DOMINION ENERGY, INC - Quarter Report: 2021 March (Form 10-Q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number	Exact name of registrants as specified in their charters, address of principal executive offices and registrants’ telephone number	I.R.S. Employer Identification Number

001-08489	DOMINION ENERGY, INC.	54-1229715

000-55337	VIRGINIA ELECTRIC AND POWER COMPANY	54-0418825

	120 Tredegar Street Richmond, Virginia 23219 (804) 819-2000

State or other jurisdiction of incorporation or organization of the registrants: Virginia

Securities registered pursuant to Section 12(b) of the Act:


Registrant	Trading Symbol	Title of Each Class	Name of Each Exchange on Which Registered
DOMINION ENERGY, INC.	D	Common Stock, no par value	New York Stock Exchange
	DRUA	2016 Series A 5.25% Enhanced Junior Subordinated Notes	New York Stock Exchange
	DCUE	2019 Series A Corporate Units	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Dominion Energy, Inc. Yes ☒ No ☐ Virginia Electric and Power Company Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Dominion Energy, Inc. Yes ☒ No ☐ Virginia Electric and Power Company Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “non-accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Dominion Energy, Inc.

Large accelerated filer	☒		Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐		Smaller reporting company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Virginia Electric and Power Company

Large accelerated filer	☐		Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☒		Smaller reporting company	☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Dominion Energy, Inc. Yes ☐ No ☒ Virginia Electric and Power Company Yes ☐ No ☒

At April 23, 2021, the latest practicable date for determination, Dominion Energy, Inc. had 806,524,337 shares of common stock outstanding and Virginia Electric and Power Company had 274,723 shares of common stock outstanding. Dominion Energy, Inc. is the sole holder of Virginia Electric and Power Company’s common stock.

This combined Form 10-Q represents separate filings by Dominion Energy, Inc. and Virginia Electric and Power Company. Information contained herein relating to an individual registrant is filed by that registrant on its own behalf. Virginia Electric and Power Company makes no representation as to the information relating to Dominion Energy, Inc.’s other operations.

VIRGINIA ELECTRIC AND POWER COMPANY MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND IS FILING THIS FORM 10-Q UNDER THE REDUCED DISCLOSURE FORMAT.

COMBINED INDEX

		Page Number
	Glossary of Terms	3

	PART I. Financial Information

Item 1.	Financial Statements	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	69
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	82
Item 4.	Controls and Procedures	83

	PART II. Other Information

Item 1.	Legal Proceedings	84
Item 1A.	Risk Factors	84
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	84
Item 6.	Exhibits	85

GLOSSARY OF TERMS

The following abbreviations or acronyms used in this Form 10-Q are defined below:

Abbreviation or Acronym		Definition
2019 Equity Units		Dominion Energy’s 2019 Series A Equity Units issued in June 2019, initially in the form of 2019 Series A Corporate Units, consisting of a stock purchase contract and a 1/10 interest in a share of the Series A Preferred Stock
2017 Tax Reform Act		An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018 (previously known as The Tax Cuts and Jobs Act) enacted on December 22, 2017
2021 Triennial Review		Virginia Commission review of Virginia Power’s earned return on base rate generation and distribution services for the four successive 12-month test periods beginning January 1, 2017 and ending December 31, 2020
ACE Rule		Affordable Clean Energy Rule
AFUDC		Allowance for funds used during construction
Align RNG		Align RNG, LLC, a joint venture between Dominion Energy and Smithfield Foods, Inc.
AOCI		Accumulated other comprehensive income (loss)
ARO		Asset retirement obligation
Atlantic Coast Pipeline		Atlantic Coast Pipeline, LLC, a limited liability company owned by Dominion Energy and Duke Energy
Atlantic Coast Pipeline Project		A previously proposed approximately 600-mile natural gas pipeline running from West Virginia through Virginia to North Carolina which would have been owned by Dominion Energy and Duke Energy
bcf		Billion cubic feet
Bear Garden		A 590 MW combined-cycle, natural gas-fired power station in Buckingham County, Virginia
BHE		The legal entity, Berkshire Hathaway Energy Company, one or more of its consolidated subsidiaries (including Dominion Energy Gas, Dominion Energy Midstream and Cove Point effective November 1, 2020), or the entirety of Berkshire Hathaway Energy Company and its consolidated subsidiaries
Brookfield		Brookfield Super-Core Infrastructure Partners, an infrastructure fund managed by Brookfield Asset Management Inc.
CAA		Clean Air Act
CCR		Coal combustion residual
CCRO		Customer credit reinvestment offset
CEO		Chief Executive Officer
CEP		Capital Expenditure Program, as established by House Bill 95, Ohio legislation enacted in 2011, deployed by East Ohio to recover certain costs associated with capital investment
CERCLA		Comprehensive Environmental Response, Compensation and Liability Act of 1980, also known as Superfund
CFO		Chief Financial Officer
CO₂		Carbon dioxide
Colonial Trail West		A 142 MW utility-scale solar power station located in Surry County, Virginia
Companies		Dominion Energy and Virginia Power, collectively
Contracted Assets		Contracted Assets operating segment
Cooling degree days		Units measuring the extent to which the average daily temperature is greater than 65 degrees Fahrenheit, or 75 degrees Fahrenheit in DESC’s service territory, calculated as the difference between 65 or 75 degrees, as applicable, and the average temperature for that day
Cove Point		Cove Point LNG, LP (formerly known as Dominion Energy Cove Point LNG, LP)

CPCN		Certificate of Public Convenience and Necessity
CWA		Clean Water Act
DCP		The legal entity, CPMLP Holding Company, LLC (formerly known as Dominion Cove Point, LLC), one or more of its consolidated subsidiaries (including Dominion Energy Midstream), or the entirety of CPMLP Holding Company, LLC and its consolidated subsidiaries
DECGS		Carolina Gas Services, Inc. (formerly known as Dominion Energy Carolina Gas Services, Inc.)
DEQPS		Dominion Energy Questar Pipeline Services, Inc.
DES		Dominion Energy Services, Inc.
DESC		The legal entity, Dominion Energy South Carolina, Inc., one or more of its consolidated entities or operating segment, or the entirety of Dominion Energy South Carolina, Inc. and its consolidated entities
DETI		Eastern Gas Transmission and Storage, Inc. (formerly known as Dominion Energy Transmission, Inc.)
DGI		Dominion Generation, Inc.
DGP		Eastern Gathering and Processing, Inc. (formerly known as Dominion Gathering and Processing, Inc.)
DMLPHCII		Eastern MLP Holding Company II, LLC (formerly known as Dominion MLP Holding Company II, LLC)
DOE		U.S. Department of Energy
Dominion Energy		The legal entity, Dominion Energy, Inc., one or more of its consolidated subsidiaries (other than Virginia Power) or operating segments, or the entirety of Dominion Energy, Inc. and its consolidated subsidiaries
Dominion Energy Gas		The legal entity, Eastern Energy Gas Holdings, LLC (formerly known as Dominion Energy Gas Holdings, LLC), one or more of its consolidated subsidiaries (consisting of DETI, DCP, DMLPHCII and Dominion Iroquois), or the entirety of Eastern Energy Gas Holdings, LLC and its consolidated subsidiaries
Dominion Energy Midstream		The legal entity, Northeast Midstream Partners, LP (formerly known as Dominion Energy Midstream Partners, LP), one or more of its consolidated subsidiaries, or the entirety of Northeast Midstream Partners, LP and its consolidated subsidiaries
Dominion Energy Questar Pipeline		The legal entity, Dominion Energy Questar Pipeline, LLC, one or more of its consolidated subsidiaries (including its 50% noncontrolling interest in White River Hub), or the entirety of Dominion Energy Questar Pipeline, LLC and its consolidated subsidiaries
Dominion Energy South Carolina		Dominion Energy South Carolina operating segment
Dominion Energy Virginia		Dominion Energy Virginia operating segment
Dominion Iroquois		The legal entity Iroquois Inc. (formerly known as Dominion Iroquois, Inc.), one or more of its consolidated subsidiaries, or the entirety of Iroquois, Inc. and its consolidated subsidiaries, which held a 50% noncontrolling interest in Iroquois
DSM		Demand-side management
Dth		Dekatherm
Duke Energy		The legal entity, Duke Energy Corporation, one or more of its consolidated subsidiaries, or the entirety of Duke Energy Corporation and its consolidated subsidiaries
East Ohio		The East Ohio Gas Company, doing business as Dominion Energy Ohio
EPA		U.S. Environmental Protection Agency
EPS		Earnings per common share
FERC		Federal Energy Regulatory Commission
FILOT		Fee in lieu of taxes

Four Brothers		Four Brothers Solar, LLC, a limited liability company owned by Dominion Energy and Four Brothers Holdings, LLC, a subsidiary of GIP
Fowler Ridge		Fowler I Holdings LLC, a wind-turbine facility in Benton County, Indiana
FTRs		Financial transmission rights
GAAP		U.S. generally accepted accounting principles
Gas Distribution		Gas Distribution operating segment
GENCO		South Carolina Generating Company, Inc.
GHG		Greenhouse gas
GIP		The legal entity, Global Infrastructure Partners, one or more of its consolidated subsidiaries, or the entirety of Global Infrastructure Partners and its consolidated subsidiaries
Granite Mountain		Granite Mountain Holdings, LLC, a limited liability company owned by Dominion Energy and Granite Mountain Renewables, LLC, a subsidiary of GIP
Grassfield Solar		A proposed 20 MW utility-scale solar power station located in Chesapeake, Virginia
Greensville County		A 1,588 MW combined-cycle, natural gas-fired power station in Greensville County, Virginia
GT&S Transaction		The sale by Dominion Energy to BHE of Dominion Energy Gas, DGP, DECGS, Eastern Energy Field Services, Inc. (formerly known as Dominion Energy Field Services, Inc.) and Modular LNG Holdings, Inc. (formerly known as Dominion Modular LNG Holdings, Inc.) (which holds a 50% noncontrolling interest in JAX LNG) pursuant to a purchase and sale agreement entered into on July 3, 2020, which was completed on November 1, 2020
GTSA		Virginia Grid Transformation and Security Act of 2018
Heating degree days		Units measuring the extent to which the average daily temperature is less than 65 degrees Fahrenheit, or 60 degrees Fahrenheit in DESC’s service territory, calculated as the difference between 65 or 60 degrees, as applicable, and the average temperature for that day
Iron Springs		Iron Springs Holdings, LLC, a limited liability company owned by Dominion Energy and Iron Springs Renewables, LLC, a subsidiary of GIP
Iroquois		Iroquois Gas Transmission System, L.P.
ISO		Independent system operator
JAX LNG		JAX LNG, LLC, an LNG supplier in Florida serving the marine and LNG markets
Kewaunee		Kewaunee nuclear power station
kV		Kilovolt
LNG		Liquefied natural gas
MD&A		Management’s Discussion and Analysis of Financial Condition and Results of Operations
MGD		Million gallons a day
Millstone		Millstone nuclear power station
Millstone 2019 power purchase agreements		Power purchase agreements with Eversource Energy and The United Illuminating Company for Millstone to provide nine million MWh per year of electricity for ten years
MW		Megawatt
MWh		Megawatt hour
NAV		Net asset value
NND Project		V.C. Summer Units 2 and 3 nuclear development project under which DESC and Santee Cooper undertook to construct two Westinghouse AP1000 Advanced Passive Safety nuclear units in Jenkinsville, South Carolina
Norge Solar		A proposed 20 MW utility-scale solar power station located in James City County, Virginia

North Carolina Commission		North Carolina Utilities Commission
NO_X		Nitrogen oxide
NRC		U.S. Nuclear Regulatory Commission
Order 1000		Order issued by FERC adopting requirements for electric transmission planning, cost allocation and development
PIR		Pipeline Infrastructure Replacement program deployed by East Ohio
PJM		PJM Interconnection, LLC
PSD		Prevention of significant deterioration
PSNC		Public Service Company of North Carolina, Incorporated, doing business as Dominion Energy North Carolina
Q-Pipe Transaction		The proposed sale by Dominion Energy to BHE of Dominion Energy Questar Pipeline, DEQPS and QPC Holding Company, LLC (including its subsidiary Questar Southern Trails Pipeline Company), pursuant to a purchase and sale agreement entered into on October 5, 2020
Questar Gas		Questar Gas Company, doing business as Dominion Energy Utah, Dominion Energy Wyoming and Dominion Energy Idaho
Regulation Act		Legislation effective July 1, 2007, that amended the Virginia Electric Utility Restructuring Act and fuel factor statute, which legislation is also known as the Virginia Electric Utility Regulation Act, as amended in 2015 and 2018
RICO		Racketeer Influenced and Corrupt Organizations Act
Rider B		A rate adjustment clause associated with the recovery of costs related to the conversion of three of Virginia Power’s coal-fired power stations to biomass
Rider CCR		A rate adjustment clause associated with the recovery of costs related to the removal of CCR at certain power stations
Rider CE		A rate adjustment clause associated with the recovery of costs related to certain renewable generation facilities in Virginia
Rider GV		A rate adjustment clause associated with the recovery of costs related to Greensville County
Rider R		A rate adjustment clause associated with the recovery of costs related to Bear Garden
Rider S		A rate adjustment clause associated with the recovery of costs related to the Virginia City Hybrid Energy Center
Rider U		A rate adjustment clause associated with the recovery of costs of new underground distribution facilities
Rider US-3		A rate adjustment clause associated with the recovery of costs related to Colonial Trail West and Spring Grove 1
Rider US-4		A rate adjustment clause associated with the recovery of costs related to Sadler Solar
Rider W		A rate adjustment clause associated with the recovery of costs related to Warren County
ROE		Return on equity
RTO		Regional transmission organization
Sadler Solar		An approximately 100 MW proposed utility-scale solar power station located in Greensville County, Virginia
Santee Cooper		South Carolina Public Service Authority
SBL Holdco		SBL Holdco, LLC, a wholly-owned subsidiary of DGI
SCANA		The legal entity, SCANA Corporation, one or more of its consolidated subsidiaries, or the entirety of SCANA Corporation and its consolidated subsidiaries
SCANA Combination		Dominion Energy’s acquisition of SCANA completed on January 1, 2019 pursuant to the terms of the agreement and plan of merger entered on January 2, 2018 between Dominion Energy and SCANA

SCANA Merger Approval Order		Final order issued by the South Carolina Commission on December 21, 2018 setting forth its approval of the SCANA Combination
SCDHEC		South Carolina Department of Health and Environmental Control
SCDOR		South Carolina Department of Revenue
SEC		U.S. Securities and Exchange Commission
Series A Preferred Stock		Dominion Energy’s 1.75% Series A Cumulative Perpetual Convertible Preferred Stock, without par value, with a liquidation preference of $1,000 per share
Series B Preferred Stock		Dominion Energy’s 4.65% Series B Fixed-Rate Cumulative Redeemable Perpetual Preferred Stock, without par value, with a liquidation preference of $1,000 per share
South Carolina Commission		Public Service Commission of South Carolina
Spring Grove 1		A 98 MW utility-scale solar power station located in Surry County, Virginia
Standard & Poor’s		Standard & Poor’s Ratings Services, a division of S&P Global Inc.
Summer		V.C. Summer nuclear power station
Surry		Surry nuclear power station
Sycamore Solar		A proposed 42 MW utility-scale solar power station located in Pittsylvania County, Virginia
Terra Nova Renewable Partners		A partnership comprised primarily of institutional investors advised by J.P. Morgan Asset Management-Global Real Assets
Three Cedars		Granite Mountain and Iron Springs, collectively
Utah Commission		Utah Public Service Commission
VCEA		Virginia Clean Economy Act of March 2020
VEBA		Voluntary Employees’ Beneficiary Association
VIE		Variable interest entity
Virginia City Hybrid Energy Center		A 610 MW baseload carbon-capture compatible, clean coal powered electric generation facility in Wise County, Virginia
Virginia Commission		Virginia State Corporation Commission
Virginia Power		The legal entity, Virginia Electric and Power Company, one or more of its consolidated subsidiaries or operating segment, or the entirety of Virginia Electric and Power Company and its consolidated subsidiaries
Warren County		A 1,350 MW combined-cycle, natural gas-fired power station in Warren County, Virginia
WECTEC		WECTEC Global Project Services, Inc., a wholly-owned subsidiary of Westinghouse
Westinghouse		Westinghouse Electric Company LLC
Wexpro		The legal entity, Wexpro Company, one or more of its consolidated subsidiaries, or the entirety of Wexpro Company and its consolidated subsidiaries
White River Hub		White River Hub, LLC
Wrangler		Wrangler Retail Gas Holdings, LLC, a partnership between Dominion Energy and Interstate Gas Supply, Inc.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31,
	2021		2020
(millions, except per share amounts)
Operating Revenue	$	3,870	$	3,938
Operating Expenses
Electric fuel and other energy-related purchases		550		657
Purchased electric capacity		11		2
Purchased gas		484		434
Other operations and maintenance		987		891
Depreciation, depletion and amortization		608		578
Other taxes		257		240
Impairment of assets and other charges		95		768
Total operating expenses		2,992		3,570
Income from operations		878		368
Other income (expense)		367		(454	)
Interest and related charges		53		432
Income (loss) from continuing operations including noncontrolling interests before income tax expense (benefit)		1,192		(518	)
Income tax expense (benefit)		212		(50	)
Net Income (Loss) From Continuing Operations Including Noncontrolling Interests		980		(468	)
Net Income From Discontinued Operations Including Noncontrolling Interests⁽¹⁾⁽²⁾		28		229
Net Income (Loss) Including Noncontrolling Interests		1,008		(239	)
Noncontrolling Interests		—		31
Net Income (Loss) Attributable to Dominion Energy	$	1,008	$	(270	)
Amounts attributable to Dominion Energy
Net Income (Loss) from continuing operations	$	980	$	(466	)
Net Income from discontinued operations		28		196
Net Income (Loss) attributable to Dominion Energy	$	1,008	$	(270	)
EPS - Basic
Net income (loss) from continuing operations	$	1.19	$	(0.57	)
Net income from discontinued operations		0.04		0.23
Net income (loss) attributable to Dominion Energy	$	1.23	$	(0.34	)
EPS - Diluted
Net income (loss) from continuing operations	$	1.19	$	(0.57	)
Net income from discontinued operations		0.04		0.23
Net income (loss) attributable to Dominion Energy	$	1.23	$	(0.34	)

(1)	See Note 10 for amounts attributable to related parties.

(2)	Includes income tax expense of $7 million and $31 million for the three months ended March 31, 2021 and 2020, respectively.

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements.

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended March 31,
	2021			2020
(millions)
Net income (loss) including noncontrolling interests	$	1,008		$	(239	)
Other comprehensive income (loss), net of taxes:
Net deferred gains (losses) on derivatives-hedging activities⁽¹⁾		39			(266	)
Changes in unrealized net gains (losses) on investment securities⁽²⁾		(31	)		9
Changes in net unrecognized pension and other postretirement benefit costs⁽³⁾		6			—
Amounts reclassified to net income (loss):
Net derivative losses-hedging activities⁽⁴⁾		13			22
Net realized (gains) losses on investment securities⁽⁵⁾		1			(9	)
Net pension and other postretirement benefit costs⁽⁶⁾		18			19
Total other comprehensive income (loss)		46			(225	)
Comprehensive income (loss) including noncontrolling interests		1,054			(464	)
Comprehensive income attributable to noncontrolling interests		—			31
Comprehensive income (loss) attributable to Dominion Energy	$	1,054		$	(495	)

(1)	Net of $(13) million and $93 million tax for the three months ended March 31, 2021 and 2020, respectively.

(2)	Net of $10 million and $(4) million tax for the three months ended March 31, 2021 and 2020, respectively.

(3)	Net of $(4) million and $— million tax for the three months ended March 31, 2021 and 2020, respectively.

(4)	Net of $(4) million and $(7) million tax for the three months ended March 31, 2021 and 2020, respectively.

(5)	Net of $— million and $4 million tax for the three months ended March 31, 2021 and 2020, respectively.

(6)	Net of $(7) million and $(5) million tax for the three months ended March 31, 2021 and 2020, respectively.

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements.

DOMINION ENERGY, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31, 2021			December 31, 2020⁽¹⁾
(millions)
ASSETS
Current Assets
Cash and cash equivalents	$	477		$	172
Customer receivables (less allowance for doubtful accounts of $39 and $42)		1,841			2,295
Other receivables (less allowance for doubtful accounts of $3 at both dates)		239			212
Inventories		1,476			1,550
Regulatory assets		650			699
Other		479			476
Current assets held for sale		1,500			1,482
Total current assets		6,662			6,886
Investments
Nuclear decommissioning trust funds		7,139			6,900
Investment in equity method affiliates		2,949			2,934
Other		405			404
Total investments		10,493			10,238
Property, Plant and Equipment
Property, plant and equipment		84,035			82,959
Accumulated depreciation, depletion and amortization		(25,614	)		(25,111	)
Total property, plant and equipment, net		58,421			57,848
Deferred Charges and Other Assets
Goodwill		7,381			7,381
Regulatory assets		8,793			9,133
Other		4,953			4,419
Total deferred charges and other assets		21,127			20,933
Total assets	$	96,703		$	95,905

(1)	Dominion Energy’s Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Balance Sheet at that date.

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements.

DOMINION ENERGY, INC.

CONSOLIDATED BALANCE SHEETS—(Continued)

(Unaudited)

	March 31, 2021			December 31, 2020⁽¹⁾
(millions)
LIABILITIES AND EQUITY
Current Liabilities
Securities due within one year	$	2,639		$	1,937
Supplemental 364-Day credit facility borrowings		—			225
Short-term debt		2,815			895
Accounts payable		848			944
Accrued interest, payroll and taxes		957			1,133
Regulatory liabilities		641			809
Liability to Atlantic Coast Pipeline		97			1,052
Q-Pipe Transaction deposit		1,290			1,290
Other⁽²⁾		1,924			1,933
Current liabilities held for sale		625			625
Total current liabilities		11,836			10,843
Long-Term Debt
Long-term debt		30,209			30,915
Junior subordinated notes		2,162			2,161
Other		877			881
Total long-term debt		33,248			33,957
Deferred Credits and Other Liabilities
Deferred income taxes and investment tax credits		6,202			5,953
Regulatory liabilities		10,202			10,187
Other		8,177			8,504
Total deferred credits and other liabilities		24,581			24,644
Total liabilities		69,665			69,444
Commitments and Contingencies (see Note 17)
Equity
Preferred stock (See Note 16)		2,387			2,387
Common stock – no par⁽³⁾		21,310			21,258
Retained earnings		4,673			4,189
Accumulated other comprehensive loss		(1,671	)		(1,717	)
Total shareholders' equity		26,699			26,117
Noncontrolling interests		339			344
Total equity		27,038			26,461
Total liabilities and equity	$	96,703		$	95,905

(1)	Dominion Energy’s Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Balance Sheet at that date.

(2)	See Note 10 for amounts attributable to related parties.

(3)	1.8 billion shares authorized; 806 million shares outstanding at both March 31, 2021 and December 31, 2020.

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements.

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

	Preferred Stock				Common Stock				Dominion Energy Shareholders						Total
	Shares		Amount		Shares		Amount		Retained Earnings			AOCI			Shareholders' Equity			Noncontrolling Interests			Total Equity
(millions, except per share amounts)
December 31, 2019		2	$	2,387		838	$	23,824	$	7,576		$	(1,793	)	$	31,994		$	2,039		$	34,033
Cumulative-effect of changes in accounting principles										(48	)					(48	)					(48	)
Net income (loss) including noncontrolling interests										(270	)					(270	)		31			(239	)
Issuance of stock						1		78								78						78
Preferred stock dividends (See Note 16)										(16	)					(16	)					(16	)
Common stock dividends ($0.940 per share) and distributions										(788	)					(788	)		(44	)		(832	)
Other comprehensive loss, net of tax													(225	)		(225	)					(225	)
Other										1						1						1
March 31, 2020		2	$	2,387		839	$	23,902	$	6,455		$	(2,018	)	$	30,726		$	2,026		$	32,752


December 31, 2020		2	$	2,387		806	$	21,258	$	4,189		$	(1,717	)	$	26,117		$	344		$	26,461
Net income including noncontrolling interests										1,008						1,008			—			1,008
Issuance of stock						—		48								48						48
Stock awards (net of change in unearned compensation)								4								4						4
Preferred stock dividends (See Note 16)										(16	)					(16	)					(16	)
Common stock dividends ($0.630 per share) and distributions										(508	)					(508	)		(6	)		(514	)
Other comprehensive income, net of tax													46			46						46
Other																—			1			1
March 31, 2021		2	$	2,387		806	$	21,310	$	4,673		$	(1,671	)	$	26,699		$	339		$	27,038

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three Months Ended March 31,	2021			2020
(millions)
Operating Activities
Net income (loss) including noncontrolling interests	$	1,008		$	(239	)
Adjustments to reconcile net income (loss) including noncontrolling interests to net cash provided by operating activities:
Depreciation, depletion and amortization (including nuclear fuel)		685			759
Deferred income taxes and investment tax credits		216			(65	)
Impairment of assets and other charges		95			768
Net losses (gains) on nuclear decommissioning trust funds and other investments		(152	)		526
Other adjustments		4			4
Changes in:
Accounts receivable		334			245
Inventories		73			71
Deferred fuel and purchased gas costs, net		(149	)		162
Prepayments		24			38
Accounts payable		21			(164	)
Accrued interest, payroll and taxes		(177	)		(234	)
Customer deposits		(9	)		(13	)
Margin deposit assets and liabilities		(60	)		46
Net realized and unrealized changes related to derivative activities		(218	)		36
Other operating assets and liabilities		(243	)		(307	)
Net cash provided by operating activities		1,452			1,633
Investing Activities
Plant construction and other property additions (including nuclear fuel)		(1,328	)		(1,462	)
Acquisition of solar development projects		(23	)		(8	)
Proceeds from sales of securities		1,765			602
Purchases of securities		(1,765	)		(631	)
Contributions to equity method affiliates		(977	)		(11	)
Acquisition of equity method investments		—			(178	)
Other		20			47
Net cash used in investing activities		(2,308	)		(1,641	)
Financing Activities
Issuance of short-term debt, net		1,921			1,279
Issuance of short-term notes		—			500
Repayment of supplemental 364-day credit facility borrowings		(225	)		—
Issuance of long-term debt		150			950
Repayment of long-term debt, including redemption premiums		(161	)		(932	)
Issuance of common stock		48			78
Common dividend payments		(508	)		(788	)
Other		(54	)		(81	)
Net cash provided by financing activities		1,171			1,006
Increase in cash, restricted cash and equivalents		315			998
Cash, restricted cash and equivalents at beginning of period		247			269
Cash, restricted cash and equivalents at end of period	$	562		$	1,267

See Note 2 for disclosure of supplemental cash flow information.

