0000715957 d:VirginiaElectricAndPowerCompanyMember us-gaap:CommodityContractMember 2020-01-01 2020-09-30 0000715957 d:ContractedAssetsMember us-gaap:IntersegmentEliminationMember 2021-07-01 2021-09-30

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 September 30, ~~2017~~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. ~~Formerly Known As Dominion Resources, Inc.~~	54-1229715

000-55337	VIRGINIA ELECTRIC AND POWER COMPANY	54-0418825

~~001-37591~~	~~DOMINION ENERGY GAS HOLDINGS, LLC~~ ~~Formerly Known As Dominion Gas Holdings, LLC~~	~~46-3639580~~

	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
	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 ☐

~~Dominion Energy Gas Holdings, LLC Yes~~ ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ 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 ~~and post~~ such files).

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

~~Dominion Energy Gas Holdings, LLC 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	☐	~~(Do not check if a smaller reporting company)~~	Smaller reporting company	☐
			~~Emerging growth 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	☒	~~(Do not check if a smaller reporting company)~~	Smaller reporting company	☐
			~~Emerging growth company~~	☐

~~Dominion Energy Gas Holdings, LLC~~

~~Large accelerated filer~~	☐		~~Accelerated filer~~	☐
~~Non-accelerated filer~~	☒	~~(Do not check if a smaller reporting company)~~	~~Smaller reporting company~~	☐
			~~Emerging growth 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 ☒

~~Dominion Energy Gas Holdings, LLC Yes~~ ☐ No ☒

At October ~~13, 2017,~~29, 2021, the latest practicable date for determination, Dominion Energy, Inc. had ~~643,529,769~~809,908,408 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. ~~Dominion Energy, Inc. holds all of the membership interests of Dominion Energy Gas Holdings, LLC.~~

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

VIRGINIA ELECTRIC AND POWER COMPANY ~~AND DOMINION ENERGY GAS HOLDINGS, LLC MEET~~MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND ~~ARE~~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	710
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	8083
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	9699
Item 4.	Controls and Procedures	97100

	PART II. Other Information

Item 1.	Legal Proceedings	98101
Item 1A.	Risk Factors	98101
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	98102
Item 5.	Other Information	102
Item 6.	Exhibits	99103

GLOSSARY OF TERMS

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

Abbreviation or Acronym		Definition
~~2013~~2019 Equity Units		Dominion ~~Energy's 2013 Series A Equity Units and 2013 Series B Equity Units issued in June 2013~~
~~2014 Equity Units~~		~~Dominion Energy's 2014~~Energy’s 2019 Series A Equity Units issued in ~~July 2014~~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
~~2016 Equity Units~~2017 Tax Reform Act		~~Dominion Energy's 2016 Series A Equity Units issued in August 2016~~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.
AMI		Advanced Metering Infrastructure
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 ~~and Southern Company Gas~~Energy
~~BACT~~Atlantic Coast Pipeline Project		~~Best available control technology~~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
~~bcfe~~Birdseye		~~Billion cubic feet equivalent~~Birdseye Renewable Energy, LLC
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
BP		BP Wind Energy North America Inc.
Brookfield		Brookfield Super-Core Infrastructure Partners, an infrastructure fund managed by Brookfield Asset Management Inc.
Brunswick County		A 1,376 MW ~~combined cycle,~~combined-cycle, natural gas-fired power station in Brunswick County, Virginia
CAA		Clean Air Act
~~CAISO~~		~~California Independent System Operator~~
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
Clearway		The legal entity, Clearway Energy, Inc. (a subsidiary of Global Infrastructure Partners), one or more of its consolidated subsidiaries, or the entirety of Clearway Energy, Inc. and its consolidated subsidiaries
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, ~~and Dominion Energy Gas,~~ 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		~~Dominion Energy~~ Cove Point LNG, LP (formerly known as Dominion Energy Cove Point LNG, LP)
CPCN		Certificate of Public Convenience and Necessity
CVOW Commercial Project		A proposed 2.6 GW wind generation facility 27 miles off the coast of Virginia Beach, Virginia in federal waters adjacent to the CVOW Pilot Project and associated interconnection facilities in and around Virginia Beach, Virginia
CVOW Pilot Project		A 12 MW wind generation facility 27 miles off the coast of Virginia Beach, Virginia in federal waters
CWA		Clean Water Act
~~DECG~~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 ~~Carolina Gas Transmission, LLC (formerly known as Dominion Carolina Gas Transmission, LLC)~~Questar Pipeline Services, Inc.
DES		Dominion Energy Services, Inc. ~~(formerly known as~~
DESC		The legal entity, Dominion ~~Resources Services,~~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		~~Dominion Energy~~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 ~~Energy,~~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. ~~(formerly known as Dominion Resources, Inc.)~~, one or more of its consolidated subsidiaries (other than Virginia ~~Power and Dominion Energy Gas)~~Power) or operating segments, or the entirety of Dominion Energy, Inc. and its consolidated subsidiaries

~~Abbreviation or Acronym~~		~~Definition~~
Dominion Energy Gas		The legal entity, ~~Dominion~~Eastern Energy Gas Holdings, LLC (formerly known as Dominion Energy Gas Holdings, LLC), one or more of its consolidated subsidiaries ~~or operating segment,~~(consisting of DETI, DCP, DMLPHCII and Dominion Iroquois), or the entirety of ~~Dominion~~Eastern Energy Gas Holdings, LLC and its consolidated subsidiaries
Dominion Energy Gas Restructuring		The acquisition of DCP and DMLPHCII from, and the disposition of East Ohio and DGP to, Dominion Energy by Dominion Energy Gas on November 6, 2019
Dominion Energy Midstream		The legal entity, ~~Dominion Energy~~Northeast Midstream Partners, LP (formerly known as Dominion Energy Midstream Partners, LP), one or more of its consolidated subsidiaries, ~~Cove Point Holdings, Iroquois GP Holding Company, LLC, DECG and Dominion Energy Questar Pipeline (beginning December 1, 2016) or operating segment,~~ or the entirety of ~~Dominion Energy~~Northeast Midstream Partners, LP and its consolidated subsidiaries
~~Dominion Energy Questar~~		The legal entity, Dominion Energy Questar Corporation (formerly known as Dominion Questar Corporation), one or more of its consolidated subsidiaries or operating segment, or the entirety of Dominion Energy Questar Corporation and its consolidated subsidiaries
~~Dominion Energy Questar Combination~~		~~Dominion Energy's acquisition of Dominion Energy Questar completed on September 16, 2016 pursuant to the terms of the agreement and plan of merger entered on January 31, 2016~~
Dominion Energy Questar Pipeline		The legal entity, Dominion Energy Questar Pipeline, LLC, ~~(formerly known as 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 operating segments,~~ or the entirety of Duke Energy Corporation and its consolidated subsidiaries
East Ohio		The East Ohio Gas Company, doing business as Dominion Energy Ohio
~~Eastern Market Access Project~~EnergySolutions		Project to provide 294,000 Dths per day of firm transportation service to help meet demand for natural gas for Washington Gas Light Company, a local gas utility serving customers in D.C., Virginia and Maryland, and Mattawoman Energy,EnergySolutions, LLC ~~for its new electric generation facility to be built in Maryland~~
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 ~~wholly-owned~~ subsidiary of ~~NRG effective November 2016~~Clearway
Fowler Ridge		AFowler I Holdings LLC, a wind-turbine facility ~~joint venture between Dominion Energy and BP Wind Energy North America Inc.~~ in Benton County, Indiana
~~FTA~~		~~Free Trade Agreement~~
FTRs		Financial transmission rights
GAAP		U.S. generally accepted accounting principles
~~Gal~~		~~Gallon~~
Gas ~~Infrastructure~~Distribution		Gas ~~Infrastructure Group~~Distribution operating segment
GENCO		South Carolina Generating Company, Inc.
GHG		Greenhouse gas
Granite Mountain		Granite Mountain Holdings, LLC, a limited liability company owned by Dominion Energy and Granite Mountain Renewables, LLC, a ~~wholly-owned~~ subsidiary of ~~NRG effective November 2016~~Clearway
Grassfield Solar		An approximate 20 MW utility-scale solar power station under development in Chesapeake, Virginia
Greensville County		~~An approximately~~A 1,588 MW ~~combined cycle,~~combined-cycle, natural gas-fired power station ~~under construction~~ 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
GW		Gigawatt
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
Hope		Hope Gas, Inc.

~~Abbreviation or Acronym~~		~~Definition~~, doing business as Dominion Energy West Virginia
Iron Springs		Iron Springs Holdings, LLC, a limited liability company owned by Dominion Energy and Iron Springs Renewables, LLC, a ~~wholly-owned~~ subsidiary of ~~NRG effective November 2016~~Clearway
Iroquois		Iroquois Gas Transmission System, L.P.
~~ISO-NE~~ISO		Independent ~~System Operator New England~~system operator
JAX LNG		JAX LNG, LLC, an LNG supplier in Florida serving the marine and LNG markets
July 2016 hybrids		Dominion Energy’s 2016 Series A Enhanced Junior Subordinated Notes due 2076
Kewaunee		Kewaunee nuclear power station

kV		Kilovolt
~~Liquefaction Project~~LIBOR		~~A natural gas export/liquefaction facility currently under construction by Cove Point~~London Interbank Offered Rate
LNG		Liquefied natural gas
~~Local 69~~		~~Local 69, Utility Workers Union of America, United Gas Workers~~
~~MATS~~		~~Utility Mercury and Air Toxics Standard Rule~~
MD&A		Management’s Discussion and Analysis of Financial Condition and Results of Operations
MGD		Million gallons aper day
Millstone		Millstone nuclear power station
~~MISO~~Millstone 2019 power purchase agreements		~~Midcontinent Independent System Operator, Inc.~~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
~~NedPower~~NND Project		~~A wind-turbine facility joint venture between Dominion Energy~~V.C. Summer Units 2 and ~~Shell Wind Energy, Inc.~~3 nuclear development project under which DESC and Santee Cooper undertook to construct two Westinghouse AP1000 Advanced Passive Safety nuclear units in ~~Grant County, West Virginia~~Jenkinsville, South Carolina
~~NGL~~Norge Solar		~~Natural gas liquid~~An approximate 20 MW utility-scale solar power station under development in James City County, Virginia
NO_xNorth Anna		~~Nitrogen oxide~~North Anna nuclear power station
North Carolina Commission		North Carolina Utilities Commission
NRC		U.S. Nuclear Regulatory Commission
~~NRG~~		The legal entity, NRG Energy, Inc., one or more of its consolidated subsidiaries (including, effective November 2016, Four Brothers Holdings, LLC, Granite Mountain Renewables, LLC and Iron Springs Renewables, LLC) or operating segments, or the entirety of NRG Energy, Inc. and its consolidated subsidiaries
~~NSPS~~NYSE		New ~~Source Performance Standards~~York Stock Exchange
Ohio Commission		Public Utilities Commission of Ohio
Order 1000		Order issued by FERC adopting requirements for electric transmission planning, cost allocation and development
~~PIPP~~		~~Percentage of Income Payment Plan deployed by East Ohio~~
PIR		Pipeline Infrastructure Replacement program deployed by East Ohio
PJM		PJM Interconnection, ~~L.L.C.~~
~~Power Delivery~~		~~Power Delivery Group operating segment~~
~~Power Generation~~		~~Power Generation Group operating segment~~
~~ppb~~		~~Parts-per-billion~~LLC
PREP		Pipeline Replacement and Expansion Program, a program of replacing, upgrading and expanding natural gas utility infrastructure deployed by Hope
PSD		Prevention of ~~Significant Deterioration~~significant deterioration
PSNC		Public Service Company of North Carolina, Incorporated, doing business as Dominion Energy North Carolina
Q-Pipe Group		Collectively, Dominion Energy Questar Pipeline, DEQPS and QPC Holding Company, LLC (including its subsidiary Questar Southern Trails Pipeline Company)
Q-Pipe Transaction		A previously proposed sale by Dominion Energy to BHE of the Q-Pipe Group pursuant to a purchase and sale agreement entered into on October 5, 2020 and terminated on July 9, 2021
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
RGGI		Regional Greenhouse Gas Initiative
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 BW		A rate adjustment clause associated with the recovery of costs related to Brunswick County
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 D		A rate mechanism which allows PSNC to recover from customers all prudently incurred gas costs and certain uncollectible expenses as well as losses on negotiated gas and transportation sales.
Rider E		A rate adjustment clause associated with the recovery of costs related to certain capital projects at Virginia Power’s electric generating stations to comply with federal and state environmental laws and regulations
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 RGGI		A rate adjustment clause associated with the recovery of costs related to the purchase of allowances through the RGGI market-based trading program for CO₂
Rider RPS		A rate adjustment clause associated with the recovery of costs related to the mandatory renewable portfolio standard program established by the VCEA
Rider S		A rate adjustment clause associated with the recovery of costs related to the Virginia City Hybrid Energy Center
Rider T1		A rate adjustment clause to recover the difference between revenues produced from transmission rates included in base rates, and the new total revenue requirement developed annually for the rate years effective September 1
Rider U		A rate adjustment clause associated with the recovery of costs of new underground distribution facilities

~~Abbreviation or Acronym~~		~~Definition~~
Rider US-2		A rate adjustment clause associated with the recovery of costs related to Woodland Solar, Scott Solar and Whitehouse Solar
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
Riders C1A, C2A, C3A and ~~C2A~~C4A		Rate adjustment clauses associated with the recovery of costs related to certain DSM programs approved in DSM cases
ROE		Return on equity
~~RSN~~RTO		~~Remarketable subordinated note~~Regional transmission organization
Sadler Solar		A 100 MW 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
Scott Solar		A 17 MW utility-scale solar power station in Powhatan County, Virginia
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
Southwest Gas		The legal entity, Southwest Gas Holdings, Inc., one or more of its consolidated subsidiaries, or the entirety of Southwest Gas Holdings, Inc. and its consolidated subsidiaries
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 ~~McGraw Hill Financial,~~S&P Global Inc.
~~SunEdison~~Summer		~~The legal entity, SunEdison, Inc., one or more~~V.C. Summer nuclear power station
Supply Header Project		A project previously intended for DETI to provide approximately 1,500,000 Dths of ~~its consolidated subsidiaries (including, through November 2016, Four Brothers Holdings, LLC, Granite Mountain Renewables, LLC and Iron Springs Renewables, LLC) or operating segments, or~~firm transportation service to various customers in connection with the ~~entirety of SunEdison, Inc. and its consolidated subsidiaries~~Atlantic Coast Pipeline Project
Surry		Surry nuclear power station
Sycamore Solar		An approximate 42 MW utility-scale solar power station under development in Pittsylvania County, Virginia
Terra Nova Renewable Partners		AThe legal entity, Terra Nova Renewable Partners, LLC, a partnership comprised primarily of institutional investors advised by J.P. Morgan Asset Management-Global Real Assets, or one or more of its consolidated subsidiaries
Three Cedars		Granite Mountain and Iron Springs, collectively
UEX Rider		Uncollectible Expense Rider deployed by East Ohio
~~VDEQ~~Utah Commission		Utah Public Service Commission
VCEA		Virginia ~~Department~~Clean Economy Act of ~~Environmental Quality~~March 2020
VEBA		Voluntary ~~Employees'~~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 Facilities		Proposed electric interconnection and transmission facilities in and around Virginia Beach, Virginia, comprising transmission facilities required to interconnect the CVOW Commercial Project reliably with the existing transmission system; including 3 miles of 230 kV offshore export circuits, 4 miles of underground 230 kV onshore export circuits, a new Harpers switching station, 14 miles of three new overhead 230 kV transmission circuits between a new Harpers switching station and the Fentress substation, rebuild eight miles of two existing 230 kV overhead lines and an expansion of the Fentress substation
Virginia Power		The legal entity, Virginia Electric and Power Company, one or more of its consolidated subsidiaries or operating ~~segments,~~segment, or the entirety of Virginia Electric and Power Company and its consolidated subsidiaries
~~VOC~~Warren County		~~Volatile organic compounds~~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
West Virginia Commission		Public Service Commission of West Virginia
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
Whitehouse Solar		A 20 MW utility-scale solar power station in Louisa County, Virginia
White River Hub		White River Hub, LLC

Wisconsin Commission		Public Services Commission of Wisconsin
Woodland Solar		A 19 MW utility-scale solar power station in Isle of Wight County, Virginia

WP&L

Wisconsin Power and Light Company, a subsidiary of Alliant Energy Corporation

WPSC

Wisconsin Public Service Corporation, a subsidiary of WEC Energy Group

Wrangler

Wrangler Retail Gas Holdings, LLC, a partnership between Dominion Energy and Interstate Gas Supply, Inc.

PART I. ~~FINANCI~~ALFINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended September 30,					Nine Months Ended September 30,					Three Months Ended September 30,						Nine Months Ended September 30,
	2017		2016			2017			2016		2021			2020			2021		2020
(millions, except per share amounts)
Operating Revenue	$	3,179	$	3,132		$	9,376		$	8,651	$	3,176		$	3,607		$	10,084	$	10,651
Operating Expenses
Electric fuel and other energy-related purchases		638		606			1,711			1,791		703			594			1,740		1,758
Purchased (excess) electric capacity		21		(6	)		(8	)		107
Purchased electric capacity												26			23			62		36
Purchased gas		24		77			441			252		60			37			665		561
Other operations and maintenance		649		765			2,166			2,133		924			977			2,806		2,720
Depreciation, depletion and amortization		485		400			1,421			1,112		621			595			1,833		1,751
Other taxes		162		145			519			448		223			203			702		663
Impairment of assets and other charges (benefits)												(222	)		1,151			194		1,963
Total operating expenses		1,979		1,987			6,250			5,843		2,335			3,580			8,002		9,452
Income from operations		1,200		1,145			3,126			2,808		841			27			2,082		1,199
Earnings (loss) from equity method investees												69			(5	)		214		0
Other income		73		63			249			189		133			286			732		327
Interest and related charges		305		250			905			715		407			306			978		1,136
Income from operations including noncontrolling interests before income tax expense		968		958			2,470			2,282
Income tax expense		272		230			683			561
Net Income Including Noncontrolling Interests		696		728			1,787			1,721
Income from continuing operations including noncontrolling interests before income tax expense (benefit)												636			2			2,050		390
Income tax expense (benefit)												35			(110	)		200		(123	)
Net Income From Continuing Operations Including Noncontrolling Interests												601			112			1,850		513
Net Income (Loss) From Discontinued Operations Including Noncontrolling Interests⁽¹⁾⁽²⁾												65			19			119		(1,753	)
Net Income (Loss) Including Noncontrolling Interests												666			131			1,969		(1,240	)
Noncontrolling Interests		31		38			100			55		12			(225	)		22		(157	)
Net Income Attributable to Dominion Energy	$	665	$	690		$	1,687		$	1,666
Earnings Per Common Share
Net income attributable to Dominion Energy - Basic	$	1.03	$	1.10		$	2.66		$	2.72
Net income attributable to Dominion Energy - Diluted		1.03		1.10			2.66			2.71
Dividends Declared Per Common Share	$	0.7700	$	0.7000		$	2.2800		$	2.1000
Net Income (Loss) Attributable to Dominion Energy											$	654		$	356		$	1,947	$	(1,083	)
Amounts attributable to Dominion Energy
Net income from continuing operations											$	589		$	369		$	1,828	$	767
Net income (loss) from discontinued operations												65			(13	)		119		(1,850	)
Net income (loss) attributable to Dominion Energy											$	654		$	356		$	1,947	$	(1,083	)
EPS - Basic
Net income from continuing operations											$	0.71		$	0.42		$	2.20	$	0.86
Net income (loss) from discontinued operations												0.08			(0.01	)		0.15		(2.21	)
Net income (loss) attributable to Dominion Energy											$	0.79		$	0.41		$	2.35	$	(1.35	)
EPS - Diluted
Net income from continuing operations											$	0.71		$	0.42		$	2.20	$	0.83
Net income (loss) from discontinued operations												0.08			(0.01	)		0.15		(2.21	)
Net income (loss) attributable to Dominion Energy											$	0.79		$	0.41		$	2.35	$	(1.38	)

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

(2)	Includes income tax expense (benefit) of $(6) million and $(10) million for the three months ended September 30, 2021 and 2020, respectively, and $5 million and $(572) million for the nine months ended September 30, 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 September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
(millions)
Net income (loss) including noncontrolling interests	$	666		$	131		$	1,969		$	(1,240	)
Other comprehensive income (loss), net of taxes:
Net deferred gains (losses) on derivatives-hedging activities⁽¹⁾		(2	)		10			21			(254	)
Changes in unrealized net gains (losses) on investment securities⁽²⁾		4			4			(15	)		32
Changes in net unrecognized pension and other postretirement benefit costs⁽³⁾		(1	)		(261	)		5			(262	)
Amounts reclassified to net income (loss):
Net derivative (gains) losses-hedging activities⁽⁴⁾		10			188			35			215
Net realized (gains) losses on investment securities⁽⁵⁾		(3	)		(1	)		(5	)		(15	)
Net pension and other postretirement benefit costs⁽⁶⁾		19			23			63			60
Changes in other comprehensive income from equity method investees⁽⁷⁾		(3	)		1			(3	)		1
Total other comprehensive income (loss)		24			(36	)		101			(223	)
Comprehensive income (loss) including noncontrolling interests		690			95			2,070			(1,463	)
Comprehensive income (loss) attributable to noncontrolling interests		12			(225	)		22			(157	)
Comprehensive income (loss) attributable to Dominion Energy	$	678		$	320		$	2,048		$	(1,306	)

(1)	Net of $— million and $(4) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(8) million and $85 million tax for nine months ended September 30, 2021 and 2020, respectively.

(2)	Net of $— million and $(2) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $8 million and $(12) million tax for the nine months ended September 30, 2021 and 2020, respectively.

(3)	Net of $(1) million and $91 million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(8) million and $94 million tax for the nine months ended September 30, 2021 and 2020, respectively.

(4)	Net of $(4) million and $(63) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(12) million and $(72) million tax for the nine months ended September 30, 2021 and 2020, respectively.

(5)	Net of $1 million and $2 million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $2 million and $6 million tax for the nine months ended September 30, 2021 and 2020, respectively.

(6)	Net of $(6) million and $(8) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(22) million and $(21) million tax for the nine months ended September 30, 2021 and 2020, respectively.

