Dominion Resources
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Dominion NYSE: D (formerly Dominion Resources) is a power and energy company headquartered in Richmond, Virginia, USA, that supplies electricity, natural gas, or other energy services to homes in Virginia, West Virginia, Ohio, Pennsylvania, and eastern North Carolina. Dominion also has generation facilities in Indiana, Illinois, Wisconsin, Massachusetts and Connecticut.
In 2000 Dominion Resources began doing business solely under the name "Dominion".
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[edit] Early history
Two of the founders of Dominion Resources' predecessor were George Washington and James Madison. In 1781 the Virginia General Assembly established the Appomattox Trustees to promote navigation on the Appomattox River. In 1795, the trustees (including Washington and Madison) formed the Upper Appomattox Company canal operation to secure water rights to the river. The company took over several hydroelectric stations on the river and added a steam power facility in 1888. Frank Jay Gould (son of Jay Gould) bought a successor company in 1909 through his Virginia Railway and Power Company (VR&P). The firm purchased several electric streetcar lines and electric and gas utilities the following year.
[edit] Formation of Virginia Electric and Power Company
VR&P was acquired by New York engineering firm Stone & Webster in 1925. Stone and Webster placed it under a new holding company, Engineers Public Service (EPS). VR&P's name was changed to Virginia Electric and Power Company (VEPCO), and the firm bought several utilities in North Carolina. During the 1930s the automobile and the Depression put the company's trolley lines out of business.
In 1940 the federal government sued EPS under the Public Utility Holding Company Act of 1935. This in effect triggered an era of regulated utility monopolies. EPS was forced to divest itself of everything but VEPCO. However, VEPCO soon doubled its service territory by merging with the Virginia Public Service Company.
The number of electric customers increased by about half from 1950 to 1957, so the company added new stations to keep up with demand. It also built the world's first extra-high-voltage transmission system.
VEPCO's first nuclear power plants (the North Anna and Surry stations) went into service in the 1970s. (Dominion Resources now also owns and operates the Millstone plant - see below.)
[edit] Birth of Dominion Resources
In 1980, company President William Berry became an early proponent of electric competition. The company redefined its corporate identity and image, and began using the names Virginia Power and North Carolina Power. Then in 1983 Berry formed Dominion Resources with Virginia Power as a subsidiary, and then halted nearly all station construction to emphasize transmission. Two years later, Dominion Capital was formed. In 1985, VEPCO sold its West Virginia Power division to UtiliCorp United (now called Aquila.) West Virginia Power served customers in southeastern West Virginia, mainly in Pocahontas, Summers, Greenbrier, Monroe and Raleigh counties. Dominion Energy was formed in 1987.
Thos. E. Capps took over as CEO in 1990, and Dominion sold its natural gas distribution operations. Dominion Energy formed joint ventures to develop natural gas reserves. The firm bought three natural gas companies in 1995, and the next year Dominion joined with Chesapeake Paper Products to build a cogeneration facility.
Dominion acquired a UK power firm, East Midlands Electricity, in 1997 and sold it to PowerGen 18 months later. Also in 1998, Dominion bought an Illinois power station from Unicom.
[edit] Dominion reorganizes, acquires CNG
The following year Dominion reorganized in preparation for energy deregulation by separating its generation activities from its transmission, distribution, and retail operations.
In 2000 Dominion bought Consolidated Natural Gas in a deal that transformed Dominion into one of the largest electric and gas utilities in the United States with more than 4 million customers. It agreed to sell Virginia Natural Gas (acquired in the Consolidated Natural Gas deal) to AGL Resources.
The company also agreed to pay $1.3 billion for Northeast Utilities' Millstone nuclear power complex, which includes two operating reactors and one that has been mothballed.
The company also acquired the Cove Point LNG Terminal on Sept. 5, 2002.[1]
[edit] Rebranding of Dominion
On August 28, 2000, the company began doing business solely under the name "Dominion." The decision to change the company's business name followed Dominion's merger with Consolidated Natural Gas Co. of Pittsburgh and an extensive branding analysis that showed significant benefits related to the use of the Dominion brand.
In September 2000, Dominion's electric and natural gas companies began using new names for their delivery, transmission and customer service operations. Virginia Power does business as Dominion Virginia Power, and North Carolina Power does business as Dominion North Carolina Power. On the gas side, The East Ohio Gas Co. does business as Dominion East Ohio, The Peoples Natural Gas Co. as Dominion Peoples, and Hope Gas Inc. as Dominion Hope.