The accompanying notes are an integral part of Dominion Energy’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31,
	2021			2020
(millions)
Operating Revenue⁽¹⁾	$	1,830		$	1,930
Operating Expenses
Electric fuel and other energy-related purchases⁽¹⁾		406			492
Excess electric capacity		(3	)		(9	)
Other operations and maintenance:
Affiliated suppliers		87			87
Other		426			331
Depreciation and amortization		324			311
Other taxes		93			87
Impairment of assets and other charges (benefit)		(51	)		764
Total operating expenses		1,282			2,063
Income (loss) from operations		548			(133	)
Other income (expense)		32			(52	)
Interest and related charges⁽¹⁾		136			126
Income (loss) before income tax expense		444			(311	)
Income tax expense (benefit)		70			(31	)
Net Income (Loss)	$	374		$	(280	)

(1)	See Note 19 for amounts attributable to affiliates.

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended March 31,
	2021			2020
(millions)
Net income (loss)	$	374		$	(280	)
Other comprehensive income (loss), net of taxes:
Net deferred gains (losses) on derivatives-hedging activities⁽¹⁾		32			(45	)
Changes in unrealized net losses on nuclear decommissioning trust funds⁽²⁾		(5	)		(2	)
Amounts reclassified to net income (loss):
Net derivative losses-hedging activities⁽³⁾		1			—
Net realized losses on nuclear decommissioning trust funds⁽⁴⁾		1			1
Total other comprehensive income (loss)		29			(46	)
Comprehensive income (loss)	$	403		$	(326	)

(1)	Net of $(11) million and $16 million tax for the three months ended March 31, 2021 and 2020, respectively.

(2)	Net of $— million and $— million tax for the three months ended March 31, 2021 and 2020, respectively.

(3)	Net of $— million and $— million tax for the three months ended March 31, 2021 and 2020, respectively.

(4)	Net of $— million and $(1) million tax for the three months ended March 31, 2021 and 2020, respectively.

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31, 2021			December 31, 2020⁽¹⁾
(millions)
ASSETS
Current Assets
Cash and cash equivalents	$	56		$	35
Customer receivables (less allowance for doubtful accounts of $18 and $23)		926			1,315
Other receivables (less allowance for doubtful accounts of $2 at both dates)		86			91
Affiliated receivables		10			5
Inventories (average cost method)		840			862
Regulatory assets		292			295
Other⁽²⁾		52			59
Total current assets		2,262			2,662
Investments
Nuclear decommissioning trust funds		3,322			3,197
Other		3			3
Total investments		3,325			3,200
Property, Plant and Equipment
Property, plant and equipment		47,431			46,736
Accumulated depreciation and amortization		(14,446	)		(14,167	)
Total property, plant and equipment, net		32,985			32,569
Deferred Charges and Other Assets
Regulatory assets		3,235			3,509
Other⁽²⁾		1,977			1,714
Total deferred charges and other assets		5,212			5,223
Total assets	$	43,784		$	43,654

(1)	Virginia Power’s Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Balance Sheet at that date.

(2)	See Note 19 for amounts attributable to affiliates.

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED BALANCE SHEETS—(Continued)

(Unaudited)

	March 31, 2021			December 31, 2020⁽¹⁾
(millions)
LIABILITIES AND SHAREHOLDER’S EQUITY
Current Liabilities
Securities due within one year	$	458		$	8
Short-term debt		420			45
Accounts payable		311			332
Payables to affiliates		125			266
Affiliated current borrowings		177			380
Accrued interest, payroll and taxes		307			253
Asset retirement obligations		159			166
Regulatory liabilities		272			425
Derivative liabilities⁽²⁾		171			390
Other		591			562
Total current liabilities		2,991			2,827
Long-Term Debt
Long-term debt		12,759			13,207
Other		481			480
Total long-term debt		13,240			13,687
Deferred Credits and Other Liabilities
Deferred income taxes and investment tax credits		2,873			2,779
Asset retirement obligations		3,681			3,654
Regulatory liabilities		5,402			5,338
Other⁽²⁾		786			812
Total deferred credits and other liabilities		12,742			12,583
Total liabilities		28,973			29,097
Commitments and Contingencies (see Note 17)
Common Shareholder’s Equity
Common stock – no par⁽³⁾		5,738			5,738
Other paid-in capital		1,113			1,113
Retained earnings		7,983			7,758
Accumulated other comprehensive loss		(23	)		(52	)
Total common shareholder’s equity		14,811			14,557
Total liabilities and shareholder’s equity	$	43,784		$	43,654

(1)	Virginia Power’s Consolidated Balance Sheet at December 31, 2020 has been derived from the audited Consolidated Balance Sheet at that date.

(2)	See Note 19 for amounts attributable to affiliates.

(3)	500,000 shares authorized; 274,723 shares outstanding at March 31, 2021 and December 31, 2020.

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF COMMON SHAREHOLDER’S EQUITY

(Unaudited)

	Common Stock
	Shares		Amount		Other Paid-In Capital		Retained Earnings			AOCI			Total
(millions, except for shares)	(thousands)
December 31, 2019		275	$	5,738	$	1,113	$	7,167		$	(29	)	$	13,989
Net loss								(280	)					(280	)
Dividends								(108	)					(108	)
Other comprehensive loss, net of tax											(46	)		(46	)
Other								1						1
March 31, 2020		275		5,738		1,113		6,780			(75	)		13,556

December 31, 2020		275	$	5,738	$	1,113	$	7,758		$	(52	)	$	14,557
Net income								374						374
Dividends								(150	)					(150	)
Other comprehensive income, net of tax											29			29
Other								1						1
March 31, 2021		275	$	5,738	$	1,113	$	7,983		$	(23	)	$	14,811

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three Months Ended March 31,	2021			2020
(millions)
Operating Activities
Net income (loss)	$	374		$	(280	)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization (including nuclear fuel)		365			357
Deferred income taxes and investment tax credits		87			(135	)
Impairment of assets and other charges (benefit)		(51	)		764
Other adjustments		(29	)		53
Changes in:
Accounts receivable		317			123
Affiliated receivables and payables		(144	)		24
Inventories		21			5
Prepayments		(4	)		(5	)
Deferred fuel expenses, net		(159	)		70
Accounts payable		—			99
Accrued interest, payroll and taxes		54			13
Net realized and unrealized changes related to derivative activities		18			(12	)
Other operating assets and liabilities		(65	)		73
Net cash provided by operating activities		784			1,149
Investing Activities
Plant construction and other property additions		(766	)		(764	)
Purchases of nuclear fuel		(46	)		(25	)
Acquisition of solar development projects		(10	)		(6	)
Proceeds from sales of securities		789			294
Purchases of securities		(791	)		(310	)
Other		41			37
Net cash used in investing activities		(783	)		(774	)
Financing Activities
Issuance (repayment) of short-term debt, net		375			(108	)
Repayment of affiliated current borrowings, net		(203	)		(106	)
Common dividend payments to parent		(150	)		(108	)
Other		(2	)		(1	)
Net cash provided by (used in) financing activities		20			(323	)
Increase in cash, restricted cash and equivalents		21			52
Cash, restricted cash and equivalents at beginning of period		35			24
Cash, restricted cash and equivalents at end of period	$	56		$	76

See Note 2 for disclosure of supplemental cash flow information.

The accompanying notes are an integral part of Virginia Power’s Consolidated Financial Statements.

COMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. Nature of Operations

Dominion Energy, headquartered in Richmond, Virginia, is one of the nation’s largest producers and distributors of energy. Dominion Energy’s operations are conducted through various subsidiaries, including Virginia Power. Dominion Energy’s operations also include DESC, regulated gas distribution operations primarily in the eastern and Rocky Mountain regions of the U.S., nonregulated electric generation and, following completion of the GT&S Transaction in November 2020, a noncontrolling interest in Cove Point. See Note 3 for a description of the sale of substantially all of Dominion Energy’s gas transmission and storage operations to BHE through the GT&S Transaction completed in November 2020 and the proposed Q-Pipe Transaction of Dominion Energy’s remaining regulated gas transmission and storage services in the Rocky Mountain region of the U.S.

Note 2. Significant Accounting Policies

As permitted by the rules and regulations of the SEC, the Companies’ accompanying unaudited Consolidated Financial Statements contain certain condensed financial information and exclude certain footnote disclosures normally included in annual audited consolidated financial statements prepared in accordance with GAAP. These unaudited Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

In the Companies’ opinion, the accompanying unaudited Consolidated Financial Statements contain all adjustments necessary to present fairly their financial position at March 31, 2021 and their results of operations, changes in equity and cash flows for the three months ended March 31, 2021 and 2020. Such adjustments are normal and recurring in nature unless otherwise noted.

The Companies make certain estimates and assumptions in preparing their Consolidated Financial Statements in accordance with GAAP. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses for the periods presented. Actual results may differ from those estimates.

The Companies’ accompanying unaudited Consolidated Financial Statements include, after eliminating intercompany transactions and balances, their accounts, those of their respective majority-owned subsidiaries and non-wholly-owned entities in which they have a controlling financial interest. For certain partnership structures, income is allocated based on the liquidation value of the underlying contractual arrangements. At March 31, 2021, Dominion Energy owns 50% of the voting interests in Four Brothers and Three Cedars and has a controlling financial interest over the entities through its right to control operations. GIP’s ownership interest in Four Brothers and Three Cedars, Terra Nova Renewable Partners’ 33% interest in certain Dominion Energy nonregulated solar projects and Brookfield’s 25% interest in Cove Point (effective December 2019 until November 2020) are reflected as noncontrolling interest in Dominion Energy’s Consolidated Financial Statements. Terra Nova Renewable Partners has a future option to buy all or a portion of Dominion Energy’s remaining 67% ownership in certain nonregulated solar projects upon the occurrence of certain events, including any proposed sale by Dominion Energy of its interest.

The results of operations for interim periods are not necessarily indicative of the results expected for the full year. Information for quarterly periods is affected by seasonal variations in sales, rate changes, electric fuel and other energy-related purchases, purchased gas expenses and other factors.

Certain amounts in the Companies’ 2020 Consolidated Financial Statements and Notes have been reclassified to conform to the 2021 presentation for comparative purposes; however, such reclassifications did not affect the Companies’ net income, total assets, liabilities, equity or cash flows.

Amounts disclosed for Dominion Energy are inclusive of Virginia Power, where applicable. There have been no significant changes from Note 2 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, with the exception of the items described below.

Cash, Restricted Cash and Equivalents

Restricted Cash and Equivalents

The following table provides a reconciliation of the total cash, restricted cash and equivalents reported within the Companies’ Consolidated Balance Sheets to the corresponding amounts reported within the Companies’ Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020:

	Cash, Restricted Cash and Equivalents at End of Period				Cash, Restricted Cash and Equivalents at Beginning of Period
	March 31, 2021		March 31, 2020		December 31, 2020		December 31, 2019
(millions)
Dominion Energy
Cash and cash equivalents⁽¹⁾	$	491	$	1,192	$	179	$	166
Restricted cash and equivalents⁽²⁾⁽³⁾		71		75		68		103
Cash, restricted cash and equivalents shown in the Consolidated Statements of Cash Flows	$	562	$	1,267	$	247	$	269
Virginia Power
Cash and cash equivalents	$	56	$	71	$	35	$	17
Restricted cash and equivalents⁽³⁾		—		5		—		7
Cash, restricted cash and equivalents shown in the Consolidated Statements of Cash Flows	$	56	$	76	$	35	$	24

(1)	At March 31, 2021, March 31, 2020, December 31, 2020 and December 31, 2019, Dominion Energy had $14 million, $59 million, $7 million and $31 million of cash and cash equivalents included in current assets held for sale, respectively.

(2)	At March 31, 2021, March 31, 2020, December 31, 2020 and December 31, 2019, Dominion Energy had $3 million, $12 million, $3 million and $12 million of restricted cash and equivalents included in current assets held for sale, respectively.

(3)	Restricted cash and equivalent balances are presented within other current assets in the Companies’ Consolidated Balance Sheets.

Supplemental Cash Flow Information

The following table provides supplemental disclosure of cash flow information related to Dominion Energy:

	Three Months Ended March 31,
	2021		2020
(millions)
Significant noncash investing and financing activities:
Accrued capital expenditures	$	341	$	343
Leases⁽¹⁾		9		17

(1)	Includes $2 million and $17 million of financing leases at March 31, 2021 and 2020, respectively, and $7 million of operating leases at March 31, 2021.

The following table provides supplemental disclosure of cash flow information related to Virginia Power:

	Three Months Ended March 31,
	2021		2020
(millions)
Significant noncash investing and financing activities:
Accrued capital expenditures	$	262	$	210
Financing leases		1		10

Property, Plant and Equipment

In March 2020, Virginia Power committed to retire certain coal- and oil-fired generating units before the end of their useful lives based on economic and other factors, including but not limited to market power prices and the VCEA. These units will be retired after they meet their capacity obligations to PJM in 2023. As a result, Virginia Power recorded a charge of $754 million ($561 million after-tax) in the first quarter of 2020, primarily included in impairment of assets and other charges in its Consolidated Statements of Income. This charge is considered a component of Virginia Power’s base rates deemed recovered under the GTSA, subject to review as discussed in Note 13 to the Consolidated Financial Statements in Virginia Power’s Annual Report on Form 10-K for the year ended December 31, 2020.

Note 3. Acquisitions and Dispositions

Disposition of Gas Transmission & Storage Operations to BHE

In July 2020, Dominion Energy entered into an agreement with BHE with a total value of approximately $10 billion, comprised of approximately $4.0 billion of cash consideration (subject to customary closing adjustments) plus the assumption of long-term debt, to sell substantially all of its gas transmission and storage operations, including processing assets, as well as noncontrolling partnership interests in Iroquois, JAX LNG and White River Hub and a controlling interest in Cove Point (consisting of 100% of the general partner interest and 25% of the total limited partner interests). The agreement provides that Dominion Energy retains the assets and obligations of the pension and other postretirement employee benefit plans associated with the operations included in the transaction and relating to services provided through closing. In October 2020, pursuant to a provision in the agreement with BHE, Dominion Energy elected to exclude Dominion Energy Questar Pipeline and certain other affiliated entities from the transaction as approval under the Hart-Scott-Rodino Act had not been obtained by mid-September 2020. Concurrently in October 2020, Dominion Energy and BHE entered into a separate agreement under which Dominion Energy will sell Dominion Energy Questar Pipeline and certain other affiliated entities for cash consideration of $1.3 billion and the assumption of related long-term debt. In November 2020, Dominion Energy completed the GT&S Transaction as discussed in Note 3 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

In connection with closing of the GT&S Transaction, Dominion Energy and BHE entered into a transition services agreement under which Dominion Energy will continue to provide specified administrative services to support the operations of the disposed business for up to 24 months after closing. In addition, BHE will provide certain administrative services to Dominion Energy. Dominion Energy recorded revenue of $5 million associated with the transition service agreement in operating revenue in its Consolidated Statements of Income for the three months ended March 31, 2021.

Also in November 2020, BHE provided a $1.3 billion deposit to Dominion Energy on the Q-Pipe Transaction. Dominion Energy will be required to repay all or substantially all of this deposit, or issue to BHE an equivalent value in shares of Dominion Energy common stock at Dominion Energy’s option, if the Q-Pipe Transaction does not close by December 30, 2021. Dominion Energy may, effective April 1, 2021, solicit or accept offers from alternative buyers for all or a material portion of the Q-Pipe Transaction and either party may terminate the Q-Pipe Transaction if closing has not occurred on or before June 30, 2021. If the Hart-Scott-Rodino Act approval has not been obtained by June 30, 2021, upon BHE’s request, Dominion Energy will seek an alternative buyer for all or a material portion of the Q-Pipe Transaction. The Q-Pipe Transaction is structured as an asset sale for tax purposes and is expected to close in 2021, contingent on clearance or approval under the Hart-Scott-Rodino Act, and other customary closing and regulatory conditions. Based on the recorded balances at March 31, 2021, Dominion Energy expects to recognize a pre-tax gain of approximately $450 million ($320 million after-tax) upon closing, including the write-off of $191 million of goodwill, but excluding the effects of any closing adjustments.

The operations included in both the GT&S Transaction and the Q-Pipe Transaction are presented in held-for-sale and discontinued operations effective July 2020. As a result, the previously reported amounts have been recast to reflect this presentation and depreciation and amortization ceased on the applicable assets. As Cove Point had previously been consolidated within Dominion Energy’s financial statements, balances associated with Cove Point prior to the closing of the GT&S Transaction are presented within held-for-sale and discontinued operations. See Note 10 for further information regarding Dominion Energy’s equity method investment in Cove Point.

The following table represents selected information regarding the results of operations, which are reported within discontinued operations in Dominion Energy’s Consolidated Statements of Income:

	Three Months Ended March 31, 2021		Three Months Ended March 31, 2020
	Q-Pipe Transaction		GT&S Transaction		Q-Pipe Transaction
(millions)
Operating revenue	$	67	$	563	$	65
Operating expense		19		333		33
Other income		—		20		1
Interest and related charges		5		53		4
Income before income taxes		43		197		29
Income tax expense		8		27		4
Net income including noncontrolling interests		35		170		25
Noncontrolling interests		—		33		—
Net income attributable to Dominion Energy	$	35	$	137	$	25

The carrying amounts of major classes of assets and liabilities relating to the disposal groups, which are reported as held for sale in Dominion Energy’s Consolidated Balance Sheets were as follows:

	At March 31, 2021		At December 31, 2020
	Q-Pipe Transaction		Q-Pipe Transaction
(millions)
Current assets⁽¹⁾	$	49	$	47
Equity method investments⁽²⁾		35		35
Property, plant and equipment, net		1,120		1,113
Other deferred charges and other assets, including goodwill and intangible assets⁽³⁾		224		224
Current liabilities		30		30
Long-term debt		426		426
Other deferred credits and liabilities		154		154

(1)

Includes cash and cash equivalents of $13 million and $7 million as of March 31, 2021 and December 31, 2020.

(2)

Comprised of an equity method investment in White River Hub.

(3)

Includes goodwill of $191 million at both March 31, 2021 and December 31, 2020.

Capital expenditures and significant noncash items relating to the disposal groups included the following:

	Three Months Ended March 31, 2021		Three Months Ended March 31, 2020
	Q-Pipe Transaction		GT&S Transaction		Q-Pipe Transaction
(millions)
Capital expenditures	$	3	$	73	$	6
Significant noncash items
Depreciation, depletion and amortization		—		82		13
Accrued capital expenditures		2		16		—

Note 4. Operating Revenue

The Companies’ operating revenue consists of the following:

	Three Months Ended March 31,
	2021		2020
(millions)
Dominion Energy
Regulated electric sales:
Residential	$	1,155	$	1,158
Commercial		719		798
Industrial		178		182
Government and other retail		189		219
Wholesale		43		33
Nonregulated electric sales		249		232
Regulated gas sales:
Residential		630		548
Commercial		206		191
Other		34		28
Nonregulated gas sales		52		83
Regulated gas transportation and storage		271		232
Other regulated revenues		66		92
Other nonregulated revenues⁽¹⁾⁽²⁾		48		31
Total operating revenue from contracts with customers		3,840		3,827
Other revenues⁽³⁾⁽⁴⁾		30		111
Total operating revenue	$	3,870	$	3,938
Virginia Power
Regulated electric sales:
Residential	$	889	$	896
Commercial		547		614
Industrial		91		97
Government and other retail		176		203
Wholesale		26		24
Other regulated revenues		57		62
Other nonregulated revenues⁽¹⁾⁽²⁾		21		13
Total operating revenue from contracts with customers		1,807		1,909
Other revenues⁽²⁾⁽³⁾		23		21
Total operating revenue	$	1,830	$	1,930

(1)

Amounts above include sales which are considered to be goods transferred at a point in time. Such amounts include $7 million for both the three months ended March 31, 2021 and 2020, primarily consisting of sales of commodities related to nonregulated extraction activities and other miscellaneous products. Additionally, amounts above include sales of renewable energy credits. Such amounts included $6 million and $4 million for the three months ended March 31, 2021 and $4 million and $3 million for the three months ended March 31, 2020, at Dominion Energy and Virginia Power, respectively.

(2)	See Notes 10 and 19 for amounts attributable to related parties and affiliates.

(3)	Amounts above include alternative revenue of $22 million and $36 million at Dominion Energy and $20 million and $17 million at Virginia Power for the three months ended March 31, 2021 and 2020, respectively.

(4)	Amounts above include revenue associated with services provided to discontinued operations of $1 million and $2 million for the three months ended March 31, 2021 and 2020, respectively.

The table below discloses the aggregate amount of the transaction price allocated to fixed-price performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period and when the Companies expect to recognize this revenue. These revenues relate to contracts containing fixed prices where the Companies will earn the associated revenue over time as they stand ready to perform services provided. This disclosure does not include revenue related to performance obligations that are part of a contract with original durations of one year or less. In addition, this disclosure does not include expected consideration related to performance obligations for which the Companies elect to recognize revenue in the amount they have a right to invoice.

Revenue expected to be recognized on multi-year

contracts in place at March 31, 2021

2021

2022

2023

2024

2025

Thereafter

Total

(millions)

Dominion Energy

493

788

At March 31, 2021 and December 31, 2020, Dominion Energy’s contract liability balances were $74 million and $130 million, respectively, and are recorded in other current liabilities and other deferred credits and other liabilities in the Consolidated Balance Sheets. At March 31, 2021 and December 31, 2020, Virginia Power’s contract liability balances were $32 million and $36 million, respectively, and are recorded in other current liabilities and other deferred credits and other liabilities in its Consolidated Balance Sheets.

The Companies recognize revenue as they fulfill their obligations to provide service to their customers. During the three months ended March 31, 2021 and 2020, Dominion Energy recognized revenue of $122 million and $93 million, respectively, from the beginning contract liability balances. During the three months ended March 31, 2021 and 2020, Virginia Power recognized $36 million and $24 million, respectively, from the beginning contract liability balance.

Note 5. Income Taxes

For continuing operations, including noncontrolling interests, the statutory U.S. federal income tax rate reconciles to the Companies’ effective income tax rate as follows:

	Dominion Energy						Virginia Power
Three Months Ended March 31,	2021			2020			2021			2020
U.S. statutory rate		21.0	%		21.0	%		21.0	%		21.0	%
Increases (reductions) resulting from:
State taxes, net of federal benefit		3.5			3.3			4.5			4.8
Investment tax credits		(3.8	)		(7.0	)		(6.6	)		(6.4	)
Production tax credits		(0.3	)		(0.8	)		(0.6	)		(0.8	)
Reversal of excess deferred income taxes		(2.2	)		(7.8	)		(2.2	)		(8.1	)
AFUDC - equity		(0.4	)		(0.7	)		(0.7	)		(0.7	)
Other, net		—			1.7			0.3			0.3
Effective tax rate		17.8	%		9.7	%		15.7	%		10.1	%

For the Companies’ rate-regulated entities, deferred taxes will reverse at the weighted average rate used to originate the deferred tax liability, which in some cases will be 35%. The Companies have recorded an estimate of excess deferred income tax amortization in 2021. The reversal of these excess deferred income taxes will impact the effective tax rate and rates charged to customers. See Note 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

As of March 31, 2021, there have been no material changes in the Companies’ unrecognized tax benefits or possible changes that could reasonably be expected to occur during the next twelve months. See Note 5 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, for a discussion of these unrecognized tax benefits.

In April 2021, a state legislative change was enacted for tax years beginning January 1, 2022. Dominion Energy expects to record an approximate $20 million deferred tax benefit, inclusive of an approximate $15 million benefit at Virginia Power, in the second quarter of 2021.

Discontinued operations

Income tax expense reflected in discontinued operations is $7 million and $31 million for the three months ended March 31, 2021 and 2020, respectively.

Note 6. Earnings Per Share

The following table presents the calculation of Dominion Energy’s basic and diluted EPS:

	Three Months Ended March 31,
	2021			2020
(millions, except EPS)
Net income (loss) attributable to Dominion Energy from continuing operations	$	980		$	(466	)
Preferred stock dividends (see Note 16)		(16	)		(16	)
Net income (loss) attributable to Dominion Energy from continuing operations – Basic		964			(482	)
Dilutive effect of Series A Preferred Stock		—			—
Net income (loss) attributable to Dominion Energy from continuing operations - Diluted	$	964		$	(482	)

Net income attributable to Dominion Energy from discontinued operations - Basic & Diluted	$	28		$	196

Average shares of common stock outstanding – Basic & Diluted		805.9			838.2
Net effect of dilutive securities		—			—
Average shares of common stock outstanding – Diluted		805.9			838.2

EPS from continuing operations – Basic	$	1.19		$	(0.57	)
EPS from discontinued operations – Basic		0.04			0.23
EPS attributable to Dominion Energy – Basic	$	1.23		$	(0.34	)

EPS from continuing operations – Diluted		1.19		$	(0.57	)
EPS from discontinued operations – Diluted		0.04			0.23
EPS attributable to Dominion Energy – Diluted	$	1.23		$	(0.34	)

The 2019 Equity Units and the Q-Pipe Transaction deposit are potentially dilutive securities. See Note 3 in this report and Note 19 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information. The forward stock purchase contracts included within the 2019 Equity Units were excluded from the calculation of diluted EPS from continuing operations for the three months ended March 31, 2021, as the dilutive stock price threshold was not met. The Series A Preferred Stock included within the 2019 Equity Units is excluded from the calculation of diluted EPS from continuing operations based upon the expectation that the conversion will be settled in cash rather than through the issuance of Dominion Energy common stock. For the three months ended March 31, 2021, a fair value adjustment related to the Series A Preferred Stock included within the 2019 Equity Units is excluded from the calculation of diluted EPS from continuing operations, as such fair value adjustment was not dilutive during the period. As a result of a net loss attributable to Dominion Energy from continuing operations for the three months ended March 31, 2020, any adjustments to earnings or shares would be considered antidilutive and are therefore excluded from the calculation of diluted EPS from continuing operations. The impact of settling the deposit associated with the Q-Pipe Transaction in shares is excluded from the calculation of diluted EPS from continuing operations for the three months ended March 31, 2021 based upon the expectation Dominion Energy would settle in cash rather than through the issuance of Dominion Energy common stock.