(7)	Net of $1 million and $(1) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $1 million and $(1) million tax for the nine months ended September 30, 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)

	September 30, 2021			December 31, 2020⁽¹⁾
(millions)
ASSETS
Current Assets
Cash and cash equivalents	$	180		$	172
Customer receivables (less allowance for doubtful accounts of $47 and $42)		1,853			2,295
Other receivables (less allowance for doubtful accounts of $4 and $3)		206			212
Inventories		1,593			1,550
Margin deposit assets		553			19
Prepayments		426			309
Regulatory assets		1,193			699
Other		255			148
Current assets held for sale		3,039			1,482
Total current assets		9,298			6,886
Investments
Nuclear decommissioning trust funds		7,506			6,900
Investment in equity method affiliates		2,920			2,934
Other		391			404
Total investments		10,817			10,238
Property, Plant and Equipment
Property, plant and equipment		84,738			82,959
Accumulated depreciation, depletion and amortization		(26,352	)		(25,111	)
Total property, plant and equipment, net		58,386			57,848
Deferred Charges and Other Assets
Goodwill		7,405			7,381
Regulatory assets		9,213			9,133
Other		4,685			4,419
Total deferred charges and other assets		21,303			20,933
Total assets	$	99,804		$	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 ~~STATEMENTS OF COMPREHENSIVE INCOME~~BALANCE SHEETS—(Continued)

(Unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Net income including noncontrolling interests

$
696

$
728

$
1,787

$
1,721

Other comprehensive income, net of taxes:

Net deferred gains on derivatives-hedging activities⁽¹⁾

11

14

82

56

Changes in unrealized net gains on investment securities⁽²⁾

48

31

141

72

Changes in net unrecognized pension and other postretirement
benefit costs⁽³⁾

—

15

—

15

Amounts reclassified to net income:

Net derivative gains-hedging activities⁽⁴⁾

(15
)

(34
)

(56
)

(141
)
Net realized gains on investment securities⁽⁵⁾

(4
)

(13
)

(36
)

(23
)
Net pension and other postretirement benefit costs⁽⁶⁾

14

9

38

25

Changes in other comprehensive income (loss) from equity
method investees⁽⁷⁾

—

—

2

(1
)
Total other comprehensive income

54

22

171

3

Comprehensive income including noncontrolling interests

750

750

1,958

1,724

Comprehensive income attributable to noncontrolling interests

31

38

100

55

Comprehensive income attributable to Dominion Energy

$
719

$
712

$
1,858

$
1,669

	September 30, 2021			December 31, 2020⁽¹⁾
(millions)
LIABILITIES AND EQUITY
Current Liabilities
Securities due within one year	$	2,845		$	1,937
Supplemental 364-Day credit facility borrowings		—			225
Short-term debt		3,885			895
Accounts payable		851			944
Accrued interest, payroll and taxes		1,185			1,133
Derivative liabilities		729			412
Regulatory liabilities		1,059			809
Liability to Atlantic Coast Pipeline		112			1,052
Q-Pipe Transaction deposit		—			1,290
Other⁽²⁾		1,507			1,521
Current liabilities held for sale		1,050			625
Total current liabilities		13,223			10,843
Long-Term Debt
Long-term debt		31,641			30,915
Junior subordinated notes		1,385			2,161
Supplemental credit facility borrowings		900			—
Other		849			881
Total long-term debt		34,775			33,957
Deferred Credits and Other Liabilities
Deferred income taxes and investment tax credits		6,313			5,953
Regulatory liabilities		10,346			10,187
Other		7,915			8,504
Total deferred credits and other liabilities		24,574			24,644
Total liabilities		72,572			69,444
Commitments and Contingencies (see Note 17)
Equity
Preferred stock (see Note 16)		2,387			2,387
Common stock – no par⁽³⁾		21,573			21,258
Retained earnings		4,562			4,189
Accumulated other comprehensive loss		(1,616	)		(1,717	)
Total shareholders' equity		26,906			26,117
Noncontrolling interests		326			344
Total equity		27,232			26,461
Total liabilities and equity	$	99,804		$	95,905

(1)

~~Net of $(5) million and $(8) million tax for~~Dominion Energy’s Consolidated Balance Sheet at December 31, 2020 has been derived from the ~~three months ended September 30, 2017 and 2016, respectively, and net of $(49) million and $(34) million tax for the nine months ended September 30, 2017 and 2016, respectively.~~audited Consolidated Balance Sheet at that date.

(2)	~~Net of $(27) million and $(18) million tax~~See Note 10 for ~~the three months ended September 30, 2017 and 2016, respectively, and net of $(80) million and $(43) million tax for the nine months ended September 30, 2017 and 2016, respectively.~~amounts attributable to related parties.

(3)

~~Net of $---~~1.8 billion shares authorized; 810 millionand ~~$(10)~~806 million ~~tax for the three months ended~~shares outstanding at September 30, ~~2017~~2021 and ~~2016, respectively, and net of $--- millionand $(10) million tax for the nine months ended September 30, 2017 and 2016, respectively.~~

~~(4)~~

Net of $10 million and $21 million tax for the three months ended September 30, 2017 and 2016, respectively, and net of $35 million and $88 million tax for the nine months ended September 30, 2017 and 2016, respectively.

~~(5)~~

Net of $2 million and $7 million tax for the three months ended September 30, 2017 and 2016, respectively, and net of $20 million and $13 million tax for the nine months ended September 30, 2017 and 2016, respectively.

~~(6)~~

Net of $(7) million and $(4) million tax for the three months ended September 30, 2017 and 2016, respectively, and net of $(25) million and $(16) million tax for the nine months ended September 30, 2017 and 2016, respectively.

~~(7)~~

~~Net of $--- million tax for both the three months ended September 30, 2017 and 2016, and net of $(1) million and $--- million tax for the nine months ended September 30, 2017 and 2016,~~December 31, 2020, respectively.

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

DOMINION ENERGY, INC.

~~CONSOLIDATED BALANCE SHEETS~~

~~(Unaudited)~~

September 30, 2017

December 31, 2016⁽¹⁾

(millions)

ASSETS

Current Assets

Cash and cash equivalents

$
227

$
261

Customer receivables (less allowance for doubtful accounts of $16 and $18)

1,292

1,523

Other receivables (less allowance for doubtful accounts of $3 and $2)

212

183

Inventories

1,527

1,524

Regulatory assets

311

244

Other

425

513

Total current assets

3,994

4,248

Investments

Nuclear decommissioning trust funds

4,881

4,484

Investment in equity method affiliates

1,895

1,561

Other

320

298

Total investments

7,096

6,343

Property, Plant and Equipment

Property, plant and equipment

73,610

69,556

Accumulated depreciation, depletion and amortization

(20,799
)

(19,592
)
Total property, plant and equipment, net

52,811

49,964

Deferred Charges and Other Assets

Goodwill

6,405

6,399

Regulatory assets

2,503

2,473

Other

2,582

2,183

Total deferred charges and other assets

11,490

11,055

Total assets

$
75,391

$
71,610

~~(1)~~

~~Dominion Energy’s Consolidated Balance Sheet at December 31, 2016 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)~~

September 30, 2017

December 31, 2016⁽¹⁾

(millions)

LIABILITIES AND EQUITY

Current Liabilities

Securities due within one year

$
2,788

$
1,709

Short-term debt

3,060

3,155

Accounts payable

757

1,000

Accrued interest, payroll and taxes

843

798

Regulatory liabilities

88

163

Other

1,023

1,290

Total current liabilities

8,559

8,115

Long-Term Debt

Long-term debt

25,529

24,878

Junior subordinated notes

3,980

2,980

Remarketable subordinated notes

1,377

2,373

Total long-term debt

30,886

30,231

Deferred Credits and Other Liabilities

Deferred income taxes and investment tax credits

9,379

8,602

Regulatory liabilities

2,906

2,622

Other

5,159

5,200

Total deferred credits and other liabilities

17,444

16,424

Total liabilities

56,889

54,770

Commitments and Contingencies (see Note 15)

Equity

Common stock – no par⁽²⁾

9,789

8,550

Retained earnings

7,119

6,854

Accumulated other comprehensive loss

(628
)

(799
)
Total common shareholders' equity

16,280

14,605

Noncontrolling interests

2,222

2,235

Total equity

18,502

16,840

Total liabilities and equity

$
75,391

$
71,610

~~(1)~~

~~Dominion Energy’s Consolidated Balance Sheet at December 31, 2016 has been derived from the audited Consolidated Balance Sheet at that date.~~

~~(2)~~

~~1 billion shares authorized; 644 million shares and 628 million shares outstanding at September 30, 2017 and December 31, 2016, respectively.~~

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

~~DOMINION ENERGY, INC.~~

CONSOLIDATED STATEMENTS OF EQUITY - QUARTER-TO-DATE

(Unaudited)

Common Stock

Dominion Energy Shareholders

Total
Common

Shares

Amount

Retained Earnings

AOCI

Shareholders'
Equity

Noncontrolling
Interests

Total
Equity

(millions)

December 31,  2015

596

$
6,680

$
6,458

$
(474
)

$
12,664

$
938

$
13,602

Net income including noncontrolling interests

1,666

1,666

55

1,721

Contributions from SunEdison to Four Brothers
   and Three Cedars

—

178

178

Sale of interest in merchant solar projects

22

22

117

139

Purchase of Dominion Energy Midstream
   common units

(3
)

(3
)

(14
)

(17
)
Issuance of common stock

31

2,079

2,079

2,079

Stock awards (net of change in unearned
   compensation)

10

10

10

Present value of stock purchase contract
   payments related to RSNs

(191
)

(191
)

(191
)
Dividends and distributions

(1,287
)

(1,287
)

(39
)

(1,326
)
Other comprehensive income, net of tax

3

3

3

Other

(5
)

(5
)

(1
)

(6
)
September 30, 2016

627

$
8,592

$
6,837

$
(471
)

$
14,958

$
1,234

$
16,192

December 31, 2016

628

$
8,550

$
6,854

$
(799
)

$
14,605

$
2,235

$
16,840

Net income including noncontrolling interests

1,687

1,687

100

1,787

Contributions from NRG to Four Brothers and
   Three Cedars

—

9

9

Issuance of common stock

16

1,232

1,232

1,232

Stock awards (net of change in unearned
   compensation)

17

17

17

Dividends and distributions

(1,435
)

(1,435
)

(123
)

(1,558
)
Other comprehensive income, net of tax

171

171

171

Other

(10
)

13

.

3

1

4

September 30, 2017

644

$
9,789

$
7,119

$
(628
)

$
16,280

$
2,222

$
18,502

	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)
June 30, 2020		2	$	2,387		840		$	23,984		$	4,480		$	(1,980	)	$	28,871		$	2,013		$	30,884
Net income (loss) including noncontrolling interests												356						356			(225	)		131
Issuance of stock						4			333									333						333
Stock repurchases						(28	)		(2,385	)								(2,385	)					(2,385	)
Stock awards (net of change in unearned compensation)									9									9						9
Preferred stock dividends (see Note 16)												(16	)					(16	)					(16	)
Common stock dividends ($0.940 per share) and distributions												(785	)					(785	)		(59	)		(844	)
Other comprehensive loss, net of tax															(36	)		(36	)					(36	)
Other									(11	)								(11	)	$	1			(10	)
September 30, 2020		2	$	2,387		816		$	21,930		$	4,035		$	(2,016	)	$	26,336		$	1,730		$	28,066


June 30, 2021		2	$	2,387		807		$	21,369		$	4,434		$	(1,640	)	$	26,550		$	334		$	26,884
Net income including noncontrolling interests												654						654			12			666
Issuance of stock						3			195									195						195
Stock awards (net of change in unearned compensation)									9									9						9
Preferred stock dividends (see Note 16)												(16	)					(16	)					(16	)
Common stock dividends ($0.630 per share) and distributions												(510	)					(510	)		(19	)		(529	)
Other comprehensive income, net of tax															24			24						24
Other																		—			(1	)		(1	)
September 30, 2021		2	$	2,387		810		$	21,573		$	4,562		$	(1,616	)	$	26,906		$	326		$	27,232

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

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~EQUITY - YEAR-TO-DATE

(Unaudited)

Nine Months Ended September 30,

2017

2016

(millions)

Operating Activities

Net income including noncontrolling interests

$
1,787

$
1,721

Adjustments to reconcile net income including noncontrolling interests to net cash
provided by operating activities:

Depreciation, depletion and amortization (including nuclear fuel)

1,649

1,325

Deferred income taxes and investment tax credits

652

481

Proceeds from assignment of tower rental portfolio

91

—

Gains on the sales of assets and equity method investment in Iroquois

(61
)

(50
)
Contribution to pension plan

(75
)

—

Other adjustments

(95
)

(78
)
Changes in:

Accounts receivable

247

19

Inventories

(34
)

(10
)
Deferred fuel and purchased gas costs, net

(81
)

84

Prepayments

34

71

Accounts payable

(158
)

(89
)
Accrued interest, payroll and taxes

61

205

Margin deposit assets and liabilities

51

1

Pension and other postretirement benefits

(132
)

(91
)
Other operating assets and liabilities

(272
)

(203
)
Net cash provided by operating activities

3,664

3,386

Investing Activities

Plant construction and other property additions (including nuclear fuel)

(4,122
)

(4,536
)
Acquisition of Dominion Energy Questar, net of cash acquired

—

(4,372
)
Acquisition of solar development projects

(343
)

(21
)
Proceeds from sales of securities

1,496

1,009

Purchases of securities

(1,555
)

(1,065
)
Contributions to equity method affiliates

(343
)

(124
)
Other

(6
)

80

Net cash used in investing activities

(4,873
)

(9,029
)
Financing Activities

Repayment of short-term debt, net

(95
)

(713
)
Issuance of short-term notes

—

1,200

Repayment and repurchase of short-term notes

(250
)

(600
)
Issuance of long-term debt

3,480

5,730

Repayment and repurchase of long-term debt

(1,529
)

(1,169
)
Proceeds from sale of interest in merchant solar projects

—

117

Contributions from NRG and SunEdison to Four Brothers and Three Cedars

9

178

Issuance of common stock

1,233

2,079

Common dividend payments

(1,435
)

(1,287
)
Other

(238
)

(248
)
Net cash provided by financing activities

1,175

5,287

Decrease in cash and cash equivalents

(34
)

(356
)
Cash and cash equivalents at beginning of period

261

607

Cash and cash equivalents at end of period

$
227

$
251

Supplemental Cash Flow Information

Significant noncash investing and financing activities⁽¹⁾:

Accrued capital expenditures

$
355

$
341

	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 loss including noncontrolling interests												(1,083	)					(1,083	)		(157	)		(1,240	)
Issuance of stock						6			481									481						481
Stock repurchases						(28	)		(2,385	)								(2,385	)					(2,385	)
Stock awards (net of change in unearned compensation)									22									22						22
Preferred stock dividends (see Note 16)												(48	)					(48	)					(48	)
Common stock dividends ($2.820 per common share) and distributions												(2,362	)					(2,362	)		(153	)		(2,515	)
Other comprehensive loss, net of tax															(223	)		(223	)					(223	)
Other									(12	)								(12	)		1			(11	)
September 30, 2020		2	$	2,387		816		$	21,930		$	4,035		$	(2,016	)	$	26,336		$	1,730		$	28,066


December 31, 2020		2	$	2,387		806		$	21,258		$	4,189		$	(1,717	)	$	26,117		$	344		$	26,461
Net income including noncontrolling interests												1,947						1,947			22			1,969
Issuance of stock						4			292									292						292
Stock awards (net of change in unearned compensation)									24									24						24
Preferred stock dividends (see Note 16)												(48	)					(48	)					(48	)
Common stock dividends ($1.890 per share) and distributions												(1,526	)					(1,526	)		(40	)		(1,566	)
Other comprehensive income, net of tax															101			101						101
Other									(1	)								(1	)					(1	)
September 30, 2021		2	$	2,387		810		$	21,573		$	4,562		$	(1,616	)	$	26,906		$	326		$	27,232

~~(1)~~

~~See Note 14 for noncash financing activities related to the remarketing of RSNs.~~

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

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Nine Months Ended September 30,	2021			2020
(millions)
Operating Activities
Net income (loss) including noncontrolling interests	$	1,969		$	(1,240	)
Adjustments to reconcile net income (loss) including noncontrolling interests to net cash provided by operating activities:
Depreciation, depletion and amortization (including nuclear fuel)		2,058			2,178
Deferred income taxes and investment tax credits		199			(380	)
Provision for refunds to electric utility customers		350			—
Impairment of assets and other charges (benefits)		194			2,207
Loss from investment in Atlantic Coast Pipeline		19			2,376
Net gains on nuclear decommissioning trust funds and other investments		(370	)		(101	)
Other adjustments		254			138
Changes in:
Accounts receivable		207			237
Inventories		(45	)		29
Deferred fuel and purchased gas costs, net		(531	)		206
Prepayments		(121	)		(292	)
Accounts payable		(29	)		(186	)
Accrued interest, payroll and taxes		51			(113	)
Customer deposits		(19	)		(9	)
Margin deposit assets and liabilities		(539	)		3
Net realized and unrealized changes related to derivative activities		432			285
Pension and other postretirement benefits		(103	)		(170	)
Other operating assets and liabilities		(441	)		(358	)
Net cash provided by operating activities		3,535			4,810
Investing Activities
Plant construction and other property additions (including nuclear fuel)		(4,142	)		(4,409	)
Acquisition of solar development projects		(87	)		(245	)
Proceeds from sales of securities		3,324			2,868
Purchases of securities		(3,288	)		(2,948	)
Repayment of Q-Pipe Transaction deposit		(1,265	)		—
Contributions to equity method affiliates		(1,006	)		(92	)
Acquisition of equity method investments		—			(178	)
Other		(143	)		144
Net cash used in investing activities		(6,607	)		(4,860	)
Financing Activities
Issuance of short-term debt, net		2,990			1,417
Issuance of short-term notes		1,265			1,125
Repayment of short-term notes		—			(625	)
Supplemental 364-Day credit facility borrowings		—			225
Repayment of supplemental 364-day credit facility borrowings		(225	)		—
Issuance of long-term debt		2,500			5,677
Repayment of long-term debt, including redemption premiums		(2,708	)		(2,546	)
Supplemental credit facility borrowings		900			—
Issuance of common stock		144			159
Repurchase of common stock		—			(2,385	)
Common dividend payments		(1,526	)		(2,362	)
Other		(248	)		(346	)
Net cash provided by financing activities		3,092			339
Increase in cash, restricted cash and equivalents		20			289
Cash, restricted cash and equivalents at beginning of period		247			269
Cash, restricted cash and equivalents at end of period	$	267		$	558

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 September 30,					Nine Months Ended September 30,					Three Months Ended September 30,					Nine Months Ended September 30,
	2017		2016			2017			2016		2021			2020		2021			2020
(millions)
Operating Revenue⁽¹⁾	$	2,154	$	2,211		$	5,732		$	5,877	$	1,976		$	2,248	$	5,547		$	5,983
Operating Expenses
Electric fuel and other energy-related purchases⁽¹⁾		549		516			1,414			1,527		515			424		1,270			1,282
Purchased (excess) electric capacity		21		(6	)		(8	)		107		15			3		16			(14	)
Other operations and maintenance:
Affiliated suppliers		76		73			229			238		77			69		242			236
Other		297		370			897			1,041		393			456		1,140			1,083
Depreciation and amortization		288		270			854			765		343			324		990			942
Other taxes	��	76		74			233			218		86			85		262			257
Impairment of assets and other charges (benefits)												(230	)		200		(269	)		1,008
Total operating expenses		1,307		1,297			3,619			3,896		1,199			1,561		3,651			4,794
Income from operations		847		914			2,113			1,981		777			687		1,896			1,189
Other income		13		13			57			47		21			34		93			34
Interest and related charges⁽¹⁾		128		118			373			345		136			135		400			398
Income before income tax expense		732		809			1,797			1,683		662			586		1,589			825
Income tax expense		273		306			664			637		106			111		245			140
Net Income	$	459	$	503		$	1,133		$	1,046	$	556		$	475	$	1,344		$	685

(1)	See Note 1719 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 September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
(millions)
Net income	$	556		$	475		$	1,344		$	685
Other comprehensive income (loss), net of taxes:
Net deferred gains (losses) on derivatives-hedging activities⁽¹⁾		(2	)		5			18			(39	)
Changes in unrealized net gains (losses) on nuclear decommissioning trust funds⁽²⁾		—			—			(2	)		4
Amounts reclassified to net income (loss):
Net derivative (gains) losses-hedging activities⁽³⁾		—			1			1			1
Net realized (gains) losses on nuclear decommissioning trust funds⁽⁴⁾		(1	)		(1	)		(1	)		(2	)
Total other comprehensive income (loss)		(3	)		5			16			(36	)
Comprehensive income	$	553		$	480		$	1,360		$	649

(1)	Net of $— million and $(1) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(6) million and $14 million tax for the nine months ended September 30, 2021 and 2020, respectively.

(2)	Net of $— million and $(1) million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $—million and $(2) million tax for the nine months ended September 30, 2021 and 2020, respectively.

(3)	Net of $(1) million and $— million tax for the three months ended September 30, 2021 and 2020, respectively, and net of $(1)million and $(1)million tax for the nine months ended September 30, 2021 and 2020, respectively.

(4)	Net of $— million and $— million tax for the three months ended September 30, 2021 and 2020, respectively and net of $— million and $1million tax for the nine months ended September 30, 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)

	September 30, 2017			December 31, 2016⁽¹⁾			September 30, 2021			December 31, 2020⁽¹⁾
(millions)
ASSETS
Current Assets
Cash and cash equivalents	$	16		$	11		$	38		$	35
Customer receivables (less allowance for doubtful accounts of $9 and $10)		920			892
Other receivables (less allowance for doubtful accounts of $1 at both dates)		36			99
Customer receivables (less allowance for doubtful accounts of $32 and $23)								1,207			1,315
Other receivables (less allowance for doubtful accounts of $2 at both dates)								58			91
Affiliated receivables		1			112			2			5
Inventories (average cost method)		853			853			826			862
Regulatory assets								690			295
Other⁽²⁾		309			281			280			59
Total current assets		2,135			2,248			3,101			2,662
Investments
Nuclear decommissioning trust funds		2,292			2,106			3,507			3,197
Other		3			3			4			3
Total investments		2,295			2,109			3,511			3,200
Property, Plant and Equipment
Property, plant and equipment		41,813			40,030			48,795			46,736
Accumulated depreciation and amortization		(13,144	)		(12,436	)		(14,919	)		(14,167	)
Total property, plant and equipment, net		28,669			27,594			33,876			32,569
Deferred Charges and Other Assets
Regulatory assets		838			770			3,941			3,509
Pension and other postretirement benefit assets⁽²⁾		182			130
Other⁽²⁾		462			457			1,974			1,714
Total deferred charges and other assets		1,482			1,357			5,915			5,223
Total assets	$	34,581		$	33,308		$	46,403		$	43,654

(1)	Virginia Power’s Consolidated Balance Sheet at December 31, ~~2016~~2020 has been derived from the audited Consolidated Balance Sheet at that date.