Dominion Energy, the company's electric power production and natural gas transportation and storage unit, includes two businesses: Dominion Generation and Dominion Transmission. Dominion Generation, based in Richmond, manages the company's regulated generating stations. Dominion Transmission, formerly CNG Transmission Corp., is based in Clarksburg, W.Va., and operates gas pipelines and North America's largest natural gas storage system. The company's unregulated generation is also part of Dominion Energy.
The former CNG Producing Co. changed its legal name to Dominion Exploration & Production. The Dominion E&P unit operates out of offices in Houston and New Orleans and is one of the top independent oil and gas producers in the country.
[edit] Acquisition of Louis Dreyfus Natural Gas Corp.
In September 2001, Dominion announced plans to acquire Louis Dreyfus Natural Gas Corp. for $2.3 billion in cash, stock and assumed debt. The acquisition increased Dominion's natural gas reserves by 60 percent and expanded its fast-growing energy trading business.
The former CNG Retail Services Corporation changed its name to Dominion Retail, Inc., and offers competitive pricing in the non-regulated energy market as well as a wide array of home warranties and other services for your everyday needs through its affiliate, Dominion Products and Services, Inc.
VPS Communications Inc., formerly part of Virginia Power, became Dominion Telecom. A Dominion affiliated company, Dominion Telecom was a facilities-based, interexchange carrier providing broadband solutions (private line, wavelengths, dark fiber, Internet and collocation) to wholesale customers throughout the eastern United States. The company was sold in early 2004 to Elantic Networks Inc.
[edit] Current status
Today, Dominion is one of the nation’s largest producers of energy, with a production capability of 2.7 trillion British thermal units (BTU) (2.8 petajoules (PJ) of energy per day. Dominion has the largest production capability among integrated utilities in the northeast quadrant of the United States. The company has a power generation portfolio of more than 28,000 megawatts. Dominion is also one of the largest independent oil and natural gas exploration and production companies in North America, with 6.1 trillion cubic feet equivalent (173 km³) of proved natural gas reserves. The company has 7,900 miles (12,700 km) of interstate natural gas pipeline with more than 650 billion cubic feet (18 km³) of annual natural gas throughput and a delivery capability of 6.3 billion cubic feet per day (0.18 km³/d).
In addition, the company operates the nation’s largest underground natural gas storage system, with more than 960 billion cubic feet (27 km³) of storage capacity. Dominion also serves 5 million retail energy customers in nine states.
[edit] Controversies
Dominion has come under fire from Ceres for refusing "shareholder requests the past three years to disclose its potential financial exposure from foreseeable climate regulations." As of 2007 the New York City Comptroller's office has requested a climate risk report from Dominion[2]. The company has also come under fire from Boston-based Conservation Law Foundation because plants they own and operate in Brayton and Salem, Mass. have experienced a 37 percent increase in emissions since 2004. However, Dominion contends that the increases are due to increased productivity and that they are operating within legal guidelines [1].
The Virginia Public Access Project also reports that Dominion is also one of Virginia's most generous political donors, giving more than $3.75 million to state politicians since 1996, and employing 18 registered lobbyists. In the 2007 legislative session, Dominion advocated enactment of Bill H3068[3] which would accelerate expiration of the existing capped rate period from December 31, 2010, to December 31, 2008, and provides for "light-handed" regulation rather than cost-of-service regulation of investor-owned electric ultilities. On March 27, 2007, Governor Tim Kaine amended the bill to provide:
- the State Corporation Commission with more authority to consider keeping Virginia’s electricity costs competitive with other southeastern states when setting rates;
- for doubling the conservation and efficiency goal for Virginia’s electric utilities;
- continued green-power tariffs for Virginia’s consumers and strengthened provisions for renewable energy use;
- more incentives for clean electricity generation;
- faster refunds to utility customers; and
- additional flexibility for industrial and commercial consumers to use competitive electricity providers.[4] The amended bill returns to the legislature for final passage.
On March 15, 2007, the Federal Trade Commission filed a lawsuit seeking to block Equitable Resources' proposed acquisition of Dominion Peoples Gas (a local gas distributor in Pennsylvania). Equitable and Dominion compete for customers in the Pittsburgh area, and the proposed merger would lessen competition.[5]
There have also been a number of controveries surrounding Dominion's Cove Point LNG facility. (See Cove Point LNG main article.)
[edit] Notes
- ^ http://www.dom.com/about/gas-transmission/covepoint/index.jsp Retrieved 2007-02-16
- ^ http://www.ceres.org/news/news_item.php?nid=267
- ^ http://leg1.state.va.us/cgi-bin/legp504.exe?071+ful+HB3068ER
- ^ http://www.governor.virginia.gov/MediaRelations/NewsReleases/viewRelease.cfm?id=366
- ^ Gas Daily, 2007-03-16 page 1