Note 7. Accumulated Other Comprehensive Income

Dominion Energy

The following table presents Dominion Energy’s changes in AOCI by component, net of tax:

	Deferred gains and losses on derivatives- hedging activities			Unrealized gains and losses on investment securities			Unrecognized pension and other postretirement benefit costs			Other comprehensive loss from equity method investees			Total
(millions)
Three Months Ended March 31, 2021
Beginning balance	$	(419	)	$	62		$	(1,359	)	$	(1	)	$	(1,717	)
Other comprehensive income before reclassifications: gains (losses)		39			(31	)		6			—			14
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		13			1			18			—			32
Net current period other comprehensive income (loss)		52			(30	)		24			—			46
Ending balance	$	(367	)	$	32		$	(1,335	)	$	(1	)	$	(1,671	)
Three Months Ended March 31, 2020
Beginning balance	$	(407	)	$	37		$	(1,421	)	$	(2	)	$	(1,793	)
Other comprehensive income before reclassifications: gains (losses)		(266	)		9			—			—			(257	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		22			(9	)		19			—			32
Net current period other comprehensive income (loss)		(244	)		—			19			—			(225	)
Ending balance	$	(651	)	$	37		$	(1,402	)	$	(2	)	$	(2,018	)

(1)	See table below for details about these reclassifications.

The following table presents Dominion Energy’s reclassifications out of AOCI by component:

Details about AOCI components	Amounts reclassified from AOCI			Affected line item in the Consolidated Statements of Income
(millions)
Three Months Ended March 31, 2021
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	1		Purchased gas
Interest rate contracts		16		Interest and related charges
Total		17
Tax		(4	)	Income tax expense (benefit)
Total, net of tax	$	13
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities	$	1		Other income (expense)
Total		1
Tax		—		Income tax expense (benefit)
Total, net of tax	$	1
Unrecognized pension and other postretirement benefit costs:
Amortization of prior-service costs (credits)	$	(5	)	Other income (expense)
Amortization of actuarial losses		30		Other income (expense)
Total		25
Tax		(7	)	Income tax expense (benefit)
Total, net of tax	$	18
Three Months Ended March 31, 2020
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	(6	)	Operating revenue
		3		Purchased gas
		(1	)	Discontinued operations
Interest rate contracts		25		Interest and related charges
		2		Discontinued operations
Foreign currency contracts		6		Discontinued operations
Total		29
Tax		(7	)	Income tax expense (benefit)
Total, net of tax	$	22
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities	$	(13	)	Other income (expense)
Total		(13	)
Tax		4		Income tax expense (benefit)
Total, net of tax	$	(9	)
Unrecognized pension and other postretirement benefit costs:
Amortization of prior-service costs (credits)	$	(6	)	Other income (expense)
Amortization of actuarial losses		30		Other income (expense)
Total		24
Tax		(5	)	Income tax expense (benefit)
Total, net of tax	$	19

Virginia Power

The following table presents Virginia Power’s changes in AOCI by component, net of tax:

	Deferred gains and losses on derivatives- hedging activities			Unrealized gains and losses on investment securities			Total
(millions)
Three Months Ended March 31, 2021
Beginning balance	$	(60	)	$	8		$	(52	)
Other comprehensive income before reclassifications: gains (losses)		32			(5	)		27
Amounts reclassified from AOCI: losses⁽¹⁾		1			1			2
Net current period other comprehensive income (loss)		33			(4	)		29
Ending balance	$	(27	)	$	4		$	(23	)
Three Months Ended March 31, 2020
Beginning balance	$	(34	)	$	5		$	(29	)
Other comprehensive income before reclassifications: losses		(45	)		(2	)		(47	)
Amounts reclassified from AOCI: losses⁽¹⁾		—			1			1
Net current period other comprehensive income (loss)		(45	)		(1	)		(46	)
Ending balance	$	(79	)	$	4		$	(75	)

(1)	See table below for details about these reclassifications.

The following table presents Virginia Power’s reclassifications out of AOCI by component:

Details about AOCI components	Amounts reclassified from AOCI			Affected line item in the Consolidated Statements of Income
(millions)
Three Months Ended March 31, 2021
(Gains) losses on cash flow hedges:
Interest rate contracts	$	1		Interest and related charges
Total		1
Tax		—		Income tax expense (benefit)
Total, net of tax	$	1
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities	$	1		Other income (expense)
Total		1
Tax		—		Income tax expense (benefit)
Total, net of tax	$	1
Three Months Ended March 31, 2020
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities	$	2		Other income (expense)
Total		2
Tax		(1	)	Income tax expense (benefit)
Total, net of tax	$	1

Note 8. Fair Value Measurements

The Companies’ fair value measurements are made in accordance with the policies discussed in Note 6 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. See Note 9 in this report for further information about the Companies’ derivatives and hedge accounting activities.

The Companies enter into certain physical and financial forwards, futures, options and swaps, which are considered Level 3 as they have one or more inputs that are not observable and are significant to the valuation. The discounted cash flow method is used to value Level 3 physical and financial forwards, futures and swaps contracts. The discounted cash flow model for forwards, futures and swaps calculates mark-to-market valuations based on forward market prices, original transaction prices, volumes, risk-free rate of return and credit spreads. For Level 3 fair value measurements, certain forward market prices are considered unobservable.

The following table presents Dominion Energy’s quantitative information about Level 3 fair value measurements at March 31, 2021. The range and weighted average are presented in dollars for market price inputs.

	Fair Value (millions)		Valuation Techniques	Unobservable Input		Range	Weighted Average⁽¹⁾
Assets
Physical and financial forwards:
Natural gas⁽²⁾	$	56	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 3		(1	)
FTRs		2	Discounted cash flow	Market price (per MWh)	⁽³⁾	(2) - 3		—
Total assets	$	58
Liabilities
Financial forwards:
FTRs	$	2	Discounted cash flow	Market price (per MWh)	⁽³⁾	(2) - 2		—
Total liabilities	$	2

(1)	Averages weighted by volume.

(2)	Includes basis.

(3)	Represents market prices beyond defined terms for Levels 1 and 2.

Sensitivity of the fair value measurements to changes in the significant unobservable inputs is as follows:

Significant Unobservable

Inputs

Position

Change to Input

Impact on Fair Value

Measurement

Market price

Buy

Increase (decrease)

Gain (loss)

Market price

Sell

Increase (decrease)

Loss (gain)

Recurring Fair Value Measurements

Dominion Energy

The following table presents Dominion Energy’s assets and liabilities that are measured at fair value on a recurring basis for each hierarchy level, including both current and noncurrent portions:

	Level 1		Level 2		Level 3		Total
(millions)
At March 31, 2021
Assets
Derivatives:
Commodity	$	—	$	51	$	58	$	109
Interest rate		—		740		—		740
Investments⁽¹⁾:
Equity securities:
U.S.		4,569		—		—		4,569
Fixed income:
Corporate debt instruments		—		722		—		722
Government securities		728		727		—		1,455
Cash equivalents and other		18		—		—		18
Total assets	$	5,315	$	2,240	$	58	$	7,613
Liabilities
Derivatives:
Commodity	$	—	$	76	$	2	$	78
Interest rate		—		186		—		186
Total liabilities	$	—	$	262	$	2	$	264
At December 31, 2020
Assets
Derivatives:
Commodity	$	—	$	57	$	110	$	167
Interest rate		—		230		—		230
Investments⁽¹⁾:
Equity securities:
U.S.		4,648		—		—		4,648
Fixed income:
Corporate debt instruments		—		629		—		629
Government securities		508		730		—		1,238
Cash equivalents and other		32		15		—		47
Total assets	$	5,188	$	1,661	$	110	$	6,959
Liabilities
Derivatives:
Commodity	$	—	$	48	$	7	$	55
Interest rate		—		431		—		431
Total liabilities	$	—	$	479	$	7	$	486

(1)

Includes investments held in the nuclear decommissioning and rabbi trusts. Excludes $399 million and $340 million of assets at March 31, 2021 and December 31, 2020, respectively, measured at fair value using NAV (or its equivalent) as a practical expedient which are not required to be categorized in the fair value hierarchy.

The following table presents the net change in Dominion Energy's assets and liabilities measured at fair value on a recurring basis and included in the Level 3 fair value category:

	Three Months Ended
	March 31,
	2021			2020
(millions)
Beginning balance	$	103		$	(37	)
Total realized and unrealized gains (losses):
Included in earnings:
Electric fuel and other energy-related purchases		(21	)		(22	)
Included in regulatory assets/liabilities		(47	)		80
Settlements		21			22
Ending balance	$	56		$	43

There are less than $1 million of unrealized gains and losses included in earnings in the Level 3 fair value category related to assets/liabilities still held at the reporting date for the three months ended March 31, 2021. There were no unrealized gains and losses included in earnings in the Level 3 fair value category related to assets/liabilities still held at the reporting date for the three months ended March 31, 2020.

Virginia Power

The following table presents Virginia Power’s quantitative information about Level 3 fair value measurements at March 31, 2021. The range and weighted average are presented in dollars for market price inputs.

	Fair Value (millions)		Valuation Techniques	Unobservable Input		Range	Weighted Average⁽¹⁾
Assets
Physical and financial forwards:
Natural gas⁽²⁾	$	56	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 3		(1	)
FTRs		2	Discounted cash flow	Market price (per MWh)	⁽³⁾	(2) - 3		—
Total assets	$	58
Liabilities
Financial forwards:
FTRs	$	2	Discounted cash flow	Market price (per MWh)	⁽³⁾	(2) - 2		—
Total liabilities	$	2

(1)	Averages weighted by volume.

(2)	Includes basis.

(3)	Represents market prices beyond defined terms for Levels 1 and 2.

Sensitivity of the fair value measurements to changes in the significant unobservable inputs is as follows:

Significant Unobservable

Inputs

Position

Change to Input

Impact on Fair Value

Measurement

Market price

Buy

Increase (decrease)

Gain (loss)

Market price

Sell

Increase (decrease)

Loss (gain)

The following table presents Virginia Power’s assets and liabilities that are measured at fair value on a recurring basis for each hierarchy level, including both current and noncurrent portions:

	Level 1		Level 2		Level 3		Total
(millions)
At March 31, 2021
Assets
Derivatives:
Commodity	$	—	$	18	$	58	$	76
Interest rate		—		283		—		283
Investments⁽¹⁾:
Equity securities:
U.S.		2,132		—		—		2,132
Fixed income:
Corporate debt instruments		—		400		—		400
Government securities		340		277		—		617
Total assets	$	2,472	$	978	$	58	$	3,508
Liabilities
Derivatives:
Commodity	$	—	$	26	$	2	$	28
Interest rate		—		150		—		150
Total liabilities	$	—	$	176	$	2	$	178
At December 31, 2020
Assets
Derivatives:
Commodity	$	—	$	5	$	110	$	115
Interest rate		—		66		—		66
Investments⁽¹⁾:
Equity securities:
U.S.		2,171		—		—		2,171
Fixed income:
Corporate debt instruments		—		348		—		348
Government securities		201		309		—		510
Cash equivalents and other		13		—		—		13
Total assets	$	2,385	$	728	$	110	$	3,223
Liabilities
Derivatives:
Commodity	$	—	$	22	$	7	$	29
Interest rate		—		376		—		376
Total liabilities	$	—	$	398	$	7	$	405

(1)

Includes investments held in the nuclear decommissioning trusts. Excludes $199 million and $167 million of assets at March 31, 2021 and December 31, 2020, respectively, measured at fair value using NAV (or its equivalent) as a practical expedient which are not required to be categorized in the fair value hierarchy.

The following table presents the net change in Virginia Power’s assets and liabilities measured at fair value on a recurring basis and included in the Level 3 fair value category:

	Three Months Ended
	March 31,
	2021			2020
(millions)
Beginning balance	$	103		$	(37	)
Total realized and unrealized gains (losses):
Included in earnings:
Electric fuel and other energy-related purchases		(21	)		(22	)
Included in regulatory assets/liabilities		(47	)		80
Settlements		21			22
Ending balance	$	56		$	43

There were no unrealized gains or losses included in earnings in the Level 3 fair value category relating to assets/liabilities still held at the reporting date for the three months ended March 31, 2021 and 2020.

Fair Value of Financial Instruments

Substantially all of the Companies’ financial instruments are recorded at fair value, with the exception of the instruments described below, which are reported at historical cost. Estimated fair values have been determined using available market information and valuation methodologies considered appropriate by management. The carrying amount of cash, restricted cash and equivalents, customer and other receivables, affiliated receivables, short-term debt, affiliated current borrowings, payables to affiliates and accounts payable are representative of fair value because of the short-term nature of these instruments. For the Companies' financial instruments that are not recorded at fair value, the carrying amounts and estimated fair values are as follows:

	March 31, 2021				December 31, 2020
	Carrying Amount		Estimated Fair Value⁽¹⁾		Carrying Amount		Estimated Fair Value⁽¹⁾
(millions)
Dominion Energy
Long-term debt⁽²⁾⁽³⁾	$	31,991	$	36,334	$	31,996	$	38,773
Supplemental 364-Day credit facility borrowings		—		—		225		225
Junior subordinated notes⁽⁴⁾		3,412		3,579		3,411		3,633
Virginia Power
Long-term debt⁽⁴⁾	$	13,209	$	15,174	$	13,207	$	16,455

(1)

Fair value is estimated using market prices, where available, and interest rates currently available for issuance of debt with similar terms and remaining maturities. All fair value measurements are classified as Level 2. The carrying amount of debt issuances with short-term maturities and variable rates refinanced at current market rates is a reasonable estimate of their fair value.

(2)

Carrying amount includes current portions included in securities due within one year and amounts which represent the unamortized debt issuance costs and discount or premium. At both March 31, 2021 and December 31, 2020, the carrying amount includes the valuation of certain fair value hedges associated with fixed rate debt of $3 million.

(3)	Includes amounts classified as held for sale, see Note 3.

(4)	Carrying amount includes current portions included in securities due within one year and amounts which represent the unamortized debt issuance costs, discount or premium.

Note 9. Derivatives and Hedge Accounting Activities

The Companies’ accounting policies, objectives and strategies for using derivative instruments are discussed in Note 2 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. See Note 8 in this report for further information about fair value measurements and associated valuation methods for derivatives.

Derivative assets and liabilities are presented gross on the Companies’ Consolidated Balance Sheets. The Companies’ derivative contracts include both over-the-counter transactions and those that are executed on an exchange or other trading platform (exchange contracts) and centrally cleared. Over-the-counter contracts are bilateral contracts that are transacted directly with a third party. Exchange contracts utilize a financial intermediary, exchange, or clearinghouse to enter, execute or clear the transactions. Certain over-the-counter and exchange contracts contain contractual rights of setoff through master netting arrangements, derivative clearing

agreements and contract default provisions. In addition, the contracts are subject to conditional rights of setoff through counterparty nonperformance, insolvency or other conditions.

In general, most over-the-counter transactions and all exchange contracts are subject to collateral requirements. Types of collateral for over-the-counter and exchange contracts include cash, letters of credit, and in some cases other forms of securities, none of which are subject to restrictions. Cash collateral, as presented in the table below, is used to offset derivative assets and liabilities. Certain accounts receivable and accounts payable recognized on the Companies’ Consolidated Balance Sheets, letters of credit and other forms of securities, as well as certain long-term debt, all of which are not included in the tables below, are subject to offset under master netting or similar arrangements and would reduce the net exposure. See Note 18 for further information regarding credit-related contingent features for the Companies’ derivative instruments.

Dominion Energy

Balance Sheet Presentation

The tables below present Dominion Energy’s derivative asset and liability balances by type of financial instrument, if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and cash collateral received or paid:

	March 31, 2021								December 31, 2020
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts		Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	76	$	18	$	—	$	58	$	117	$	9	$	—	$	108
Exchange		33		33		—		—		49		24		—		25
Interest rate contracts:
Over-the-counter		740		19		—		721		230		13		—		217
Total derivatives, subject to a master netting or similar arrangement	$	849	$	70	$	—	$	779	$	396	$	46	$	—	$	350

(1)	Excludes less than $1 million and $1 million of derivative assets at March 31, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

	March 31, 2021								December 31, 2020
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts		Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	28	$	18	$	—	$	10	$	30	$	9	$	—	$	21
Exchange		50		33		17		—		24		24		—		—
Interest rate contracts:
Over-the-counter		186		19		11		156		431		13		17		401
Total derivatives, subject to a master netting or similar arrangement	$	264	$	70	$	28	$	166	$	485	$	46	$	17	$	422

(1)

Excludes less than $1 million and $1 million of derivative liabilities at March 31, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

Volumes

The following table presents the volume of Dominion Energy’s derivative activity at March 31, 2021. These volumes are based on open derivative positions and represent the combined absolute value of their long and short positions, except in the case of offsetting transactions, for which they represent the absolute value of the net volume of its long and short positions.

	Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		60		19
Basis		202		496
Electricity (MWh):
Fixed price		10,745,307		9,789,934
FTRs		18,264,727		—
Interest rate⁽²⁾ (millions)	$	1,250	$	5,407

(1)	Includes options.

(2)	Maturity is determined based on final settlement period.

AOCI

The following table presents selected information related to losses on cash flow hedges included in AOCI in Dominion Energy’s Consolidated Balance Sheet at March 31, 2021:

	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term
(millions)
Interest rate	$	(367	)	$	(40	)	393 months
Total	$	(367	)	$	(40	)

The amounts that will be reclassified from AOCI to earnings will generally be offset by the recognition of the hedged transactions (e.g., interest rate payments) in earnings, thereby achieving the realization of prices contemplated by the underlying risk management strategies and will vary from the expected amounts presented above as a result of changes in interest rates.

Fair Value Hedges

For derivative instruments that are designated and qualify as a fair value hedge, the gain or loss on the derivative instrument as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in current earnings and presented in the same line item. There were no derivative instruments designated as fair value hedges during the three months ended March 31, 2021 and March 31, 2020.

The following table presents the amounts recorded on the balance sheet related to cumulative basis adjustments for fair value hedges:

	Carrying Amount of the Hedged Asset (Liability)⁽¹⁾						Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of the Hedged Assets (Liabilities)⁽²⁾
	March 31, 2021			December 31, 2020			March 31, 2021			December 31, 2020
(millions)
Long-term debt	$	(1,153	)	$	(1,153	)	$	(3	)	$	(3	)

(1)	Includes $(1.2) billion related to discontinued hedging relationships at both March 31, 2021 and December 31, 2020.

(2)	Includes $(3) million of hedging adjustments on discontinued hedging relationships at both March 31, 2021 and December 31, 2020.

Fair Value and Gains and Losses on Derivative Instruments

The following table presents the fair values of Dominion Energy’s derivatives and where they are presented in its Consolidated Balance Sheets:

	Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)
March 31, 2021
ASSETS
Current Assets
Commodity	$	—	$	24	$	24
Interest rate		—		12		12
Total current derivative assets⁽¹⁾		—		36		36
Noncurrent Assets
Commodity		—		85		85
Interest rate		287		441		728
Total noncurrent derivative assets⁽²⁾		287		526		813
Total derivative assets	$	287	$	562	$	849
LIABILITIES
Current Liabilities
Commodity	$	—	$	61	$	61
Interest rate		150		10		160
Total current derivative liabilities⁽³⁾		150		71		221
Noncurrent Liabilities
Commodity		—		17		17
Interest rate		—		26		26
Total noncurrent derivative liabilities⁽⁴⁾		—		43		43
Total derivative liabilities	$	150	$	114	$	264
December 31, 2020
ASSETS
Current Assets
Commodity	$	—	$	58	$	58
Interest rate		—		9		9
Total current derivative assets⁽¹⁾		—		67		67
Noncurrent Assets
Commodity		—		109		109
Interest rate		66		155		221
Total noncurrent derivative assets⁽²⁾		66		264		330
Total derivative assets	$	66	$	331	$	397
LIABILITIES
Current Liabilities
Commodity	$	—	$	42	$	42
Interest rate		363		10		373
Total current derivative liabilities⁽³⁾		363		52		415
Noncurrent Liabilities
Commodity		—		13		13
Interest rate		19		39		58
Total noncurrent derivative liabilities⁽⁴⁾		19		52		71
Total derivative liabilities	$	382	$	104	$	486

(1)

Current derivative assets include $31 million and $63 million in other current assets in Dominion Energy’s Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020, respectively. The remainder is recorded in current assets held for sale in Dominion Energy’s Consolidated Balance Sheets.

(2)	Noncurrent derivative assets are presented in other deferred charges and other assets in Dominion Energy’s Consolidated Balance Sheets.

(3)

Current derivative liabilities include $217 million and $412 million at March 31, 2021 and December 31, 2020, respectively, presented in other current liabilities in Dominion Energy’s Consolidated Balance Sheets. The remainder is in current liabilities held for sale in Dominion Energy’s Consolidated Balance Sheets.

(4)	Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Dominion Energy’s Consolidated Balance Sheets.

The following tables present the gains and losses on Dominion Energy’s derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of Income.

Derivatives in cash flow hedging relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
(millions)
Three Months Ended March 31, 2021
Derivative type and location of gains (losses):
Commodity:
Purchased gas	$	—		$	(1	)	$	—
Interest rate:
Interest and related charges		52			(16	)		408
Total	$	52		$	(17	)	$	408
Three Months Ended March 31, 2020
Derivative type and location of gains (losses):
Commodity:
Operating revenue				$	6
Purchased gas					(3	)
Discontinued operations					1
Total Commodity	$	—		$	4		$	—
Interest rate:
Interest and related charges					(25	)
Discontinued operations					(2	)
Total interest rate		(336	)		(27	)		(563	)
Foreign currency⁽³⁾		(23	)		(6	)		—
Total	$	(359	)	$	(29	)	$	(563	)

(1)	Amounts deferred into AOCI have no associated effect in Dominion Energy’s Consolidated Statements of Income.

(2)	Represents net derivative activity deferred into and amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Dominion Energy’s Consolidated Statements of Income.

(3) Amounts recorded in Dominion Energy’s Consolidated Statement of Income are classified in discontinued operations.

Derivatives not designated as hedging instruments	Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾
	Three Months Ended
	March 31,
	2021			2020
(millions)
Derivative type and location of gains (losses):
Commodity:
Operating revenue	$	(41	)	$	51
Purchased gas		—			(11	)
Electric fuel and other energy-related purchases		(44	)		(65	)
Discontinued operations		—			11
Interest rate:
Interest and related charges		319			(53	)
Discontinued operations		—			(8	)
Total	$	234		$	(75	)

(1)	Includes derivative activity amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Dominion Energy’s Consolidated Statements of Income.

Virginia Power

Balance Sheet Presentation

The tables below present Virginia Power’s derivative asset and liability balances by type of financial instrument, if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and cash collateral received or paid:

	March 31, 2021								December 31, 2020
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts		Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	71	$	15	$	—	$	56	$	111	$	6	$	—	$	105
Exchange		3		3		—		—	1		1			—		—
Interest rate contracts:
Over-the-counter		283		19		—		264	66		7			—		59
Total derivatives, subject to a master netting or similar arrangement	$	357	$	37	$	—	$	320	$	178	$	14	$	—	$	164

(1)	Excludes $2 million and $3 million of derivative assets at March 31, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

	March 31, 2021								December 31, 2020
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts		Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	19	$	15	$	—	$	4	$	6	$	6	$	—	$	—
Exchange		4		3		1		—	1		1			—		—
Interest rate contracts:
Over-the-counter		150		19		—		131	376		7			—		369
Total derivatives, subject to a master netting or similar arrangement	$	173	$	37	$	1	$	135	$	383	$	14	$	—	$	369

(1)

Excludes $5 million and $22 million of derivative liabilities at March 31, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

Volumes

The following table presents the volume of Virginia Power’s derivative activity at March 31, 2021. These volumes are based on open derivative positions and represent the combined absolute value of their long and short positions, except in the case of offsetting transactions, for which they represent the absolute value of the net volume of its long and short positions.

	Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		35		18
Basis		151		495
Electricity (MWh):
Fixed price		3,770,002		3,029,859
FTRs		18,264,727		—
Interest rate⁽²⁾ (millions)	$	850	$	1,200

(1)	Includes options.

(2)	Maturity is determined based on final settlement period.

AOCI

The following table presents selected information related to losses on cash flow hedges included in AOCI in Virginia Power’s Consolidated Balance Sheet at March 31, 2021:

	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term
(millions)
Interest rate	$	(27	)	$	(2	)	393 months
Total	$	(27	)	$	(2	)

The amounts that will be reclassified from AOCI to earnings will generally be offset by the recognition of the hedged transactions (e.g., interest payments) in earnings, thereby achieving the realization of interest rates contemplated by the underlying risk management strategies and will vary from the expected amounts presented above as a result of changes in interest rates.

Fair Value and Gains and Losses on Derivative Instruments

The following table presents the fair values of Virginia Power’s derivatives and where they are presented in its Consolidated Balance Sheets:

	Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)
March 31, 2021
ASSETS
Current Assets
Commodity	$	—	$	11	$	11
Total current derivative assets⁽¹⁾		—		11		11
Noncurrent Assets
Commodity		—		65		65
Interest rate		283		—		283
Total noncurrent derivative assets⁽²⁾		283		65		348
Total derivative assets	$	283	$	76	$	359
LIABILITIES
Current Liabilities
Commodity	$	—	$	21	$	21
Interest rate		150		—		150
Total current derivative liabilities		150		21		171
Noncurrent Liabilities
Commodity		—		7		7
Total noncurrent derivative liabilities⁽³⁾		—		7		7
Total derivative liabilities	$	150	$	28	$	178
December 31, 2020
ASSETS
Current Assets
Commodity	$	—	$	22	$	22
Total current derivative assets⁽¹⁾		—		22		22
Noncurrent Assets
Commodity		—		93		93
Interest rate		66		—		66
Total noncurrent derivative assets⁽²⁾		66		93		159
Total derivative assets	$	66	$	115	$	181
LIABILITIES
Current Liabilities
Commodity	$	—	$	28	$	28
Interest rate		362		—		362
Total current derivative liabilities		362		28		390
Noncurrent Liabilities
Commodity		—		1		1
Interest rate		14		—		14
Total noncurrent derivative liabilities⁽³⁾		14		1		15
Total derivative liabilities	$	376	$	29	$	405

(1)	Current derivative assets are presented in other current assets in Virginia Power’s Consolidated Balance Sheets.