(2)	See Note 1719 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)

	September 30, 2017		December 31, 2016⁽¹⁾		September 30, 2021			December 31, 2020⁽¹⁾
(millions)
LIABILITIES AND SHAREHOLDER’S EQUITY
Current Liabilities
Securities due within one year	$	851	$	678	$	761		$	8
Short-term debt		320		65		896			45
Accounts payable		337		444		393			332
Payables to affiliates		167		109		139			266
Affiliated current borrowings		36		262		310			380
Accrued interest, payroll and taxes		307		239		374			253
Other⁽²⁾		536		725
Regulatory liabilities						685			425
Derivative liabilities⁽²⁾						389			390
Other						703			728
Total current liabilities		2,554		2,522		4,650			2,827
Long-Term Debt		10,495		9,852
Long-term debt						12,462			13,207
Other						495			480
Total long-term debt						12,957			13,687
Deferred Credits and Other Liabilities
Deferred income taxes and investment tax credits		5,357		5,103		3,028			2,779
Asset retirement obligations		1,300		1,262		3,699			3,654
Regulatory liabilities		2,202		1,962		5,560			5,338
Other⁽²⁾		863		742		892			812
Total deferred credits and other liabilities		9,722		9,069		13,179			12,583
Total liabilities		22,771		21,443		30,786			29,097
Commitments and Contingencies (see Note 15)
Commitments and Contingencies (see Note 17)
Common Shareholder’s Equity
Common stock – no par⁽³⁾		5,738		5,738		5,738			5,738
Other paid-in capital		1,113		1,113		1,113			1,113
Retained earnings		4,904		4,968		8,802			7,758
Accumulated other comprehensive income		55		46
Accumulated other comprehensive loss						(36	)		(52	)
Total common shareholder’s equity		11,810		11,865		15,617			14,557
Total liabilities and shareholder’s equity	$	34,581	$	33,308	$	46,403		$	43,654

(1)	Virginia Power’s Consolidated Balance Sheet at December 31, ~~2016~~2020 has been derived from the audited Consolidated Balance Sheet at that date.

(2)	See Note 1719 for amounts attributable to affiliates.

(3)	500,000 shares authorized; 274,723 sharesoutstanding at September 30, ~~2017~~2021 and December 31, ~~2016.~~2020.

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

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~COMMON SHAREHOLDER’S EQUITY

(Unaudited)

QUARTER-TO-DATE

Nine Months Ended September 30,

2017

2016

(millions)

Operating Activities

Net income

$
1,133

$
1,046

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization (including nuclear fuel)

999

903

Deferred income taxes and investment tax credits

262

369

Proceeds from assignment of tower rental portfolio

91

—

Other adjustments

(28
)

(15
)
Changes in:

Accounts receivable

32

(99
)
Affiliated receivables and payables

159

306

Inventories

1

37

Prepayments

(3
)

15

Deferred fuel expenses, net

(48
)

79

Accounts payable

(33
)

4

Accrued interest, payroll and taxes

67

131

Other operating assets and liabilities

(162
)

8

Net cash provided by operating activities

2,470

2,784

Investing Activities

Plant construction and other property additions

(1,917
)

(1,835
)
Purchases of nuclear fuel

(133
)

(106
)
Proceeds from sales of securities

654

478

Purchases of securities

(681
)

(513
)
Other

(29
)

(11
)
Net cash used in investing activities

(2,106
)

(1,987
)
Financing Activities

Issuance (repayment) of short-term debt, net

255

(691
)
Repayment of affiliated current borrowings, net

(226
)

(376
)
Issuance of long-term debt

1,500

750

Repayment of long-term debt

(679
)

(476
)
Common dividend payments to parent

(1,199
)

—

Other

(10
)

(4
)
Net cash used in financing activities

(359
)

(797
)
Increase in cash and cash equivalents

5

—

Cash and cash equivalents at beginning of period

11

18

Cash and cash equivalents at end of period

$
16

$
18

Supplemental Cash Flow Information

Significant noncash investing activities:

Accrued capital expenditures

$
158

$
209

	Common Stock
	Shares		Amount		Other Paid-In Capital		Retained Earnings			AOCI			Total
(millions, except for shares)	(thousands)
June 30, 2020		275	$	5,738	$	1,113	$	7,163		$	(70	)	$	13,944
Net income								475						475
Dividends								(108	)					(108	)
Other comprehensive income, net of tax											5			5
Other								(1	)					(1	)
September 30, 2020		275	$	5,738	$	1,113	$	7,529		$	(65	)	$	14,315

June 30, 2021		275	$	5,738	$	1,113	$	8,246		$	(33	)	$	15,064
Net income								556						556
Other comprehensive loss, net of tax											(3	)	$	(3	)
September 30, 2021		275	$	5,738	$	1,113	$	8,802		$	(36	)	$	15,617

YEAR-TO-DATE

	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 income								685						685
Dividends								(323	)					(323	)
Other comprehensive loss, net of tax											(36	)		(36	)
September 30, 2020		275	$	5,738	$	1,113	$	7,529		$	(65	)	$	14,315

December 31, 2020		275	$	5,738	$	1,113	$	7,758		$	(52	)	$	14,557
Net income								1,344						1,344
Dividends								(300	)					(300	)
Other comprehensive income, net of tax											16			16
September 30, 2021		275	$	5,738	$	1,113	$	8,802		$	(36	)	$	15,617

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)

Nine Months Ended September 30,	2021			2020
(millions)
Operating Activities
Net income	$	1,344		$	685
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization (including nuclear fuel)		1,109			1,068
Deferred income taxes and investment tax credits		198			(259	)
Impairment of assets and other charges (benefits)		(269	)		1,004
Provision for refunds to customers		350			—
Other adjustments		81			11
Changes in:
Accounts receivable		(98	)		(186	)
Affiliated receivables and payables		(123	)		144
Inventories		36			46
Prepayments		(5	)		1
Deferred fuel expenses, net		(396	)		144
Accounts payable		66			(1	)
Accrued interest, payroll and taxes		121			81
Margin deposit assets and liabilities		(121	)		—
Net realized and unrealized changes related to derivative activities		8			(18	)
Asset retirement obligations		16			51
Pension and other postretirement benefits		6			(273	)
Other operating assets and liabilities		(83	)		67
Net cash provided by operating activities		2,240			2,565
Investing Activities
Plant construction and other property additions		(2,525	)		(2,301	)
Purchases of nuclear fuel		(73	)		(170	)
Acquisition of solar development projects		(61	)		(26	)
Proceeds from sales of securities		1,465			694
Purchases of securities		(1,470	)		(729	)
Other		(45	)		33
Net cash used in investing activities		(2,709	)		(2,499	)
Financing Activities
Issuance of short-term debt, net		851			179
Issuance (repayment) of affiliated current borrowings, net		(70	)		123
Issuance of long-term debt, net		—			427
Repayment of long-term debt, net		—			(427	)
Common dividend payments to parent		(300	)		(323	)
Other		(8	)		(6	)
Net cash provided by (used in) financing activities		473			(27	)
Increase in cash, restricted cash and equivalents		4			39
Cash, restricted cash and equivalents at beginning of period		35			24
Cash, restricted cash and equivalents at end of period	$	39		$	63

~~DOMINION ENERGY GAS HOLDINGS, LLC~~

~~CONSOLIDATED STATEMENTS OF INCOME~~

~~(Unaudited)~~

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Operating Revenue⁽¹⁾

$
401

$
382

$
1,313

$
1,181

Operating Expenses

Purchased gas⁽¹⁾

19

21

100

71

Other energy-related purchases

4

4

11

8

Other operations and maintenance:

Affiliated suppliers

20

20

65

63

Other

53

113

312

268

Depreciation and amortization

57

55

167

150

Other taxes

42

36

139

127

Total operating expenses

195

249

794

687

Income from operations

206

133

519

494

Earnings from equity method investee

4

5

15

14

Other income

6

2

16

8

Interest and related charges⁽¹⁾

25

23

72

68

Income from operations before income taxes

191

117

478

448

Income tax expense

74

34

176

162

Net Income

$
117

$
83

$
302

$
286

~~(1)~~

~~See Note 17 for amounts attributable to related parties.~~

See Note 2 for disclosure of supplemental cash flow information.

The accompanying notes are an integral part of ~~Dominion Energy Gas' Consolidated Financial Statements.~~

~~DOMINION ENERGY GAS HOLDINGS, LLC~~

~~CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME~~

~~(Unaudited)~~

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Net income

$
117

$
83

$
302

$
286

Other comprehensive income (loss), net of taxes:

Net deferred gains (losses) on derivatives-hedging
activities⁽¹⁾

1

9

3

(6
)
Amounts reclassified to net income:

Net derivative gains-hedging activities⁽²⁾

(4
)

(1
)

(5
)

(3
)
Net pension and other postretirement benefit costs⁽³⁾

1

1

3

2

Total other comprehensive income (loss)

(2
)

9

1

(7
)
Comprehensive income

$
115

$
92

$
303

$
279

~~(1)~~

Net of $(1) million and $(3) million tax for the three months ended September 30, 2017 and 2016, respectively, and net of $(2) million and $5 million tax for the nine months ended September 30, 2017 and 2016, respectively.

~~(2)~~

Net of $3 million and $2 million tax for the three months ended September 30, 2017 and 2016, respectively, and net of $3 million and $2 million tax for the nine months ended September 30, 2017 and 2016, respectively.

~~(3)~~

~~Net of $(1) million tax for both the three months ended September 30, 2017 and 2016, and net of $(2) million tax for both the nine months ended September 30, 2017 and 2016.~~

~~The accompanying notes are an integral part of Dominion Energy Gas' Consolidated Financial Statements.~~

~~DOMINION ENERGY GAS HOLDINGS, LLC~~

~~CONSOLIDATED BALANCE SHEETS~~

~~(Unaudited)~~

September 30, 2017

December 31, 2016⁽¹⁾

(millions)

ASSETS

Current Assets

Cash and cash equivalents

$
13

$
23

Restricted cash

29

20

Customer receivables (less allowance for doubtful accounts of $1 at both dates)

190

281

Other receivables (less allowance for doubtful accounts of $1 at both dates)⁽²⁾

72

13

Affiliated receivables

17

17

Inventories

90

70

Other⁽²⁾

110

158

Total current assets

521

582

Investments

97

99

Property, Plant and Equipment

Property, plant and equipment

10,971

10,475

Accumulated depreciation and amortization

(2,978
)

(2,851
)
Total property, plant and equipment, net

7,993

7,624

Deferred Charges and Other Assets

Pension and other postretirement benefit assets⁽²⁾

1,714

1,557

Other⁽²⁾

1,303

1,280

Total deferred charges and other assets

3,017

2,837

Total assets

$
11,628

$
11,142

~~(1)~~

~~Dominion Energy Gas’ Consolidated Balance Sheet at December 31, 2016 has been derived from the audited Consolidated Balance Sheet at that date.~~

~~(2)~~

~~See Note 17 for amounts attributable to related parties.~~

~~The accompanying notes are an integral part of Dominion Energy Gas' Consolidated Financial Statements.~~

~~DOMINION ENERGY GAS HOLDINGS, LLC~~

~~CONSOLIDATED BALANCE SHEETS—(Continued)~~

~~(Unaudited)~~

September 30, 2017

December 31, 2016⁽¹⁾

(millions)

LIABILITIES AND EQUITY

Current Liabilities

Short-term debt

$
620

$
460

Accounts payable

161

221

Payables to affiliates

18

29

Affiliated current borrowings

34

118

Accrued interest, payroll and taxes

197

225

Other⁽²⁾

157

162

Total current liabilities

1,187

1,215

Long-Term Debt

3,564

3,528

Deferred Credits and Other Liabilities

Deferred income taxes and investment tax credits

2,622

2,438

Other⁽²⁾

429

425

Total deferred credits and other liabilities

3,051

2,863

Total liabilities

7,802

7,606

Commitments and Contingencies (see Note 15)

Equity

Membership interests

3,948

3,659

Accumulated other comprehensive loss

(122
)

(123
)
Total equity

3,826

3,536

Total liabilities and equity

$
11,628

$
11,142

~~(1)~~

~~Dominion Energy Gas’ Consolidated Balance Sheet at December 31, 2016 has been derived from the audited Consolidated Balance Sheet at that date.~~

~~(2)~~

~~See Note 17 for amounts attributable to related parties.~~

~~The accompanying notes are an integral part of Dominion Energy Gas' Consolidated Financial Statements.~~

~~DOMINION ENERGY GAS HOLDINGS, LLC~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(Unaudited)~~

Nine Months Ended September 30,

2017

2016

(millions)

Operating Activities

Net income

$
302

$
286

Adjustments to reconcile net income to net cash provided by operating activities:

Gains on the sales of assets and equity method investment in Iroquois

(61
)

(50
)
Depreciation and amortization

167

150

Deferred income taxes and investment tax credits

176

204

Other adjustments

(9
)

3

Changes in:

Accounts receivable

88

56

Affiliated receivables and payables

(11
)

91

Inventories

(20
)

(17
)
Deferred purchased gas costs, net

11

7

Prepayments

39

15

Accounts payable

(68
)

(76
)
Accrued interest, payroll and taxes

(28
)

(7
)
Pension and other postretirement benefits

(98
)

(97
)
Other operating assets and liabilities

(13
)

(62
)
Net cash provided by operating activities

475

503

Investing Activities

Plant construction and other property additions

(535
)

(610
)
Proceeds from sale of equity method investment in Iroquois

—

7

Proceeds from assignments of shale development rights

5

10

Other

(16
)

(10
)
Net cash used in investing activities

(546
)

(603
)
Financing Activities

Issuance (repayment) of short-term debt, net

160

(331
)
Issuance of long-term debt

—

680

Repayment of affiliated current borrowings, net

(84
)

(95
)
Distribution payments to parent

(15
)

(150
)
Other

—

(9
)
Net cash provided by financing activities

61

95

Decrease in cash and cash equivalents

(10
)

(5
)
Cash and cash equivalents at beginning of period

23

13

Cash and cash equivalents at end of period

$
13

$
8

Supplemental Cash Flow Information

Significant noncash investing activities:

Accrued capital expenditures

$
54

$
42

~~The accompanying notes are an integral part of Dominion Energy Gas'~~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 ~~transporters~~distributors of energy. Dominion Energy’s operations are conducted through various subsidiaries, including Virginia ~~Power and~~Power. Dominion ~~Energy Gas. Virginia Power is a~~Energy’s operations also include DESC, regulated public utility that generates, transmits and distributes electricity for sale in Virginia and northeastern North Carolina. Dominion Energy Gas is a holding company that conducts business activities through a regulated interstate natural gas ~~transmission pipeline and underground storage system~~distribution operations primarily in the ~~Northeast, mid-Atlantic~~eastern and ~~Midwest states, regulated gas transportation~~Rocky Mountain regions of the U.S., nonregulated electric generation and, ~~distribution operations~~following completion of the GT&S Transaction in ~~Ohio, and gas gathering and processing activities primarily~~November 2020, a noncontrolling interest in ~~West Virginia, Ohio and Pennsylvania.~~Cove Point. See Note 3 for a description of the sale of substantially all of Dominion Energy’s gas transmission and storage operations ~~acquired~~to BHE through the GT&S Transaction completed in November 2020 and the expected sale of Dominion Energy’s remaining regulated gas transmission and storage services in the ~~Dominion Energy Questar Combination.~~Rocky Mountain region of the U.S. to Southwest Gas.

Note 2. Significant Accounting Policies

As permitted by the rules and regulations of the SEC, the ~~Companies'~~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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

In the ~~Companies'~~Companies’ opinion, the accompanying unaudited Consolidated Financial Statements contain all adjustments necessary to present fairly their financial position ~~as of~~at September 30, ~~2017,~~2021, their results of operations and changes in equity for the three and nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020 and their cash flows for the nine months ended September 30, ~~2017~~2021 and ~~2016 and Dominion Energy's changes in equity for the nine months ended September 30, 2017 and 2016.~~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'~~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 September 30, ~~2017,~~2021, Dominion Energy owns ~~the general partner, 50.9%~~50% of the ~~common and subordinated units and 37.5% of the convertible preferred~~voting interests in ~~Dominion Energy Midstream. The public’s~~Four Brothers and Three Cedars and has a controlling financial interest over the entities through its right to control operations. Clearway’s ownership interest in Four Brothers and Three Cedars, Terra Nova Renewable Partners’ 33% interest in certain Dominion Energy ~~Midstream is~~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. ~~Also, at September 30, 2017,~~In August 2021, Dominion Energy ~~owns~~entered into an agreement with Terra Nova Renewable Partners to sell its remaining controlling financial interest in certain nonregulated solar projects. Also in August 2021, Dominion Energy entered into an agreement with Clearway to sell its 50% ~~of the units in and consolidates Four Brothers and Three Cedars. NRG's ownership~~voting interest in Four Brothers and Three Cedars, as well as Terra Nova Renewable Partners' 33% interest in certain Dominion Energy merchant solar projects, is reflected as noncontrolling interest in Dominion Energy’s Consolidated Financial Statements.Cedars. See Note 11 for more information.

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' 2016~~Companies’ 2020 Consolidated Financial Statements and Notes have been reclassified to conform to the ~~2017~~2021 presentation for comparative ~~purposes. The~~purposes; however, such reclassifications did not affect the Companies’ net income, total assets, liabilities, equity or cash flows. Effective in the second quarter of 2021, the Companies updated their Statements of Cash Flows to present net charges for allowance for credit risk and write-offs of accounts receivables within other adjustments to reconcile net income to net cash provided by operating activities from the previous presentation within changes in accounts receivable. All prior period information has been conformed to this presentation, which does not result in a change to net cash provided by operating activities.

Amounts disclosed for Dominion Energy are inclusive of Virginia Power, ~~and/or Dominion Energy Gas,~~ where applicable. ~~With the exception of the items described below, there~~There have been no significant changes from Note 2 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020, with the exception of the items described below.

~~Property, Plant~~23

Cash, Restricted Cash and ~~Equipment~~Equivalents

InRestricted Cash and Equivalents

The following table provides a reconciliation of the ~~first quarter~~total cash, restricted cash and equivalents reported within the Companies’ Consolidated Balance Sheets to the corresponding amounts reported within the Companies’ Consolidated Statements of 2017, Virginia Power revised the depreciation rates for its assets to reflect the results of a new depreciation study. This change resulted in an increase in depreciation expense of $32 million ($20 million after-tax)Cash Flows for the nine months ended September 30, ~~2017~~2021 and ~~is expected~~2020:

	Cash, Restricted Cash and Equivalents at End of Period				Cash, Restricted Cash and Equivalents at Beginning of Period
	September 30, 2021		September 30, 2020		December 31, 2020		December 31, 2019
(millions)
Dominion Energy
Cash and cash equivalents⁽¹⁾	$	195	$	462	$	179	$	166
Restricted cash and equivalents⁽²⁾⁽³⁾		72		96		68		103
Cash, restricted cash and equivalents shown in the Consolidated Statements of Cash Flows	$	267	$	558	$	247	$	269
Virginia Power
Cash and cash equivalents	$	38	$	62	$	35	$	17
Restricted cash and equivalents⁽³⁾		1		1		0		7
Cash, restricted cash and equivalents shown in the Consolidated Statements of Cash Flows	$	39	$	63	$	35	$	24

(1)	At September 30, 2021, September 30, 2020, December 31, 2020 and December 31, 2019, Dominion Energy had $15 million, $49 million, $7 million and $31 million of cash and cash equivalents included in current assets held for sale, respectively.

(2)	At September 30, 2021, September 30, 2020, December 31, 2020 and December 31, 2019, Dominion Energy had $22 million, $16 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 ~~increase annual depreciation by approximately $40~~Dominion Energy:

	Nine Months Ended September 30,
	2021		2020
(millions)
Significant noncash investing and financing activities:⁽¹⁾
Accrued capital expenditures	$	374	$	461
Accrued contributions to equity method affiliates		0		15
Leases⁽²⁾		75		45

(1)	See Notes 16 and 17 for noncash financing activities related to derivative restructuring and the issuance of stock associated with the settlement of litigation and noncash investing activities related to property, plant and equipment conveyed to satisfy litigation, respectively.

(2)	Includes $34 million and $42 million of financing leases at September 30, 2021 and 2020, respectively, and $41 million and $3 million of operating leases at September 30, 2021 and 2020, respectively.

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

	Nine Months Ended September 30,
	2021		2020
(millions)
Significant noncash investing and financing activities:⁽¹⁾
Accrued capital expenditures	$	238	$	234
Leases⁽²⁾		59		26

(1)	See Note 16 for noncash financing activities related to derivative restructuring.

(2)	Includes $24 million and $26 million of financing leases at September 30, 2021 and 2020, respectively, and $35 million of operating leases at September 30, 2021.

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 ($25561 million after-tax)~~. Additionally,~~ 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. In addition, see Note 13 for information on the proposed settlement of the 2021 Triennial Review.

In the second quarter of 2020, Virginia Power recorded charges of $30 million ($22 million after-tax) associated with dismantling certain of these electric generation facilities, recorded in impairment of assets and other charges in its Consolidated Statements of Income.

Asset Retirement Obligations

In the second quarter of 2021, Dominion Energy revised its estimated cash flow projections associated with the ~~depreciable lives~~recovery of spent nuclear fuel costs for its ~~merchant generation assets, excluding Millstone, which resulted in~~AROs associated with the decommissioning of Kewaunee. As a ~~decrease in depreciation expense~~result, Dominion Energy recorded a charge of ~~$19~~$44 million ($1235 million after-tax) ~~for the nine months ended September 30, 2017~~within other operations and ~~is expected to decrease annual depreciation by approximately $26 million ($16 million after-tax).~~

~~New Accounting Standards~~maintenance expense in its Consolidated Statements of Income.

In ~~January 2017,~~ the ~~Financial Accounting Standards Board issued~~third quarter of 2021, Dominion Energy revised ~~accounting guidance~~its estimated cash flow projections associated with certain gas distribution pipeline AROs. As a result, Dominion Energy recorded a $252 million decrease to ~~clarify~~AROs with a corresponding $173 million decrease to property, plant and equipment, net and the ~~definition of a business. The revised guidance affects the evaluation of whether a transaction should be accounted for~~remainder primarily recorded as an acquisition or disposition of an asset or a business, which may impact goodwill and related financial statement disclosures. The Companies have adopted this guidance on a prospective basis effective October 1, 2017. The adoption of the pronouncement will result in additional transactions being accounted for as asset acquisitions or dispositions.

