Dominion Energy wants regulators to give it a 10.25% Return on Equity and 7.7% rate hike. That’s absurd.

If we were in criminal court instead of the Public Service Commission, the charge would be grand larceny,

The rate of Return on Equity includes interest on debt and what stockholders should be paid for their investment.

The cost of debt is easy. Markets set interest rates which right now are as low as 1%.

According to energy expert Jim Clarkson, the most amusing part of a rate case is the utility witness who will argue for a high Return on Equity – money in Dominion executives’ and their investors’ pockets.

The utilities bring high-paid outside experts with formulas and reviews of what other regulated utilities are making.

It’s like using the profits of Wendy’s and McDonald’s to determine Burger King’s profits.

This makes no sense. It’s saying, if Duke gets 10.25%, Dominion should get it, too.

It doesn’t matter that they are paying 1% interest on borrowed money and pay 9.25% to their investors and themselves.

Unelected regulators setting Dominion’s profits is nonsense.

In competitive situations, prices are set by competition and you must control costs to make a profit. In Dominion’s case, it has no competition.

They will take whatever the Public Disservice Commission will blindly give them.

This way, business owners and their investors get the shaft.

Voters – home owners – may pay the utility a 4% return but business owners pay 12%.

The average works out to 8% that the regulators can allow.

This is no problem for the utilities. If sticking it to business owners keeps regulators and the lawmakers who appoint them happy, then that’s just tough.

Short of doing away with regulation entirely, as Texas has done, why don’t we let all voters – home and business owners – elect the regulators?

Are you concerned about another 7.7% electric rate hike?

Write us with your view at JerryBellune@yahoo.com

If sticking it to the business owners keeps lawmakers happy, that’s just tough.