(2)	Noncurrent derivative assets are presented in other deferred charges and other assets in Virginia Power’s Consolidated Balance Sheets.

(3)	Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Virginia Power’s Consolidated Balance Sheets.

The following tables present the gains and losses on Virginia Power’s derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of Income:

Derivatives in cash flow hedging relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
(millions)
Three Months Ended March 31, 2021
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	43		$	(1	)	$	407
Total	$	43		$	(1	)	$	407
Three Months Ended March 31, 2020
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(61	)	$	—		$	(565	)
Total	$	(61	)	$	—		$	(565	)

(1)	Amounts deferred into AOCI have no associated effect in Virginia Power’s Consolidated Statements of Income.

(2)	Represents net derivative activity deferred into and amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Virginia Power’s Consolidated Statements of Income.

(3)	Amounts recorded in Virginia Power’s Consolidated Statements of Income are classified in interest and related charges.

Derivatives not designated as hedging instruments	Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾
	Three Months Ended
	March 31,
	2021			2020
(millions)
Derivative type and location of gains (losses):
Commodity:
Electric fuel and other energy-related purchases	$	(44	)	$	(65	)
Operating revenue		(2	)		—
Total	$	(46	)	$	(65	)

(1)	Includes derivative activity amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Virginia Power’s Consolidated Statements of Income.

Note 10. Investments

Dominion Energy

Equity and Debt Securities

Rabbi Trust Securities

Equity and fixed income securities and cash equivalents in Dominion Energy’s rabbi trusts and classified as trading totaled $139 million and $134 million at March 31, 2021 and December 31, 2020, respectively.

Decommissioning Trust Securities

Dominion Energy holds equity and fixed income securities, insurance contracts and cash equivalents in nuclear decommissioning trust funds to fund future decommissioning costs for its nuclear plants. Dominion Energy’s decommissioning trust funds are summarized below:

	Amortized Cost			Total Unrealized Gains		Total Unrealized Losses				Allowance for Credit Losses		Fair Value
(millions)
March 31, 2021
Equity securities:⁽¹⁾
U.S.	$	1,573		$	3,036	$	(10	)				$	4,599
Fixed income securities:⁽²⁾
Corporate debt instruments		698			32		(8	)		$	—		722
Government securities		1,369			47		(14	)			—		1,402
Common/collective trust funds		221			6		—				—		227
Insurance contracts		237			—		—						237
Cash equivalents and other⁽³⁾		(51	)		3		—				—		(48	)
Total	$	4,047		$	3,124	$	(32	)	⁽⁴⁾	$	—	$	7,139
December 31, 2020
Equity securities:⁽¹⁾
U.S.	$	1,756		$	2,948	$	(24	)				$	4,680
Fixed income securities:⁽²⁾
Corporate debt instruments		572			58		(1	)		$	—		629
Government securities		1,119			66		(1	)			—		1,184
Common/collective trust funds		170			5		—				—		175
Insurance contracts		237			—		—						237
Cash equivalents and other⁽³⁾		(8	)		4		(1	)			—		(5	)
Total	$	3,846		$	3,081	$	(27	)	⁽⁴⁾	$	—	$	6,900

(1)	Unrealized gains and losses on equity securities are included in other income and the nuclear decommissioning trust regulatory liability.

(2)	Unrealized gains and losses on fixed income securities are included in AOCI and the nuclear decommissioning trust regulatory liability. Changes in allowance for credit losses are included in other income.

(3)	Includes pending purchases of securities of $63 million and $49 million at March 31, 2021 and December 31, 2020, respectively.

(4)	The fair value of securities in an unrealized loss position was $937 million and $293 million at March 31, 2021 and December 31, 2020, respectively.

The portion of unrealized gains and losses that relates to equity securities held within Dominion Energy’s nuclear decommissioning trusts is summarized below:

	Three Months Ended March 31,
	2021			2020
(millions)
Net gains (losses) recognized during the period	$	279		$	(898	)
Less: Net (gains) losses recognized during the period on securities sold during the period		(178	)		14
Unrealized gains (losses) recognized during the period on securities still held at period end⁽¹⁾	$	101		$	(884	)

(1)	Included in other income and the nuclear decommissioning trust regulatory liability.

The fair value of Dominion Energy’s fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds at March 31, 2021 by contractual maturity is as follows:

	Amount
(millions)
Due in one year or less	$	292
Due after one year through five years		640
Due after five years through ten years		614
Due after ten years		805
Total	$	2,351

Presented below is selected information regarding Dominion Energy’s equity and fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds.

	Three Months Ended March 31,
	2021		2020
(millions)
Proceeds from sales	$	1,765	$	602
Realized gains⁽¹⁾		232		66
Realized losses⁽¹⁾		59		69

(1)	Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability.

Virginia Power

Virginia Power holds equity and fixed income securities and cash equivalents in nuclear decommissioning trust funds to fund future decommissioning costs for its nuclear plants. Virginia Power’s decommissioning trust funds are summarized below:

	Amortized Cost			Total Unrealized Gains		Total Unrealized Losses				Allowance for Credit Losses		Fair Value
(millions)
March 31, 2021
Equity securities:⁽¹⁾
U.S.	$	839		$	1,414	$	(9	)				$	2,244
Fixed income securities:⁽²⁾
Corporate debt instruments		385			18		(3	)		$	—		400
Government securities		601			18		(3	)			—		616
Common/collective trust funds		86			—		—				—		86
Cash equivalents and other⁽³⁾		(24	)		—		—				—		(24	)
Total	$	1,887		$	1,450	$	(15	)	⁽⁴⁾	$	—	$	3,322
December 31, 2020
Equity securities:⁽¹⁾
U.S.	$	929		$	1,371	$	(21	)				$	2,279
Fixed income securities:⁽²⁾
Corporate debt instruments		315			33		—			$	—		348
Government securities		484			25		—				—		509
Common/collective trust funds		58			—		—				—		58
Cash equivalents and other⁽³⁾		3			—		—				—		3
Total	$	1,789		$	1,429	$	(21	)	⁽⁴⁾	$	—	$	3,197

(1)	Unrealized gains and losses on equity securities are included in other income and the nuclear decommissioning trust regulatory liability.

(2)	Unrealized gains and losses on fixed income securities are included in AOCI and the nuclear decommissioning trust regulatory liability. Changes in allowance for credit losses are included in other income.

(3)	Includes pending purchases of securities of $24 million and $10 million at March 31, 2021 and December 31, 2020, respectively.

(4)	The fair value of securities in an unrealized loss position was $434 million and $142 million at March 31, 2021 and December 31, 2020, respectively.

The portion of unrealized gains and losses that relates to equity securities held within Virginia Power’s nuclear decommissioning trusts is summarized below:

	Three Months Ended March 31,
	2021			2020
(millions)
Net gains (losses) recognized during the period	$	143		$	(423	)
Less: Net (gains) losses recognized during the period on securities sold during the period		(88	)		6
Unrealized gains (losses) recognized during the period on securities still held at period end⁽¹⁾	$	55		$	(417	)

(1)	Included in other income and the nuclear decommissioning trust regulatory liability.

The fair value of Virginia Power’s fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds at March 31, 2021 by contractual maturity is as follows:

	Amount
(millions)
Due in one year or less	$	111
Due after one year through five years		314
Due after five years through ten years		365
Due after ten years		312
Total	$	1,102

Presented below is selected information regarding Virginia Power’s equity and fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds.

	Three Months Ended March 31,
	2021		2020
(millions)
Proceeds from sales	$	789	$	294
Realized gains⁽¹⁾		106		31
Realized losses⁽¹⁾		23		31

(1)	Includes realized gains and losses recorded to the nuclear decommissioning trust regulatory liability.

Equity Method Investments

Dominion Energy

Dominion Energy recorded equity earnings on its investments of $80 million and $4 million for the three months ended March 31, 2021 and 2020, respectively, in other income in its Consolidated Statements of Income. In addition, Dominion Energy recorded equity earnings (losses) of $(8) million and $35 million for the three months ended March 31, 2021 and 2020, respectively, in discontinued operations related to its investment in Atlantic Coast Pipeline. Dominion Energy received distributions of $73 million and $5 million for the three months ended March 31, 2021 and 2020, respectively. At March 31, 2021 and December 31, 2020, the net difference between the carrying amount of Dominion Energy’s investments and its share of underlying equity in net assets was $224 million and $213 million, respectively. At March 31, 2021, these differences are comprised of $27 million of equity method goodwill that is not being amortized, a $226 million basis difference from Dominion Energy’s investments in Cove Point, which is being amortized over the useful lives of the underlying assets and a net $(29) million basis difference primarily attributable to an unfunded commitment made to Align RNG. At December 31, 2020, these differences are comprised of $27 million of equity method goodwill that is not being amortized, a $227 million basis difference from Dominion Energy’s investments in Cove Point, which is being amortized over the useful lives of the underlying assets and a net $(41) million basis difference primarily attributable to an unfunded commitment made to Align RNG.

Cove Point

In November 2020, in conjunction with the GT&S Transaction, Dominion Energy sold 100% of its general partner interest and 25% of the total limited partner interest in Cove Point. Dominion Energy retained a 50% noncontrolling limited partnership interest in Cove

Point which is accounted for as an equity method investment, as discussed in Note 9 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Income before income taxes recorded by Cove Point for the three months ended March 31, 2021 and 2020, was $138 million and $133 million, respectively. For the periods prior to closing of the GT&S Transaction, earnings attributable to Dominion Energy are presented in discontinued operations and subsequent to the closing, earnings attributable to Dominion Energy are presented within other income in its Consolidated Statements of Income.

Dominion Energy recorded distributions from Cove Point of $73 million for the three months ended March 31, 2021. No contributions were made to Cove Point for the three months ended March 31, 2021.

Atlantic Coast Pipeline

A description of Dominion Energy’s investment in Atlantic Coast Pipeline, including events that led to the cancellation of the Atlantic Coast Pipeline Project in July 2020, is included in Note 9 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020.

At March 31, 2021 and December 31, 2020, Dominion Energy has recorded a liability of $97 million and $1.1 billion, respectively, in its Consolidated Balance Sheets as a result of its share of equity losses exceeding its investment which reflects Dominion Energy’s obligations on behalf of Atlantic Coast Pipeline related to its credit facility, through February 2021, and AROs.

In February 2021, Atlantic Coast Pipeline repaid the outstanding borrowed amounts and terminated its revolving credit facility. As of December 31, 2020, Atlantic Coast Pipeline had borrowed $1.8 billion against the revolving credit facility. Concurrently, Dominion Energy’s related guarantee agreement to support its portion of Atlantic Coast Pipeline’s borrowings was also terminated. Dominion Energy’s Consolidated Balance Sheets included a liability of $6 million associated with this guarantee agreement at December 31, 2020.

Dominion Energy recorded contributions of $965 million and $16 million during the three months ended March 31, 2021 and 2020, respectively, to Atlantic Coast Pipeline.

Dominion Energy expects to incur additional losses from Atlantic Coast Pipeline as it completes wind-down activities. While Dominion Energy is unable to precisely estimate the amounts to be incurred by Atlantic Coast Pipeline, the portion of such amounts attributable to Dominion Energy is not expected to be material to Dominion Energy’s results of operations, financial position or statement of cash flows.

DETI provided services to Atlantic Coast Pipeline which totaled $20 million for the three months ended March 31, 2020, included in discontinued operations in Dominion Energy’s Consolidated Statements of Income.

Wrangler

A description of Dominion Energy’s investment in Wrangler is included in Note 9 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. At March 31, 2021 and December 31, 2020, $72 million and $63 million of assets and $15 million and $15 million of liabilities, respectively, associated with the remaining nonregulated retail energy marketing operations expected to be contributed to Wrangler by December 2021 were classified as held for sale and were included in current assets held for sale and current liabilities held for sale on Dominion Energy’s Consolidated Balance Sheets, respectively. The related disposal group is primarily comprised of customer receivables, goodwill, inventories and accounts payable.

Note 11. Property, Plant and Equipment

Acquisitions of Nonregulated Solar Projects

Other than the items discussed below, there have been no updates to acquisitions of solar projects by the Companies from those discussed in Note 10 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

The following table presents acquisitions by Virginia Power of non-jurisdictional solar projects. Virginia Power expects to claim federal investment tax credits on the projects.

Date Agreement

Entered

Date Agreement Closed

Project Location

Project Name

Project Cost

(millions)⁽¹⁾

Date of Commercial

Operations

Capacity

February 2021

Expected 2021

Virginia

Bookers Mill

200

Expected 2023

127

(1)	Includes acquisition cost.

The following table presents acquisitions by Dominion Energy of solar projects. Dominion Energy has claimed or expects to claim federal investment tax credits on the projects.

Date Agreement

Entered

Date Agreement Closed

Project Location

Project Name

Project Cost

(millions)⁽¹⁾

Date of Commercial

Operations

Capacity

May 2020

October 2020

South Carolina

Trask

March 2021

August 2020

Expected 2021

Ohio

Hardin II

300

Expected 2023

150

(1)	Includes acquisition cost.

In addition to the facilities discussed above, Dominion Energy has also entered into various agreements to install solar facilities, primarily at schools in Virginia, with in-service dates throughout 2021. As of March 2021, Dominion Energy anticipates a total projected cost of approximately $59 million under these agreements with an associated aggregate generation capacity of 29 MW. Dominion Energy has claimed or expects to claim federal investment tax credits on the projects.

Note 12. Regulatory Assets and Liabilities

Regulatory assets and liabilities include the following:

	March 31, 2021		December 31, 2020
(millions)
Dominion Energy
Regulatory assets:
Deferred project costs and DSM programs for gas utilities⁽¹⁾	$	17	$	35
Unrecovered gas costs⁽²⁾		63		78
Deferred rider costs for Virginia electric utility⁽³⁾		123		98
Deferred nuclear refueling outage costs⁽⁴⁾		54		53
NND Project costs⁽⁵⁾		138		138
PJM transmission rates⁽⁶⁾		48		71
Other		207		226
Regulatory assets-current		650		699
Pension and other postretirement benefit costs⁽⁷⁾		1,304		1,363
Deferred rider costs for Virginia electric utility⁽³⁾		347		311
Deferred project costs for gas utilities⁽¹⁾		658		632
Interest rate hedges⁽⁸⁾		624		1,042
AROs and related funding⁽⁹⁾		340		331
Cost of reacquired debt⁽¹⁰⁾		242		245
NND Project costs⁽⁵⁾		2,330		2,364
Ash pond and landfill closure costs⁽¹¹⁾		2,317		2,301
Deferred cost of fuel used in electric generation⁽¹²⁾		82		—
Other		549		544
Regulatory assets-noncurrent		8,793		9,133
Total regulatory assets	$	9,443	$	9,832
Regulatory liabilities:
Deferred cost of fuel used in electric generation⁽¹²⁾	$	33	$	58
Provision for future cost of removal and AROs⁽¹³⁾		183		183
Reserve for refunds to electric utility customers⁽¹⁴⁾		127		128
Reserve for future credits to Virginia electric customers⁽¹⁵⁾		—		120
Cost-of-service impact of 2017 Tax Reform Act⁽¹⁶⁾		—		12
Income taxes refundable through future rates⁽¹⁷⁾		119		124
Monetization of guarantee settlement⁽¹⁸⁾		67		67
Other		112		117
Regulatory liabilities-current		641		809
Income taxes refundable through future rates⁽¹⁷⁾		4,365		4,376
Provision for future cost of removal and AROs⁽¹³⁾		2,180		2,150
Nuclear decommissioning trust⁽¹⁹⁾		1,805		1,719
Monetization of guarantee settlement⁽¹⁸⁾		886		903
Reserve for refunds to electric utility customers⁽¹⁴⁾		505		540
Overrecovered other postretirement benefit costs⁽²⁰⁾		84		111
Other		377		388
Regulatory liabilities-noncurrent		10,202		10,187
Total regulatory liabilities	$	10,843	$	10,996

(1)	Primarily reflects amounts expected to be collected from or owed to gas customers in Dominion Energy’s service territories associated with current and prospective rider projects, including CEP, PIR and pipeline integrity management. See Note 13 for more information.

(2)	Reflects unrecovered or overrecovered gas costs at regulated gas operations, which are recovered or refunded through filings with the applicable regulatory authority.

(3)

Reflects deferrals under Virginia Power’s electric transmission FERC formula rate and the deferral of costs associated with certain current and prospective rider projects. See Note 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

(4)	Legislation enacted in Virginia in April 2014 requires Virginia Power to defer operation and maintenance costs incurred in connection with the refueling of any nuclear-powered generating plant. These deferred costs will be amortized over the refueling cycle, not to exceed 18 months.

(5)

Reflects expenditures by DESC associated with the NND Project, which pursuant to the SCANA Merger Approval Order, will be recovered from DESC electric service customers over a 20-year period ending in 2039. See Note 3 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

(6)	Reflects current portion of amounts to be recovered through retail rates in Virginia for payments Virginia Power expects to make to PJM through 2026 under the terms of a FERC settlement agreement in May 2018 resolving a PJM cost allocation matter.

(7)	Represents unrecognized pension and other postretirement employee benefit costs expected to be recovered or refunded through future rates generally over the expected remaining service period of plan participants by certain of Dominion Energy's rate-regulated subsidiaries.

(8)

Reflects interest rate hedges recoverable from or refundable to customers. Certain of these instruments are settled and any related payments are being amortized into interest expense over the life of the related debt, which has a weighted-average useful life of approximately 27 years as of March 31, 2021.

(9)

Represents deferred depreciation and accretion expense related to legal obligations associated with the future retirement of generation, transmission and distribution properties. The AROs primarily relate to DESC’s electric generating facilities, including Summer, and are expected to be recovered over the related property lives and periods of decommissioning which may range up to approximately 105 years.

(10)	Costs of the reacquisition of debt are deferred and amortized as interest expense over the would-be remaining life of the reacquired debt. The reacquired debt costs had a weighted-average life of approximately 26 years as of March 31, 2021.

(11) Primarily reflects legislation enacted in Virginia in 2019, which requires any CCR asset located at certain Virginia Power stations to be closed by removing the CCR to an approved landfill or through beneficial reuse. These deferred costs are expected to be collected over a period between 15 and 18 years commencing December 2021 through Rider CCR. Virginia Power is entitled to collect carrying costs once expenditures have been made. See Note 13 for additional information.

(12)	Reflects deferred fuel expenses for the Virginia, North Carolina and South Carolina jurisdictions of Dominion Energy’s electric generation operations.

(13)	Rates charged to customers by Dominion Energy’s regulated businesses include a provision for the cost of future activities to remove assets that are expected to be incurred at the time of retirement.

(14)

Reflects amounts previously collected from retail electric customers of DESC for the NND Project to be credited over an estimated 11-year period effective February 2019, in connection with the SCANA Merger Approval Order. See Notes 3 and 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

(15)	Represents a reserve related to the use of a CCRO in accordance with the GTSA associated with the 2021 Triennial Review. See Note 13 for additional information.

(16)

Balance refundable to customers related to the decrease in revenue requirements for recovery of income taxes at the Companies’ regulated electric generation and electric and natural gas distribution operations. See Notes 3 and 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

(17)

Amounts recorded to pass the effect of reduced income taxes from the 2017 Tax Reform Act to customers in future periods, which will primarily reverse at the weighted average tax rate that was used to build the reserves over the remaining book life of the property, net of amounts to be recovered through future rates to pay income taxes that become payable when rate revenue is provided to recover AFUDC equity.

(18)

Reflects amounts to be refunded to DESC electric service customers over a 20-year period ending in 2039 associated with the monetization of a bankruptcy settlement agreement. See Note 3 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

(19)

Primarily reflects a regulatory liability representing amounts collected from Virginia jurisdictional customers and placed in external trusts (including income, losses and changes in fair value thereon, as applicable) for the future decommissioning of Dominion Energy’s utility nuclear generation stations, in excess of the related AROs.

(20)	Reflects a regulatory liability for the collection of postretirement benefit costs allowed in rates in excess of expense incurred.

	March 31, 2021		December 31, 2020
(millions)
Virginia Power
Regulatory assets:
Deferred rider costs⁽¹⁾	$	123	$	98
Deferred nuclear refueling outage costs⁽²⁾		54		53
PJM transmission rates⁽³⁾		48		71
Other		67		73
Regulatory assets-current		292		295
Deferred rider costs⁽¹⁾		347		311
Interest rate hedges⁽⁴⁾		327		733
Ash pond and landfill closure costs⁽⁵⁾		2,317		2,301
Deferred cost of fuel used in electric generation⁽⁶⁾		82		—
Other		162		164
Regulatory assets-noncurrent		3,235		3,509
Total regulatory assets	$	3,527	$	3,804
Regulatory liabilities:
Deferred cost of fuel used in electric generation⁽⁶⁾	$	33	$	58
Provision for future cost of removal⁽⁷⁾		152		152
Reserve for future credits to Virginia electric customers⁽⁸⁾		—		120
Income taxes refundable through future rates⁽⁹⁾		54		54
Other		33		41
Regulatory liabilities-current		272		425
Income taxes refundable through future rates⁽⁹⁾		2,406		2,404
Nuclear decommissioning trust⁽¹⁰⁾		1,805		1,719
Provision for future cost of removal⁽⁷⁾		996		980
Deferred cost of fuel used in electric generation⁽⁶⁾		2		54
Other		193		181
Regulatory liabilities-noncurrent		5,402		5,338
Total regulatory liabilities	$	5,674	$	5,763

(1)

(2)	Legislation enacted in Virginia in April 2014 requires Virginia Power to defer operation and maintenance costs incurred in connection with the refueling of any nuclear-powered generating plant. These deferred costs will be amortized over the refueling cycle, not to exceed 18 months.

(3)	Reflects current portion of amounts to be recovered through retail rates in Virginia for payments Virginia Power expects to make to PJM through 2026 under the terms of a FERC settlement agreement in May 2018 resolving a PJM cost allocation matter.

(4)

(5)

Primarily reflects legislation enacted in Virginia in 2019, which requires any CCR asset located at certain Virginia Power stations to be closed by removing the CCR to an approved landfill or through beneficial reuse. These deferred costs are expected to be collected over a period between 15 and 18 years commencing December 2021 through Rider CCR. Virginia Power is entitled to collect carrying costs once expenditures have been made. See Note 13 for additional information.

(6) Reflects deferred fuel expenses for the Virginia and North Carolina jurisdictions of Virginia Power’s generation operations.

(7)	Rates charged to customers by Virginia Power's regulated businesses include a provision for the cost of future activities to remove assets that are expected to be incurred at the time of retirement.

(8)	Represents a reserve related to the use of a CCRO in accordance with the GTSA associated with the 2021 Triennial Review. See Note 13 for additional information.

(9)

Amounts recorded to pass the effect of reduced income taxes from the 2017 Tax Reform Act to customers in future periods, which will reverse at the weighted average tax rate that was used to build the reserves over the remaining book life of the property, net of amounts to be recovered through future rates to pay income taxes that become payable when rate revenue is provided to recover AFUDC equity.

(10)

Primarily reflects a regulatory liability representing amounts collected from Virginia jurisdictional customers and placed in external trusts (including income, losses and changes in fair value thereon) for the future decommissioning of Virginia Power’s utility nuclear generation stations, in excess of the related AROs.

At March 31, 2021, Dominion Energy and Virginia Power regulatory assets include $4.1 billion and $2.8 billion, respectively, on which they do not expect to earn a return during the applicable recovery period. With the exception of certain items discussed above, the majority of these expenditures are expected to be recovered within the next two years.

Note 13. Regulatory Matters

Regulatory Matters Involving Potential Loss Contingencies

As a result of issues generated in the ordinary course of business, the Companies are involved in various regulatory matters. Certain regulatory matters may ultimately result in a loss; however, as such matters are in an initial procedural phase, involve uncertainty as to the outcome of pending reviews or orders, and/or involve significant factual issues that need to be resolved, it is not possible for the Companies to estimate a range of possible loss. For regulatory matters that the Companies cannot estimate, a statement to this effect is made in the description of the matter. Other matters may have progressed sufficiently through the regulatory process such that the Companies are able to estimate a range of possible loss. For regulatory matters that the Companies are able to reasonably estimate a range of possible losses, an estimated range of possible loss is provided, in excess of the accrued liability (if any) for such matters. Any estimated range is based on currently available information, involves elements of judgment and significant uncertainties and may not represent the Companies’ maximum possible loss exposure. The circumstances of such regulatory matters will change from time to time and actual results may vary significantly from the current estimate. For current matters not specifically reported below, management does not anticipate that the outcome from such matters would have a material effect on the Companies’ financial position, liquidity or results of operations.

Other Regulatory Matters

Other than the following matters, there have been no significant developments regarding the pending regulatory matters disclosed in Note 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Virginia Regulation

2021 Triennial Review

In March 2021, Virginia Power filed its base rate case and accompanying schedules in support of the 2021 Triennial Review. In its filing, Virginia Power did not request an increase in base rates for generation and distribution services and proposed that base rates remain at their existing level. Virginia Power’s earnings test analysis, as filed, demonstrates it earned a combined ROE of 10.85% on its generation and distribution services for the test period, before accounting for forgiven customer balances. Pursuant to Virginia legislation, forgiven customer balances are excluded from the cost of service in determining test period revenues as part of the 2021 Triennial Review. To the extent that the Virginia Commission determines total earnings for the test period to be above Virginia Power’s authorized earnings band, the forgiven balance amounts are offset against the available revenues in the determination of any customer bill credits, or utilization of a CCRO. Test period earnings may be further reduced by Virginia Commission approved investment amounts in qualifying solar or wind generation facilities or electric distribution grid transformation projects that Virginia Power elects to include as a CCRO under the GTSA. In its filing, Virginia Power has elected to utilize $26 million of the Coastal Virginia Offshore Wind Pilot project investment as a CCRO to offset available revenues. The Virginia Commission will determine whether Virginia Power’s earnings for the test period, considered as a whole, were within 70 basis points above or below the authorized ROE of 9.2%. Should the Virginia Commission determine that there are additional available revenues for earnings sharing, then Virginia Power has contingently elected to offset those revenues with additional Virginia Commission approved qualifying CCRO investments. The Virginia Commission will also authorize an ROE for Virginia Power that will be applied to Virginia Power’s riders prospectively and that will also be utilized to measure base rate earnings as of January 1, 2021. Virginia Power is requesting authorization of an ROE of 10.8% based on Virginia Power’s current cost of equity. Pursuant to the Regulation Act, Virginia Power’s authorized ROE shall not be set lower than the average of either (i) the returns reported for the three previous years by not less than a majority of comparable utilities in the Southeastern U.S., with certain limitations as described in the Regulation Act, or (ii) the authorized returns that are set by the applicable regulatory commissions for the same select peer group. This matter is pending.