In March 2017, the Financial Accounting Standards Board issued revised accounting guidance for the presentation of net periodic pension and other postretirement benefit costs. The update requires that the service cost component of net periodic pension and other postretirement benefit costs be classified in the same line item as other compensation costs arising from services rendered by employees, while all other components of net periodic pension and other postretirement benefit costs would be classified outside of income from operations. In addition, only the service cost component will be eligible for capitalization during construction. The standard also recognized that in the event that a regulator continuesincrease to ~~require capitalization of all net periodic benefit costs prospectively, the difference would result in recognition of a~~ regulatory asset or liability. The guidance is effective for the Companies’ interim and annual reporting periods beginning January 1, 2018, with a retrospective adoption for income statement presentation and a prospective adoption for capitalization. The Companies are currently evaluating the impact the adoption of the standard will have on their consolidated financial statements and disclosures. The Companies are also evaluating industry issues that could potentially create a regulatory accounting difference in the event that any of our state commissions do not adopt the change in capitalization requirements for regulatory reporting.liabilities.

Note 3. Acquisitions and Dispositions

~~Dominion Energy~~Disposition of Gas Transmission & Storage Operations

~~Acquisition of~~

In July 2020, Dominion Energy ~~Questar~~

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 ~~September 2016,~~October 2020, pursuant to a provision in the agreement with BHE, Dominion Energy elected to exclude the Q-Pipe Group 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 would sell the Q-Pipe Group for cash consideration of $1.3 billion and the assumption of related long-term debt. In November 2020, Dominion Energy completed the Dominion Energy Questar Combination and Dominion Energy Questar became a wholly-owned subsidiary of Dominion Energy. Dominion Energy Questar, a Rockies-based integrated natural gas company, included Questar Gas, Wexpro Company and Dominion Energy Questar Pipeline at closing. Questar Gas has regulated gas distribution operationsGT&S Transaction as discussed in Utah, southwestern Wyoming and southeastern Idaho. Wexpro Company develops and produces natural gas from reserves that are supplied to Questar Gas under a cost-of-service framework. Dominion Energy Questar Pipeline provides FERC-regulated interstate natural gas transportation and storage services in Utah, Wyoming and western Colorado. The Dominion Energy Questar Combination provides Dominion Energy with pipeline infrastructure that provides a principal source of gas supply to Western states. Dominion Energy Questar’s regulated businesses also provide further balance between Dominion Energy’s electric and gas operations.

In accordance with the terms of the Dominion Energy Questar Combination, at closing, each share of issued and outstanding Dominion Energy Questar common stock was converted into the right to receive $25.00 per share in cash. The total consideration was $4.4 billion based on 175.5 million shares of Dominion Energy Questar outstanding at closing.

Dominion Energy financed the Dominion Energy Questar Combination through the: (1) August 2016 issuance of $1.4 billion of 2016 Equity Units, (2) August 2016 issuance of $1.3 billion of senior notes, (3) September 2016 borrowing of $1.2 billion under a term loan agreement and (4) $500 million of the proceeds from the April 2016 issuance of common stock. See Notes 17 and 19Note 3 to the Consolidated Financial Statements in the ~~Companies'~~Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016 for more information.~~2020.

~~See Note 3 to~~In connection with closing of the ~~Consolidated Financial Statements in the Companies' Annual Report on Form 10-K for the year ended December 31, 2016 for more information on the~~GT&S Transaction, Dominion Energy ~~Questar Combination including purchase price allocation, regulatory matters~~ and ~~the contribution of~~BHE entered into a transition services agreement under which Dominion Energy ~~Questar Pipeline~~will continue to provide specified administrative services to support the operations of the disposed business for up to 24 months after closing, subsequently extended through June 2023 for certain services. In addition, BHE will provide certain administrative services to Dominion Energy Midstream. During the third quarter of 2017, certain modifications were made to the valuation amounts for regulatory liabilities, current liabilities and deferred income taxes, resulting in a $6 million net increase to goodwill recorded in Dominion Energy’s Consolidated Balance Sheets. The modifications relate primarily to the finalization ofEnergy. Dominion Energy ~~Questar’s 2016 tax return for~~recorded revenue of $5 million and $16 million associated with the ~~period January 1, 2016 through the Dominion Energy Questar Combination, as well as certain regulatory adjustments.~~

~~Results of Operations and Pro Forma Information~~

~~The impact of the Dominion Energy Questar Combination on Dominion Energy’s~~transition service agreement in operating revenue ~~and net income attributable to Dominion Energy~~ in ~~the~~its Consolidated Statements of Income ~~for both the three and nine months ended September 30, 2016, was an increase of $23 million and $5 million, respectively.~~

~~Dominion Energy incurred transaction and transition costs, of which $14 million and $34 million was recorded in other operations and maintenance expense~~ for the three and nine months ended September 30, ~~2017, respectively,~~2021, respectively.

Also in November 2020, BHE provided a $1.3 billion deposit to Dominion Energy on the Q-Pipe Transaction. In July 2021, Dominion Energy and BHE mutually agreed to terminate the Q-Pipe Transaction as a result of ongoing uncertainty associated with receiving approval under the Hart-Scott-Rodino Act. Dominion Energy simultaneously announced its intention to pursue the divestiture of the Q-Pipe Group to an alternative buyer via competitive sales process with targeted closing, subject to applicable regulatory approval, by the end of 2021. Also in July 2021, Dominion Energy entered into an approximately $1.3 billion term loan credit agreement and borrowed the full amount available thereunder. The agreement matures in December 2021, which can be extended at Dominion Energy’s option to June 2022, and bears interest at a variable rate. The proceeds were utilized to repay the deposit received from BHE on the Q-Pipe Transaction. Upon completion of a sale of the Q-Pipe Group, Dominion Energy is required to utilize the net proceeds to repay any outstanding balances under the term loan agreement.

In October 2021, Dominion Energy entered into an agreement with Southwest Gas to sell the Q-Pipe Group. The total value of this transaction is approximately $2 billion, comprised of approximately $1.5 billion of cash consideration (subject to customary closing adjustments) plus the assumption of long-term debt. 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. The sale will be treated as an asset sale for tax purposes and is expected to close by the end of 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 September 30, 2021, Dominion Energy expects to recognize a gain of approximately $685 million ($500 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 Group are presented in held for sale and discontinued operations effective July 2020, at which time 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. Dominion Energy incurred transaction~~Income:

	Three Months Ended September 30, 2021		Three Months Ended September 30, 2020					Nine Months Ended September 30, 2021		Nine Months Ended September 30, 2020
	Q-Pipe Group		GT&S Transaction			Q-Pipe Group		Q-Pipe Group		GT&S Transaction			Q-Pipe Group
(millions)
Operating revenue	$	62	$	511		$	59	$	188	$	1,554		$	182
Operating expense⁽¹⁾		24		208			16		52		1,311			78
Other income⁽²⁾		26		(5	)		1		27		27			3
Interest and related charges⁽³⁾		7		267			5		17		366			15
Income (loss) before income taxes		57		31			39		146		(96	)		92
Income tax expense (benefit)⁽⁴⁾		12		(14	)		5		29		(65	)		19
Net income (loss) including noncontrolling interests		45		45			34		117		(31	)		73
Noncontrolling interests		—		32			—		—		97			—
Net income (loss) attributable to Dominion Energy	$	45	$	13		$	34	$	117	$	(128	)	$	73

(1)

GT&S Transaction includes a charge of $482 million ($359 million after-tax) recorded in the second quarter of 2020 associated with the probable abandonment of a significant portion of the Supply Header Project, as well as the establishment of a $75 million ARO as a result of the cancellation of the Atlantic Coast Pipeline Project.

(2)	Q-Pipe Group includes a $25 million benefit associated with the termination of the Q-Pipe Transaction in the third quarter of 2021.

(3)	GT&S Transaction includes a loss of $237 million recorded in the third quarter of 2020 associated with cash flow hedges of debt-related items that were determined to be probable of not occurring.

(4)	Excludes $18 million income tax benefit recorded in the third quarter of 2021 associated with the GT&S Transaction.

The carrying amounts of major classes of assets and ~~transition costs, of~~liabilities relating to the disposal groups, which ~~$40 million and $47 million was recorded in other operations and maintenance expense~~are reported as held for ~~the three and nine months ended September 30, 2016, respectively, and $13 million was recorded in interest and related charges for both the three and nine months ended September 30, 2016,~~sale in Dominion Energy’s Consolidated Statements of Income. These costs consist of the amortization of financing costs, the charitable contribution commitment described in Note 3 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2016, employee-related expenses, professional fees and other miscellaneous costs.

The following unaudited pro forma financial information reflects the consolidated results of operations of Dominion Energy assuming the Dominion Energy Questar Combination had taken place on January 1, 2015. The unaudited pro forma financial information has been presented for illustrative purposes only and is not necessarily indicative of the consolidated results of operations that would have been achieved or the future consolidated results of operations of the combined company.Balance Sheets were as follows:

Three Months
Ended September 30,
2016⁽¹⁾

Nine Months
Ended September 30,
2016⁽¹⁾

(millions, except EPS)

Operating Revenue

$
3,261

$
9,410

Net income attributable to Dominion Energy

732

1,835

Earnings Per Common Share – Basic

$
1.17

$
2.99

Earnings Per Common Share – Diluted

$
1.17

$
2.99

	At September 30, 2021		At December 31, 2020
	Q-Pipe Group		Q-Pipe Group
(millions)
Current assets⁽¹⁾	$	47	$	47
Equity method investments⁽²⁾		35		35
Property, plant and equipment, net		1,142		1,113
Other deferred charges and other assets, including goodwill and intangible assets⁽³⁾		223		224
Current liabilities		35		30
Long-term debt		426		426
Other deferred credits and liabilities		154		154

(1)	Includes cash and cash equivalents of $1 million and $7 million as of September 30, 2021 and December 31, 2020, respectively.

~~(1)~~(2)

~~Amounts include adjustments for non-recurring costs directly related to the Dominion Energy Questar Combination.~~Comprised of an equity method investment in White River Hub.

(3)	Includes goodwill of $191 million at both September 30, 2021 and December 31, 2020.

~~Wholly-Owned Merchant Solar Projects~~Capital expenditures and significant noncash items relating to the disposal groups included the following:

~~In January 2017, Dominion Energy entered into an agreement to acquire 100%~~

	Nine Months Ended September 30, 2021		Nine Months Ended September 30, 2020
	Q-Pipe Group		GT&S Transaction		Q-Pipe Group
(millions)
Capital expenditures	$	26	$	240	$	27
Significant noncash items:
Impairment of assets and other charges		0		463		0
Depreciation, depletion and amortization		0		173		25
Accrued capital expenditures		2		43		2

Sale of the equity interests of a solar project in North Carolina from Cypress Creek Renewables, LLC for cash consideration. In May 2017, Dominion Energy closed on the acquisition for $154 million, all of which was allocated to property, plant and equipment. The facility commenced commercial operations in June 2017, at a cost of $160 million, including the initial acquisition cost, and generates approximately 79 MW.

In September 2016, Dominion Energy entered into an agreement to acquire 100% of the equity interests of a solar project in Virginia from Community Energy Solar, LLC for cash consideration. In February 2017, Dominion Energy closed on the acquisition for $29 million, all of which was allocated to property, plant and equipment. The project is expected to cost approximately $205 million once constructed, including the initial acquisition cost. The facility is expected to begin commercial operations during the fourth quarter of 2017 and to generate approximately 100 MW.

In August 2016, Dominion Energy entered into an agreement to acquire 100% of the equity interests of two solar projects in California from Solar Frontier Americas Holding LLC for cash consideration. In March 2017, Dominion Energy closed on the acquisition of one of the solar projects for $77 million, all of which was allocated to property, plant and equipment. The facility commenced commercial operations in June 2017, at a cost of $78 million, including the initial acquisition cost, and generates approximately 30 MW. In April 2017, Dominion Energy discontinued efforts on the acquisition of the additional 20 MW solar project from Solar Frontier Americas Holding LLC.Kewaunee

In May 2017, Dominion Energy entered into an agreement to acquire 100% of the equity interests of two solar projects in Virginia from Hecate Energy Virginia C&C LLC for cash consideration of $56 million. Dominion Energy completed the acquisition of one of the projects in June 2017 for $16 million and the facility commenced commercial operations in August 2017. The second acquisition was completed in September 2017 for $40 million with commencement of commercial operations expected to occur by the end of 2017. The projects are expected to cost approximately $60 million once constructed, including the initial acquisition costs, and to generate approximately 30 MW combined.

In June 2017, Dominion Energy entered into an agreement to acquire 100% of the equity interests of four solar projects in North Carolina from Strata Solar Development, LLC and Moorings Farm 2 Holdco, LLC for cash consideration of $40 million. Dominion Energy completed the acquisition of two of the projects in June 2017 for $20 million. The final two acquisitions were completed in October 2017 for $20 million. Commencement of commercial operations of all the projects is expected to occur by the end of 2017. The projects are expected to cost approximately $45 million once constructed, including the initial acquisition costs, and to generate approximately 19 MW combined.

Long-term power purchase, interconnection and operation and maintenance agreements have been executed for all of the projects described above. These projects are included in Power Generation. Dominion Energy has claimed or will claim federal investment tax credits on these solar projects.

~~Sale of Interest in Merchant Solar Projects~~

In September 2015, Dominion Energy signed an agreement to sell a noncontrolling interest (consisting of 33% of the equity interests) in all of its then currently wholly-owned merchant solar projects, 24 solar projects totaling approximately 425 MW, to SunEdison. In December 2015, the sale of interest in 15 of the solar projects closed for $184 million with the sale of interest in the remaining projects completed in January 2016 for $117 million. Upon closing, SunEdison sold its interest in these projects to Terra Nova Renewable Partners. Terra Nova Renewable Partners has a future option to buy all or a portion of Dominion Energy’s remaining 67% ownership in the projects upon the occurrence of certain events, none of which had occurred at September 30, 2017 nor are expected to occur in the remainder of 2017.

~~Sale of Certain Retail Energy Marketing Assets~~

~~In October 2017,~~2021, Dominion Energy entered into an agreement to sell ~~certain assets~~100% of the equity interests in Dominion Energy Kewaunee, Inc. to EnergySolutions, including the transfer of all decommissioning obligations associated with Kewaunee, which ceased operations in 2013. The agreement provides that Dominion Energy retains the assets and obligations of the pension and other postretirement employee benefit plans. In addition, Dominion Energy may continue to withdraw funds prior to closing from the nuclear decommissioning trust to recover certain spent nuclear fuel and other permitted costs, subject to certain conditions. The sale will be treated as an asset sale for tax purposes and is subject to termination by either party if not completed by December 2022. Closing is contingent on approval from the Wisconsin Commission as well as the NRC for the transfer of control of applicable licenses. The purchase agreement requires that EnergySolutions be subject to the Wisconsin regulatory conditions agreed to by Dominion Energy upon its ~~nonregulated retail energy marketing operations~~acquisition of Kewaunee, including the return of any excess decommissioning funds to WPSC and WP&L customers following completion of all decommissioning activities.

In May 2021, Dominion Energy and EnergySolutions submitted a license transfer application to the NRC. Also in May 2021, Dominion Energy submitted an application to the Wisconsin Commission for approval. In July 2021, WPSC and WP&L submitted a joint request to the Wisconsin Commission for the waiver of both of their rights of first refusal to purchase Kewaunee, such rights having been granted as the former owners of Kewaunee. At September 30, 2021, Dominion Energy determined that the assets and liabilities associated with the Kewaunee sale did not meet the criteria to be classified as held for sale due to the significant uncertainty surrounding the timing of or ability to obtain necessary regulatory approvals.

Dominion Energy expects to record a loss if and when it determines that criteria for the classification as held for sale have been met. If such classification had been made at September 30, 2021, Dominion Energy would have recognized a loss of approximately $710 million ($565 million after-tax). If the sale is ultimately completed, the final net loss will primarily depend on the value of the nuclear decommissioning trust and AROs at closing.

Acquisition of Birdseye

In May 2021, Dominion Energy acquired 100% of the ownership interest in Birdseye from BRE Holdings, LLC for total consideration of ~~$143~~$46 million, ~~subject to customary approvals~~consisting of $28 million in cash and $18 million, measured at fair value at closing, of consideration contingent on the achievement of certain ~~adjustments. Pursuant~~revenue targets and future development project sales. Birdseye is primarily engaged in the development of solar energy projects in southeastern states in the U.S. with 2.5 GW of solar generation projects under development. The allocation of the purchase price resulted in $25 million of development project assets, primarily reflected in other deferred charges and other assets in Dominion Energy’s Consolidated Balance Sheets, and $24 million of goodwill, which is not deductible for tax purposes. The goodwill reflects the value associated with enhancing Dominion Energy's development of regulated and long-term contracted solar generating and electric storage projects. The fair value measurements, including of the assets acquired, were determined using the income approach and are considered Level 3 fair value measurements due to the ~~agreement, Dominion Energy will enter into a commission agreement with the buyer upon the first closing under which the buyer will pay a commission~~use of significant judgmental and unobservable inputs, including projected timing and amount of future cash flows. Birdseye is included in connection with the right to use Dominion Energy’s brand in marketing materials and other services over a ten-year term. Dominion Energy is expected to recognize a benefit in other operations and maintenance expense upon each phase of closing, approximately $78 million ($48 million after-tax) in the fourth quarter of 2017 and approximately $65 million ($40 million after-tax) in 2018.Contracted Assets.

~~Virginia Power~~

~~Acquisition of Solar Projects~~

In September 2017, Virginia Power entered into agreements to acquire two solar development projects in North Carolina. The first acquisition is expected to close prior to the project commencing commercial operations, which is expected by the end of 2018, and cost approximately $140 million once constructed, including the initial acquisition cost. The second acquisition is expected to close prior to the project commencing commercial operations, which is expected by the end of 2019, and cost approximately $140 million once constructed, including the initial acquisition cost. The projects are expected to generate approximately 155 MW combined. Virginia Power anticipates claiming federal investment tax credits on these solar projects.

~~Assignment of Tower Rental Portfolio~~

Virginia Power rents space on certain of its electric transmission towers to various wireless carriers for communications antennas and other equipment. In March 2017, Virginia Power sold its rental portfolio to Vertical Bridge Towers II, LLC for $91 million in cash. The proceeds are subject to Virginia Power's FERC-regulated tariff, under which it is required to return half of the proceeds to customers. Virginia Power recognized $2 million and $10 million in other income for the three and nine months ended September 30, 2017, respectively, with the remaining $36 million to be recognized ratably through 2023.

~~Dominion Energy Gas~~

~~Assignment of Shale Development Rights~~

In December 2013, Dominion Energy Gas closed an agreement with a natural gas producer to convey over time approximately 79,000 acres of Marcellus Shale development rights underneath one of its natural gas storage fields. The agreement provided for payments to Dominion Energy Gas, subject to customary adjustments, of up to approximately $200 million over a period of nine years, and an overriding royalty interest in gas produced from the acreage. In March 2015, Dominion Energy Gas and the natural gas producer closed on an amendment to the agreement, which included the immediate conveyance of approximately 9,000 acres of Marcellus Shale development rights and a two year extension of the term of the original agreement. In April 2016, Dominion Energy Gas and the natural gas producer closed on an amendment to the agreement, which included the immediate conveyance of a 32% partial interest in the remaining approximately 70,000 acres. This conveyance resulted in the recognition of $35 million ($21 million after-tax) of previously deferred revenue to other operations and maintenance expense in Dominion Energy Gas’ Consolidated Statements of Income. In August 2017, Dominion Energy Gas and the natural gas producer signed an amendment to the agreement, which included the finalization of contractual matters on previous conveyances, the conveyance of Dominion Energy Gas’ remaining 68% interest in approximately 70,000 acres and the elimination of Dominion Energy Gas’ overriding royalty interest in gas produced from all acreage. Dominion Energy Gas will receive total consideration of $130 million, with $65 million to be received by the end of the fourth quarter 2017 and $65 million to be received by the end of the third quarter of 2018 in connection with the final conveyance. As

a result of this amendment in the third quarter of 2017, Dominion Energy Gas recognized a $56 million ($33 million after-tax) gain included in other operations and maintenance expense in Dominion Energy Gas’ Consolidated Statements of Income associated with the finalization of the contractual matters on previous conveyances. Additionally, Dominion Energy Gas is expected to recognize an approximately $9 million ($5 million after-tax) gain in the fourth quarter of 2017 associated with the elimination of its overriding royalty interest and an approximately $65 million ($40 million after-tax) gain associated with the final conveyance of acreage.

In November 2014, Dominion Energy Gas closed on an agreement with a natural gas producer to convey over time approximately 24,000 acres of Marcellus Shale development rights underneath one of its natural gas storage fields. In connection with that agreement, in January 2016, Dominion Energy Gas conveyed approximately 2,000 acres of Marcellus Shale development rights and received proceeds of $5 million and an overriding royalty interest in gas produced from the acreage. This transaction resulted in a $5 million ($3 million after-tax) gain, included in other operations and maintenance expense in Dominion Energy Gas’ Consolidated Statements of Income. In July 2016, in connection with the existing agreement, Dominion Energy Gas conveyed approximately 2,000 acres of Marcellus Shale development rights and received proceeds of $5 million and an overriding royalty interest in gas produced from the acreage. This transaction resulted in a $5 million ($3 million after-tax) gain, included in other operations and maintenance expense in Dominion Energy Gas’ Consolidated Statements of Income. In July 2017, in connection with the existing agreement, Dominion Energy Gas conveyed an additional approximately 2,000 acres of Marcellus Shale development rights and received proceeds of $5 million and an overriding royalty interest in gas produced from the acreage. This transaction resulted in a $5 million ($3 million after-tax) gain, included in other operations and maintenance expense in Dominion Energy Gas’ Consolidated Statements of Income.

