Virginia energy stakeholders send draft PBR recommendations to SCC after debate over consensus language

This was the final meeting of the stakeholder group convened by the Virginia Department of Energy, and the group will forward its draft report and record to the State Corporation Commission for the commission’s study, the department’s meeting lead said. “This is the last meeting for the stakeholder group, and then we'll turn things over to the SCC to complete the study,” the lead said.

The meeting focused on a review of the draft summary report and a set of recommendations the stakeholders asked the commission to consider in its statutorily directed study of performance‑based regulatory tools. The Department circulated a near‑final draft and asked participants to flag factual errors; the department said it will submit the final stakeholder report to the State Corporation Commission docket by May 9, 2025, and also circulate a survey to record where individual organizations agree, disagree or have no opinion on each recommendation.

Why it matters: the General Assembly directed the commission study to evaluate whether alternative regulatory tools could better align utility incentives with Virginia’s clean energy, energy efficiency, reliability and affordability goals. The stakeholder draft is intended to summarize the record and identify topics the group thinks the commission should examine further, while leaving final findings to the commission.

Participants debated how the report should present recommendations. Joe Reed, a utility representative, said he perceived “very few, if any, consensus recommendations of the 38 stakeholders to this process,” and urged the report to avoid language that might imply a broad consensus where one does not exist. Several other stakeholders said the report should still reflect areas that received substantial attention in meetings, written comments and surveys.

Christian Tucker, speaking for the Virginia Committee and Old Dominion Committee for Fair Utility Rates, asked that the draft be explicit that views in the report are not necessarily “representative of any individual stakeholder,” and that participating organizations not be presumed to endorse recommendations merely by participating. The Department agreed to add caveats and to collect explicit survey responses indicating support, opposition or no opinion for each recommendation.

Substantive topics highlighted for further commission study included: whether rate adjustment clauses (RACs) and fuel cost recovery rules interact with PBR proposals; the design and scale of performance incentive mechanisms (PIMs) and associated scorecards/metrics; decoupling and other revenue‑adjustment structures; multi‑year rate plans (3–5 year models compared with Virginia’s biennial reviews and existing recovery clauses); and the possibility of capital‑bias in the existing framework and whether alternative mechanisms would produce stronger consideration of non‑capital solutions. Lena Lewis of The Nature Conservancy and other stakeholders emphasized that metrics, scorecards and PIMs are interrelated and should be addressed together.

The group discussed the specific recommendation that the commission “directly address RACs” and conduct comparative analysis of recovering investments through RACs, base rates, PBR tools or hybrid mechanisms. Some utility representatives said the scope of the legislatively directed SCC study is limited and cautioned against treating RAC reform as the central focus of PBR analysis. Others said RACs are part of Virginia’s regulatory framework and must be considered because they materially affect incentives and the feasibility of alternative tools.

On next steps, Brian Pratt of the State Corporation Commission told the group the commission had opened docket PUR202400152 and expects to post the Department’s summary in that docket. “The commission has opened a docket, which is case number PUR202400152,” Pratt said, and he outlined the schedule the commission will follow: the department’s report will be posted to the docket (May 9, 2025, as extended), the commission will later issue an order setting a deadline for public comments on its study, and commission staff and retained consultants will prepare the commission’s executive summary and study. The commission’s executive report to the governor and General Assembly is due Oct. 15, 2025, and the commission will present findings to the General Assembly on Nov. 15, 2025.

The stakeholder group agreed to a short follow‑up survey that will ask each participating organization whether it agrees, disagrees or has no opinion on each recommendation; the department said results will be footnoted or otherwise reflected in the final stakeholder submission to the commission. The department also asked stakeholders to submit any factual corrections to the draft report in writing by the end of the day Thursday.

The meeting record shows substantial differences among stakeholders about emphasis and framing, but not formal votes or collective endorsements. Stakeholders who want their positions shown explicitly in the record should respond to the department’s survey and submit written corrections and comments to the commission docket when it opens for comments.

Looking ahead: the Department will transmit the final stakeholder report and the survey results to the SCC docket, and the SCC will determine the scope and depth of the study it conducts and whether to pursue regulatory changes. The stakeholder group’s role, officials said, ends with the record it provides and any additional written comments filed in the commission docket.