In the third and fourth quarters of 2020, Virginia Power recorded a net charge of $130 million related to the use of a CCRO in accordance with the GTSA. In the first quarter of 2021, Virginia Power recorded a benefit of $130 million ($97 million after-tax) in impairment of assets and other charges in its Consolidated Statements of Income to adjust its reserve related to the use of a CCRO in accordance with the GTSA. These amounts reflect the impact related to jurisdictional customers as a result of the 2021 Triennial Review as well as the impact on certain non-jurisdictional customers which follow Virginia Power’s jurisdictional customer rate methodology.

Utility Disconnection Moratorium Legislation

In November 2020, legislation was enacted in Virginia relating to the moratorium on utility disconnections during the COVID-19 pandemic and resulted in Virginia Power forgiving Virginia jurisdictional retail electric customer balances that were more than 30 days past due as of September 30, 2020. As a result, Virginia Power recorded a charge of $127 million in the fourth quarter of 2020. In connection with the Virginia 2021 budget process, in the first quarter of 2021 Virginia Power recorded a charge of $76 million ($56

million after-tax) in impairment of assets and other charges in its Consolidated Statements of Income for Virginia jurisdictional retail electric customer balances that were more than 30 days past due as of December 31, 2020 that Virginia Power is required to forgive. These forgiven customer balances are factored into Virginia Power’s 2021 Triennial Review as discussed above.

Solar Facility Projects

In May 2020 and July 2020, Virginia Power entered into and closed on separate agreements to acquire Grassfield Solar, Norge Solar and Sycamore Solar. The projects are expected to cost approximately $170 million in aggregate once constructed, including the initial acquisition cost. The facilities are expected to generate 82 MW combined and be placed into service in 2021 and 2022. In October 2020, Virginia Power filed an application with the Virginia Commission for CPCNs to construct and operate these projects as part of its efforts to meet the renewable generation development requirements under the VCEA. In April 2021, the Virginia Commission approved the application.

Riders

Below is a discussion of significant riders associated with various Virginia Power projects:

•

The Virginia Commission previously approved Rider U in conjunction with cost recovery to move certain electric distribution facilities underground as authorized by Virginia legislation. In June 2020, Virginia Power proposed an $80 million total revenue requirement consisting of $44 million for previously approved phases and $36 million for phase five costs for Rider U for the rate year beginning April 1, 2021. This total revenue requirement represents a $28 million increase over the previous year. In February 2021, the Virginia Commission approved the filing.

•

Pursuant to Virginia legislation, Virginia Power can recover the costs related to the closure of CCR units. In February 2021, Virginia Power filed for approval of Rider CCR with a proposed $216 million revenue requirement for the rate year beginning December 1, 2021. This matter is pending.

•

In October 2020, Virginia Power applied for approval of Rider CE associated with Grassfield Solar, Norge Solar and Sycamore Solar described above. In April 2021, the Virginia Commission approved a $10 million revenue requirement for the rate year beginning June 1, 2021.

Additional significant riders associated with various Virginia Power projects are as follows:

Rider Name

Application Date

Approval Date

Rate Year

Beginning

Total Revenue

Requirement

(millions)

Increase (Decrease)

Over Previous Year

(millions)

Rider B

June 2020

February 2021

April 2021

)

Rider GV

June 2020

February 2021

April 2021

153

Rider R

June 2020

February 2021

April 2021

Rider S

June 2020

February 2021

April 2021

194

)

Rider W

June 2020

February 2021

April 2021

120

Rider US-3

July 2020

March 2021

June 2021

Rider US-4

July 2020

March 2021

June 2021

Electric Transmission Projects

Description and Location

of Project

Application

Date

Approval

Date

Type of

Line

Miles of

Lines

Cost Estimate

(millions)

Elmont-Ladysmith rebuild and related projects in the Counties of Hanover and Caroline, Virginia

April 2021

Pending

500 kV

North Carolina Regulation

PSNC Base Rate Case

In April 2021, PSNC filed its general rate case application, direct testimony, exhibits, and schedules with the North Carolina Commission. PSNC proposed a non-fuel, base rate increase of $53 million to be effective November 1, 2021. After considering the benefits of the 2017 Tax Reform Act, the net revenue increase to customers would be approximately $42 million. The base rate increase was proposed to recover the significant investment in infrastructure to serve a growing customer base, improve safety and reliability of the transmission and distribution system and enhance energy efficiency and sustainability. The proposed rates would provide for an ROE of 10.25% compared to the currently authorized ROE of 9.7%. This matter is pending.

South Carolina Regulation

DSM Programs

DESC has approval for a DSM rider through which it recovers expenditures related to its DSM programs. In January 2021, DESC filed an application with the South Carolina Commission seeking approval to recover $48 million of costs and net lost revenues associated with these programs, along with an incentive to invest in such programs. In April 2021, the South Carolina Commission approved the filing.

Cost of Fuel

DESC’s retail electric rates include a cost of fuel component approved by the South Carolina Commission which may be adjusted periodically to reflect changes in the price of fuel purchased by DESC. In February 2021, DESC filed a proposal with the South Carolina Commission to increase the total fuel cost component of retail electric rates. DESC’s proposed adjustment would increase annual base fuel component recoveries by $36 million and is designed to recover DESC’s current base fuel costs, net of the existing over-collected balance, over the 12-month period beginning with the first billing cycle of May 2021. In addition, DESC proposed a decrease to its variable environmental component and an increase to its distributed energy resource component. In April 2021, the South Carolina Commission approved the filing.

Ohio Regulation

PIR Program

In 2008, East Ohio began PIR, aimed at replacing approximately 25% of its pipeline system. In February 2021, East Ohio filed an application requesting approval to adjust the PIR cost recovery rates for 2020 costs. The filing reflects gross plant investment for 2020 of $178 million, cumulative gross plant investment of $2.0 billion and an annual revenue requirement of $243 million.

CEP Program

In 2011, East Ohio began CEP which enables East Ohio to defer depreciation expense, property tax expense and carrying costs associated with CEP investments. In April 2021, East Ohio filed an application requesting approval to adjust the CEP cost recovery rates for 2019 and 2020 costs. The filing reflects gross plant investment for 2019 of $137 million, gross plant investment for 2020 of $99 million, cumulative gross plant investment of $957 million and a revenue requirement of $119 million. This matter is pending.

Utah Regulation

Purchased Gas

In April 2021, Questar Gas submitted a filing with the Utah Commission for a $43 million gas cost increase with rates effective June 2021. This matter is pending.

Note 14. Leases

Other than the items discussed below, there have been no significant changes regarding the Companies’ leases as described in Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Dominion Energy’s Consolidated Statements of Income include $34 million and $32 million for the three months ended March 31, 2021 and 2020, respectively, of rental revenue included in operating revenue. Dominion Energy’s Consolidated Statements of Income include $27 million and $23 million for the three months ended March 31, 2021 and 2020, respectively, of depreciation expense included in depreciation, depletion and amortization, related to facilities subject to power purchase agreements under which Dominion Energy is the lessor.

Corporate Office Leasing Arrangement

In December 2019, Dominion Energy signed an agreement with a lessor, as amended in May 2020, to construct and lease a new corporate office property in Richmond, Virginia. The lessor provided equity and had obtained financing commitments from debt investors, totaling $465 million, to fund the estimated project costs. In March 2021, Dominion Energy notified the lessor of its intention to terminate the leasing arrangement effective April 2021. As a result, Dominion Energy recorded a charge of $71 million ($53 million after-tax) in the first quarter of 2021, included in impairments of assets and other charges in its Consolidated Statements of Income, primarily for amounts required to be repaid to the lessor.

Note 15. Variable Interest Entities

There have been no significant changes regarding the entities the Companies consider VIEs as described in Note 16 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Dominion Energy

At March 31, 2021 and December 31, 2020, Dominion Energy’s securities due within one year included $34 million and $32 million, respectively, and at March 31, 2021 and December 31, 2020, Dominion Energy’s long-term debt included $238 million and $239 million, respectively, of debt issued by SBL Holdco, a VIE, net of issuance costs, that is nonrecourse to Dominion Energy and is secured by SBL Holdco’s interest in certain merchant solar facilities.

Virginia Power

Virginia Power purchased shared services from DES, an affiliated VIE, of $96 million and $93 million for the three months ended March 31, 2021 and 2020, respectively. Virginia Power’s Consolidated Balance Sheets include amounts due to DES of $35 million and $175 million at March 31, 2021 and December 31, 2020, respectively, recorded in payables to affiliates.

Note 16. Significant Financing Transactions

Credit Facilities and Short-term Debt

The Companies use short-term debt to fund working capital requirements and as a bridge to long-term debt financings. The levels of borrowing may vary significantly during the course of the year, depending upon the timing and amount of cash requirements not satisfied by cash from operations. In addition, Dominion Energy utilizes cash and letters of credit to fund collateral requirements. Collateral requirements are impacted by commodity prices, hedging levels, Dominion Energy’s credit ratings and the credit quality of its counterparties.

Dominion Energy

At March 31, 2021, Dominion Energy’s commercial paper and letters of credit outstanding, as well as its capacity available under the credit facility, were as follows:

Facility

Limit

Outstanding

Commercial

Paper

Outstanding

Letters of

Credit

Facility

Capacity

Available

(millions)

Joint revolving credit facility⁽¹⁾

6,000

2,477

3,424

(1)	This credit facility matures in March 2023 and can be used by the borrowers under the credit facility to support bank borrowings and the issuance of commercial paper, as well as to support up to a combined $2.0 billion of letters of credit.

DESC and Questar Gas’ short-term financings are supported through access as co-borrowers to the joint revolving credit facility discussed above with the Companies. At March 30, 2021, the sub-limits for DESC and Questar Gas were $500 million and $250 million, respectively.

In January 2021, DESC and GENCO applied to FERC for a two-year short-term borrowing authorization. In March 2021, FERC granted DESC authority through March 2023 to issue short-term indebtedness (pursuant to Section 204 of the Federal Power Act) in amounts not to exceed $2.2 billion outstanding with maturity dates of one year or less. In addition, in March 2021, FERC granted GENCO authority through March 2023 to issue short-term indebtedness not to exceed $200 million outstanding with maturity dates of one year or less.

In addition to the credit facility mentioned above, Dominion Energy also has a credit facility which allows Dominion Energy to issue up to approximately $30 million in letters of credit and matures in June 2022. At both March 31, 2021 and December 31, 2020, Dominion Energy had $30 million in letters of credit outstanding under this agreement.

In addition to the credit facilities mentioned above, SBL Holdco has $30 million of credit facilities which had an original stated maturity date of December 2017 with automatic one-year renewals through the maturity of the SBL Holdco term loan agreement in 2023. Dominion Solar Projects III, Inc. has $25 million of credit facilities which had an original stated maturity date of May 2018 with automatic one-year renewals through the maturity of the Dominion Solar Projects III, Inc. term loan agreement in 2024. At both March 31, 2021 and December 31, 2020, no amounts were outstanding under either of these facilities.

In March 2020, Dominion Energy entered into a $900 million 364-Day Revolving Credit Agreement that bore interest at a variable rate. At December 31, 2020, $225 million was outstanding under the agreement. In March 2021, the agreement reached maturity and Dominion Energy repaid the outstanding borrowed amount in full.

Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. At March 31, 2021 and December 31, 2020, Dominion Energy’s Consolidated Balance Sheets include $338 million and $268 million, respectively, with respect to such notes presented within short-term debt. The proceeds are used for general corporate purposes and to repay debt.

Virginia Power

Virginia Power’s short-term financing is supported through its access as co-borrower to the joint revolving credit facility. This credit facility can be used for working capital, as support for the combined commercial paper programs of the borrowers under the credit facility and for other general corporate purposes.

At March 31, 2021, Virginia Power’s share of commercial paper and letters of credit outstanding under the joint revolving credit facility with Dominion Energy, Questar Gas and DESC was as follows:

Facility

Limit⁽¹⁾

Outstanding

Commercial

Paper

Outstanding

Letters of

Credit

(millions)

Joint revolving credit facility⁽¹⁾

6,000

420

(1)

The full amount of the facility is available to Virginia Power, less any amounts outstanding to co-borrowers Dominion Energy, Questar Gas and DESC. The sub-limit for Virginia Power is set within the facility limit but can be changed at the option of the borrowers under the credit facility multiple times per year. At March 31, 2021, the sub-limit for Virginia Power was $1.5 billion. If Virginia Power has liquidity needs in excess of its sub-limit, the sub-limit may be changed or such needs may be satisfied through short-term intercompany borrowings from Dominion Energy. This credit facility matures in March 2023 and can be used to support bank borrowings and the issuance of commercial paper, as well as to support up to $2.0 billion (or the sub-limit, whichever is less) of letters of credit.

Long-term Debt

Unless otherwise noted, the proceeds of long-term debt issuances were used for general corporate purposes and/or to repay short-term debt.

In March 2021, PSNC issued, through private placement, $150 million of 3.10% senior notes that mature in 2051.

In April 2021, Dominion Energy issued $600 million of 1.45% senior notes and $500 million of 3.30% senior notes that mature in 2026 and 2041, respectively.

Preferred Stock

Dominion Energy is authorized to issue up to 20 million shares of preferred stock, which may be designated into separate classes. At both March 31, 2021 and December 31, 2020, Dominion Energy had issued and outstanding 2.4 million shares of preferred stock, 1.6 million and 0.8 million of which were designated as the Series A Preferred Stock and the Series B Preferred Stock, respectively. Dominion Energy’s Series A Preferred Stock and Series B Preferred Stock are described in Note 19 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Dominion Energy recorded dividends of $7 million ($4.375 per share) and $9 million ($11.625 per share) during both the three months ended March 31, 2021 and 2020 on the Series A Preferred Stock and Series B Preferred Stock, respectively. The stock purchase contract liability associated with Dominion Energy’s 2019 Equity Units was $108 million and $129 million at March 31, 2021 and December 31, 2020, respectively. Stock purchase contract payments of $21 million and $20 million were made during the three months ended March 31, 2021 and 2020, respectively. In calculating diluted EPS, Dominion Energy applies the treasury stock method to the stock purchase contracts and the if-converted method to the Series A Preferred Stock.

Issuance of Common Stock

Dominion Energy recorded, net of fees and commissions, $48 million and $78 million from the issuance of less than 1 million and 1 million shares of common stock for the three months ended March 31, 2021 and 2020, respectively, through various programs including Dominion Energy Direct® and employee savings plans as described in Note 20 to the Consolidated Financial Statements to the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

At-the-Market Program

In August 2020, Dominion Energy entered into sales agency agreements to effect sales under an at-the-market program as discussed in Note 20 to the Consolidated Financial Statements in the Companies’ Annual Report Form 10-K for the year ended December 31,

2020. As of March 31, 2021, Dominion Energy has not issued any shares or entered into any forward sale agreements under this program.

Repurchase of Common Stock

In November 2020, the Board of Directors authorized the repurchase of up to $1.0 billion of Dominion Energy’s common stock as discussed in Note 20 to the Consolidated Financial Statements in the Companies’ Annual Report Form 10-K for the year ended December 31, 2020. Dominion Energy did not repurchase any shares of common stock during the first quarter of 2021.

Note 17. Commitments and Contingencies

As a result of issues generated in the ordinary course of business, the Companies are involved in legal proceedings before various courts and are periodically subject to governmental examinations (including by regulatory authorities), inquiries and investigations. Certain legal proceedings and governmental examinations involve demands for unspecified amounts of damages, are in an initial procedural phase, involve uncertainty as to the outcome of pending appeals or motions, or involve significant factual issues that need to be resolved, such that it is not possible for the Companies to estimate a range of possible loss. For such matters that the Companies cannot estimate, a statement to this effect is made in the description of the matter. Other matters may have progressed sufficiently through the litigation or investigative processes such that the Companies are able to estimate a range of possible loss. For legal proceedings and governmental examinations that the Companies are able to reasonably estimate a range of possible losses, an estimated range of possible loss is provided, in excess of the accrued liability (if any) for such matters. Any accrued liability is recorded on a gross basis with a receivable also recorded for any probable insurance recoveries. Estimated ranges of loss are inclusive of legal fees and net of any anticipated insurance recoveries. Any estimated range is based on currently available information and involves elements of judgment and significant uncertainties. Any estimated range of possible loss may not represent the Companies’ maximum possible loss exposure. The circumstances of such legal proceedings and governmental examinations will change from time to time and actual results may vary significantly from the current estimate. For current proceedings not specifically reported below, management does not anticipate that the liabilities, if any, arising from such proceedings would have a material effect on the Companies’ financial position, liquidity or results of operations.

Environmental Matters

The Companies are subject to costs resulting from a number of federal, state and local laws and regulations designed to protect human health and the environment. These laws and regulations affect future planning and existing operations. They can result in increased capital, operating and other costs as a result of compliance, remediation, containment and monitoring obligations.

Air

The CAA, as amended, is a comprehensive program utilizing a broad range of regulatory tools to protect and preserve the nation's air quality. At a minimum, states are required to establish regulatory programs to meet applicable requirements of the CAA. However, states may choose to develop regulatory programs that are more restrictive. Many of the Companies’ facilities are subject to the CAA’s permitting and other requirements.

Ozone Standards

The EPA published final non-attainment designations for the October 2015 ozone standard in June 2018. States have until August 2021 to develop plans to address the new standard. Until the states have developed implementation plans for the standard, the Companies are unable to predict whether or to what extent the new rules will ultimately require additional controls. The expenditures required to implement additional controls could have a material impact on the Companies’ results of operations and cash flows.

ACE Rule

In July 2019, the EPA published the final rule informally referred to as the ACE Rule, as a replacement for the Clean Power Plan. The ACE Rule regulated GHG emissions from existing coal-fired power plants pursuant to Section 111(d) of the CAA and required states to develop plans by July 2022 establishing unit-specific performance standards for existing coal-fired power plants. In January 2021, the U.S. Court of Appeals for the D.C. Circuit vacated the ACE Rule and remanded it to the EPA. This decision would take effect upon issuance of the court’s mandate. In March 2021, the court issued a partial mandate vacating and remanding all parts of the ACE Rule except for the portion of the ACE Rule that repealed the Clean Power Plan. While the EPA has stated its intention to replace the ACE Rule, it is unknown at this time if or how the EPA will issue a replacement for the ACE Rule and how that replacement will affect the Companies’ operations, financial condition and/or cash flows.

Carbon Regulations

In August 2016, the EPA issued a draft rule proposing to reaffirm that a source’s obligation to obtain a PSD or Title V permit for GHGs is triggered only if such permitting requirements are first triggered by non-GHG, or conventional, pollutants that are regulated by the New Source Review program, and exceed a significant emissions rate of 75,000 tons per year of CO₂ equivalent emissions. Until the EPA ultimately takes final action on this rulemaking, the Companies cannot predict the impact to their results of operations, financial condition and/or cash flows.

In December 2018, the EPA proposed revised Standards of Performance for Greenhouse Gas Emissions from New, Modified, and Reconstructed Stationary Sources. The proposed rule would amend the previous determination that the best system of emission reduction for newly constructed coal-fired steam generating units is no longer partial carbon capture and storage. Instead, the proposed revised best system of emission reduction for this source category is the most efficient demonstrated steam cycle (e.g., supercritical steam conditions for large units and subcritical steam conditions for small units) in combination with best operating practices. In January 2021, the EPA published a final rule affirming that fossil fuel-fired electric generating units meet the requirement that a source category “significantly contribute” to endangering air pollution for the purposes of regulating GHG emissions from new, modified and reconstructed stationary sources. The January 2021 rule also established a threshold for the “significant contribution” threshold that would have meant that no other source category, such as oil and gas facilities, petroleum refineries, and boilers, would meet that requirement at this time. In April 2021, the U.S. Court of Appeals for the D.C. Circuit granted an unopposed motion by the EPA to vacate and remand the January 2021 rule. The proposed revision to the performance standards for coal-fired steam generating units remains pending. Until the EPA ultimately takes final action on this rulemaking, the Companies cannot predict the impact to their results of operations, financial condition and/or cash flows.

Water

The CWA, as amended, is a comprehensive program requiring a broad range of regulatory tools including a permit program to authorize and regulate discharges to surface waters with strong enforcement mechanisms. The Companies must comply with applicable aspects of the CWA programs at their operating facilities.

Regulation 316(b)

In October 2014, the final regulations under Section 316(b) of the CWA that govern existing facilities and new units at existing facilities that employ a cooling water intake structure and that have flow levels exceeding a minimum threshold became effective. The rule establishes a national standard for impingement based on seven compliance options, but forgoes the creation of a single technology standard for entrainment. Instead, the EPA has delegated entrainment technology decisions to state regulators. State regulators are to make case-by-case entrainment technology determinations after an examination of five mandatory facility-specific factors, including a social cost-benefit test, and six optional facility-specific factors. The rule governs all electric generating stations with water withdrawals above two MGD, with a heightened entrainment analysis for those facilities over 125 MGD. Dominion Energy and Virginia Power currently have 15 and nine facilities, respectively, that are subject to the final regulations. Dominion Energy is also working with the EPA and state regulatory agencies to assess the applicability of Section 316(b) to eight hydroelectric facilities, including three Virginia Power facilities. The Companies anticipate that they may have to install impingement control technologies at certain of these stations that have once-through cooling systems. The Companies are currently evaluating the need or potential for entrainment controls under the final rule as these decisions will be made on a case-by-case basis after a thorough review of detailed biological, technology, cost and benefit studies. DESC is conducting studies and implementing plans as required by the rule to determine appropriate intake structure modifications at certain facilities to ensure compliance with this rule. While the impacts of this rule could be material to the Companies’ results of operations, financial condition and/or cash flows, the existing regulatory frameworks in South Carolina and Virginia provide rate recovery mechanisms that could substantially mitigate any such impacts for the regulated electric utilities.

Effluent Limitations Guidelines

In September 2015, the EPA released a final rule to revise the Effluent Limitations Guidelines for the Steam Electric Power Generating Category. The final rule established updated standards for wastewater discharges that apply primarily at coal and oil steam generating stations. Affected facilities are required to convert from wet to dry or closed cycle coal ash management, improve existing wastewater treatment systems and/or install new wastewater treatment technologies in order to meet the new discharge limits. In April 2017, the EPA granted two separate petitions for reconsideration of the Effluent Limitations Guidelines final rule and stayed future compliance dates in the rule. Also in April 2017, the U.S. Court of Appeals for the Fifth Circuit granted the EPA’s request for a stay of the pending consolidated litigation challenging the rule while the EPA addresses the petitions for reconsideration. In September 2017, the EPA signed a rule to postpone the earliest compliance dates for certain waste streams regulations in the Effluent Limitations Guidelines final rule from November 2018 to November 2020; however, the latest date for compliance for these regulations was December 2023. In October 2020, the EPA released the final rule that extends the latest dates for compliance. Individual facilities’

compliance dates will vary based on circumstances and the determination by state regulators and may range from 2021 to 2028. While the impacts of this rule could be material to the Companies’ results of operations, financial condition and/or cash flows, the existing regulatory frameworks in South Carolina and Virginia provide rate recovery mechanisms that could substantially mitigate any such impacts for the regulated electric utilities.

Waste Management and Remediation

The operations of the Companies are subject to a variety of state and federal laws and regulations governing the management and disposal of solid and hazardous waste, and release of hazardous substances associated with current and/or historical operations. The CERCLA, as amended, and similar state laws, may impose joint, several and strict liability for cleanup on potentially responsible parties who owned, operated or arranged for disposal at facilities affected by a release of hazardous substances. In addition, many states have created programs to incentivize voluntary remediation of sites where historical releases of hazardous substances are identified and property owners or responsible parties decide to initiate cleanups.

From time to time, the Companies may be identified as a potentially responsible party in connection with the alleged release of hazardous substances or wastes at a site. Under applicable federal and state laws, the Companies could be responsible for costs associated with the investigation or remediation of impacted sites, or subject to contribution claims by other responsible parties for their costs incurred at such sites. The Companies also may identify, evaluate and remediate other potentially impacted sites under voluntary state programs. Remediation costs may be subject to reimbursement under the Companies’ insurance policies, rate recovery mechanisms, or both. Except as described below, the Companies do not believe these matters will have a material effect on results of operations, financial condition and/or cash flows.

Dominion Energy has determined that it is associated with former manufactured gas plant sites, including certain sites associated with Virginia Power. At 12 sites associated with Dominion Energy, including certain sites acquired in the SCANA Combination, remediation work has been substantially completed under federal or state oversight. Where required, the sites are following state-approved groundwater monitoring programs. Dominion Energy has proposed or expects to propose remediation plans associated with three sites, including one at Virginia Power, and expects to conduct remediation activities primarily by the end of 2021. At March 31, 2021 and December 31, 2020, Dominion Energy had $40 million and $42 million, respectively, and Virginia Power had $25 million and $26 million, respectively, of reserves recorded. In addition, for one site associated with Dominion Energy, an updated work plan submitted to SCDHEC in September 2018, would increase costs by approximately $11 million if approved by federal and state agencies. In September 2020, this plan was submitted to the Army Corps of Engineers. Dominion Energy is associated with 12 additional sites, including two associated with Virginia Power, which are not under investigation by any state or federal environmental agency nor the subject of any current or proposed plans to perform remediation activities. Due to the uncertainty surrounding such sites, the Companies are unable to make an estimate of the potential financial statement impacts.

Other Legal Matters

The Companies are defendants in a number of lawsuits and claims involving unrelated incidents of property damage and personal injury. Due to the uncertainty surrounding these matters, the Companies are unable to make an estimate of the potential financial statement impacts; however, they could have a material impact on results of operations, financial condition and/or cash flows.