Note 4. Operating Revenue

The Companies’ operating revenue consists of the following:

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Dominion Energy

Electric sales:

Regulated

$
2,108

$
2,147

$
5,590

$
5,707

Nonregulated

380

399

1,114

1,123

Gas sales:

Regulated

97

46

696

137

Nonregulated

69

87

323

259

Gas transportation and storage

406

378

1,328

1,162

Other

119

75

325

263

Total operating revenue

$
3,179

$
3,132

$
9,376

$
8,651

Virginia Power

Regulated electric sales

$
2,108

$
2,147

$
5,590

$
5,707

Other

46

64

142

170

Total operating revenue

$
2,154

$
2,211

$
5,732

$
5,877

Dominion Energy Gas

Gas sales:

Regulated

$
12

$
28

$
59

$
69

Nonregulated

2

1

12

8

Gas transportation and storage

324

303

1,062

955

Other

63

50

180

149

Total operating revenue

$
401

$
382

$
1,313

$
1,181

	Three Months Ended September 30,					Nine Months Ended September 30,
	2021			2020		2021			2020
(millions)
Dominion Energy
Regulated electric sales:
Residential	$	1,281		$	1,497	$	3,453		$	3,746
Commercial		831			865		2,311			2,391
Industrial		194			190		547			548
Government and other retail		258			239		670			651
Wholesale		52			37		131			99
Nonregulated electric sales		253			218		719			627
Regulated gas sales:
Residential		132			123		950			853
Commercial		61			50		346			304
Other		31			18		88			61
Nonregulated gas sales		7			12		74			124
Regulated gas transportation and storage		208			165		698			578
Other regulated revenues		47			61		187			236
Other nonregulated revenues⁽¹⁾		79			61		184			132
Total operating revenue from contracts with customers		3,434			3,536		10,358			10,350
Other revenues⁽²⁾⁽³⁾		(258	)		71		(274	)		301
Total operating revenue	$	3,176		$	3,607	$	10,084		$	10,651
Virginia Power
Regulated electric sales:
Residential	$	935		$	1,146	$	2,572		$	2,860
Commercial		604			645		1,715			1,805
Industrial		94			98		268			284
Government and other retail		241			223		625			603
Wholesale		31			25		79			70
Other regulated revenues		37			61		165			217
Other nonregulated revenues⁽¹⁾⁽⁴⁾		45			33		93			66
Total operating revenue from contracts with customers		1,987			2,231		5,517			5,905
Other revenues⁽²⁾⁽⁴⁾		(11	)		17		30			78
Total operating revenue	$	1,976		$	2,248	$	5,547		$	5,983

(1)

Includes sales which are considered to be goods transferred at a point in time of $9 million and $5 million for the three months ended September 30, 2021 and 2020, respectively, and $24 million and $16 million for the nine months ended September 30, 2021 and 2020, respectively, at Dominion Energy, primarily consisting of sales of commodities related to nonregulated extraction activities and other miscellaneous products. Additionally, sales of renewable energy credits were $16 million and $21 million for the three months ended September 30, 2021 and 2020, respectively, and $29 million and $32 million for the nine months ended September 30, 2021 and 2020, respectively, at Dominion Energy and $13 million and $16 million for the three months ended September 30, 2021 and 2020, respectively, and $22 million and $24 million for the nine months ended September 30, 2021 and 2020, respectively, at Virginia Power.

(2)

Includes alternative revenue of $3 million and $51 million at Dominion Energy and $3 million and $12 million at Virginia Power for the three months ended September 30, 2021 and 2020, respectively, and $50 million and $90 million at Dominion Energy and $41 million and $63 million at Virginia Power for the nine months ended September 30, 2021 and 2020, respectively.

(3)	Includes revenue associated with services provided to discontinued operations of $1 million and $1 million for the three months ended September 30, 2021 and 2020, respectively, and $3 million and $4 million for the nine months ended September 30, 2021 and 2020, respectively.

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

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 Dominion Energy expects to recognize this revenue. These revenues relate to contracts containing fixed prices where Dominion Energy will earn the associated revenue over time as it stands 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 Dominion Energy elects to recognize revenue in the amount it has a right to invoice.

Revenue expected to be recognized on multi-year

contracts in place at September 30, 2021

2021

2022

2023

2024

2025

Thereafter

Total

(millions)

Dominion Energy⁽¹⁾

493

754

(1)	Includes no amounts for Virginia Power.

At September 30, 2021 and December 31, 2020, Dominion Energy’s contract liability balances were $124 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 September 30, 2021 and December 31, 2020, Virginia Power’s contract liability balances were $29 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 nine months ended September 30, 2021 and 2020, Dominion Energy recognized revenue of $124 million and $95 million, respectively, from the beginning contract liability balances. During the nine months ended September 30, 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'~~Companies’ effective income tax rate as follows:

	Dominion Energy						Virginia Power						Dominion Energy Gas						Dominion Energy						Virginia Power
Nine Months Ended September 30,	2017			2016			2017			2016			2017			2016			2021			2020			2021			2020
U.S. statutory rate		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		21.0	%		21.0	%		21.0	%		21.0	%
Increases (reductions) resulting from:
State taxes, net of federal benefit		2.9			3.7			3.7			3.9			2.7			0.8			2.0			1.5			4.5			4.7
Investment tax credits		(5.7	)		(10.4	)		(0.8	)		—			—			—			(5.6	)		(30.5	)		(5.8	)		(5.6	)
Production tax credits		(0.7	)		(0.8	)		(0.5	)		(0.5	)		—			—			(0.5	)		(2.4	)		(0.6	)		(0.9	)
Reversal of excess deferred income taxes																				(3.8	)		(14.5	)		(2.2	)		(1.9	)
State legislative change		—			(0.8	)		—			—			—			—			(1.0	)		—			(1.0	)		—
Change in tax status																				—			(6.1	)		—			—
AFUDC - equity		(1.3	)		(0.7	)		(0.6	)		(0.6	)		(0.8	)		(0.1	)		(0.5	)		(1.1	)		(0.5	)		(0.3	)
Changes in state deferred taxes associated with assets held for sale																				(0.5	)		(11.6	)		—			—
Absence of tax on noncontrolling interest																				(0.2	)		14.1			—			—
Other, net		(2.6	)		(1.4	)		0.2			0.1			(0.1	)		0.5			(1.1	)		(1.8	)		—			—
Effective tax rate		27.6	%		24.6	%		37.0	%		37.9	%		36.8	%		36.2	%		9.8	%		(31.4	)%		15.4	%		17.0	%

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.

For the nine months ended September 30, 2021, the Companies’ effective tax rates ~~in 2017 for the Companies~~ reflect the ~~completion~~benefit of ~~audits by~~a state ~~tax authorities that resulted~~legislative change enacted in ~~the recognition of previously unrecognized tax benefits. At December 31, 2016, Virginia Power’s unrecognized tax benefits included state refund claims~~April 2021 for ~~open~~ tax years ~~through 2011. Management believed settlement of the claims, including interest thereon, within the next twelve months was remote. In June 2017, Virginia Power received and accepted~~beginning January 1, 2022. Dominion Energy’s effective tax rate reflects a ~~cash offer to settle the refund claims. As a result of the settlement, Virginia Power decreased its unrecognized tax benefits by $8~~$21 million ~~and recognized a $2 million~~deferred tax benefit, ~~which impacted its~~inclusive of a $16 million deferred tax benefit at Virginia Power.

For the nine months ended September 30, 2020, Dominion Energy’s effective tax ~~rate. Also~~rate reflects an income tax benefit of $45 million associated with the remeasurement of consolidated state deferred taxes with the classification of gas transmission and storage operations as held for sale. In addition, Dominion Energy’s effective tax rate reflects an income tax expense of $55 million attributable to the noncontrolling interest primarily associated with the impairment of solar assets held in ~~connection with this settlement, Virginia Power realized interest income~~partnership form discussed in Note 11.

As of ~~$11 million, which is reflected in other income in the Consolidated Statements of Income. Otherwise, at~~ September 30, ~~2017,~~2021, there have been no material changes in the ~~Companies'~~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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016~~2020, for a discussion of these unrecognized tax benefits.

Discontinued operations

Income tax expense (benefit) included in discontinued operations is $5 million and $(572) million for the nine months ended September 30, 2021 and 2020, respectively. 2021 income taxes include a $15 million benefit related to finalizing income tax returns on the GT&S Transaction. 2020 income taxes reflect a charge of $81 million for the write-off of tax-related regulatory assets associated with the Atlantic Coast Pipeline Project.

Note 6. Earnings Per Share

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

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions, except EPS)

Net income attributable to Dominion Energy

$
665

$
690

$
1,687

$
1,666

Average shares of common stock outstanding – Basic

642.5

625.9

633.4

612.8

Net effect of dilutive securities⁽¹⁾

—

0.1

—

1.0

Average shares of common stock outstanding – Diluted

642.5

626.0

633.4

613.8

Earnings Per Common Share – Basic

$
1.03

$
1.10

$
2.66

$
2.72

Earnings Per Common Share – Diluted

$
1.03

$
1.10

$
2.66

$
2.71

	Three Months Ended September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
(millions, except EPS)
Net income attributable to Dominion Energy from continuing operations	$	589		$	369		$	1,828		$	767
Preferred stock dividends (see Note 16)		(16	)		(16	)		(48	)		(48	)
Net income attributable to Dominion Energy from continuing operations – Basic		573			353			1,780			719
Dilutive effect of Series A Preferred Stock		—			—			—			(28	)
Net income attributable to Dominion Energy from continuing operations - Diluted	$	573		$	353		$	1,780		$	691
Net income (loss) attributable to Dominion Energy from discontinued operations - Basic & Diluted	$	65		$	(13	)	$	119		$	(1,850	)

Average shares of common stock outstanding – Basic		808.7			833.8			807.1			837.1
Net effect of dilutive securities ⁽¹⁾		1.3			—			0.5			—
Average shares of common stock outstanding – Diluted		810.0			833.8			807.6			837.1

EPS from continuing operations – Basic	$	0.71		$	0.42		$	2.20		$	0.86
EPS from discontinued operations – Basic		0.08			(0.01	)		0.15			(2.21	)
EPS attributable to Dominion Energy – Basic	$	0.79		$	0.41		$	2.35		$	(1.35	)

EPS from continuing operations – Diluted	$	0.71		$	0.42		$	2.20		$	0.83
EPS from discontinued operations – Diluted		0.08			(0.01	)		0.15			(2.21	)
EPS attributable to Dominion Energy – Diluted	$	0.79		$	0.41		$	2.35		$	(1.38	)

(1)

~~Dilutive securities consist primarily of the 2013 Equity Units for the nine months ended September 30, 2016. See Note 17~~Primarily related to ~~the Consolidated Financial Statements in the Companies' Annual Report on Form 10-K for the year ended December 31, 2016 for more information.~~shares expected to be issued to settle litigation.

The ~~2014~~2019 Equity Units and ~~2016~~the Q-Pipe Transaction deposit, prior to being settled in cash in July 2021, are potentially dilutive securities. See Note 19 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 and Note 3, respectively, for additional information. Additionally, the two September 2020 accelerated share purchase agreements were potentially dilutive for the three and nine months ended September 30, 2020. See Note 16 for additional information.

The forward stock purchase contracts included within the 2019 Equity Units are ~~potentially~~excluded from the calculation of diluted EPS from continuing operations for the three and nine months ended September 30, 2021 and 2020, as the dilutive ~~securities but were~~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. As described in Note 16, effective November 2021 any settlement of the conversion up to $1,000 per share is payable in cash, and any amount in excess of $1,000 per share may be settled in cash, common stock or a combination thereof. For the three and nine months ended September 30, 2021 and the three months ended September 30, 2020, 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 periods.

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 and nine months ended September 30, 2021 based upon the expectation Dominion Energy would settle in cash, which occurred in July 2021, rather than through the issuance of Dominion Energy common stock.

The forward stock purchase contracts included within the September 2020 accelerated share repurchase agreements are excluded from the calculation of diluted EPS for the three and nine months ended September 30, ~~2017 and 2016,~~2020 as the dilutive stock price threshold was not met. The Dominion Energy Midstream convertible preferred units are potentially dilutive securities but had no effect on the calculation of diluted EPS for the three and nine months ended September 30, 2017.

Note 7. Accumulated Other Comprehensive Income (Loss)

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
Income (Loss)
From Equity
Method
Investee

Total

(millions)

Three Months Ended September 30, 2017

Beginning balance

$
(250
)

$
630

$
(1,058
)

$
(4
)

$
(682
)
Other comprehensive income before
   reclassifications: gains

11

48

—

—

59

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(15
)

(4
)

14

—

(5
)
Net current-period other comprehensive income (loss)

(4
)

44

14

—

54

Ending balance

$
(254
)

$
674

$
(1,044
)

$
(4
)

$
(628
)
Three Months Ended September 30, 2016

Beginning balance

$
(241
)

$
535

$
(781
)

$
(6
)

$
(493
)
Other comprehensive income before
   reclassifications: gains

14

31

15

—

60

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(34
)

(13
)

9

—

(38
)
Net current-period other comprehensive income (loss)

(20
)

18

24

—

22

Ending balance

$
(261
)

$
553

$
(757
)

$
(6
)

$
(471
)
Nine Months Ended September 30, 2017

Beginning balance

$
(280
)

$
569

$
(1,082
)

$
(6
)

$
(799
)
Other comprehensive income before
   reclassifications: gains

82

141

—

2

225

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(56
)

(36
)

38

—

(54
)
Net current-period other comprehensive income

26

105

38

2

171

Ending balance

$
(254
)

$
674

$
(1,044
)

$
(4
)

$
(628
)
Nine Months Ended September 30, 2016

Beginning balance

$
(176
)

$
504

$
(797
)

$
(5
)

$
(474
)
Other comprehensive income before
   reclassifications: gains (losses)

56

72

15

(1
)

142

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(141
)

(23
)

25

—

(139
)
Net current-period other comprehensive income (loss)

(85
)

49

40

(1
)

3

Ending balance

$
(261
)

$
553

$
(757
)

$
(6
)

$
(471
)

	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 September 30, 2021
Beginning balance	$	(371	)	$	41		$	(1,309	)	$	(1	)	$	(1,640	)
Other comprehensive income before reclassifications: gains (losses)		(2	)		4			(1	)		(3	)		(2	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		10			(3	)		19			0			26
Net current period other comprehensive income (loss)		8			1			18			(3	)		24
Ending balance	$	(363	)	$	42		$	(1,291	)	$	(4	)	$	(1,616	)
Three Months Ended September 30, 2020
Beginning balance	$	(644	)	$	51		$	(1,385	)	$	(2	)	$	(1,980	)
Other comprehensive income before reclassifications: gains (losses)		10			4			(261	)		1			(246	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		188			(1	)		23			0			210
Net current period other comprehensive income (loss)		198			3			(238	)		1			(36	)
Ending balance	$	(446	)	$	54		$	(1,623	)	$	(1	)	$	(2,016	)
Nine Months Ended September 30, 2021
Beginning balance	$	(419	)	$	62		$	(1,359	)	$	(1	)	$	(1,717	)
Other comprehensive income before reclassifications: gains (losses)		21			(15	)		5			(3	)		8
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		35			(5	)		63			0			93
Net current period other comprehensive income (loss)		56			(20	)		68			(3	)		101
Ending balance	$	(363	)	$	42		$	(1,291	)	$	(4	)	$	(1,616	)
Nine Months Ended September 30, 2020
Beginning balance	$	(407	)	$	37		$	(1,421	)	$	(2	)	$	(1,793	)
Other comprehensive income before reclassifications: gains (losses)		(254	)		32			(262	)		1			(483	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		215			(15	)		60			0			260
Net current period other comprehensive income (loss)		(39	)		17			(202	)		1			(223	)
Ending balance	$	(446	)	$	54		$	(1,623	)	$	(1	)	$	(2,016	)

(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
Details about AOCI components					Amounts reclassified from AOCI			Affected line item in the Consolidated Statements of Income
(millions)
Three Months Ended September 30, 2017
Three Months Ended September 30, 2021
Deferred (gains) and losses on derivatives-hedging activities:
Interest rate contracts					$	14		Interest and related charges
Total						14
Tax						(4	)	Income tax expense (benefit)
Total, net of tax					$	10
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities					$	(4	)	Other income
Total						(4	)
Tax						1		Income tax expense (benefit)
Total, net of tax					$	(3	)
Unrecognized pension and other postretirement benefit costs:
Amortization of prior-service costs (credits)					$	(5	)	Other income
Amortization of actuarial losses						30		Other income
Total						25
Tax						(6	)	Income tax expense (benefit)
Total, net of tax					$	19
Three Months Ended September 30, 2020
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	(32	)	Operating revenue	$	(8	)	Operating revenue
Interest rate contracts						23		Interest and related charges
		1		Electric fuel and other energy-related purchases		230		Discontinued operations
Interest rate contracts		16		Interest and related charges
Foreign currency contracts		(10	)	Other income		6		Discontinued operations
Total						251
Tax						(63	)	Income tax expense (benefit)
Total, net of tax					$	188
Unrealized (gains) and losses on investment securities:
Realized (gains) losses on sale of securities					$	(3	)	Other income
Total						(3	)
Tax						2		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
Amortization of actuarial losses						36		Other income
Total						31
Tax						(8	)	Income tax expense (benefit)
Total, net of tax					$	23
		(25	)
Tax		10		Income tax expense
	$	(15	)
Unrealized (gains) and losses on investment securities:
Realized (gain) loss on sale of securities	$	(10	)	Other income
Impairment		4		Other income
		(6	)
Tax		2		Income tax expense
	$	(4	)
Unrecognized pension and other postretirement benefit costs:
Prior service (credit) costs	$	(5	)	Other operations and maintenance
Actuarial (gains) losses		26		Other operations and maintenance
		21
Tax		(7	)	Income tax expense
	$	14
Three Months Ended September 30, 2016
Details about AOCI components					Amounts reclassified from AOCI			Affected line item in the Consolidated Statements of Income
(millions)
Nine Months Ended September 30, 2021
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	(64	)	Operating revenue	$	1		Purchased gas
		1		Purchased gas
		1		Electric fuel and other energy-related purchases
Interest rate contracts		10		Interest and related charges		46		Interest and related charges
Foreign currency contracts		(3	)	Other income
		(55	)
Total						47
Tax		21		Income tax expense		(12	)	Income tax expense (benefit)
	$	(34	)
Total, net of tax					$	35
Unrealized (gains) and losses on investment securities:
Realized (gain) loss on sale of securities	$	(25	)	Other income
Impairment		5		Other income
		(20	)
Tax		7		Income tax expense
	$	(13	)
Unrecognized pension and other postretirement benefit costs:
Prior service (credit) costs	$	(4	)	Other operations and maintenance
Actuarial (gains) losses		17		Other operations and maintenance
		13
Tax		(4	)	Income tax expense
	$	9
Nine Months Ended September 30, 2017
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	(114	)	Operating revenue
		(1	)	Electric fuel and other energy-related purchases
Interest rate contracts		39		Interest and related charges
Realized (gains) losses on sale of securities					$	(7	)	Other income
Total						(7	)

Details About AOCI Components	Amounts Reclassified From AOCI			Affected Line Item in the Consolidated Statements of Income
Foreign currency contracts		(15	)	Other income
		(91	)
Tax		35		Income tax expense		2		Income tax expense (benefit)
	$	(56	)
Unrealized (gains) and losses on investment securities:
Realized (gain) loss on sale of securities	$	(74	)	Other income
Impairment		18		Other income
		(56	)
Total, net of tax					$	(5	)
Unrecognized pension and other postretirement benefit costs:
Amortization of prior-service costs (credits)					$	(15	)	Other income
Amortization of actuarial losses						100		Other income
Total						85
Tax		20		Income tax expense		(22	)	Income tax expense (benefit)
	$	(36	)
Unrecognized pension and other postretirement benefit costs:
Prior service (credit) costs	$	(16	)	Other operations and maintenance
Actuarial (gains) losses		79		Other operations and maintenance
		63
Tax		(25	)	Income tax expense
	$	38
Nine Months Ended September 30, 2016
Total, net of tax					$	63
Nine Months Ended September 30, 2020
Deferred (gains) and losses on derivatives-hedging activities:
Commodity contracts	$	(266	)	Operating revenue	$	(22	)	Operating revenue
		9		Purchased gas		3		Purchased gas
		8		Electric fuel and other energy-related purchases		(2	)	Discontinued operations
Interest rate contracts		21		Interest and related charges		66		Interest and related charges
						236		Discontinued operations
Foreign currency contracts		(1	)	Other income		6		Discontinued operations
		(229	)
Total						287
Tax		88		Income tax expense		(72	)	Income tax expense (benefit)
	$	(141	)
Total, net of tax					$	215
Unrealized (gains) and losses on investment securities:
Realized (gain) loss on sale of securities	$	(55	)	Other income
Impairment		19		Other income
		(36	)
Realized (gains) losses on sale of securities					$	(21	)	Other income
Total						(21	)
Tax		13		Income tax expense		6		Income tax expense (benefit)
	$	(23	)
Total, net of tax					$	(15	)
Unrecognized pension and other postretirement benefit costs:
Prior service (credit) costs	$	(11	)	Other operations and maintenance
Actuarial (gains) losses		52		Other operations and maintenance
		41
Amortization of prior-service costs (credits)					$	(16	)	Other income
Amortization of actuarial losses						97		Other income
Total						81
Tax		(16	)	Income tax expense		(21	)	Income tax expense (benefit)
	$	25
Total, net of tax					$	60

~~Dominion Energy Gas~~Virginia Power

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

Deferred Gains
and Losses on
Derivatives-Hedging
Activities

Unrecognized
Pension and
Other
Postretirement
Benefit Costs

Total

(millions)

Three Months Ended September 30, 2017

Beginning balance

$
(23
)

$
(97
)

$
(120
)
Other comprehensive income before
   reclassifications: gains

1

—

1

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(4
)

1

(3
)
Net current-period other comprehensive income (loss)

(3
)

1

(2
)
Ending balance

$
(26
)

$
(96
)

$
(122
)
Three Months Ended September 30, 2016

Beginning balance

$
(34
)

$
(81
)

$
(115
)
Other comprehensive income before
   reclassifications: gains

9

—

9

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(1
)

1

—

Net current-period other comprehensive income

8

1

9

Ending balance

$
(26
)

$
(80
)

$
(106
)
Nine Months Ended September 30, 2017

Beginning balance

$
(24
)

$
(99
)

$
(123
)
Other comprehensive income before
   reclassifications: gains

3

—

3

Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(5
)

3

(2
)
Net current-period other comprehensive income (loss)

(2
)

3

1

Ending balance

$
(26
)

$
(96
)

$
(122
)
Nine Months Ended September 30, 2016

Beginning balance

$
(17
)

$
(82
)

$
(99
)
Other comprehensive income before
   reclassifications: losses

(6
)

—

(6
)
Amounts reclassified from AOCI⁽¹⁾: (gains) losses

(3
)

2

(1
)
Net current-period other comprehensive income (loss)

(9
)

2

(7
)
Ending balance

$
(26
)

$
(80
)

$
(106
)

	Deferred gains and losses on derivatives- hedging activities			Unrealized gains and losses on investment securities			Total
(millions)
Three Months Ended September 30, 2021
Beginning balance	$	(39	)	$	6		$	(33	)
Other comprehensive income before reclassifications: gains (losses)		(2	)		0			(2	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		0			(1	)		(1	)
Net current period other comprehensive income (loss)		(2	)		(1	)		(3	)
Ending balance	$	(41	)	$	5		$	(36	)
Three Months Ended September 30, 2020
Beginning balance	$	(78	)	$	8		$	(70	)
Other comprehensive income before reclassifications: gains (losses)		5			0			5
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		1			(1	)		0
Net current period other comprehensive income (loss)		6			(1	)		5
Ending balance	$	(72	)	$	7		$	(65	)
Nine Months Ended September 30, 2021
Beginning balance	$	(60	)	$	8		$	(52	)
Other comprehensive income before reclassifications: gains (losses)		18			(2	)		16
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		1			(1	)		0
Net current period other comprehensive income (loss)		19			(3	)		16
Ending balance	$	(41	)	$	5		$	(36	)
Nine Months Ended September 30, 2020
Beginning balance	$	(34	)	$	5		$	(29	)
Other comprehensive income before reclassifications: gains (losses)		(39	)		4			(35	)
Amounts reclassified from AOCI: (gains) losses⁽¹⁾		1			(2	)		(1	)
Net current period other comprehensive income (loss)		(38	)		2			(36	)
Ending balance	$	(72	)	$	7		$	(65	)

(1)

~~See table below for details about these reclassifications.~~Amounts are allocated as follows within Virginia Power’s Consolidated Statements of Income; deferred gains and losses on derivatives – hedging activities are recorded to interest and related charges, unrealized gains and losses on investment securities are recorded to other income and associated tax amounts are recorded to income tax expense.

