32 6.36

0 1.764 353.16 397.8 417.6 3725.271 0 1215.972 161.7 80.712 36.6 19.08 12607.131

0 2.236 300.84 902.2 742.4 7461.729 0 2537.028 113.3 37.288 573.4 510.92 32306.869

439.39 439.389

REFERENCE Reference Number Title of Document 1 About Dominion 2 Dominion VI&NC Fleet

3 Dominion Resources Inc Dominion IR Reference Book, 4 Sept 2011 5 Democratic Policy Committee Virginia Report: Placement of Utility Distribution Lines 6 Underground Renewable and Efficient Electric Power Systems By: 7 Gilbert Masters Costs related to plant by type of 8 fuel

Website https://www.dom.com/about/index.jsp https://www.dom. com/about/conservation/pdf/2010_integrated_resource_plan.pd http://quicktake.morningstar. com/StockNet/bonds.aspx? Symbol=D&Country=USA http://investors.dom.com/phoenix.zhtml? c=110481&p=irol-irhome http://dpc.senate.gov/dpcdoc.cfm? doc_name=fs-111-1-34 http://www.scc.virginia. gov/comm/reports/report_hjr153.pdf

Textbook

9 10 11 12 13 14 15 16 17 18 19 20

21

22

23 24

25

26 27

http://www.eia.gov/oiaf/beck_plantcosts/ https://www.dom.com/dominion-northcarolina-power/customer-service/ratesand-tariffs/pdf-rate-adjustment/testimonyEnergy_Purchased_dominion 2012/Morgan-Direct-Testimony.pdf 3Q11 Earnings Release Kit http://investors.dom.com/phoenix.zhtml? Final 2 c=110481&p=irol-finModelEarn Nuclear Energy Costs http://www.world-nuclear.org/info/inf02.html http://www.repartners. Public Renewables Partnership org/biomass/biocosts.htm 4Q11 Earnings Release Kit http://investors.dom.com/phoenix.zhtml? Final 2 c=110481&p=irol-finModelEarn EIA www.eia.gov Business Essentials For Utility Engineers By: Richard Brown Textbook PJM Rate Request Moodle NCSU http://www.investopedia. Investopedia com/#axzz2CgcSoFFM http://quote.morningstar.com/stock/s.aspx? Morningstar Financials t=DOM Visualizing the U.S. Electric http://www.npr.org/templates/story/story. Grid: NPR php?storyId=110997398 Dominion IR Reference Book, http://investors.dom.com/phoenix.zhtml? March 2012 c=110481&p=irol-irhome https://docs.google.com/a/ncsu. edu/spreadsheet/ccc? Income Statement 2012 key=0AvXEDpcM6kFbdDdHMm9Bel9qN3VrbFZvamI2X3pjRV https://docs.google.com/a/ncsu. operating income from edu/spreadsheet/ccc? Electricity Generation key=0AvXEDpcM6kFbdExPX2FjRC03X0U4TUVKcjVLd2pJd0E https://docs.google.com/a/ncsu. edu/spreadsheet/ccc? Balance sheet key=0AqWIUhCkLuNydHZFOFh4LWRFVncyazBJQmlRREg2S https://www.dom.com/investors/stockDividend info information/dividend-information.jsp http://www.eia. gov/electricity/monthly/epm_table_grapher. cost of electricity cfm?t=epmt_5_04_a https://www.dom. com/about/conservation/aboutsmart meters smartmeters.jsp https://www.dom. vehicle management com/about/environment/hybrid-vehicles.jsp