SCANA Legal Proceedings

The following describes certain legal proceedings involving Dominion Energy, SCANA or DESC relating to events occurring before closing of the SCANA Combination. No reference to, or disclosure of, any proceeding, item or matter described below shall be construed as an admission or indication that such proceeding, item or matter is material. For certain of these matters, and unless otherwise noted therein, Dominion Energy is unable to estimate a reasonable range of possible loss and the related financial statement impacts, but for any such matter there could be a material impact to its results of operations, financial condition and/or cash flows. For the matters for which Dominion Energy is able to reasonably estimate a probable loss, Dominion Energy’s Consolidated Balance Sheets at March 31, 2021 and December 31, 2020 include reserves of $268 million and $208 million, respectively, included within other current liabilities, and insurance receivables at both dates of $8 million, included within other receivables. During the three months ended March 31, 2021, Dominion Energy’s Consolidated Statements of Income include charges of $60 million ($45 million after-tax) included within impairment of assets and other charges. During the three months ended March 31, 2020, Dominion Energy’s Consolidated Statements of Income include charges of $25 million ($25 million after-tax) included within other income (expense).

Ratepayer Class Actions

In May 2018, a consolidated complaint against DESC, SCANA and the State of South Carolina was filed in the State Court of Common Pleas in Hampton County, South Carolina (the DESC Ratepayer Case). The plaintiffs alleged, among other things, that DESC was negligent and unjustly enriched, breached alleged fiduciary and contractual duties and committed fraud and

misrepresentation in failing to properly manage the NND Project, and that DESC committed unfair trade practices and violated state anti-trust laws. In December 2018, the State Court of Common Pleas in Hampton County entered an order granting preliminary approval of a class action settlement. The court entered an order granting final approval of the settlement in June 2019, which became effective in July 2019. The settlement agreement, contingent upon the closing of the SCANA Combination, provided that SCANA and DESC establish an escrow account and proceeds from the escrow account would be distributed to the plaintiffs, after payment of certain taxes, attorneys' fees and other expenses and administrative costs. The escrow account would include (1) up to $2.0 billion, net of a credit of up to $2.0 billion in future electric bill relief, which would inure to the benefit of the escrow account in favor of class members over a period of time established by the South Carolina Commission in its order related to matters before the South Carolina Commission related to the NND Project, (2) a cash payment of $115 million and (3) the transfer of certain DESC-owned real estate or sales proceeds from the sale of such properties, which counsel for the plaintiffs estimated to have an aggregate value between $60 million and $85 million. At the closing of the SCANA Combination, SCANA and DESC funded the cash payment portion of the escrow account. In July 2019, DESC transferred $117 million representing the cash payment, plus accrued interest, to the plaintiffs. Through August 2020, property, plant and equipment with a net recorded value of $27 million had been transferred to the plaintiffs in coordination with the court-appointed real estate trustee to satisfy the settlement agreement. In September 2020, the court entered an order approving a final resolution of the transfer of real estate or sales proceeds with a cash contribution of $38.5 million by DESC and the conveyance of property, plant and equipment with a net recorded value of $3 million, which was completed by DESC in October 2020.

In September 2017, a purported class action was filed by Santee Cooper ratepayers against Santee Cooper, DESC, Palmetto Electric Cooperative, Inc. and Central Electric Power Cooperative, Inc. in the State Court of Common Pleas in Hampton County, South Carolina (the Santee Cooper Ratepayer Case). The allegations were substantially similar to those in the DESC Ratepayer Case. In March 2020, the parties executed a settlement agreement relating to this matter as well as the Luquire Case and the Glibowski Case described below. The settlement agreement provided that Dominion Energy and Santee Cooper establish a fund for the benefit of class members in the amount of $520 million, of which Dominion Energy’s portion was $320 million of shares of Dominion Energy common stock. In July 2020, the court issued a final approval of the settlement agreement. In September 2020, Dominion Energy issued $322 million of shares of Dominion Energy common stock to satisfy its obligation under the settlement agreement, including interest charges.

In July 2019, a similar purported class action was filed by certain Santee Cooper ratepayers against DESC, SCANA, Dominion Energy and former directors and officers of SCANA in the State Court of Common Pleas in Orangeburg, South Carolina (the Luquire Case). In August 2019, DESC, SCANA and Dominion Energy were voluntarily dismissed from the case. The claims were similar to the Santee Cooper Ratepayer Case. In March 2020, the parties executed a settlement agreement as described above relating to this matter as well as the Santee Cooper Ratepayer Case and the Glibowski Case. This case was dismissed as part of the Santee Cooper Ratepayer Case settlement described above.

RICO Class Action

In January 2018, a purported class action was filed, and subsequently amended, against SCANA, DESC and certain former executive officers in the U.S. District Court for the District of South Carolina (the Glibowski Case). The plaintiff alleged, among other things, that SCANA, DESC and the individual defendants participated in an unlawful racketeering enterprise in violation of RICO and conspired to violate RICO by fraudulently inflating utility bills to generate unlawful proceeds. In March 2020, the parties executed a settlement agreement as described above relating to this matter as well as the Santee Cooper Ratepayer Case and the Luquire Case. This case was dismissed as part of the Santee Cooper Ratepayer Case settlement described above.

SCANA Shareholder Litigation

In September 2017, a purported class action was filed against SCANA and certain former executive officers and directors in the U.S. District Court for the District of South Carolina. Subsequent additional purported class actions were separately filed against all or nearly all of these defendants (collectively the SCANA Securities Class Action). In January 2018, the U.S. District Court for the District of South Carolina consolidated these suits, and the plaintiffs filed a consolidated amended complaint in March 2018. The plaintiffs alleged, among other things, that the defendants violated §10(b) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder, and that the individually named defendants are liable under §20(a) of the same act. In December 2019, the parties executed a settlement agreement pursuant to which SCANA would pay $192.5 million, up to $32.5 million of which could be satisfied through the issuance of shares of Dominion Energy common stock, subject to court approval. In February 2020, the U.S. District Court for the District of South Carolina granted preliminary approval of the settlement agreement, pending a fairness hearing, and granted final approval in July 2020. In March 2020, SCANA funded an escrow account with $160 million in cash and paid the balance of $32.5 million in cash in August 2020 to satisfy the settlement.

In September 2017, a shareholder derivative action was filed against certain former executive officers and directors of SCANA in the State Court of Common Pleas in Richland County, South Carolina. In September 2018, this action was consolidated with another

action in the Business Court Pilot Program in Richland County. The plaintiffs allege, among other things, that the defendants breached their fiduciary duties to shareholders by their gross mismanagement of the NND Project, and that the defendants were unjustly enriched by bonuses they were paid in connection with the project. In January 2019, the defendants filed a motion to dismiss the consolidated action. In February 2019, one action was voluntarily dismissed. In March 2020, the court denied the defendants’ motion to dismiss. In April 2020, the defendants filed a notice of appeal with the South Carolina Court of Appeals and a petition with the Supreme Court of South Carolina seeking appellate review of the denial of the motion to dismiss. In June 2020, the plaintiffs filed a motion to dismiss the appeal with the South Carolina Court of Appeals, which was granted in July 2020. In August 2020, the Supreme Court of South Carolina denied the defendants’ petition seeking appellate review. Also in August 2020, the defendants filed a petition for rehearing with the South Carolina Court of Appeals relating to the July 2020 ruling by the court, which was denied in October 2020. In November 2020, SCANA filed a petition of certiorari with the Supreme Court of South Carolina seeking appellate review of the denial of SCANA’s motion to dismiss. This case is pending.

In January 2018, a purported class action was filed against SCANA, Dominion Energy and certain former executive officers and directors of SCANA in the State Court of Common Pleas in Lexington County, South Carolina (the City of Warren Lawsuit). The plaintiff alleges, among other things, that defendants violated their fiduciary duties to shareholders by executing a merger agreement that would unfairly deprive plaintiffs of the true value of their SCANA stock, and that Dominion Energy aided and abetted these actions. Among other remedies, the plaintiff seeks to enjoin and/or rescind the merger. In February 2018, a purported class action was filed against Dominion Energy and certain former directors of SCANA and DESC in the State Court of Common Pleas in Richland County, South Carolina (the Metzler Lawsuit). The allegations made and the relief sought by the plaintiffs are substantially similar to that described for the City of Warren Lawsuit. In September 2019, the U.S. District Court for the District of South Carolina granted the plaintiffs’ motion to consolidate the City of Warren Lawsuit and the Metzler Lawsuit. In October 2019, the plaintiffs filed an amended complaint against certain former directors and executive officers of SCANA and DESC, which stated substantially similar allegations to those in the City of Warren Lawsuit and the Metzler Lawsuit as well as an inseparable fraud claim. In November 2019, the defendants filed a motion to dismiss. In April 2020, the U.S. District Court for the District of South Carolina denied the motion to dismiss. In May 2020, SCANA filed a motion to intervene, which was denied in August 2020. In September 2020, SCANA filed a notice of appeal with the U.S. Court of Appeals for the Fourth Circuit. This case is pending.

In May 2019, a case was filed against certain former executive officers and directors of SCANA in the State Court of Common Pleas in Richland County, South Carolina. The plaintiff alleges, among other things, that the defendants breached their fiduciary duties to shareholders by their gross mismanagement of the NND Project, were unjustly enriched by the bonuses they were paid in connection with the project and breached their fiduciary duties to secure and obtain the best price for the sale of SCANA. Also in May 2019, the case was removed to the U.S. District Court of South Carolina by the non-South Carolina defendants. In June 2019, the plaintiffs filed a motion to remand the case to state court. In January 2020, the case was remanded to state court. In February 2020, the defendants filed a motion to dismiss. This case is pending.

Employment Class Actions and Indemnification

In August 2017, a case was filed in the U.S. District Court for the District of South Carolina on behalf of persons who were formerly employed at the NND Project. In July 2018, the court certified this case as a class action. In February 2019, certain of these plaintiffs filed an additional case, which case has been dismissed and the plaintiffs have joined the case filed August 2017. The plaintiffs allege, among other things, that SCANA, DESC, Fluor Corporation and Fluor Enterprises, Inc. violated the Worker Adjustment and Retraining Notification Act in connection with the decision to stop construction at the NND Project. The plaintiffs allege that the defendants failed to provide adequate advance written notice of their terminations of employment and are seeking damages, which could be as much as $100 million for 100% of the NND Project. In January 2021, the U.S. District Court for the District of South Carolina granted summary judgment in favor of SCANA, DESC, Fluor Corporation and Fluor Enterprises, Inc. In February 2021, the plaintiffs filed a notice of appeal with the U.S. Court of Appeals for the Fourth Circuit. This case is pending.

In September 2018, a case was filed in the State Court of Common Pleas in Fairfield County, South Carolina by Fluor Enterprises, Inc. and Fluor Daniel Maintenance Services, Inc. against DESC and Santee Cooper. The plaintiffs make claims for indemnification, breach of contract and promissory estoppel arising from, among other things, the defendants' alleged failure and refusal to defend and indemnify the Fluor defendants in the aforementioned case. This case is pending.

FILOT Litigation and Related Matters

In November 2017, Fairfield County filed a complaint and a motion for temporary injunction against DESC in the State Court of Common Pleas in Fairfield County, South Carolina, making allegations of breach of contract, fraud, negligent misrepresentation, breach of fiduciary duty, breach of implied duty of good faith and fair dealing and unfair trade practices related to DESC’s termination of the FILOT agreement between DESC and Fairfield County related to the NND Project. The plaintiff sought a temporary and permanent injunction to prevent DESC from terminating the FILOT agreement. The plaintiff withdrew the motion for temporary injunction in December 2017. This case is pending.

Governmental Proceedings and Investigations

In June 2018, DESC received a notice of proposed assessment of approximately $410 million, excluding interest, from the SCDOR following its audit of DESC’s sales and use tax returns for the periods September 1, 2008 through December 31, 2017. The proposed assessment, which includes 100% of the NND Project, is based on the SCDOR’s position that DESC’s sales and use tax exemption for the NND Project does not apply because the facility will not become operational. In December 2020, the parties reached an agreement in principle in the amount of $165 million to resolve this matter.

In September and October 2017, SCANA was served with subpoenas issued by the U.S. Attorney’s Office for the District of South Carolina and the Staff of the SEC’s Division of Enforcement seeking documents related to the NND Project. In February 2020, the SEC filed a complaint against SCANA, two of its former executive officers and DESC in the U.S. District Court for the District of South Carolina alleging that the defendants violated federal securities laws by making false and misleading statements about the NND Project. In April 2020, SCANA and DESC reached an agreement in principle with the Staff of the SEC’s Division of Enforcement to settle, without admitting or denying the allegations in the complaint. In December 2020, the U.S. District Court for the District of South Carolina issued an order approving the settlement which required SCANA to pay a civil monetary penalty totaling $25 million, and SCANA and DESC to pay disgorgement and prejudgment interest totaling $112.5 million, which disgorgement and prejudgment interest amount were deemed satisfied by the settlements in the SCANA Securities Class Action and the DESC Ratepayer Case. SCANA paid the civil penalty in December 2020. The SEC civil action against two former executive officers of SCANA remains pending and is currently subject to a stay granted by the court in June 2020 at the request of the U.S. Attorney’s Office for the District of South Carolina.

In addition, the South Carolina Law Enforcement Division is conducting a criminal investigation into the handling of the NND Project by SCANA and DESC. Dominion Energy is cooperating fully with the investigations by the U.S. Attorney’s Office and the South Carolina Law Enforcement Division, including responding to additional subpoenas and document requests. Dominion Energy has also entered into a cooperation agreement with the U.S. Attorney’s Office and the South Carolina Attorney General’s Office. The cooperation agreement provides that in consideration of its full cooperation with these investigations to the satisfaction of both agencies, neither such agency will criminally prosecute or bring any civil action against Dominion Energy or any of its current, previous, or future direct or indirect subsidiaries related to the NND Project. A former executive officer of SCANA entered a plea agreement with the U.S. Attorney’s Office and the South Carolina Attorney General’s Office in June 2020 and entered a guilty plea with the U.S. District Court for the District of South Carolina in July 2020. Another former executive officer of SCANA entered a plea agreement with the U.S. Attorney's Office and the South Carolina Attorney General's Office in November 2020 and entered guilty pleas in the U.S. District Court for the District of South Carolina and in South Carolina state court in February 2021. As a result of the pleas, Dominion Energy has terminated indemnity for these former executive officers related to these two cases.

Abandoned NND Project

DESC, for itself and as agent for Santee Cooper, entered into an engineering, construction and procurement contract with Westinghouse and WECTEC in 2008 for the design and construction of the NND Project, of which DESC’s ownership share is 55%. Various difficulties were encountered in connection with the project. The ability of Westinghouse and WECTEC to adhere to established budgets and construction schedules was affected by many variables, including unanticipated difficulties encountered in connection with project engineering and the construction of project components, constrained financial resources of the contractors, regulatory, legal, training and construction processes associated with securing approvals, permits and licenses and necessary amendments to them within projected time frames, the availability of labor and materials at estimated costs and the efficiency of project labor. There were also contractor and supplier performance issues, difficulties in timely meeting critical regulatory requirements, contract disputes, and changes in key contractors or subcontractors. These matters preceded the filing for bankruptcy protection by Westinghouse and WECTEC in March 2017, and were the subject of comprehensive analyses performed by SCANA and Santee Cooper.

Based on the results of SCANA’s analysis, and in light of Santee Cooper's decision to suspend construction on the NND Project, in July 2017, SCANA determined to stop the construction of the units and to pursue recovery of costs incurred in connection with the construction under the abandonment provisions of the Base Load Review Act or through other means. This decision by SCANA

became the focus of numerous legislative, regulatory and legal proceedings. Some of these proceedings remain unresolved and are described above.

In September 2017, DESC, for itself and as agent for Santee Cooper, filed with the U.S. Bankruptcy Court for the Southern District of New York Proofs of Claim for unliquidated damages against each of Westinghouse and WECTEC. These Proofs of Claim were based upon the anticipatory repudiation and material breach by Westinghouse and WECTEC of the contract, and assert against Westinghouse and WECTEC any and all claims that are based thereon or that may be related thereto.

Westinghouse’s reorganization plan was confirmed by the U.S. Bankruptcy Court for the Southern District of New York and became effective in August 2018. In connection with the effectiveness of the reorganization plan, the contract associated with the NND Project was deemed rejected. DESC is contesting approximately $285 million of filed liens in Fairfield County, South Carolina. Most of these asserted liens are claims that relate to work performed by Westinghouse subcontractors before the Westinghouse bankruptcy, although some of them are claims arising from work performed after the Westinghouse bankruptcy.

Westinghouse has indicated that some unsecured creditors have sought or may seek amounts beyond what Westinghouse allocated when it submitted its reorganization plan to the U.S. Bankruptcy Court for the Southern District of New York. If any unsecured creditor is successful in its attempt to include its claim as part of the class of general unsecured creditors beyond the amounts in the bankruptcy reorganization plan allocated by Westinghouse, it is possible that the reorganization plan will not provide for payment in full or nearly in full to its pre-petition trade creditors. The shortfall could be significant.

DESC and Santee Cooper were responsible for amounts owed to Westinghouse for valid work performed by Westinghouse subcontractors on the NND Project after the Westinghouse bankruptcy filing until termination of the interim assessment agreement. In December 2019, DESC and Santee Cooper entered into a confidential settlement agreement with W Wind Down Co LLC resolving claims relating to the interim assessment agreement.

Further, some Westinghouse subcontractors who have made claims against Westinghouse in the bankruptcy proceeding also filed against DESC and Santee Cooper in South Carolina state court for damages. Many of these claimants have also asserted construction liens against the NND Project site. DESC also intends to oppose these claims and liens. With respect to claims of Westinghouse subcontractors, DESC believes there were sufficient amounts previously funded during the interim assessment agreement period to pay such validly asserted claims. With respect to the Westinghouse subcontractor claims which relate to other periods, DESC understands that such claims will be paid pursuant to Westinghouse’s confirmed bankruptcy reorganization plan. DESC further understands that the amounts paid under the plan may satisfy such claims in full. Therefore, DESC believes that the Westinghouse subcontractors may be paid substantially (and potentially in full) by Westinghouse. While Dominion Energy cannot be assured that it will not have any exposure on account of unpaid Westinghouse subcontractor claims, which DESC is presently disputing, Dominion Energy believes it is unlikely that it will be required to make payments on account of such claims.

Nuclear Operations

Nuclear Insurance

In March 2021, the total liability protection per nuclear incident available to all participants in the Secondary Financial Protection Program decreased from $13.8 billion to $13.7 billion. This decrease does not impact Dominion Energy’s responsibility per active unit under the Price-Anderson Amendments Act of 1988.

Spent Nuclear Fuel

As discussed in Note 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, the Companies entered into contracts with the DOE for the disposal of spent nuclear fuel under provisions of the Nuclear Waste Policy Act of 1982.

In June 2018, a lawsuit for Kewaunee was filed in the U.S. Court of Federal Claims for recovery of spent nuclear fuel storage costs incurred after 2013. In March 2019, Dominion Energy amended its filing for recovery of spent nuclear fuel storage to include costs incurred for the year ended December 31, 2018. This matter is pending.

Guarantees, Surety Bonds and Letters of Credit

Upon the closing of the GT&S Transaction, Dominion Energy retained its four guarantees related to Cove Point, an equity method investment, in support of terminal services, transportation and construction. Two of the Cove Point guarantees have a cumulative

maximum exposure of $1.9 billion while the other two guarantees have no maximum limit. No amounts related to these guarantees have been recorded.

In addition, at March 31, 2021, Dominion Energy had issued an additional $25 million of guarantees, primarily to support third parties. No amounts related to these guarantees have been recorded.

Dominion Energy also enters into guarantee arrangements on behalf of its consolidated subsidiaries, primarily to facilitate their commercial transactions with third parties. If any of these subsidiaries fail to perform or pay under the contracts and the counterparties seek performance or payment, Dominion Energy would be obligated to satisfy such obligation. To the extent that a liability subject to a guarantee has been incurred by one of Dominion Energy’s consolidated subsidiaries, that liability is included in the Consolidated Financial Statements. Dominion Energy is not required to recognize liabilities for guarantees issued on behalf of its subsidiaries unless it becomes probable that it will have to perform under the guarantees. Terms of the guarantees typically end once obligations have been paid. Dominion Energy currently believes it is unlikely that it would be required to perform or otherwise incur any losses associated with guarantees of its subsidiaries’ obligations.

At March 31, 2021, Dominion Energy had issued the following subsidiary guarantees:

	Maximum Exposure
(millions)
Commodity transactions⁽¹⁾	$	1,851
Nuclear obligations⁽²⁾		202
Solar⁽³⁾		463
Other⁽⁴⁾		982
Total⁽⁵⁾	$	3,498

(1)	Guarantees related to commodity commitments of certain subsidiaries. These guarantees were provided to counterparties in order to facilitate physical and financial transaction related commodities and services.

(2)	Guarantees primarily related to certain DGI subsidiaries regarding all aspects of running a nuclear facility.

(3)	Includes guarantees to facilitate the development of solar projects. Also includes guarantees entered into by DGI on behalf of certain subsidiaries to facilitate the acquisition and development of solar projects.

(4)

Guarantees related to other miscellaneous contractual obligations such as leases, environmental obligations, construction projects and insurance programs. Also includes guarantees entered into by Dominion Energy RNG Holdings II, Inc. on behalf of a subsidiary to facilitate construction of renewable natural gas facilities. Due to the uncertainty of workers’ compensation claims, the parental guarantee has no stated limit.

(5)	Excludes Dominion Energy's guarantees for the new corporate office properties and an offshore wind installation vessel discussed in Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and in Note 14 in this report.

Additionally, at March 31, 2021, Dominion Energy had purchased $167 million of surety bonds, including $95 million at Virginia Power, and authorized the issuance of letters of credit by financial institutions of $99 million to facilitate commercial transactions by its subsidiaries with third parties. Under the terms of surety bonds, the Companies are obligated to indemnify the respective surety bond company for any amounts paid.

Note 18. Credit Risk

The Companies’ accounting policies for credit risk are discussed in Note 24 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

At March 31, 2021, Dominion Energy’s credit exposure totaled $124 million, primarily related to price risk management activities. Of this amount, investment grade counterparties, including those internally rated, represented 87%. No single counterparty, whether investment grade or non-investment grade, exceeded $38 million of exposure. At March 31, 2021, Virginia Power’s exposure related to wholesale customers totaled $7 million. Of this amount, investment grade counterparties, including those internally rated, represented 52%. No single counterparty, whether investment grade or non-investment grade, exceeded $2 million of exposure.

Credit-Related Contingent Provisions

Certain of Dominion Energy’s derivative instruments contain credit-related contingent provisions. These provisions require Dominion Energy to provide collateral upon the occurrence of specific events, primarily a credit rating downgrade. If the credit-related contingent features underlying these instruments that are in a liability position and not fully collateralized with cash were fully triggered as of March 31, 2021 and December 31, 2020, Dominion Energy would have been required to post $11 million and $14 million, respectively, of additional collateral to its counterparties. The collateral that would be required to be posted includes the impacts of any offsetting asset positions and any amounts already posted for derivatives, non-derivative contracts and derivatives elected under the normal purchases and normal sales exception, per contractual terms. Dominion Energy had posted $1 million of collateral at December 31, 2020 related to derivatives with credit-related contingent provisions that are in a liability position and not fully collateralized with cash. The aggregate fair value of all derivative instruments with credit-related contingent provisions that are in a liability position and not fully collateralized with cash was $11 million and $15 million at March 31, 2021 and December 31, 2020, respectively, which does not include the impact of any offsetting asset positions.

If the credit-related contingent features underlying these instruments that are in a liability position and not fully collateralized with cash were fully triggered, Virginia Power would not have been required to post any additional collateral to its counterparties at March 31, 2021 and would have been required to post an additional $2 million of collateral to its counterparties at December 31, 2020.

See Note 9 for further information about derivative instruments.

Note 19. Related-Party Transactions

Virginia Power engages in related-party transactions primarily with other Dominion Energy subsidiaries (affiliates). Virginia Power’s receivable and payable balances with affiliates are settled based on contractual terms or on a monthly basis, depending on the nature of the underlying transactions. Virginia Power is included in Dominion Energy's consolidated federal income tax return and, where applicable, combined income tax returns for Dominion Energy are filed in various states. Dominion Energy’s transactions with equity method investments are described in Note 10. A discussion of significant related-party transactions follows.

Virginia Power

Transactions with Affiliates

Virginia Power transacts with affiliates for certain quantities of natural gas and other commodities in the ordinary course of business. Virginia Power also enters into certain commodity derivative contracts with affiliates. Virginia Power uses these contracts, which are principally comprised of forward commodity purchases, to manage commodity price risks associated with purchases of natural gas. At March 31, 2021, Virginia Power’s derivative assets and liabilities with affiliates were $3 million and $5 million, respectively. At December 31, 2020, Virginia Power’s derivative assets and liabilities with affiliates were $3 million and $22 million, respectively. See Note 9 for more information.

Virginia Power participates in certain Dominion Energy benefit plans described in Note 22 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. At March 31, 2021 and December 31, 2020, amounts due to Dominion Energy associated with the Dominion Energy Pension Plan and included in other deferred credits and other liabilities in the Consolidated Balance Sheets were $457 million and $436 million, respectively. At March 31, 2021 and December 31, 2020, Virginia Power's amounts due from Dominion Energy associated with the Dominion Energy Retiree Health and Welfare Plan and included in other deferred charges and other assets in the Consolidated Balance Sheets were $373 million and $354 million, respectively.

DES and other affiliates provide accounting, legal, finance and certain administrative and technical services to Virginia Power. In addition, Virginia Power provides certain services to affiliates, including charges for facilities and equipment usage.

The financial statements for all years presented include costs for certain general, administrative and corporate expenses assigned by DES to Virginia Power on the basis of direct and allocated methods in accordance with Virginia Power’s services agreements with DES. Where costs incurred cannot be determined by specific identification, the costs are allocated based on the proportional level of effort devoted by DES resources that is attributable to the entity, determined by reference to number of employees, salaries and wages and other similar measures for the relevant DES service. Management believes the assumptions and methodologies underlying the allocation of general corporate overhead expenses are reasonable.