~~The following table presents Dominion Energy Gas' 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 September 30, 2017

Deferred (gains) and losses on derivatives-hedging activities:

Commodity contracts

$
2

Operating revenue
Interest rate contracts

1

Interest and related charges
Foreign currency contracts

(10
)

Other income

(7
)

Tax

3

Income tax expense

$
(4
)

Unrecognized pension and other postretirement benefit costs:

Actuarial (gains) losses

$
2

Other operations and maintenance

2

Tax

(1
)

Income tax expense

$
1

Three Months Ended September 30, 2016

Deferred (gains) and losses on derivatives-hedging activities:

Commodity contracts

$
(1
)

Operating revenue
Interest rate contracts

1

Interest and related charges
Foreign currency contracts

(3
)

Other income

(3
)

Tax

2

Income tax expense

$
(1
)

Unrecognized pension and other postretirement benefit costs:

Actuarial (gains) losses

$
2

Other operations and maintenance

2

Tax

(1
)

Income tax expense

$
1

Nine Months Ended September 30, 2017

Deferred (gains) and losses on derivatives-hedging activities:

Commodity contracts

$
4

Operating revenue
Interest rate contracts

3

Interest and related charges
Foreign currency contracts

(15
)

Other income

(8
)

Tax

3

Income tax expense

$
(5
)

Unrecognized pension and other postretirement benefit costs:

Actuarial (gains) losses

$
5

Other operations and maintenance

5

Tax

(2
)

Income tax expense

$
3

Nine Months Ended September 30, 2016

Deferred (gains) and losses on derivatives-hedging activities:

Commodity contracts

$
(6
)

Operating revenue
Interest rate contracts

2

Interest and related charges
Foreign currency contracts

(1
)

Other income

(5
)

Tax

2

Income tax expense

$
(3
)

Unrecognized pension and other postretirement benefit costs:

Actuarial (gains) losses

$
4

Other operations and maintenance

4

Tax

(2
)

Income tax expense

$
2

Note 8. Fair Value Measurements

The ~~Companies'~~Companies’ fair value measurements are made in accordance with the policies discussed in Note 6 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. See Note 9 in this report for further information about the ~~Companies'~~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. An option model is used to value Level 3 physical ~~and financial~~ options. 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. The option model calculates mark-to-market valuations using variations of the Black-Scholes option model. The inputs into the models are the forward market prices, implied price volatilities, risk-free rate of return, the option expiration dates, the option strike prices, the original sales prices and volumes. For Level 3 fair value measurements, certain forward market prices and implied price volatilities are considered unobservable. The unobservable inputs are developed and substantiated using historical information, available market data, third-party data, and statistical analysis. Periodically, inputs to valuation models are reviewed and revised as needed, based on historical information, updated market data, market liquidity and relationships, and changes in third-party pricing sources.

The following table presents Dominion ~~Energy's~~Energy’s quantitative information about Level 3 fair value measurements at September 30, ~~2017.~~2021. The range and weighted average are presented in dollars for market price inputs and percentages for price volatility.

	Fair Value (millions)		Valuation Techniques	Unobservable Input		Range	Weighted Average⁽¹⁾			Fair Value (millions)		Valuation Techniques	Unobservable Input		Range	Weighted Average⁽¹⁾
Assets
Physical and financial forwards and futures:
Physical and financial forwards:
Natural gas⁽²⁾	$	91	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 7		—		$	52	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 6		(1	)
FTRs		19	Discounted cash flow	Market price (per MWh)	⁽³⁾	(3) - 7		1			64	Discounted cash flow	Market price (per MWh)	⁽³⁾	(1) - 6		2
Electricity											38	Discounted cash flow	Market price (per MWh)	⁽³⁾	24 - 97		37
Physical options:
Natural gas		2	Option model	Market price (per Dth)	⁽³⁾	2 - 7		4			6	Option model	Market price (per Dth)	⁽³⁾	4 - 10		7
				Price volatility	⁽⁴⁾	24% - 46%		32	%				Price volatility	⁽⁴⁾	19% - 32%		24	%
Electricity		42	Option model	Market price (per MWh)	⁽³⁾	21 - 50		34
				Price volatility	⁽⁴⁾	0% - 78%		28	%
Total assets	$	154								$	160
Liabilities
Financial forwards:
Physical and financial forwards:
Natural gas⁽²⁾										$	1	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 5		0
FTRs	$	1	Discounted cash flow	Market price (per MWh)	⁽³⁾	(5) - 7		1			6	Discounted cash flow	Market price (per MWh)	⁽³⁾	(3) - 6		1
Electricity											9	Discounted cash flow	Market price (per MWh)	⁽³⁾	24 - 111		39
Total liabilities	$	1								$	16

(1)	Averages weighted by volume.

(2)	Includes basis.

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

(4)Represents volatilities unrepresented in published markets.

~~Represents volatilities unrepresented in published markets.~~

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)
Price volatility	Buy	Increase (decrease)	Gain (loss)
Price volatility	Sell	Increase (decrease)	Loss (gain)

Nonrecurring Fair Value Measurements

In the second quarter of 2021, Dominion Energy recorded a charge of $20 million ($15 million after-tax) in impairment of assets and other charges in its Consolidated Statements of Income to write off substantially all of the long-lived assets of its nonregulated retail software development operations to their estimated fair value, using a market approach, of less than $1 million. The valuation is considered a Level 2 fair value measurement given that it is based on bids received.

In the third quarter of 2021, Dominion Energy recorded a charge of $16 million ($12 million after-tax) in impairment of assets and other charges in its Consolidated Statements of Income to adjust a corporate office building down to its estimated fair value, using both an income and market approach, of $26 million. The valuation is considered a Level 3 measurement due to the use of significant judgmental and unobservable inputs, including projected timing and amount of future cash flows and discount rates inherent in the future cash flows and market prices. The corporate office building is reflected in the Corporate and Other segment and presented as held for sale in Dominion Energy’s Consolidated Balance Sheets at September 30, 2021.

See Note 3 for information on the nonrecurring fair value measurement associated with the acquisition of Birdseye.

See Notes 10 and 11 for information on nonrecurring fair value measurements associated with charges recorded related to Fowler Ridge and non-wholly-owned nonregulated solar facilities, respectively.

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 September 30, 2021
Assets
Derivatives:
Commodity	$	0	$	125	$	160	$	285
Interest rate		0		371		0		371
Investments⁽¹⁾:
Equity securities:
U.S.		4,738		0		0		4,738
Fixed income:
Corporate debt instruments		0		879		0		879
Government securities		774		715		0		1,489
Cash equivalents and other		3		0		0		3
Total assets	$	5,515	$	2,090	$	160	$	7,765
Liabilities
Derivatives:
Commodity	$	0	$	607	$	16	$	623
Interest rate		0		327		0		327
Total liabilities	$	0	$	934	$	16	$	950
At December 31, 2020
Assets
Derivatives:
Commodity	$	0	$	57	$	110	$	167
Interest rate		0		230		0		230
Investments⁽¹⁾:
Equity securities:
U.S.		4,648		0		0		4,648
Fixed income:
Corporate debt instruments		0		629		0		629
Government securities		508		730		0		1,238
Cash equivalents and other		32		15		0		47
Total assets	$	5,188	$	1,661	$	110	$	6,959
Liabilities
Derivatives:
Commodity	$	0	$	48	$	7	$	55
Interest rate		0		431		0		431
Total liabilities	$	0	$	479	$	7	$	486

(1)

Includes investments held in the nuclear decommissioning and rabbi trusts. Excludes $382 million and $340 million of assets at September 30, 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					Nine Months Ended
	September 30,					September 30,
	2021			2020		2021			2020
(millions)
Beginning balance	$	62		$	123	$	103		$	(37	)
Total realized and unrealized gains (losses):
Included in earnings:
Operating revenue		(6	)		0		(8	)		0
Electric fuel and other energy-related purchases		29			0		12			(26	)
Included in regulatory assets/liabilities		88			4		49			164
Settlements		(29	)		0		(12	)		26
Ending balance	$	144		$	127	$	144		$	127

There are $(6) million and $(8) million of unrealized gains and losses included in operating revenue in the Level 3 fair value category related to assets/liabilities still held at the reporting date for the three and nine months ended September 30, 2021, respectively. There were 0 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 and nine months ended September 30, 2020.

Virginia Power

The following table presents Virginia Power’s quantitative information about Level 3 fair value measurements at September 30, 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⁾	$	52	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 6		(1	)
FTRs		64	Discounted cash flow	Market price (per MWh)	⁽³⁾	(1) - 6		2
Physical options:
Natural gas		6	Option model	Market price (per Dth)	⁽³⁾	4 - 10		7
				Price volatility	⁽⁴⁾	19% - 32%		24	%
Total assets	$	122
Liabilities
Physical and financial forwards:
Natural gas⁽²⁾	$	1	Discounted cash flow	Market price (per Dth)	⁽³⁾	(2) - 5		0
FTRs		6	Discounted cash flow	Market price (per MWh)	⁽³⁾	(3) - 6		1
Total liabilities	$	7

(1)	Averages weighted by volume.

(2)	Includes basis.

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

(4) Represents volatilities unrepresented in published markets.

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)
Price volatility	Buy	Increase (decrease)	Gain (loss)
Price volatility	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)

September 30, 2017

Assets

Derivatives:

Commodity

$
—

$
59

$
154

$
213

Interest rate

—

11

—

11

Foreign currency

—

25

—

25

Investments⁽¹⁾:

Equity securities:

U.S.

3,288

—

—

3,288

Fixed income:

Corporate debt instruments

—

452

—

452

Government securities

475

631

—

1,106

Cash equivalents and other

7

—

—

7

Total assets

$
3,770

$
1,178

$
154

$
5,102

Liabilities

Derivatives:

Commodity

$
—

$
41

$
1

$
42

Interest rate

—

72

—

72

Foreign currency

—

4

—

4

Total liabilities

$
—

$
117

$
1

$
118

December 31, 2016

Assets

Derivatives:

Commodity

$
—

$
115

$
147

$
262

Interest rate

—

17

—

17

Investments⁽¹⁾:

Equity securities:

U.S.

2,913

—

—

2,913

Fixed income:

Corporate debt instruments

—

487

—

487

Government securities

424

614

—

1,038

Cash equivalents and other

5

—

—

5

Total assets

$
3,342

$
1,233

$
147

$
4,722

Liabilities

Derivatives:

Commodity

$
—

$
88

$
8

$
96

Interest rate

—

53

—

53

Foreign currency

—

6

—

6

Total liabilities

$
—

$
147

$
8

$
155

~~(1)~~

Includes investments held in the nuclear decommissioning and rabbi trusts. Excludes $92 million and $89 million of assets at September 30, 2017 and December 31, 2016, 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 September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Beginning balance

$
152

$
124

$
139

$
95

Total realized and unrealized gains (losses):

Included in earnings

(11
)

(7
)

(36
)

(23
)
Included in other comprehensive income

—

—

—

2

Included in regulatory assets/liabilities

11

(37
)

34

(5
)
Settlements

1

9

13

27

Transfers out of Level 3

—

—

3

(7
)
Ending balance

$
153

$
89

$
153

$
89

The amount of total gains (losses) for the period included in
   earnings attributable to the change in unrealized gains
   (losses) relating to assets/liabilities still held at the
   reporting date

$
1

$
—

$
1

$
—

~~The following table presents Dominion Energy’s classification of gains and losses included in earnings in the Level 3 fair value category.~~

Operating Revenue

Electric Fuel and Other Energy - Related Purchases

Total

(millions)

Three Months Ended September 30, 2017

Total gains (losses) included in earnings

$
1

$
(12
)

$
(11
)
The amount of total gains (losses) for the period included in
   earnings attributable to the change in unrealized gains
   (losses) relating to assets/liabilities still held at the
   reporting date

1

—

1

Three Months Ended September 30, 2016

Total gains (losses) included in earnings

$
—

$
(7
)

$
(7
)
Nine Months Ended September 30, 2017

Total gains (losses) included in earnings

$
1

$
(37
)

$
(36
)
The amount of total gains (losses) for the period included in
   earnings attributable to the change in unrealized gains
   (losses) relating to assets/liabilities still held at the
   reporting date

1

—

1

Nine Months Ended September 30, 2016

Total gains (losses) included in earnings

$
—

$
(23
)

$
(23
)

~~Virginia Power~~

The following table presents Virginia Power's quantitative information about Level 3 fair value measurements at September 30, 2017. The range and weighted average are presented in dollars for market price inputs and percentages for price volatility.

Fair Value
(millions)

Valuation Techniques

Unobservable Input

Range

Weighted
Average⁽¹⁾

Assets

Physical and financial forwards and
futures:

Natural gas⁽²⁾

$
91

Discounted cash flow

Market price (per Dth)
⁽³⁾

(2) - 7

(1
)
FTRs

19

Discounted cash flow

Market price (per MWh)
⁽³⁾

(1) - 7

1

Physical options:

Natural gas

1

Option model

Market price (per Dth)
⁽³⁾

2 - 7

4

Price volatility
⁽⁴⁾

24% - 46%

32
%
Electricity

42

Option model

Market price (per MWh)
⁽³⁾

21 - 50

34

Price volatility
⁽⁴⁾

0% - 78%

28
%
Total assets

$
153

Liabilities

Financial forwards:

FTRs

$
1

Discounted cash flow

Market price (per MWh)
⁽³⁾

(5) - 7

1

Total liabilities

$
1

~~(1)~~

~~Averages weighted by volume.~~

~~(2)~~

~~Includes basis.~~

~~(3)~~

~~Represents market prices beyond defined terms for Levels 1 and 2.~~

~~(4)~~

~~Represents volatilities unrepresented in published markets~~.

~~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)~~
~~Price volatility~~	~~Buy~~	~~Increase (decrease)~~	~~Gain (loss)~~
~~Price volatility~~	~~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		Level 1		Level 2		Level 3		Total
(millions)
September 30, 2017
Assets
Derivatives:
Commodity	$	—	$	15	$	153	$	168
Investments⁽¹⁾:
Equity securities:
U.S.		1,471		—		—		1,471
Fixed income:
Corporate debt instruments		—		234		—		234
Government securities		193		302		—		495
Total assets	$	1,664	$	551	$	153	$	2,368
Liabilities
Derivatives:
Commodity	$	—	$	5	$	1	$	6
Interest rate		—		55		—		55
Total liabilities	$	—	$	60	$	1	$	61
December 31, 2016
At September 30, 2021
Assets
Derivatives:
Commodity	$	—	$	43	$	145	$	188	$	0	$	67	$	122	$	189
Interest rate		—		6		—		6		0		170		0		170
Investments⁽¹⁾:
Equity securities:
U.S.		1,302		—		—		1,302		2,188		0		0		2,188
Fixed income:
Corporate debt instruments		—		277		—		277		0		516		0		516
Government securities		136		291		—		427		349		274		0		623
Total assets	$	1,438	$	617	$	145	$	2,200	$	2,537	$	1,027	$	122	$	3,686
Liabilities
Derivatives:
Commodity	$	—	$	8	$	2	$	10	$	0	$	164	$	7	$	171
Interest rate		—		21		—		21		0		282		0		282
Total liabilities	$	—	$	29	$	2	$	31	$	0	$	446	$	7	$	453
At December 31, 2020
Assets
Derivatives:
Commodity									$	0	$	5	$	110	$	115
Interest rate										0		66		0		66
Investments⁽¹⁾:
Equity securities:
U.S.										2,171		0		0		2,171
Fixed income:
Corporate debt instruments										0		348		0		348
Government securities										201		309		0		510
Cash equivalents and other										13		0		0		13
Total assets									$	2,385	$	728	$	110	$	3,223
Liabilities
Derivatives:
Commodity									$	0	$	22	$	7	$	29
Interest rate										0		376		0		376
Total liabilities									$	0	$	398	$	7	$	405

(1)

Includes investments held in the nuclear decommissioning trusts. Excludes ~~$29~~$183 million and ~~$26~~$167 million of assets at September 30, ~~2017~~2021 and December 31, ~~2016,~~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					Nine Months Ended
	Three Months Ended September 30,						Nine Months Ended September 30,						September 30,					September 30,
	2017			2016			2017			2016			2021			2020		2021			2020
(millions)
Beginning balance	$	152		$	125		$	143		$	93		$	74		$	123	$	103		$	(37	)
Total realized and unrealized gains (losses):
Included in earnings		(12	)		(7	)		(37	)		(24	)
Included in earnings:
Electric fuel and other energy-related purchases														27			0		10			(26	)
Included in regulatory assets/liabilities		11			(37	)		34			(5	)		41			4		12			164
Settlements		1			7			12			24			(27	)		0		(10	)		26
Ending balance	$	152		$	88		$	152		$	88		$	115		$	127	$	115		$	127

The gains and losses included in earnings in the Level 3 fair value category were classified in electric fuel and other energy-related purchases in Virginia Power's Consolidated Statements of Income for the three and nine months ended September 30, 2017 and 2016. There were no0 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 and nine months ended September 30, ~~2017~~2021 and ~~2016.~~

~~Dominion Energy Gas~~

The following table presents Dominion Energy Gas' assets and liabilities for derivatives that are measured at fair value on a recurring basis for each hierarchy level, including both current and noncurrent portions.2020.

Level 1

Level 2

Level 3

Total

(millions)

September 30, 2017

Assets

Commodity

$
—

$
1

$
—

$
1

Foreign currency

—

25

—

25

Total assets

$
—

$
26

$
—

$
26

Liabilities

Commodity

$
—

$
6

$
—

$
6

Foreign currency

—

4

—

4

Total liabilities

$
—

$
10

$
—

$
10

December 31, 2016

Liabilities

Commodity

$
—

$
3

$
2

$
5

Foreign currency

—

6

—

6

Total liabilities

$
—

$
9

$
2

$
11

The following table presents the net change in Dominion Energy Gas' assets and liabilities for derivatives measured at fair value on a recurring basis and included in the Level 3 fair value category. There were no net changes in assets and liabilities for derivatives measured at fair value on a recurring basis and included in the Level 3 fair value category for the three months ended September 30, 2017 and 2016.

Nine Months Ended September 30,

2017

2016

(millions)

Beginning balance

$
(2
)

$
6

Total realized and unrealized gains (losses):

Included in other comprehensive income (loss)

(1
)

2

Transfers out of Level 3

3

(8
)
Ending balance

$
—

$
—

There were no gains or losses included in earnings in the Level 3 fair value category for the three and nine months ended September 30, 2017 and 2016. 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 and nine months ended September 30, 2017 and 2016.

Fair Value of Financial Instruments

Substantially all of the ~~Companies'~~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, ~~and cash equivalents,~~ restricted cash ~~(which is recorded in Dominion Energy’s other current assets),~~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:

September 30, 2017

December 31, 2016

Carrying
Amount

Estimated
Fair
Value⁽¹⁾

Carrying
Amount

Estimated
Fair
Value⁽¹⁾

(millions)

Dominion Energy

Long-term debt, including securities due within one year⁽²⁾

$
28,317

$
30,639

$
26,587

$
28,273

Junior subordinated notes⁽³⁾

3,980

4,128

2,980

2,893

Remarketable subordinated notes⁽³⁾

1,377

1,421

2,373

2,418

Virginia Power

Long-term debt, including securities due within one year⁽³⁾

$
11,346

$
12,686

$
10,530

$
11,584

Dominion Energy Gas

Long-term debt⁽⁴⁾

$
3,564

$
3,705

$
3,528

$
3,603

	September 30, 2021				December 31, 2020
	Carrying Amount		Estimated Fair Value⁽¹⁾		Carrying Amount		Estimated Fair Value⁽¹⁾
(millions)
Dominion Energy
Long-term debt⁽²⁾⁽³⁾	$	35,140	$	40,471	$	31,996	$	38,773
Supplemental credit facility borrowings⁽⁴⁾		900		900		225		225
Junior subordinated notes⁽⁵⁾		1,386		1,503		3,411		3,633
Virginia Power
Long-term debt⁽⁵⁾	$	13,212	$	15,570	$	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 ~~issues~~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, and foreign currency remeasurement adjustments.~~premium. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, the carrying amount includes the valuation of certain fair value hedges associated with fixed rate debt of ~~$(4)~~$2 million and ~~$(1)~~$3 million, respectively.

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

(4)	Also includes Supplemental 364-Day credit facility borrowings.