Presented below are Virginia Power’s significant transactions with DES and other affiliates:

	Three Months Ended March 31,
	2021		2020
(millions)
Commodity purchases from affiliates	$	181	$	211
Services provided by affiliates⁽¹⁾		125		121
Services provided to affiliates		5		5

(1)	Includes capitalized expenditures of $38 million and $34 million for the three months ended March 31, 2021 and 2020, respectively.

Virginia Power has borrowed funds from Dominion Energy under short-term borrowing arrangements. There were $177 million and $380 million in short-term demand note borrowings from Dominion Energy as of March 31, 2021 and December 31, 2020, respectively. Virginia Power had no outstanding borrowings, net of repayments, under the Dominion Energy money pool for its nonregulated subsidiaries as of March 31, 2021 and December 31, 2020. Interest charges related to Virginia Power’s borrowings from Dominion Energy were immaterial for the three months ended March 31, 2021 and 2020.

There were no issuances of Virginia Power’s common stock to Dominion Energy for the three months ended March 31, 2021 and 2020.

Note 20. Employee Benefit Plans

Dominion Energy

The service cost component of net periodic benefit (credit) cost is reflected in other operations and maintenance expense in Dominion Energy’s Consolidated Statements of Income, except for $5 million for the three months ended March 31, 2020, presented in discontinued operations. The non-service cost components of net period benefit (credit) cost are reflected in other income in Dominion Energy’s Consolidated Statements of Income. The components of Dominion Energy’s provision for net periodic benefit cost (credit) are as follows:

	Pension Benefits						Other Postretirement Benefits
	2021			2020			2021			2020
(millions)
Three Months Ended March 31,
Service cost	$	42		$	43		$	6		$	7
Interest cost		79			91			12			15
Expected return on plan assets		(208	)		(193	)		(44	)		(39	)
Amortization of prior service (credit) cost		—			—			(10	)		(12	)
Amortization of net actuarial loss		48			49			1			1
Settlements		(2	)		—			—			—
Net periodic benefit (credit) cost	$	(41	)	$	(10	)	$	(35	)	$	(28	)

Employer Contributions

During the three months ended March 31, 2021, Dominion Energy made no contributions to its qualified defined benefit pension plans or other postretirement benefit plans. Dominion Energy does not expect to make any contributions to its qualified defined benefit pension plans or to VEBAs associated with its other postretirement plans in 2021.

Note 21. Operating Segments

The Companies are organized primarily on the basis of products and services sold in the U.S. A description of the operations included in the Companies’ primary operating segments is as follows:

Primary Operating Segment	Description of Operations	Dominion Energy	Virginia Power
Dominion Energy Virginia	Regulated electric distribution	X	X
	Regulated electric transmission	X	X
	Regulated electric generation fleet⁽¹⁾	X	X
Gas Distribution	Regulated gas distribution and storage⁽²⁾	X
Dominion Energy South Carolina	Regulated electric distribution	X
	Regulated electric transmission	X
	Regulated electric generation fleet	X
	Regulated gas distribution and storage	X
Contracted Assets	Nonregulated electric generation fleet	X
	Noncontrolling interest in Cove Point	X

(1)	Includes Virginia Power’s nonjurisdictional generation operations.

(2)	Includes renewable natural gas operations as well as Wexpro’s gas development and production operations.

In addition to the operating segments above, the Companies also report a Corporate and Other segment.

Dominion Energy

The Corporate and Other Segment of Dominion Energy includes its corporate, service company and other functions (including unallocated debt) as well as nonregulated retail energy marketing operations, including Dominion Energy’s noncontrolling interest in Wrangler. In addition, Corporate and Other includes specific items attributable to Dominion Energy’s operating segments that are not included in profit measures evaluated by executive management in assessing the segments’ performance or in allocating resources as well as the net impact of the gas transmission and storage operations held in discontinued operations, which are discussed in Note 3.

In the three months ended March 31, 2021, Dominion Energy reported after-tax net income of $71 million in the Corporate and Other segment, including $115 million of after-tax net income for specific items with $87 million of after-tax net expenses attributable to its operating segments. In the three months ended March 31, 2020, Dominion Energy reported after-tax net expenses of $1.1 billion in the Corporate and Other segment, including $1.1 billion of after-tax net expenses for specific items with $1.0 billion of after-tax net expenses attributable to its operating segments.

The net expenses for specific items attributable to Dominion Energy’s operating segments in 2021 primarily related to the impact of the following items:

•	A $151 million ($112 million after-tax) loss from an unbilled revenue reduction at Virginia Power, attributable to Dominion Energy Virginia;

•	A $76 million ($56 million after-tax) charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process, attributable to Dominion Energy Virginia;

•	A $60 million ($45 million after-tax) charge associated with litigation acquired in the SCANA Combination, attributable to Dominion Energy South Carolina; and

•	A $51 million ($38 million after-tax) charge associated with storm damage and service restoration in Virginia Power’s service territory, attributable to Dominion Energy Virginia; partially offset by

•	A $134 million ($100 million after-tax) gain related to investments in nuclear decommissioning trust funds, attributable to:

•

Contracted Assets ($88 million after-tax) and;

•

Dominion Energy Virginia ($12 million after-tax); and

•	A $130 million ($97 million after-tax) benefit for a change in the CCRO reserve associated with the 2021 Triennial Review, attributable to Dominion Energy Virginia.

The net expense for specific items attributable to Dominion Energy’s operating segments in 2020 primarily related to the impact of the following items:

•	A $754 million ($566 million after-tax) charge primarily related to the planned early retirement of certain Virginia Power electric generation facilities, attributable to Dominion Energy Virginia; and

•	A $538 million ($410 million after-tax) loss related to investments in nuclear decommissioning trust funds, attributable to:

•

Contracted Assets ($364 million after-tax) and;

•

Dominion Energy Virginia ($46 million after-tax).

In September 2020, Dominion Energy updated its segments. The historical information presented herein has been recast to reflect the current segment presentation. The following table presents segment information pertaining to Dominion Energy’s operations:

	Dominion Energy Virginia			Gas Distribution		Dominion Energy South Carolina		Contracted Assets		Corporate and Other			Adjustments & Eliminations			Consolidated Total
(millions)
Three Months Ended March 31, 2021
Total revenue from external customers	$	1,987		$	975	$	752	$	268	$	(130	)	$	17		$	3,869
Intersegment revenue		(2	)		1		2		21		230			(251	)		1
Total operating revenue		1,985			976		754		289		100			(234	)		3,870
Net income from discontinued operations		—			—		—		—		28			—			28
Net income attributable to Dominion Energy		434			251		102		150		71			—			1,008
Three Months Ended March 31, 2020
Total revenue from external customers	$	1,938		$	886	$	713	$	288	$	109		$	15		$	3,949
Intersegment revenue		(3	)		4		1		8		242			(263	)		(11	)
Total operating revenue		1,935			890		714		296		351			(248	)		3,938
Net income from discontinued operations		—			—		—		51		178			—			229
Net income (loss) attributable to Dominion Energy		429			224		94		111		(1,128	)		—			(270	)

Intersegment sales and transfers for Dominion Energy are based on contractual arrangements and may result in intersegment profit or loss that is eliminated in consolidation, including amounts related to entities presented within discontinued operations.

Virginia Power

The Corporate and Other Segment of Virginia Power primarily includes specific items attributable to its operating segment that are not included in profit measures evaluated by executive management in assessing the segment’s performance or in allocating resources.

In the three months ended March 31, 2021, Virginia Power reported after-tax net expenses of $58 million in the Corporate and Other segment, including $117 million of after-tax net expenses for specific items all of which was attributable to its operating segment. In the three months ended March 31, 2020, Virginia Power reported after-tax net expenses of $707 million in the Corporate and Other segment, including $634 million of after-tax net expenses for specific items all of which was attributable to its operating segment.

The net expenses for specific items attributable to Virginia Power’s operating segment in 2021 primarily related to the impact of the following items:

•	A $151 million ($112 million after-tax) loss from an unbilled revenue reduction;

•	A $76 million ($56 million after-tax) charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process; and

•	A $51 million ($38 million after-tax) charge associated with storm damage and service restoration in its service territory; partially offset by

•	A $130 million ($97 million after-tax) benefit for a change in the CCRO reserve associated with the 2021 Triennial Review.

The net expenses for specific items attributable to Virginia Power’s operating segment in 2020 primarily related to the impact of the following items:

•	A $754 million ($561 million after-tax) charge related to the planned early retirement of certain Virginia Power electric generation facilities; and

•	A $62 million ($46 million after-tax) loss related to investments in nuclear decommissioning trust funds.

The following table presents segment information pertaining to Virginia Power’s operations:

	Dominion Energy Virginia		Corporate and Other			Consolidated Total
(millions)
Three Months Ended March 31, 2021
Operating revenue	$	1,981	$	(151	)	$	1,830
Net income (loss)		432		(58	)		374
Three Months Ended March 31, 2020
Operating revenue	$	1,930	$	—		$	1,930
Net income (loss)		427		(707	)		(280	)

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MD&A discusses Dominion Energy’s results of operations and general financial condition and Virginia Power’s results of operations. MD&A should be read in conjunction with the Companies’ Consolidated Financial Statements. Virginia Power meets the conditions to file under the reduced disclosure format, and therefore has omitted certain sections of MD&A.

Contents of MD&A

MD&A consists of the following information:

•	Forward-Looking Statements

•	Accounting Matters – Dominion Energy

•	Dominion Energy

•

Results of Operations

•

Segment Results of Operations

•	Virginia Power

•

Results of Operations

•	Liquidity and Capital Resources – Dominion Energy

•	Future Issues and Other Matters – Dominion Energy

Forward-Looking Statements

This report contains statements concerning the Companies’ expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In most cases, the reader can identify these forward-looking statements by such words as “anticipate,” “estimate,” “forecast,” “expect,” “believe,” “should,” “could,” “plan,” “may,” “continue,” “target” or other similar words.

The Companies make forward-looking statements with full knowledge that risks and uncertainties exist that may cause actual results to differ materially from predicted results. Factors that may cause actual results to differ are often presented with the forward-looking statements themselves. Additionally, other factors may cause actual results to differ materially from those indicated in any forward-looking statement. These factors include but are not limited to:

•	Unusual weather conditions and their effect on energy sales to customers and energy commodity prices;

•	Extreme weather events and other natural disasters, including, but not limited to, hurricanes, high winds, severe storms, earthquakes, flooding, climate changes and changes in water temperatures and availability that can cause outages and property damage to facilities;

•	The impact of extraordinary external events, such as the current pandemic health event resulting from COVID-19, and their collateral consequences, including extended disruption of economic activity in our markets;

•	Federal, state and local legislative and regulatory developments, including changes in or interpretations of federal and state tax laws and regulations;

•	Risks of operating businesses in regulated industries that are subject to changing regulatory structures;

•	Changes to regulated electric rates collected by the Companies and regulated gas distribution, transportation and storage rates collected by Dominion Energy;

•	Changes in rules for RTOs and ISOs in which the Companies join and/or participate, including changes in rate designs, changes in FERC’s interpretation of market rules and new and evolving capacity models;

•	Risks associated with Virginia Power’s membership and participation in PJM, including risks related to obligations created by the default of other participants;

•	Risks associated with entities in which Dominion Energy shares ownership with third parties, including risks that result from lack of sole decision making authority, disputes that may arise between Dominion Energy and third party participants and difficulties in exiting these arrangements;

•	Changes in future levels of domestic and international natural gas production, supply or consumption;

•	Impacts to Dominion Energy’s noncontrolling interest in Cove Point from fluctuations in future volumes of LNG imports or exports from the U.S. and other countries worldwide or demand for, purchases of, and prices related to natural gas or LNG;

•	Timing and receipt of regulatory approvals necessary for planned construction or growth projects and compliance with conditions associated with such regulatory approvals;

•	The inability to complete planned construction, conversion or growth projects at all, or with the outcomes or within the terms and time frames initially anticipated, including as a result of increased public involvement, intervention or litigation in such projects;

•	Changes to federal, state and local environmental laws and regulations, including those related to climate change, the tightening of emission or discharge limits for GHGs and other substances, more extensive permitting requirements and the regulation of additional substances;

•	Cost of environmental compliance, including those costs related to climate change;

•	Changes in implementation and enforcement practices of regulators relating to environmental standards and litigation exposure for remedial activities;

•	Difficulty in anticipating mitigation requirements associated with environmental and other regulatory approvals or related appeals;

•	Unplanned outages at facilities in which the Companies have an ownership interest;

•	The impact of operational hazards, including adverse developments with respect to pipeline and plant safety or integrity, equipment loss, malfunction or failure, operator error and other catastrophic events;

•	Risks associated with the operation of nuclear facilities, including costs associated with the disposal of spent nuclear fuel, decommissioning, plant maintenance and changes in existing regulations governing such facilities;

•	Changes in operating, maintenance and construction costs;

•	Domestic terrorism and other threats to the Companies’ physical and intangible assets, as well as threats to cybersecurity;

•

Additional competition in industries in which the Companies operate, including in electric markets in which Dominion Energy’s merchant generation facilities operate and potential competition from the development and deployment of alternative energy sources, such as self-generation and distributed generation technologies, and availability of market alternatives to large commercial and industrial customers;

•	Competition in the development, construction and ownership of certain electric transmission facilities in the Companies’ service territory in connection with Order 1000;

•	Changes in technology, particularly with respect to new, developing or alternative sources of generation and smart grid technologies;

•

Changes in demand for the Companies’ services, including industrial, commercial and residential growth or decline in the Companies’ service areas, changes in supplies of natural gas delivered to Dominion Energy’s pipeline system, failure to maintain or replace customer contracts on favorable terms, changes in customer growth or usage patterns, including as a result of energy conservation programs, the availability of energy efficient devices and the use of distributed generation methods;

•	Receipt of approvals for, and timing of, closing dates for acquisitions and divestitures;

•	Impacts of acquisitions, divestitures, transfers of assets to joint ventures and retirements of assets based on asset portfolio reviews;

•	The expected timing and likelihood of completion of the Q-Pipe Transaction, including the ability to obtain the requisite regulatory approvals and the terms and conditions of such regulatory approvals;

•	Adverse outcomes in litigation matters or regulatory proceedings, including matters acquired in the SCANA Combination;

•	Counterparty credit and performance risk;

•	Fluctuations in the value of investments held in nuclear decommissioning trusts by the Companies and in benefit plan trusts by Dominion Energy;

•	Fluctuations in energy-related commodity prices and the effect these could have on Dominion Energy’s earnings and the Companies’ liquidity position and the underlying value of their assets;

•	Fluctuations in interest rates;

•	Changes in rating agency requirements or credit ratings and their effect on availability and cost of capital;

•	Global capital market conditions, including the availability of credit and the ability to obtain financing on reasonable terms;

•	Political and economic conditions, including inflation and deflation;

•	Employee workforce factors including collective bargaining agreements and labor negotiations with union employees; and

•	Changes in financial or regulatory accounting principles or policies imposed by governing bodies.

Additionally, other risks that could cause actual results to differ from predicted results are set forth in Part I. Item 1A. Risk Factors in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

The Companies’ forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. The Companies caution the reader not to place undue reliance on their forward-looking statements because the assumptions, beliefs, expectations and projections about future events may, and often do, differ materially from actual results. The Companies undertake no obligation to update any forward-looking statement to reflect developments occurring after the statement is made.

Accounting Matters

Critical Accounting Policies and Estimates

As of March 31, 2021, there have been no significant changes with regard to the critical accounting policies and estimates disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. The policies disclosed included the accounting for regulated operations, AROs, income taxes, accounting for derivative contracts and financial instruments at fair value, use of estimates in goodwill impairment testing, use of estimates in long-lived asset and equity method investment impairment testing and employee benefit plans.

Dominion Energy

Results of Operations

Presented below is a summary of Dominion Energy’s consolidated results:

	2021		2020			$ Change
(millions, except EPS)
First Quarter
Net income (loss) attributable to Dominion Energy	$	1,008	$	(270	)	$	1,278
Diluted EPS		1.23		(0.34	)		1.57

Overview

First Quarter 2021 vs. 2020

Net income attributable to Dominion Energy increased $1.3 billion, primarily due to the absence of charges related to the planned early retirements of certain electric generation facilities in Virginia, an increase in net investment earnings on nuclear decommissioning trust funds and an increase in net unrealized earnings associated with freestanding interest rate derivatives.

Analysis of Consolidated Operations

Presented below are selected amounts related to Dominion Energy’s results of operations:

	First Quarter
	2021		2020			$ Change
(millions)
Operating revenue	$	3,870	$	3,938		$	(68	)
Electric fuel and other energy-related purchases		550		657			(107	)
Purchased electric capacity		11		2			9
Purchased gas		484		434			50
Other operations and maintenance		987		891			96
Depreciation, depletion and amortization		608		578			30
Other taxes		257		240			17
Impairment of assets and other charges		95		768			(673	)
Other income (expense)		367		(454	)		821
Interest and related charges		53		432			(379	)
Income tax expense (benefit)		212		(50	)		262
Net income from discontinued operations including noncontrolling interests		28		229			(201	)
Noncontrolling interests		—		31			(31	)

An analysis of Dominion Energy’s results of operations follows:

First Quarter 2021 vs. 2020

Operating revenue decreased 2%, primarily reflecting:

•	A $151 million decrease from an unbilled revenue reduction at Virginia Power;

•	A $51 million decrease due to unfavorable pricing at Millstone;

•	A $31 million decrease as a result of the contribution of certain nonregulated natural gas retail energy contracts to Wrangler; and

•	A $17 million decrease in PJM off-system sales.

These decreases were partially offset by:

•	A $85 million increase in sales to electric utility retail customers, primarily due to an increase in heating degree days;

•	A $71 million increase from Virginia Power riders;

•

A $42 million net increase in the fuel cost component included in utility rates as a result of a net increase in commodity costs associated with sales to gas utility customers ($88 million) partially offset by a net decrease in commodity costs associated with sales to electric utility retail customers ($46 million); and

•	A $35 million increase from gas utility capital cost riders.

Electric fuel and other energy-related purchases decreased 16%, primarily due to lower commodity costs for electric utilities ($49 million), which are offset in operating revenue and do not impact net income, and a decrease in PJM off-system sales ($17 million).

Purchased gas increased 12%, primarily due to an increase in commodity costs for gas utilities ($88 million), which are offset in operating revenue and do not impact net income, partially offset by a decrease as a result of the contribution of certain nonregulated natural gas retail energy contracts to Wrangler ($27 million).

Other operations and maintenance increased 11%, primarily reflecting an increase in certain Virginia Power expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income ($62 million) and an increase in storm damage and restoration costs in Virginia Power’s service territory ($48 million).

Depreciation, depletion and amortization increased 5%, primarily due to various projects being placed into service.

Impairment of assets and other charges decreased 88%, primarily due to the absence of charges associated with the planned early retirements of certain electric generation facilities in Virginia ($750 million) and a decrease to the CCRO reserve associated with the

2021 Triennial Review ($130 million), partially offset by a charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process ($76 million), charges associated with litigation acquired in the SCANA Combination ($60 million) and a charge for corporate office lease termination ($71 million).

Other income increased $821 million, primarily reflecting net investment gains in 2021 compared to net investment losses in 2020 on nuclear decommissioning trust funds ($671 million), an increase in equity method earnings from Cove Point following closing of the GT&S Transaction ($67 million), an increase in non-service components of pension and other postretirement employee benefit plan credits ($36 million) and the absence of charges associated with litigation acquired in the SCANA Combination ($25 million).

Interest and related charges decreased 88%, primarily reflecting unrealized gains in 2021 compared to unrealized losses in 2020 associated with freestanding derivatives ($375 million) and the absence of charges associated with the early redemption of certain securities in the first quarter of 2020 ($31 million).

Income tax expense increased $262 million, primarily due to higher pre-tax income.

Net income from discontinued operations including noncontrolling interests decreased 88%, primarily due to the closing of the GT&S Transaction in November 2020.

Noncontrolling interests decreased $31 million, primarily due to the closing of the GT&S Transaction in November 2020.

Segment Results of Operations

Segment results include the impact of intersegment revenues and expenses, which may result in intersegment profit and loss. In September 2020, Dominion Energy updated its operating segments following the July 2020 agreement to sell substantially all of its gas transmission and storage operations to BHE. The historical information presented herein has been recast to reflect the current segment presentation. Presented below is a summary of contributions by Dominion Energy’s operating segments to net income (loss) attributable to Dominion Energy:

	Net Income (Loss) Attributable to Dominion Energy							Diluted EPS
	2021		2020			$ Change		2021		2020			$ Change
(millions, except EPS)
First Quarter
Dominion Energy Virginia	$	434	$	429		$	5	$	0.54	$	0.51		$	0.03
Gas Distribution		251		224			27		0.31		0.27			0.04
Dominion Energy South Carolina		102		94			8		0.13		0.11			0.02
Contracted Assets		150		111			39		0.18		0.13			0.05
Corporate and Other		71		(1,128	)		1,199		0.07		(1.36	)		1.43
Consolidated	$	1,008	$	(270	)	$	1,278	$	1.23	$	(0.34	)	$	1.57

Dominion Energy Virginia

Presented below are selected operating statistics related to Dominion Energy Virginia’s operations:

	First Quarter
	2021		2020		% Change
Electricity delivered (million MWh)		21.7		20.8		4	%
Electricity supplied (million MWh):
Utility		21.9		22.3		(2	)
Non-Jurisdictional		0.2		0.1		100
Degree days (electric distribution and utility service area):
Cooling		11		14		(21	)
Heating		1,889		1,518		24
Average electric distribution customer accounts (thousands)		2,684		2,647		1

Presented below, on an after-tax basis, are the key factors impacting Dominion Energy Virginia’s net income contribution:

	First Quarter 2021 vs. 2020 Increase (Decrease)
	Amount			EPS
(millions, except EPS)
Regulated electric sales:
Weather	$	51		$	0.06
Other		(1	)		—
Electric capacity		(5	)		(0.01	)
Depreciation and amortization		(6	)		(0.01	)
Renewable energy investment tax credits		(32	)		(0.03	)
Other		(2	)		—
Share accretion		—			0.02
Change in net income contribution	$	5		$	0.03

Gas Distribution

Presented below are selected operating statistics related to Gas Distribution’s operations:

	First Quarter
	2021		2020		% Change
Gas distribution throughput (bcf):
Sales		86		80		8	%
Transportation		273		250		9
Heating degree days (gas distribution service area):
North Carolina		1,692		1,334		27
Ohio and West Virginia		2,758		2,442		13
Utah, Wyoming and Idaho		2,398		2,332		3
Average gas distribution customer accounts (thousands):
Sales		1,922		1,891		2
Transportation		1,137		1,115		2

Presented below, on an after-tax basis, are the key factors impacting Gas Distribution’s net income contribution:

	First Quarter 2021 vs. 2020 Increase (Decrease)
	Amount		EPS
(millions, except EPS)
Regulated gas sales:
Weather	$	4	$	0.01
Other		3		—
Rider equity return		11		0.01
Interest expense, net		9		0.01
Share accretion		—		0.01
Change in net income contribution	$	27	$	0.04

Dominion Energy South Carolina

Presented below are selected operating statistics related to Dominion Energy South Carolina’s operations:

	First Quarter
	2021		2020		% Change
Electricity delivered (million MWh)		5.3		5.1		4	%
Electricity supplied (million MWh)		5.6		5.3		6
Degree days (electric distribution service areas):
Cooling		1		5		(80	)
Heating		786		578		36
Average electric distribution customer accounts (thousands)		761		746		2
Gas distribution throughput (bcf):
Sales		20		19		5
Average gas distribution customer accounts (thousands)		408		394		4

Presented below, on an after-tax basis, are the key factors impacting Dominion Energy South Carolina’s net income contribution:

	First Quarter 2021 vs. 2020 Increase (Decrease)
	Amount			EPS
(millions, except EPS)
Regulated electric sales:
Weather	$	13		$	0.02
Other		(4	)		—
Regulated gas sales		4			—
Other		(5	)		(0.01	)
Share accretion		—			0.01
Change in net income contribution	$	8		$	0.02

Contracted Assets

Presented below are selected operating statistics related to Contracted Asset’s operations:

	First Quarter
	2021		2020		% Change
Electricity supplied (million MWh)		5.1		5.3		(4	%)

Presented below, on an after-tax basis, are the key factors impacting Contracted Asset’s net income contribution:

	First Quarter 2021 vs. 2020 Increase (Decrease)
	Amount		EPS
(millions, except EPS)
Renewable energy investment tax credits	$	29	$	0.03
Absence of contract associated with Fowler Ridge		5		0.01
Other		5		—
Share accretion		—		0.01
Change in net income contribution	$	39	$	0.05

Corporate and Other

Presented below are the Corporate and Other segment’s after-tax results:

	First Quarter
	2021			2020			$ Change
(millions, except EPS)
Specific items attributable to operating segments	$	(87	)	$	(1,004	)	$	917
Specific items attributable to Corporate and Other segment		202			(54	)		256
Total specific items		115			(1,058	)		1,173
Other corporate operations:
Interest expense, net		(111	)		(92	)		(19	)
Other		67			22			45
Total other corporate operations		(44	)		(70	)		26
Total net income (expense)	$	71		$	(1,128	)	$	1,199
EPS impact	$	0.07		$	(1.36	)	$	1.43

Total Specific Items

Corporate and Other includes specific items attributable to Dominion Energy’s primary operating segments that are not included in profit measures evaluated by executive management in assessing the segments' performance or in allocating resources. See Note 21 to the Consolidated Financial Statements in this report for discussion of these items in more detail. Corporate and Other also includes items attributable to the Corporate and Other segment. In 2021, this primarily included a $234 million after-tax benefit for derivative mark-to-market changes, a $53 million after-tax charge for corporate office lease termination associated with workplace realignment and a $28 million after-tax benefit for discontinued operations, primarily associated with the Q-Pipe Transaction. In 2020, other than the effects of required interim period provision for income taxes, this primarily included a $145 million after-tax benefit for discontinued operations, primarily associated with the GT&S and Q-Pipe Transactions, $41 million of after-tax charges for merger and integration-related costs associated with the SCANA Combination, $30 million of after-tax charges for derivative mark-to-market changes and $23 million of after-tax charges associated with the early redemption of certain debt securities.

Virginia Power

Results of Operations

Presented below is a summary of Virginia Power’s consolidated results:

	First Quarter
	2021		2020			$ Change
(millions)
Net income (loss)	$	374	$	(280	)	$	654

Overview

First Quarter 2021 vs. 2020

Net income increased $654 million, primarily due to the absence of charges related to the planned early retirements of certain electric generation facilities.