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

~~(4)~~

~~Carrying amount includes amounts which represent the unamortized debt issuance costs, discount or premium, and foreign currency remeasurement adjustments.~~

Note 9. Derivatives and Hedge Accounting Activities

The ~~Companies'~~Companies’ accounting policies, objectives and strategies for using derivative instruments are discussed in Note 2 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~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'~~Companies’ Consolidated Balance Sheets. ~~Dominion Energy's~~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. ~~Virginia Power's and Dominion Energy Gas' derivative contracts consist of over-the-counter transactions.~~ Over-the-counter contracts are bilateral contracts that are transacted directly with a ~~counterparty.~~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 ~~security,~~securities, none of which are subject to restrictions. Cash collateral, ~~is used~~as presented in the table below, is used to offset derivative assets and liabilities. Certain accounts receivable and accounts payable recognized on the ~~Companies'~~Companies’ Consolidated Balance Sheets, ~~as well as~~ letters of credit and other forms of ~~security,~~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~~Energy’s derivative asset and liability balances by type of financial instrument, ~~before~~if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and ~~after the effects of offsetting:~~cash collateral received or paid:

September 30, 2017

December 31, 2016

Gross
Amounts of Recognized
Assets

Gross
Amounts
Offset in the Consolidated Balance Sheet

Net Amounts of Assets
Presented in the Consolidated Balance Sheet

Gross
Amounts of Recognized
Assets

Gross
Amounts
Offset in the Consolidated
Balance Sheet

Net Amounts of
Assets
Presented in the Consolidated
Balance Sheet

(millions)

Commodity contracts:

Over-the-counter

$
186

$
—

$
186

$
211

$
—

$
211

Exchange

24

—

24

44

—

44

Interest rate contracts:

Over-the-counter

11

—

11

17

—

17

Foreign currency contracts:

Over-the-counter

25

—

25

—

—

—

Total derivatives, subject to a master netting or
similar arrangement

246

—

246

272

—

272

Total derivatives, not subject to a master netting or
similar arrangement

3

—

3

7

—

7

Total

$
249

$
—

$
249

$
279

$
—

$
279

			September 30, 2017									December 31, 2016						September 30, 2021								December 31, 2020
			Gross Amounts Not Offset in the Consolidated Balance Sheet									Gross Amounts Not Offset in the Consolidated Balance Sheet						Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Net Amounts of Assets Presented in the Consolidated Balance Sheet			Financial Instruments		Cash Collateral Received		Net Amounts		Net Amounts of Assets Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Received		Net Amounts		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	$	186		$	8	$	—	$	178	$	211	$	14	$	—	$	197	$	202	$	10	$	0	$	192	$	117	$	9	$	0	$	108
Exchange		24			21		—		3		44		44		—		—		45		32		0		13		49		24		0		25
Interest rate contracts:
Over-the-counter		11			6		—		5		17		9		—		8		371		27		0		344		230		13		0		217
Foreign currency contracts:
Over-the-counter		25			4		—		21		—		—		—		—
Total	$	246		$	39	$	—	$	207	$	272	$	67	$	—	$	205
Total derivatives, subject to a master netting or similar arrangement																		$	618	$	69	$	0	$	549	$	396	$	46	$	0	$	350

(1)	Excludes $38million and $1 million of derivative assets at September 30, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

September 30, 2017

December 31, 2016

Gross
Amounts of
Recognized
Liabilities

Gross
Amounts
Offset in the
Consolidated
Balance Sheet

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

Gross
Amounts of
Recognized
Liabilities

Gross
Amounts
Offset in the
Consolidated
Balance Sheet

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

(millions)

Commodity contracts:

Over-the-counter

$
19

$
—

$
19

$
23

$
—

$
23

Exchange

21

—

21

71

—

71

Interest rate contracts:

Over-the-counter

72

—

72

53

—

53

Foreign currency contracts:

Over-the-counter

4

—

4

6

—

6

Total derivatives, subject to a master netting or
similar arrangement

116

—

116

153

—

153

Total derivatives, not subject to a master netting or
similar arrangement

2

—

2

2

—

2

Total

$
118

$
—

$
118

$
155

$
—

$
155

			September 30, 2017									December 31, 2016						September 30, 2021								December 31, 2020
			Gross Amounts Not Offset in the Consolidated Balance Sheet									Gross Amounts Not Offset in the Consolidated Balance Sheet						Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Net Amounts of Liabilities Presented in the Consolidated Balance Sheet			Financial Instruments		Cash Collateral Paid		Net Amounts		Net Amounts of Liabilities Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Paid		Net Amounts		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		$	8	$	—	$	11	$	23	$	14	$	—	$	9	$	148	$	10	$	79	$	59	$	30	$	9	$	0	$	21
Exchange		21			21		—		—		71		44		27		—		473		32		441		0		24		24		0		0
Interest rate contracts:
Over-the-counter		72			6		—		66		53		9		—		44		327		27		11		289		431		13		17		401
Foreign currency contracts:
Over-the-counter		4			4		—		—		6		—		—		6
Total	$	116		$	39	$	—	$	77	$	153	$	67	$	27	$	59
Total derivatives, subject to a master netting or similar arrangement																		$	948	$	69	$	531	$	348	$	485	$	46	$	17	$	422

(1)	Excludes $2 million and $1 million of derivative liabilities at September 30, 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 September 30, ~~2017.~~2021. These volumes are based on open derivative positions and represent the combined absolute value of ~~its~~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		Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		62		17		59		9
Basis		165		612		202		472
Electricity (MWh):
Fixed price		6,749,288		902,069		14,286,444		32,508,487
FTRs		72,126,361		—		71,265,005		0
Liquids (Gal)⁽²⁾		36,940,288		—
Interest rate⁽³⁾	$	1,100,000,000	$	5,049,890,127
Foreign currency⁽³⁾⁽⁴⁾	$	—	$	280,000,000
Interest rate⁽²⁾ (millions)					$	1,600	$	6,715

(1)	Includes options.

(2)	~~Includes NGLs and oil.~~

~~(3)~~

Maturity is determined based on final settlement period.

~~(4)~~

~~Euro equivalent volumes are €250,000,000.~~

~~Ineffectiveness and~~ AOCI

For the three and nine months ended September 30, 2017 and 2016, gains or losses on hedging instruments determined to be ineffective and amounts excluded from the assessment of effectiveness were not material. Amounts excluded from the assessment of effectiveness include changes in the differences between spot prices and forward prices.

The following table presents selected information related to ~~gains (losses)~~losses on cash flow hedges included in AOCI in Dominion Energy’s Consolidated Balance Sheet at September 30, ~~2017:~~2021:

AOCI
After-Tax

Amounts Expected to be
Reclassified to Earnings
During the Next 12 Months
After-Tax

Maximum Term
(millions)

Commodities:

Gas

$
(1
)

$
(1
)

37 months
Electricity

7

7

15 months
Other

(4
)

(4
)

6 months
Interest rate

(260
)

(11
)

387 months
Foreign currency

4

(2
)

105 months
Total

$
(254
)

$
(11
)

	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term
(millions)
Interest rate	$	(363	)	$	(43	)	387 months
Total	$	(363	)	$	(43	)

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 ~~market prices,~~ interest ~~rates~~rates.

Fair Value Hedges

For derivative instruments that are designated and ~~foreign currency exchange rates.~~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 0 derivative instruments designated as fair value hedges during the three and nine months ended September 30, 2021 and 2020.

The following table presents the amounts recorded on the balance sheet related to cumulative basis adjustments for fair value hedges, all of which related to discontinued hedging relationships at both September 30, 2021 and December 31, 2020:

	Carrying Amount of the Hedged Asset (Liability)						Cumulative Amount of Fair Value Hedging Adjustments Included in the Carrying Amount of the Hedged Assets (Liabilities)
	September 30, 2021			December 31, 2020			September 30, 2021			December 31, 2020
(millions)
Long-term debt	$	(752	)	$	(1,153	)	$	(2	)	$	(3	)

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		Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)
September 30, 2017
ASSETS
Current Assets
Commodity	$	19	$	83	$	102
Interest rate		9		—		9
Total current derivative assets⁽¹⁾		28		83		111
Noncurrent Assets
Commodity		1		110		111
Interest rate		2		—		2
Foreign currency		25		—		25
Total noncurrent derivative assets⁽²⁾		28		110		138
Total derivative assets	$	56	$	193	$	249
LIABILITIES
Current Liabilities
Commodity	$	15	$	25	$	40
Interest rate		21		—		21
Foreign currency		4		—		4
Total current derivative liabilities⁽³⁾		40		25		65
Noncurrent Liabilities
Commodity		—		2		2
Interest rate		51		—		51
Total noncurrent derivative liabilities⁽⁴⁾		51		2		53
Total derivative liabilities	$	91	$	27	$	118
December 31, 2016
September 30, 2021
ASSETS
Current Assets
Commodity	$	29	$	101	$	130	$	0	$	190	$	190
Interest rate		10		—		10		0		19		19
Total current derivative assets⁽¹⁾		39		101		140		0		209		209
Noncurrent Assets
Commodity		—		132		132		0		95		95
Interest rate		7		—		7		170		182		352
Total noncurrent derivative assets⁽²⁾		7		132		139		170		277		447
Total derivative assets	$	46	$	233	$	279	$	170	$	486	$	656
LIABILITIES
Current Liabilities
Commodity	$	51	$	41	$	92	$	0	$	484	$	484
Interest rate		33		—		33		253		17		270
Foreign currency		3		—		3
Total current derivative liabilities⁽³⁾		87		41		128		253		501		754
Noncurrent Liabilities
Commodity		1		3		4		0		139		139
Interest rate		20		—		20		29		28		57
Foreign currency		3		—		3
Total noncurrent derivative liabilities⁽⁴⁾		24		3		27		29		167		196
Total derivative liabilities	$	111	$	44	$	155	$	282	$	668	$	950
December 31, 2020
ASSETS
Current Assets
Commodity							$	0	$	58	$	58
Interest rate								0		9		9
Total current derivative assets⁽¹⁾								0		67		67
Noncurrent Assets
Commodity								0		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							$	0	$	42	$	42
Interest rate								363		10		373
Total current derivative liabilities⁽³⁾								363		52		415
Noncurrent Liabilities
Commodity								0		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 ~~are presented~~include $182 million and $63 million in other current assets in Dominion Energy’s Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020, respectively. The remainder is presented 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 are~~Includes $25 million and $3 million at September 30, 2021 and December 31, 2020, respectively, presented in ~~other~~ current liabilities held for sale in Dominion ~~Energy's~~Energy’s Consolidated Balance Sheets.

~~(4)~~(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~~Energy’s derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of ~~Income:~~Income.

Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
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 September 30, 2017
Three Months Ended September 30, 2021
Derivative type and location of gains (losses):
Interest rate⁽³⁾										$	(2	)	$	(14	)	$	9
Total										$	(2	)	$	(14	)	$	9
Three Months Ended September 30, 2020
Derivative type and location of gains (losses):
Commodity:
Operating revenue				$	32								$	8
Electric fuel and other energy-related purchases					(1	)
Total commodity										$	—		$	8		$	—
Interest rate:
Interest and related charges													$	(23	)
Discontinued operations														(230	)
Total interest rate										$	8		$	(253	)	$	62
Foreign currency⁽⁴⁾											6			(6	)		—
Total										$	14		$	(251	)	$	62
Nine Months Ended September 30, 2021
Derivative type and location of gains (losses):
Commodity:
Purchased gas													$	(1	)
Total commodity	$	8		$	31		$	—		$	—		$	(1	)	$	—
Interest rate⁽³⁾		(4	)		(16	)		(26	)		29			(46	)		198
Foreign currency⁽⁴⁾		12			10			—
Total	$	16		$	25		$	(26	)	$	29		$	(47	)	$	198
Three Months Ended September 30, 2016
Nine Months Ended September 30, 2020
Derivative type and location of gains (losses):
Commodity:
Operating revenue				$	64								$	22
Purchased gas					(1	)								(3	)
Electric fuel and other energy-related purchases					(1	)
Discontinued operations														2
Total commodity	$	7		$	62		$	—		$	—		$	21		$	—
Interest rate⁽³⁾		3			(10	)		(16	)
Interest rate:
Interest and related charges													$	(66	)
Discontinued operations														(236	)
Total interest rate										$	(328	)	$	(302	)	$	(488	)
Foreign currency⁽⁴⁾		12			3			—			(11	)		(6	)		—
Total	$	22		$	55		$	(16	)	$	(339	)	$	(287	)	$	(488	)
Nine Months Ended September 30, 2017
Derivative type and location of gains (losses):
Commodity:
Operating revenue				$	114
Electric fuel and other energy-related purchases					1
Total commodity	$	139		$	115		$	—
Interest rate⁽³⁾		(18	)		(39	)		(60	)
Foreign currency⁽⁴⁾		10			15			—
Total	$	131		$	91		$	(60	)
Nine Months Ended September 30, 2016
Derivative type and location of gains (losses):
Commodity:
Operating revenue				$	266
Purchased gas					(9	)
Electric fuel and other energy-related purchases					(8	)
Total commodity	$	193		$	249		$	—
Interest rate⁽³⁾		(107	)		(21	)		(258	)
Foreign currency⁽⁴⁾		4			1			—
Total	$	90		$	229		$	(258	)

(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 interest and related charges.

(4) 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						Nine Months Ended
	September 30,						September 30,
	2021			2020			2021			2020
(millions)
Derivative type and location of gains (losses):
Commodity:
Operating revenue	$	(334	)	$	(15	)	$	(521	)	$	31
Purchased gas		25			4			32			(6	)
Electric fuel and other energy-related purchases		44			(6	)		7			(79	)
Discontinued operations		0			(1	)		0			4
Interest rate:
Interest and related charges		(20	)		57			142			(21	)
Discontinued operations		0			5			0			(3	)
Foreign Currency:
Discontinued operations		0			8			0			8
Total	$	(285	)	$	52		$	(340	)	$	(66	)

~~(3)~~

~~Amounts recorded in Dominion Energy’s Consolidated Statements of Income are classified in interest and related charges.~~

~~(4)~~

~~Amounts recorded in Dominion Energy’s Consolidated Statements of Income are classified in other income.~~

Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾

Three Months Ended September 30,

Nine Months Ended September 30,

Derivatives Not Designated as Hedging Instruments

2017

2016

2017

2016

(millions)

Derivative type and location of gains (losses):

Commodity:

Operating revenue

$
7

$
25

$
22

$
19

Purchased gas

(6
)

(21
)

2

(14
)
Electric fuel and other energy-related purchases

(19
)

(12
)

(51
)

(43
)
Other operations and maintenance

1

—

(1
)

—

Total

$
(17
)

$
(8
)

$
(28
)

$
(38
)

(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~~Power’s derivative asset and liability balances by type of financial instrument, ~~before~~if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and ~~after the effects of offsetting:~~cash collateral received or paid:

September 30, 2017

December 31, 2016

Gross
Amounts of
Recognized
Assets

Gross
Amounts
Offset in the
Consolidated
Balance Sheet

Net Amounts of
Assets
Presented in the
Consolidated
Balance Sheet

Gross
Amounts of
Recognized Assets

Gross
Amounts
Offset in the
Consolidated
Balance Sheet

Net Amounts of
Assets Presented
in the
Consolidated
Balance Sheet

(millions)

Commodity contracts:

Over-the-counter

$
156

$
—

$
156

$
147

$
—

$
147

Interest rate contracts:

Over-the-counter

—

—

—

6

—

6

Total derivatives, subject to a master netting or
similar arrangement

156

—

156

153

—

153

Total derivatives, not subject to a master netting or
similar arrangement

12

—

12

41

—

41

Total

$
168

$
—

$
168

$
194

$
—

$
194

			September 30, 2017								December 31, 2016						September 30, 2021								December 31, 2020
			Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet						Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Net Amounts of Assets Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Received		Net Amounts		Net Amounts of Assets Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Received		Net Amounts		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	$	156	$	1	$	—	$	155	$	147	$	2	$	—	$	145	$	122	$	7	$	0	$	115	$	111	$	6	$	0	$	105
Exchange																		4		4		0		0	1		1			0		0
Interest rate contracts:
Over-the-counter		—		—		—		—		6		—		—		6		170		19		0		151	66		7			0		59
Total	$	156	$	1	$	—	$	155	$	153	$	2	$	—	$	151
Total derivatives, subject to a master netting or similar arrangement																	$	296	$	30	$	0	$	266	$	178	$	14	$	0	$	164

(1)	Excludes $63million and $3 million of derivative assets at September 30, 2021 and December 31, 2020, respectively, which are not subject to master netting or similar arrangements.

													September 30, 2021								December 31, 2020
	September 30, 2017						December 31, 2016						Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Liabilities Presented in the Consolidated Balance Sheet		Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Liabilities Presented 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	$	1	$	—	$	1	$	2	$	—	$	2	$	123	$	7	$	79	$	37	$	6	$	6	$	0	$	0
Exchange														46		4		42		0	1		1			0		0
Interest rate contracts:
Over-the-counter		55		—		55		21		—		21		282		19		0		263	376		7			0		369
Total derivatives, subject to a master netting or similar arrangement		56		—		56		23		—		23	$	451	$	30	$	121	$	300	$	383	$	14	$	0	$	369
Total derivatives, not subject to a master netting or similar arrangement		5		—		5		8		—		8
Total	$	61	$	—	$	61	$	31	$	—	$	31

September 30, 2017

December 31, 2016

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

Financial
Instruments

Cash
Collateral
Paid

Net
Amounts

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

Financial
Instruments

Cash
Collateral
Paid

Net
Amounts

(millions)

Commodity contracts:

Over-the-counter

$
1

$
1

$
—

$
—

$
2

$
2

$
—

$
—

Interest rate contracts:

Over-the-counter

55

—

—

55

21

—

—

21

Total

$
56

$
1

$
—

$
55

$
23

$
2

$
—

$
21

(1)	Excludes $2million and $22 million of derivative liabilities at September 30, 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 September 30, ~~2017.~~2021. These volumes are based on open derivative positions and represent the combined absolute value of ~~its~~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		Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		28		6		23		9
Basis		85		562		143		465
Electricity (MWh):
Fixed price⁽¹⁾		1,426,093		611,629		5,953,983		6,092,512
FTRs		68,673,158		—		71,265,005		0
Interest rate⁽²⁾	$	300,000,000	$	1,150,000,000
Interest rate⁽²⁾ (millions)					$	850	$	1,900

(1)	Includes options.

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

~~Ineffectiveness and~~ AOCI

~~For the three and nine months ended September 30, 2017 and 2016, gains or losses on hedging instruments determined to be ineffective were not material.~~

The following table presents selected information related to losses on cash flow hedges included in AOCI in Virginia Power’s Consolidated Balance Sheet at September 30, ~~2017:~~2021:

	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term
(millions)
Interest rate	$	(12	)	$	(1	)	387 months	$	(41	)	$	(2	)	387 months
Total	$	(12	)	$	(1	)		$	(41	)	$	(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 ~~prices~~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		Fair Value – Derivatives under Hedge Accounting			Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)
September 30, 2017
September 30, 2021
ASSETS
Current Assets
Commodity	$	—	$	61	$	61	$	0		$	117	$	117
Total current derivative assets⁽¹⁾		—		61		61		0			117		117
Noncurrent Assets
Commodity		—		107		107		0			72		72
Interest rate								170			0		170
Total noncurrent derivative assets⁽²⁾		—		107		107		170			72		242
Total derivative assets	$	—	$	168	$	168	$	170		$	189	$	359
LIABILITIES
Current Liabilities
Commodity	$	—	$	6	$	6	$	0		$	136	$	136
Interest rate		17		—		17		253			0		253
Total current derivative liabilities⁽³⁾		17		6		23
Total current derivative liabilities								253			136		389
Noncurrent Liabilities
Commodity								0			35		35
Interest rate		38		—		38		29			0		29
Total noncurrent derivatives liabilities ⁽⁴⁾		38		—		38
Total noncurrent derivative liabilities⁽³⁾								29			35		64
Total derivative liabilities	$	55	$	6	$	61	$	282		$	171	$	453
December 31, 2016
December 31, 2020
ASSETS
Current Assets
Commodity	$	—	$	60	$	60	$	0		$	22	$	22
Interest rate		6		—		6
Total current derivative assets⁽¹⁾		6		60		66		0			22		22
Noncurrent Assets
Commodity		—		128		128		0	��		93		93
Interest rate								66			0		66
Total noncurrent derivative assets⁽²⁾		—		128		128		66			93		159
Total derivative assets	$	6	$	188	$	194	$	66		$	115	$	181
LIABILITIES
Current Liabilities
Commodity	$	—	$	10	$	10	$	0		$	28	$	28
Interest rate		8		—		8		362			0		362
Total current derivative liabilities⁽³⁾		8		10		18
Total current derivative liabilities								362			28		390
Noncurrent Liabilities
Commodity								0			1		1
Interest rate		13		—		13		14			0		14
Total noncurrent derivative liabilities⁽⁴⁾		13		—		13
Total noncurrent derivative liabilities⁽³⁾								14			1		15
Total derivative liabilities	$	21	$	10	$	31	$	376		$	29	$	405

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

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

(3)	~~Current derivative liabilities are presented in other current liabilities in Virginia Power's Consolidated Balance Sheets.~~

~~(4)~~

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~~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 (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
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 September 30, 2017
Three Months Ended September 30, 2021
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(3	)	$	—		$	(26	)	$	(2	)	$	(1	)	$	8
Total	$	(3	)	$	—		$	(26	)	$	(2	)	$	(1	)	$	8
Three Months Ended September 30, 2016
Three Months Ended September 30, 2020
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(2	)	$	—		$	(16	)	$	6		$	(1	)	$	60
Total	$	(2	)	$	—		$	(16	)	$	6		$	(1	)	$	60
Nine Months Ended September 30, 2017
Nine Months Ended September 30, 2021
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(8	)	$	(1	)	$	(60	)	$	24		$	(2	)	$	194
Total	$	(8	)	$	(1	)	$	(60	)	$	24		$	(2	)	$	194
Nine Months Ended September 30, 2016
Nine Months Ended September 30, 2020
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(26	)	$	(1	)	$	(258	)	$	(53	)	$	(2	)	$	(492	)
Total	$	(26	)	$	(1	)	$	(258	)	$	(53	)	$	(2	)	$	(492	)

(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⁾
	Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾												Three Months Ended						Nine Months Ended
	Three Months Ended September 30,						Nine Months Ended September 30,						September 30,						September 30,
Derivatives Not Designated as Hedging Instruments	2017			2016			2017			2016
													2021			2020			2021			2020
(millions)
Derivative type and location of gains (losses):
Commodity⁽²⁾	$	(18	)	$	(10	)	$	(42	)	$	(40	)
Commodity:
Operating Revenue													$	(19	)	$	—			(25	)	$	0
Electric fuel and other energy-related purchases														42			(6	)		5			(79	)
Total	$	(18	)	$	(10	)	$	(42	)	$	(40	)	$	23		$	(6	)	$	(20	)	$	(79	)

(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.