Analysis of Consolidated Operations

Presented below are selected amounts related to Virginia Power’s results of operations:

	First Quarter
	2021			2020			$ Change
(millions)
Operating revenue	$	1,830		$	1,930		$	(100	)
Electric fuel and other energy-related purchases		406			492			(86	)
Excess electric capacity		(3	)		(9	)		6
Other operations and maintenance		513			418			95
Depreciation and amortization		324			311			13
Other taxes		93			87			6
Impairment of assets and other charges (benefit)		(51	)		764			(815	)
Other income (expense)		32			(52	)		84
Interest and related charges		136			126			10
Income tax expense (benefit)		70			(31	)		101

An analysis of Virginia Power’s results of operations follows:

First Quarter 2021 vs. 2020

Operating revenue decreased 5%, primarily reflecting:

•	A $151 million decrease from an unbilled revenue reduction;

•	A $74 million decrease in the fuel cost component included in utility rates as a result of a net decrease in commodity costs associated with sales to electric utility retail customers; and

•	A $17 million decrease in PJM off-system sales; partially offset by

•	A $71 million increase from riders; and

•	A $68 million increase in sales to retail customers, primarily due to an increase in heating degree days.

Electric fuel and other energy-related purchases decreased 17%, primarily due to lower commodity costs for electric utilities ($74 million), which are offset in operating revenue and do not impact net income, and a decrease in PJM off-system sales ($17 million).

Other operations and maintenance increased 23%, primarily reflecting an increase in certain expenses which are primarily recovered through state- and FERC-regulated rates and do not impact net income ($62 million) and an increase in storm damage and service restoration costs in its service territory ($48 million), partially offset by a reduction in bad debt expense due to the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process ($10 million).

Depreciation and amortization increased 4%, primarily due to various projects being placed into service ($19 million), partially offset by the absence of depreciation from certain electric generation facilities that were, or have committed to be, retired early ($11 million).

Impairment of assets and other charges decreased $815 million, primarily due to the absence of charges associated with the planned early retirements of certain electric generation facilities ($750 million) and a decrease to the CCRO reserve associated with the 2021 Triennial Review ($130 million), partially offset by a charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process ($76 million).

Other income increased $84 million, primarily reflecting net investment gains in 2021 compared to net investment losses in 2020 on nuclear decommissioning trust funds.

Income tax expense increased $101 million, primarily due to higher pre-tax income.

Liquidity and Capital Resources

Dominion Energy depends on both internal and external sources of liquidity to provide working capital and as a bridge to long-term debt financings. Short-term cash requirements not met by cash provided by operations are generally satisfied with proceeds from short-term borrowings. Long-term cash needs are met through issuances of debt and/or equity securities.

At March 31, 2021, Dominion Energy had $3.4 billion of unused capacity under its joint revolving credit facility.

A summary of Dominion Energy’s cash flows is presented below:

	2021			2020
(millions)
Cash, restricted cash and equivalents at January 1	$	247		$	269
Cash flows provided by (used in):
Operating activities⁽¹⁾		1,452			1,633
Investing activities⁽²⁾		(2,308	)		(1,641	)
Financing activities⁽³⁾		1,171			1,006
Net increase in cash, restricted cash and equivalents		315			998
Cash, restricted cash and equivalents at March 31	$	562		$	1,267

(1)	Includes $(12) million and $413 million related to discontinued operations for 2021 and 2020, respectively.

(2)	Includes $(968) million and $(268) million related to discontinued operations for 2021 and 2020, respectively.

(3)	Includes $(69) million related to discontinued operations for 2020 and no amounts for 2021.

Operating Cash Flows

Net cash provided by Dominion Energy’s operating activities decreased $181 million, including a $425 million decrease from discontinued operations. Net cash provided by continuing operations increased primarily due to a decrease in cash paid for interest, a distribution from Cove Point, the absence of payments related to a voluntary retirement program and net changes in working capital items, partially offset by lower deferred fuel cost recoveries.

Dominion Energy believes that its operations provide a stable source of cash flow to contribute to planned levels of capital expenditures and maintain or grow the dividend on common shares.

Dominion Energy’s operations are subject to risks and uncertainties that may negatively impact the timing or amounts of operating cash flows, which are discussed in Part I. Item 1A. Risk Factors in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Credit Risk

Dominion Energy’s exposure to potential concentrations of credit risk results primarily from its energy marketing and price risk management activities. Presented below is a summary of Dominion Energy’s credit exposure as of March 31, 2021 for these activities. Gross credit exposure for each counterparty is calculated prior to the application of collateral and represents outstanding receivables plus any unrealized on- or off-balance sheet exposure, taking into account contractual netting rights.

	Gross Credit Exposure		Credit Collateral		Net Credit Exposure
(millions)
Investment grade⁽¹⁾	$	52	$	—	$	52
Non-investment grade⁽²⁾		2		—		2
No external ratings:
Internally rated—investment grade⁽³⁾		60		4		56
Internally rated—non-investment grade⁽⁴⁾		14		—		14
Total⁽⁵⁾	$	128	$	4	$	124

(1)	Designations as investment grade are based upon minimum credit ratings assigned by Moody’s Investors Service and Standard & Poor’s. The five largest counterparty exposures, combined, for this category represented approximately 41% of the total net credit exposure.

(2)	The five largest counterparty exposures, combined, for this category represented less than 2% of the total net credit exposure.

(3)	The five largest counterparty exposures, combined, for this category represented approximately 25% of the total net credit exposure.

(4)	The five largest counterparty exposures, combined, for this category represented approximately 3% of the total net credit exposure.

(5) Excludes the Millstone 2019 power purchase agreements.

Investing Cash Flows

Net cash used in Dominion Energy’s investing activities increased $667 million, primarily due to an increase in contributions to equity method affiliates including Atlantic Coast Pipeline, partially offset by a decrease in plant construction and other property additions and the absence of the acquisitions of Pivotal LNG, Inc. and an additional interest in Atlantic Coat Pipeline.

Financing Cash Flows and Liquidity

Dominion Energy relies on capital markets as significant sources of funding for capital requirements not satisfied by cash provided by its operations. As discussed further in Credit Ratings and Debt Covenants in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, the ability to borrow funds or issue securities and the return demanded by investors are affected by credit ratings. In addition, the raising of external capital is subject to certain regulatory requirements, including registration with the SEC for certain issuances.

Dominion Energy currently meets the definition of a well-known seasoned issuer under SEC rules governing the registration, communication and offering processes under the Securities Act of 1933, as amended. The rules provide for a streamlined shelf registration process to provide registrants with timely access to capital. This allows Dominion Energy to use automatic shelf registration statements to register any offering of securities, other than those for exchange offers or business combination transactions.

Net cash provided by Dominion Energy's financing activities increased $165 million primarily due to lower common stock dividend payments and higher net issuances of short-term debt, partially offset by repayment of the 364-day revolving supplemental credit facility borrowings.

Dominion Energy has an effective shelf registration statement with the SEC for the sale of up to $3.0 billion of variable denomination floating rate demand notes, called Dominion Energy Reliability Investment^SM. The registration limits the principal amount that may be outstanding at any one time to $1.0 billion. The notes are offered on a continuous basis and bear interest at a floating rate per annum determined by the Dominion Energy Reliability Investment Committee, or its designee, on a weekly basis. The notes have no stated maturity date, are non-transferable and may be redeemed in whole or in part by Dominion Energy or at the investor’s option at any time. At March 31, 2021 and December 31, 2020, Dominion Energy’s Consolidated Balance Sheets include $338 million and $268 million, respectively, with respect to such notes presented within short-term debt. The proceeds are used for general corporate purposes and to repay debt.

See Note 16 to the Consolidated Financial Statements in this report for further information regarding Dominion Energy’s credit facilities, liquidity and significant financing transactions.

Credit Ratings

Credit ratings are intended to provide banks and capital market participants with a framework for comparing the credit quality of securities and are not a recommendation to buy, sell or hold securities. In the Credit Ratings section of MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, there is a discussion on the use of capital markets by Dominion Energy as well as the impact of credit ratings on the accessibility and costs of using these markets. As of March 31, 2021, there have been no changes in Dominion Energy’s credit ratings.

Debt Covenants

In the Debt Covenants section of MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, there is a discussion on the various covenants present in the enabling agreements underlying Dominion Energy’s debt. As of March 31, 2021, there have been no material changes to debt covenants, nor any events of default under Dominion Energy’s debt covenants.

Subsidiary Dividend Restrictions

As of March 31, 2021, there have been no material changes to the subsidiary dividend restrictions disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Future Cash Payments for Contractual Obligations and Planned Capital Expenditures

As of March 31, 2021, there have been no material changes outside the ordinary course of business to Dominion Energy’s contractual obligations nor any material changes to planned capital expenditures as disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

Use of Off-Balance Sheet Arrangements

As of March 31, 2021, there have been no material changes to the off-balance sheet arrangements disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, with the exception of the following matter.

Future Issues and Other Matters

The following discussion of future issues and other information includes current developments of previously disclosed matters and new issues arising during the period covered by, and subsequent to, the dates of Dominion Energy’s Consolidated Financial Statements that may impact future results of operations, financial condition and/or cash flows. This section should be read in conjunction with Item 1. Business and Future Issues and Other Matters in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and Note 17 to the Consolidated Financial Statements in this report.

Environmental Matters

Dominion Energy is subject to costs resulting from a number of federal, state and local laws and regulations designed to protect human health and the environment. These laws and regulations affect future planning and existing operations. They can result in increased capital, operating and other costs as a result of compliance, remediation, containment and monitoring obligations. See Note 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and Note 17 to the Consolidated Financial Statements in this report for additional information on various environmental matters.

Legal Matters

See Notes 13 and 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and Notes 13 and 17 to the Consolidated Financial Statements and Item 1. Legal Proceedings in this report for additional information on various legal matters.

Regulatory Matters

See Notes 3 and 13 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and Note 13 to the Consolidated Financial Statements in this report for additional information on various regulatory matters.

Future Environmental Regulations

State Actions Related to Air and GHG Emissions

In October 2020, the EPA published a proposal to revise the 2016 Cross-State Air Pollution Rule Update to address interstate air quality impacts for the 2008 ozone National Ambient Air Quality Standards. In April 2021, the EPA published the final rule update, which will become effective in June 2021. The EPA’s final rule affects 12 states including Virginia and West Virginia and amends existing NO_X ozone season emission budgets. The EPA requires implementation of the revised emission budgets beginning with the 2021 ozone season (May 1 through September 30, 2021). Dominion Energy has completed an evaluation of the potential impacts of the final rule and expects that any impact would not be material to its results of operations, financial condition and/or cash flows.

Coastal Virginia Offshore Wind Commercial Project

In September 2019, Virginia Power filed applications with PJM for the Coastal Virginia Offshore Wind Commercial project to interconnect 2,640 MW of wind energy off the coast of Virginia adjacent to the Coastal Virginia Offshore Wind Pilot project. The project is expected to be placed in service by the end of 2026 with preliminary cost estimates from late 2019 of approximately $8 billion. Throughout project development, certain planning inputs and assumptions may vary from initial and preliminary estimates. During 2021, inflationary pressure on certain raw materials including steel have been observed which may impact project costs. In addition, Virginia Power has moved into the detailed design phase for the project’s onshore electric transmission facilities including final route selection with consideration given for resiliency and minimizing environmental impacts. Although total costs for this component cannot be more precisely estimated until a final route is selected, these design factors will likely result in an increase in costs. While certain cost inputs may increase, further evaluation of turbine design and wind resource in addition to the performance to-date of the Coastal Virginia Offshore Wind Pilot project, is likely to result in a revised assumption of higher lifetime capacity factors which is expected to mitigate potential increases in development costs such that there is no expected change to Virginia Power’s preliminary estimate for the project’s projected levelized cost of energy. Virginia Power expects to file with the Virginia Commission a request for CPCN and related rider, which filing will include an updated cost estimate for the project, by the end of 2021.

Dominion Energy Virginia – Nuclear Operating Licenses

In 2018, Virginia Power applied for renewal of its operating licenses for an additional 20 years for the two nuclear units at Surry. In May 2021, the NRC approved Virginia Power’s application, allowing the units to generate electricity through 2052 and 2053.

ITEM 3.

QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

The matters discussed in this Item may contain “forward-looking statements” as described in the introductory paragraphs under Part I., Item 2. MD&A in this report. The reader’s attention is directed to those paragraphs for discussion of various risks and uncertainties that may impact the Companies.

Market Risk Sensitive Instruments and Risk Management

The Companies’ financial instruments, commodity contracts and related financial derivative instruments are exposed to potential losses due to adverse changes in commodity prices, interest rates and equity security prices as described below. Commodity price risk is present in the Companies’ electric operations and Dominion Energy’s natural gas procurement and marketing operations due to the exposure to market shifts in prices received and paid for electricity, natural gas and other commodities. The Companies use commodity derivative contracts to manage price risk exposures for these operations. Interest rate risk is generally related to their outstanding debt and future issuances of debt. In addition, the Companies are exposed to investment price risk through various portfolios of equity and debt securities.

The following sensitivity analysis estimates the potential loss of future earnings or fair value from market risk sensitive instruments over a selected time period due to a 10% change in commodity prices or interest rates.

Commodity Price Risk

To manage price risk, the Companies hold commodity-based derivative instruments held for non-trading purposes associated with purchases and sales of electricity, natural gas and other energy-related products.

The derivatives used to manage commodity price risk are executed within established policies and procedures and may include instruments such as futures, forwards, swaps, options and FTRs that are sensitive to changes in the related commodity prices. For sensitivity analysis purposes, the hypothetical change in market prices of commodity-based derivative instruments is determined based on models that consider the market prices of commodities in future periods, the volatility of the market prices in each period, as well as the time value factors of the derivative instruments. Prices and volatility are principally determined based on observable market prices.

A hypothetical 10% increase in commodity prices would have resulted in a decrease in fair value of $15 million of Dominion Energy’s commodity-based derivative instruments as of March 31, 2021. A hypothetical 10% decrease in commodity prices would have resulted in a decrease in fair value of $2 million of Dominion Energy’s commodity-based derivative instruments as of December 31, 2020.

A hypothetical 10% decrease in commodity prices would have resulted in a decrease in fair value of $26 million and $35 million of Virginia Power’s commodity-based derivative instruments as of March 31, 2021 and December 31, 2020, respectively.

The impact of a change in energy commodity prices on the Companies' commodity-based derivative instruments at a point in time is not necessarily representative of the results that will be realized when the contracts are ultimately settled. Net losses from commodity-based financial derivative instruments used for hedging purposes, to the extent realized, will generally be offset by recognition of the hedged transaction, such as revenue from physical sales of the commodity.

Interest Rate Risk

The Companies manage their interest rate risk exposure predominantly by maintaining a balance of fixed and variable rate debt. They also enter into interest rate sensitive derivatives, including interest rate swaps and interest rate lock agreements. For variable rate debt outstanding for Dominion Energy and Virginia Power, a hypothetical 10% increase in market interest rates would not have resulted in a material change in earnings at March 31, 2021 or December 31, 2020.

The Companies also use interest rate derivatives, including forward-starting swaps, interest rate swaps and interest rate block agreements to manage interest rate risk. As of March 31, 2021, Dominion Energy and Virginia Power had $6.7 billion and $2.1 billion, respectively, in aggregate notional amounts of these interest rate derivatives outstanding. A hypothetical 10% decrease in market interest rates would have resulted in a decrease of $177 million and $100 million, respectively, in the fair value of Dominion Energy and Virginia Power interest rate derivatives at March 31, 2021. As of December 31, 2020, Dominion Energy and Virginia Power had $6.9 billion and $2.1 billion, respectively, in aggregate notional amounts of these interest rate derivatives outstanding. A hypothetical 10% decrease in market interest rates would have resulted in a decrease of $124 million and $75 million, respectively, in the fair value of Dominion Energy and Virginia Power’s interest rate derivatives at December 31, 2020.

The impact of a change in interest rates on the Companies’ interest rate-based financial derivative instruments at a point in time is not necessarily representative of the results that will be realized when the contracts are ultimately settled. Net gains and/or losses from interest rate derivative instruments used for hedging purposes, to the extent realized, will generally be offset by recognition of the hedged transaction.

Investment Price Risk

The Companies are subject to investment price risk due to securities held as investments in nuclear decommissioning and rabbi trust funds that are managed by third-party investment managers. These trust funds primarily hold marketable securities that are reported in the Companies’ Consolidated Balance Sheets at fair value.

Dominion Energy recognized net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $304 million for the three months ended March 31, 2021, net investment losses (including investment income) on nuclear decommissioning and rabbi trust investments of $876 million for the three months ended March 31, 2020, and net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $0.7 billion for the year ended December 31, 2020. Net realized gains and losses include gains and losses from the sale of investments. Dominion Energy recorded in AOCI and regulatory liabilities, a net decrease in unrealized gains on debt investments of $64 million for the three months ended March 31, 2021 and a net increase in unrealized gains on debt investments of $57 million for the year ended December 31, 2020.

Virginia Power recognized net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $153 million for the three months ended March 31, 2021, net investment losses (including investment income) on nuclear decommissioning and rabbi trust investments of $412 million for the three months ended March 31, 2020, and net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $287 million for the year ended December 31, 2020. Net realized gains and losses include gains and losses from the sale of investments. Virginia Power recorded in AOCI and regulatory liabilities, a net decrease in unrealized gains on debt investments of $28 million and $1 million for the three months ended March 31, 2021 and 2020, respectively, and a net increase in unrealized gains on debt investments of $29 million for the year ended December 31, 2020.

Dominion Energy sponsors pension and other postretirement employee benefit plans that hold investments in trusts to fund employee benefit payments. Virginia Power employees participate in these plans. Differences between actual and expected returns on plan assets are accumulated and amortized during future periods. As such, any investment-related declines in these trusts will result in future increases in the net periodic cost recognized for employee benefit plans and will be included in the determination of the amount of cash to be contributed to the employee benefit plans.

ITEM 4. CONTROLS AND PROCEDURES

Senior management of both Dominion Energy and Virginia Power, including Dominion Energy and Virginia Power’s CEO and CFO, evaluated the effectiveness of each company’s disclosure controls and procedures as of the end of the period covered by this report. Based on this evaluation process, each of Dominion Energy and Virginia Power’s CEO and CFO have concluded that each company’s disclosure controls and procedures are effective.

In the first quarter of 2021, Dominion Energy completed the integration of SCANA’s systems and processes into Dominion Energy’s framework of internal control over financial reporting. As part of this process, Dominion Energy transitioned SCANA’s financial activity into Dominion Energy’s accounting system. Throughout this integration and system implementation, Dominion Energy appropriately considered internal controls over financial reporting.

Other than with respect to this item for Dominion Energy, there were no changes that occurred during the last fiscal quarter that materially affected, or are reasonably likely to materially affect, Dominion Energy or Virginia Power’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, the Companies are parties to various legal, environmental or other regulatory proceedings, including in the ordinary course of business. SEC regulations require disclosure of certain environmental matters when a governmental authority is a party to the proceedings and such proceedings involve potential monetary sanctions that the Companies reasonably believe will exceed a specified threshold. Pursuant to the SEC regulations, the Companies use a threshold of $1 million for such proceedings.

See the following for discussions on various legal, environmental and other regulatory proceedings to which the Companies are a party, which information is incorporated herein by reference:

•	Notes 13 and 23 to the Consolidated Financial Statements and Future Issues and Other Matters in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

•	Notes 13 and 17 to the Consolidated Financial Statements in this report.

ITEM 1A. RISK FACTORS

The Companies’ businesses are influenced by many factors that are difficult to predict, involve uncertainties that may materially affect actual results and are often beyond the Companies’ control. A number of these risk factors have been identified in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020, which should be taken into consideration when reviewing the information contained in this report. There have been no material changes with regard to the risk factors previously disclosed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. For other factors that may cause actual results to differ materially from those indicated in any forward-looking statement or projection contained in this report, see Forward-Looking Statements in MD&A in this report.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Dominion Energy

Purchases of Equity Securities

Period	Total Number of Shares (or Units) Purchased⁽¹⁾		Average Price Paid per Share (or Unit)⁽²⁾		Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased under the Plans or Programs⁽³⁾
1/1/21-1/31/21		12,193	$	75.20		—	$ 0.92 billion
2/1/21-2/28/21		72,389		72.68		—	0.92 billion
3/1/21-3/31/21		—		—		—	0.92 billion
Total		84,582	$	73.04		—	$ 0.92 billion

(1)	Represents shares of common stock that were tendered by employees to satisfy tax withholding obligations on vested restricted stock.

(2)	Represents the weighted-average price paid per share.

(3)

In November 2020, the Dominion Energy Board of Directors authorized the repurchase of up to $1.0 billion of shares of common stock. This repurchase program has no expiration date or price or volume targets and may be modified, suspended or terminated at any time. Shares may be purchased through open market or privately negotiated transactions or otherwise at the discretion of management subject to prevailing market conditions, applicable securities laws and other factors.

ITEM 6. EXHIBITS

Exhibit Number	Description	Dominion Energy	Virginia Power



3.1.a	Dominion Energy, Inc. Articles of Incorporation, as restated, effective December 13, 2019 (Exhibit 3.1, Form 8-K filed December 13, 2019, File No.1-8489).	X

3.1.b	Virginia Electric and Power Company Amended and Restated Articles of Incorporation, as in effect on October 30, 2014 (Exhibit 3.1.b, Form 10-Q filed November 3, 2014, File No. 1-2255).		X

3.2.a	Dominion Energy, Inc. Bylaws, as amended and restated, effective July 30, 2020 (Exhibit 3.1, Form 8-K filed July 31, 2020, File No. 1-8489).	X

3.2.b	Virginia Electric and Power Company Amended and Restated Bylaws, effective June 1, 2009 (Exhibit 3.1, Form 8-K filed June 3, 2009, File No. 1-2255).		X

4	Dominion Energy, Inc. and Virginia Electric and Power Company agree to furnish to the Securities and Exchange Commission upon request any other instrument with respect to long-term debt as to which the total amount of securities authorized does not exceed 10% of any of their total consolidated assets.	X	X

4.1	Indenture, dated as of June 1, 2015, between Dominion Resources, Inc. and Deutsche Bank Trust Company Americas, as Trustee (Exhibit 4.1, Form 8-K filed June 15, 2015, File No. 1-8489); Second Supplemental Indenture, dated as of September 1, 2015 (Exhibit 4.2, Form 8-K filed September 24, 2015, File No. 1-8489); Fifth Supplemental Indenture, dated as of August 1, 2016 (Exhibit 4.3, Form 8-K filed August 9, 2016, File No. 1-8489); Sixth Supplemental Indenture, dated as of August 1, 2016 (Exhibit 4.4, Form 8-K filed August 9, 2016, File No. 1-8489); Tenth Supplemental Indenture, dated as of January 1, 2017 (Exhibit 4.3, Form 8-K filed January 12, 2017, File No. 1-8489); Eleventh Supplemental Indenture, dated as of March 1, 2017 (Exhibit 4.3, Form 10-Q filed May 4, 2017, File No. 1-8489); Thirteenth Supplemental Indenture, dated December 1, 2017 (Exhibit 4.8, Form 10-K for the fiscal year ended December 31, 2017 filed February 27, 2018, File No. 1-8489); Fifteenth Supplemental Indenture, dated June 1, 2018 (Exhibit 4.2, Form 8-K, filed June 5, 2018, File No. 1-8489); Sixteenth Supplemental Indenture, dated March 1, 2019 (Exhibit 4.2, Form 8-K filed March 13, 2019, File No. 1-8489); Seventeenth Supplemental Indenture, dated as of August 1, 2019 (Exhibit 4.2, Form 10-Q filed November 1, 2019, File No. 1-8489); Eighteenth Supplemental Indenture, dated as of March 1, 2020 (Exhibit 4.2, Form 8-K, filed March 19, 2020, File No. 1-8489); Nineteenth Supplemental Indenture, dated as of March 1, 2020 (Exhibit 4.3, Form 8-K, filed March 19, 2020, File No. 1-8489); Twentieth Supplemental Indenture, dated as of April 1, 2020 (Exhibit 4.2, Form 8-K, filed April 3, 2020, File No. 1-8489); Twenty-First Supplemental Indenture, dated as of September 1, 2020 (Exhibit 4.2, Form 8-K, filed September 17, 2020, File No. 1-8489); Twenty-Second Supplemental Indenture, dated as of April 1, 2021 (Exhibit 4.2, Form 8-K, filed April 5, 2021, File No. 1-8489); Twenty-Third Supplemental Indenture, dated as of April 1, 2021 (Exhibit 4.3, Form 8-K, filed April 5, 2021, File No. 1-8489).	X

31.a	Certification by Chief Executive Officer of Dominion Energy, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).	X

31.b	Certification by Chief Financial Officer of Dominion Energy, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).	X

31.c	Certification by Chief Executive Officer of Virginia Electric and Power Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).		X

31.d	Certification by Chief Financial Officer of Virginia Electric and Power Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).		X

32.a	Certification to the Securities and Exchange Commission by Chief Executive Officer and Chief Financial Officer of Dominion Energy, Inc. as required by Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).	X

32.b	Certification to the Securities and Exchange Commission by Chief Executive Officer and Chief Financial Officer of Virginia Electric and Power Company as required by Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).		X

99	Condensed consolidated earnings statements (filed herewith).	X	X

Exhibit Number	Description	Dominion Energy	Virginia Power

101	The following financial statements from Dominion Energy, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, filed on May 4, 2021, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Equity, (v) Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements. The following financial statements from Virginia Electric and Power Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, filed on May 4, 2021, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Common Shareholder’s Equity (v) Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements.	X	X

104	Cover Page Interactive Data File formatted in iXBRL (Inline eXtensible Business Reporting Language) and contained in Exhibit 101.	X	X

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	DOMINION ENERGY, INC. Registrant

May 4, 2021	/s/ Michele L. Cardiff
	Michele L. Cardiff Senior Vice President, Controller and Chief Accounting Officer

	VIRGINIA ELECTRIC AND POWER COMPANY Registrant

May 4, 2021	/s/ Michele L. Cardiff
	Michele L. Cardiff Senior Vice President, Controller and Chief Accounting Officer