~~(2)~~

~~Amounts recorded in Virginia Power's Consolidated Statements of Income are classified in electric fuel and other energy-related purchases.~~

~~Dominion Energy Gas~~

~~Balance Sheet Presentation~~

~~The tables below present Dominion Energy Gas' derivative asset and liability balances by type of financial instrument, before and after the effects of offsetting.~~

September 30, 2017

December 31, 2016

Gross
Amounts of Recognized
Assets

Gross
Amounts
Offset in the Consolidated Balance Sheet

Net Amounts of Assets
Presented in the Consolidated Balance Sheet

Gross Amounts of Recognized
Assets

Gross
Amounts
Offset in the Consolidated
Balance Sheet

Net Amounts of Assets
Presented in the Consolidated
Balance Sheet

(millions)

Commodity contracts:

Over-the-counter

$
1

$
—

$
1

$
—

$
—

$
—

Foreign currency contracts:

Over-the-counter

25

—

25

—

—

—

Total derivatives, subject to a master netting or
similar arrangement

26

—

26

—

—

—

Total

$
26

$
—

$
26

$
—

$
—

$
—

September 30, 2017

December 31, 2016

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Net Amounts of
Assets Presented
in the
Consolidated
Balance Sheet

Financial
Instruments

Cash
Collateral
Received

Net
Amounts

Net Amounts of
Assets Presented
in the
Consolidated
Balance Sheet

Financial
Instruments

Cash
Collateral
Received

Net
Amounts

(millions)

Commodity contracts:

Over-the-counter

$
1

$
—

$
—

$
1

$
—

$
—

$
—

$
—

Foreign currency contracts:

Over-the-counter

25

4

—

21

—

—

—

—

Total

$
26

$
4

$
—

$
22

$
—

$
—

$
—

$
—

September 30, 2017

December 31, 2016

Gross
Amounts of Recognized Liabilities

Gross
Amounts
Offset in the Consolidated Balance Sheet

Net Amounts of Liabilities Presented in the Consolidated Balance Sheet

Gross
Amounts of Recognized Liabilities

Gross
Amounts
Offset in the Consolidated Balance Sheet

Net Amounts of Liabilities
Presented in the
Consolidated
Balance Sheet

(millions)

Commodity contracts:

Over-the-counter

$
6

$
—

$
6

$
5

$
—

$
5

Foreign currency contracts:

Over-the-counter

4

—

4

6

—

6

Total derivatives, subject to a master netting or
similar arrangement

10

—

10

11

—

11

Total

$
10

$
—

$
10

$
11

$
—

$
11

September 30, 2017

December 31, 2016

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Gross Amounts Not Offset
in the Consolidated
Balance Sheet

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

Financial Instruments

Cash
Collateral
Paid

Net
Amounts

Net Amounts of
Liabilities
Presented in the
Consolidated
Balance Sheet

Financial Instruments

Cash
Collateral
Paid

Net
Amounts

(millions)

Commodity contracts

Over-the-counter

$
6

$
—

$
—

$
6

$
5

$
—

$
—

$
5

Foreign currency contracts:

Over-the-counter

4

4

—

—

6

—

—

6

Total

$
10

$
4

$
—

$
6

$
11

$
—

$
—

$
11

~~Volumes~~

The following table presents the volume of Dominion Energy Gas' derivative activity at September 30, 2017. These volumes are based on open derivative positions and represent the combined absolute value of its 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

2

—

Basis

2

—

NGLs (Gal)

30,514,288

—

Foreign currency⁽¹⁾

$
—

$
280,000,000

~~(1)~~

~~Maturity is determined based on final settlement period. Euro equivalent volumes are €250,000,000.~~

~~Ineffectiveness and AOCI~~

~~For the three and nine months ended September 30, 2017 and 2016, gains or losses on hedging instruments determined to be ineffective were not material.~~

~~The following table presents selected information related to gains (losses) on cash flow hedges included in AOCI in Dominion Energy Gas' Consolidated Balance Sheet at September 30, 2017:~~

AOCI
After-Tax

Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax

Maximum Term
(millions)

Commodities:

NGLs

$
(4
)

$
(4
)

6 months
Interest rate

(26
)

(3
)

327 months
Foreign currency

4

(2
)

105 months
Total

$
(26
)

$
(9
)

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 prices contemplated by the underlying risk management strategies and will vary from the expected amounts presented above as a result of changes in market prices, interest rates and foreign currency exchange rates.

~~Fair Value and Gains and Losses on Derivative Instruments~~

~~The following tables present the fair values of Dominion Energy Gas' 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)

September 30, 2017

ASSETS

Current Assets

Commodity

$
—

$
1

$
1

Total current derivative assets⁽¹⁾

—

1

1

Noncurrent Assets

Foreign currency

25

—

25

Total noncurrent derivative assets⁽²⁾

25

—

25

Total derivative assets

$
25

$
1

$
26

LIABILITIES

Current Liabilities

Commodity

$
6

$
—

$
6

Foreign currency

4

—

4

Total current derivative liabilities⁽³⁾

10

—

10

Total derivative liabilities

$
10

$
—

$
10

December 31, 2016

LIABILITIES

Current Liabilities

Commodity

$
4

$
—

$
4

Foreign currency

3

—

3

Total current derivative liabilities⁽³⁾

7

—

7

Noncurrent Liabilities

Commodity

1

—

1

Foreign currency

3

—

3

Total noncurrent derivative liabilities⁽⁴⁾

4

—

4

Total derivative liabilities

$
11

$
—

$
11

~~(1)~~

~~Current derivative assets are presented in other current assets in Dominion Energy Gas’ Consolidated Balance Sheets.~~

~~(2)~~

~~Noncurrent derivatives assets are presented in other deferred charges and other assets in Dominion Energy Gas’ Consolidated Balance Sheets.~~

~~(3)~~

~~Current derivative liabilities are presented in other current liabilities in Dominion Energy Gas' Consolidated Balance Sheets.~~

~~(4)~~

~~Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Dominion Energy Gas’ Consolidated Balance Sheets.~~

The following table presents the gains and losses on Dominion Energy Gas' 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 (Effective Portion)⁽¹⁾

Amount of Gain
(Loss) Reclassified From AOCI
to Income

(millions)

Three Months Ended September 30, 2017

Derivative Type and Location of Gains (Losses):

Commodity:

Operating revenue

$
(2
)
Total commodity

$
(10
)

$
(2
)
Interest rate⁽²⁾

—

(1
)
Foreign currency⁽³⁾

12

10

Total

$
2

$
7

Three Months Ended September 30, 2016

Derivative Type and Location of Gains (Losses):

Commodity:

Operating revenue

$
1

Total commodity

$
—

$
1

Interest rate⁽²⁾

—

(1
)
Foreign currency⁽³⁾

12

3

Total

$
12

$
3

Nine Months Ended September 30, 2017

Derivative Type and Location of Gains (Losses):

Commodity:

Operating revenue

$
(4
)
Total commodity

$
(5
)

$
(4
)
Interest rate⁽²⁾

—

(3
)
Foreign currency⁽³⁾

10

15

Total

$
5

$
8

Nine Months Ended September 30, 2016

Derivative Type and Location of Gains (Losses):

Commodity:

Operating revenue

$
6

Total commodity

$
(7
)

$
6

Interest rate⁽²⁾

(8
)

(2
)
Foreign currency⁽³⁾

4

1

Total

$
(11
)

$
5

~~(1)~~

~~Amounts deferred into AOCI have no associated effect in Dominion Energy Gas' Consolidated Statements of Income.~~

~~(2)~~

~~Amounts recorded in Dominion Energy Gas' Consolidated Statements of Income are classified in interest and related charges.~~

~~(3)~~

~~Amounts recorded in Dominion Energy Gas' Consolidated Statements of Income are classified in other income.~~

Amount of Gain (Loss) Recognized in Income on Derivatives

Three Months Ended September 30,

Nine Months Ended September 30,

Derivatives Not Designated as Hedging Instruments

2017

2016

2017

2016

(millions)

Derivative type and location of gains (losses):

Commodity:

Operating revenue

$
—

$
5

$
—

$
3

Total

$
—

$
5

$
—

$
3

Note 10. Investments

Dominion Energy

Equity and Debt Securities

Rabbi Trust Securities

~~Marketable equity~~Equity and ~~debt~~fixed income securities and cash equivalents ~~held~~ in Dominion Energy’s rabbi trusts and classified as trading totaled ~~$109~~$122 million and ~~$104~~$134 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

Decommissioning Trust Securities

Dominion Energy holds ~~marketable~~ equity and ~~debt~~fixed income securities, ~~(classified as available-for-sale),~~insurance contracts and cash equivalents ~~and cost method investments~~ 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⁽¹⁾		Total Unrealized Losses⁽¹⁾				Fair Value		Amortized Cost			Total Unrealized Gains		Total Unrealized Losses				Allowance for Credit Losses		Fair Value
(millions)
September 30, 2017
Marketable equity securities:
September 30, 2021
Equity securities:⁽¹⁾
U.S.	$	1,562	$	1,664	$	—			$	3,226	$	1,546		$	3,247	$	(11	)				$	4,782
Fixed income:
Fixed income securities:⁽²⁾
Corporate debt instruments		438		15		(1	)			452		842			40		(3	)		$	0		879
Government securities		1,041		28		(4	)			1,065		1,414			44		(6	)			0		1,452
Common/collective trust funds		66		—		—				66		187			5		0				0		192
Cost method investments		67		—		—				67
Cash equivalents and other⁽²⁾		5		—		—				5
Insurance contracts												246			—		—						246
Cash equivalents and other⁽³⁾												(28	)		3		(20	)			0		(45	)
Total	$	3,179	$	1,707	$	(5	)	⁽³⁾	$	4,881	$	4,207		$	3,339	$	(40	)	⁽⁴⁾	$	0	$	7,506
December 31, 2016
Marketable equity securities:
December 31, 2020
Equity securities:⁽¹⁾
U.S.	$	1,449	$	1,408	$	—			$	2,857	$	1,756		$	2,948	$	(24	)				$	4,680
Fixed income:
Fixed income securities:⁽²⁾
Corporate debt instruments		478		13		(4	)			487		572			58		(1	)		$	0		629
Government securities		978		22		(8	)			992		1,119			66		(1	)			0		1,184
Common/collective trust funds		67		—		—				67		170			5		0				0		175
Cost method investments		69		—		—				69
Cash equivalents and other⁽²⁾		12		—		—				12
Insurance contracts												237			0		0						237
Cash equivalents and other⁽³⁾												(8	)		4		(1	)			0		(5	)
Total	$	3,053	$	1,443	$	(12	)	⁽³⁾	$	4,484	$	3,846		$	3,081	$	(27	)	⁽⁴⁾	$	0	$	6,900

(1)	~~Included~~Unrealized gains and losses on equity securities are included in ~~AOCI~~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 ~~net~~ pending ~~sales~~purchases of securities of $4$48 million and $9$49 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

~~(3)~~(4)

The fair value of securities in an unrealized loss position was ~~$402~~$846 million and ~~$576~~$293 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~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 September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
(millions)
Net gains (losses) recognized during the period	$	(15	)	$	308		$	616		$	20
Less: Net (gains) losses recognized during the period on securities sold during the period		(11	)		(15	)		(323	)		(6	)
Unrealized gains (losses) recognized during the period on securities still held at period end⁽¹⁾	$	(26	)	$	293		$	293		$	14

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

The fair value of Dominion Energy’s ~~marketable debt~~fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds at September 30, ~~2017~~2021 by contractual maturity is as follows:

	Amount		Amount
(millions)
Due in one year or less	$	183	$	351
Due after one year through five years		410		667
Due after five years through ten years		366		654
Due after ten years		624		851
Total	$	1,583	$	2,523

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

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016		2021		2020		2021		2020
(millions)
Proceeds from sales	$	377	$	300	$	1,496	$	1,009	$	614	$	1,208	$	3,324	$	2,868
Realized gains⁽¹⁾		25		40		142		102		25		48		405		188
Realized losses⁽¹⁾		16		9		52		43		7		29		81		159

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

~~Dominion Energy recorded other-than-temporary impairment losses on investments held in nuclear decommissioning trust funds as follows:~~

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Total other-than-temporary impairment losses⁽¹⁾

$
7

$
9

$
33

$
34

Losses recorded to the nuclear decommissioning trust
regulatory liability

(2
)

(4
)

(13
)

(15
)
Losses recognized in other comprehensive income
(before taxes)

(1
)

—

(2
)

(1
)
Net impairment losses recognized in earnings

$
4

$
5

$
18

$
18

~~(1)~~

Amounts include other-than-temporary impairment losses for debt securities of less than $1 million for both the three months ended September 2017 and 2016, respectively, and $2 million for both the nine months ended September 30, 2017 and 2016, respectively.

Virginia Power

Virginia Power holds ~~marketable~~ equity and ~~debt~~fixed income securities ~~(classified as available-for-sale),~~and cash equivalents ~~and cost method investments~~ 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⁽¹⁾		Total Unrealized Losses⁽¹⁾				Fair Value			Amortized Cost			Total Unrealized Gains		Total Unrealized Losses				Allowance for Credit Losses		Fair Value
(millions)
September 30, 2017
Marketable equity securities:
September 30, 2021
Equity securities:⁽¹⁾
U.S.	$	729		$	741	$	—			$	1,470		$	829		$	1,497	$	(10	)				$	2,316
Fixed income:
Fixed income securities:⁽²⁾
Corporate debt instruments		226			8		—				234			497			21		(1	)		$	0		517
Government securities		483			13		(2	)			494			608			16		(2	)			0		622
Common/collective trust funds		29			—		—				29			54			0		0				0		54
Cost method investments		67			—		—				67
Cash equivalents and other⁽²⁾		(2	)		—		—				(2	)
Cash equivalents and other⁽³⁾														(2	)		—		—				0		(2	)
Total	$	1,532		$	762	$	(2	)	⁽³⁾	$	2,292		$	1,986		$	1,534	$	(13	)	⁽⁴⁾	$	0	$	3,507
December 31, 2016
Marketable equity securities:
December 31, 2020
Equity securities:⁽¹⁾
U.S.	$	677		$	624	$	—			$	1,301		$	929		$	1,371	$	(21	)				$	2,279
Fixed income:
Fixed income securities:⁽²⁾
Corporate debt instruments		274			6		(4	)			276			315			33		0			$	0		348
Government securities		420			9		(2	)			427			484			25		—				0		509
Common/collective trust funds		26			—		—				26			58			0		0				0		58
Cost method investments		69			—		—				69
Cash equivalents and other⁽²⁾		7			—		—				7
Cash equivalents and other⁽³⁾														3			—		—				0		3
Total	$	1,473		$	639	$	(6	)	⁽³⁾	$	2,106		$	1,789		$	1,429	$	(21	)	⁽⁴⁾	$	0	$	3,197

(1)	~~Included~~Unrealized gains and losses on equity securities are included in ~~AOCI~~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.

~~(2)~~(3)

Includes pending purchases of securities of $2 million and ~~pending sales of securities of $7~~$10 million at September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

~~(3)~~(4)

The fair value of securities in an unrealized loss position was ~~$165~~$397 million and ~~$287~~$142 millionat September 30, ~~2017~~2021 and December 31, ~~2016,~~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 September 30,						Nine Months Ended September 30,
	2021			2020			2021			2020
(millions)
Net gains (losses) recognized during the period	$	6		$	138		$	319		$	(16	)
Less: Net (gains) losses recognized during the period on securities sold during the period		(9	)		(6	)		(182	)		(3	)
Unrealized gains (losses) recognized during the period on securities still held at period end⁽¹⁾	$	(3	)	$	132		$	137		$	(19	)

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

The fair value of Virginia Power’s ~~marketable debt~~fixed income securities with readily determinable fair values held in nuclear decommissioning trust funds at September 30, ~~2017~~2021 by contractual maturity is as follows:

	Amount		Amount
(millions)
Due in one year or less	$	60	$	83
Due after one year through five years		192		354
Due after five years through ten years		189		372
Due after ten years		316		384
Total	$	757	$	1,193

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

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016		2021		2020		2021		2020
(millions)
Proceeds from sales	$	156	$	131	$	654	$	478	$	216	$	164	$	1,465	$	694
Realized gains⁽¹⁾		9		18		64		48		17		18		213		73
Realized losses⁽¹⁾		6		4		24		21		2		10		28		58

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

Equity Method Investments

~~Other-than-temporary impairment losses~~Dominion Energy recorded equity earnings on its investments ~~held in nuclear decommissioning trust funds recognized~~of $214 million and less than $1 million for the nine months ended September 30, 2021 and 2020, respectively, in earnings from equity method investees in its Consolidated Statements of Income. In addition, Dominion Energy recorded equity losses of $19 million and $2.3 billion for ~~Virginia Power were~~the nine months ended September 30, 2021 and 2020, respectively, in discontinued operations related to its investment in Atlantic Coast Pipeline. Dominion Energy received distributions of $263 million and $25 million for the nine months ended September 30, 2021 and 2020, respectively. Dominion Energy made contributions of $1.0 billion and $93 million for the nine months ended September 30, 2021 and 2020 respectively. At September 30, 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 $231 million and $213 million, respectively. At September 30, 2021, these differences are comprised of $27 million of equity method goodwill that is not ~~material~~being amortized, a $222 million basis difference from Dominion Energy’s investment in Cove Point, which is being amortized over the useful lives of the underlying assets, and a net $(18) 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 investment 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 was $136 million and $132 million for the three months ended September 30, 2021 and 2020, respectively, and $410 million and $396 million for the nine months ended September 30, 2021 and 2020, 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 earnings from equity method investees in its Consolidated Statements of Income.

Dominion Energy recorded distributions from Cove Point of $85 million and $235 million for the three and nine months ended September 30, ~~2017 and 2016.~~

~~Equity Method Investments~~

~~Dominion Energy~~

~~Atlantic Coast Pipeline~~

~~In October 2016, Dominion Energy purchased an additional 3% membership interest in Atlantic Coast Pipeline from Duke~~2021, respectively. NaN contributions were made to Cove Point for ~~$14 million, which adjusted Dominion Energy’s and Duke’s membership interest to 48% and 47%, respectively.~~

~~Dominion Energy contributed $84 million and $286 million during~~ the three and nine months ended September 30, ~~2017~~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 September 30, 2021 and December 31, 2020, Dominion Energy has recorded a liability of $112 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 $45 million during the three months ended September 30, 2020, and $965 million and $74 million during the nine months ended September 30, 2021 and ~~$143~~2020, respectively, to Atlantic Coast Pipeline. Dominion Energy recorded 0 contributions during the three months ended September 30, 2021 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 $7 million ~~during~~and $44 million for the three and nine months ended September 30, ~~2016,~~2020, respectively, 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 ~~Atlantic Coast Pipeline.~~the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020. At September 30, 2021 and December 31, 2020, $81 million and $63 million of assets and $21 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. The related disposal group is primarily comprised of customer receivables, goodwill, inventories, derivative assets and liabilities and accounts payable. All activity related to Wrangler is recorded in the Corporate and Other segment.

Fowler Ridge

In September 2020, Dominion Energy ~~Gas~~

~~Iroquois~~

sold its 50% noncontrolling partnership interest in Fowler Ridge to BP and terminated an affiliate’s long-term power, capacity and renewable energy credit contract with Fowler Ridge for a net payment by Dominion Energy ~~Gas' equity earnings totaled $15~~of $150 million. Dominion Energy recognized a loss of $221 million ($165 million after-tax) on the contract termination, included in impairment of assets and ~~$14 million~~other charges in its Consolidated Statements of Income for the three and nine months ended September 30, ~~2017~~2020.

The $150 million payment was allocated between the contract termination and ~~2016, respectively.~~sale based on the relative fair value of each using an income approach. The fair value determinations for the payment allocations are considered Level 3 fair value measurements due to the use of significant judgmental and unobservable inputs, including the amount of future cash flows and discount rate reflecting risks inherent in the future cash flows and market prices.

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 has claimed or expects to claim federal investment tax credits on the projects.

Project Name

Date Agreement Entered

Date Agreement

Closed

Project

Location

Project Cost

(millions)⁽¹⁾

Date of

Commercial

Operations

MW Capacity

Bookers Mill

February 2021

June 2021

Virginia

200

Expected 2023

127

Belcher

June 2019

August 2019

Virginia

164

June 2021

(1)	Includes acquisition cost.

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

Project Name

Date Agreement Entered

Date Agreement

Closed

Project

Location

Project Cost

(millions)⁽¹⁾

Date of

Commercial

Operations

MW Capacity

Trask

May 2020

October 2020

South Carolina

March 2021

Hardin II

August 2020

Expected 2021

Ohio

295

Expected 2022

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 through 2022. As of September 30, 2021, Dominion Energy anticipates a total projected cost of approximately $65 million under these agreements with an associated aggregate generation capacity of 32 MW. Dominion Energy has claimed or expects to claim federal investment tax credits on the projects.

Non-Wholly-Owned Nonregulated Solar Facilities

Sale to Terra Nova Renewable Partners

In August 2021, Dominion Energy entered into an agreement with Terra Nova Renewable Partnersto sell SBL Holdco, which holds Dominion Energy’s remaining 67% controlling interest in certain nonregulated solar projects for consideration of $456 million,

subject to customary closing adjustments, with the amount of cash reduced by the amount of SBL Holdco’s debt outstanding at closing. The transaction is expected to close in the fourth quarter of 2021, contingent on clearance or approval under the Hart-Scott-Rodino Act and by FERC as well as other customary closing and regulatory conditions. In September 2021, the waiting period under the Hart-Scott-Rodino Act expired. In October 2021, FERC approved the proposed sale.

At September 30, 2021, $743 million of assets, primarily consisting of property, plant and equipment, and $339 million of liabilities, primarily consisting of long-term debt, were classified as held for sale in Dominion Energy’s Consolidated Balance Sheets. Dominion Energy expects to record a gain of approximately $30 million ($31 million after-tax) upon closing.All activity related to SBL Holdco is recorded within Contracted Assets.

Sale to Clearway

In August 2021, Dominion Energy entered an agreement with Clearway to sell its 50% controlling interest in Four Brothers and Three Cedars for $335 million in cash, subject to customary closing adjustments. The transaction is expected to close in the fourth quarter of 2021, contingent on clearance or approval under the Hart-Scott-Rodino Act and by FERC as well as other customary closing and regulatory conditions. In October 2021, the waiting period under the Hart-Scott-Rodino Act expired.

At September 30, 2021, $744 million of related assets, primarily consisting of property, plant and equipment, and $75 million of liabilities, primarily consisting of operating leases, were classified as held for sale in Dominion Energy’s Consolidated Balance Sheets. Dominion Energy expects to record a loss of approximately $225 million ($170 million after-tax) upon closing, primarily associated with the derecognition of noncontrolling interest. All activity related to Four Brothers and Three Cedars is recorded within Contracted Assets.

Impairment

In the third quarter of 2020, Dominion Energy performed a strategic review of its long-term intentions for its contracted nonregulated solar generation assets in partnerships outside of its core electric service territories in consideration of the impact of the VCEA and Dominion Energy’s decision to sell substantially all of its gas transmission and storage operations. Based on an evaluation of Dominion Energy’s interests in these long-lived assets for recoverability under a probability weighted approach, Dominion Energy determined the assets were impaired. As a result of this ~~investment~~evaluation, Dominion Energy recorded a charge of ~~$17~~$665 million ($293 million after-tax attributable to Dominion Energy and $267 million attributable to noncontrolling interest) in impairment of assets and other charges in its Consolidated Statements of Income for both the three and nine months ended September 30, ~~2017~~2020 to adjust the property, plant and ~~2016. At September 30, 2017~~equipment down to its estimated fair value of $1.4 billion. The fair value was estimated using an income approach. The valuation is considered a Level 3 fair value measurement due to the use of significant judgmental and ~~December 31, 2016, the carrying~~unobservable inputs, including projected timing and amount of ~~Dominion Energy Gas' investment~~future cash flows and discount rates reflecting risks inherent in the future cash flows and market prices.

Virginia Power CCRO Utilization

In the third quarter of ~~$96~~2021, Virginia Power wrote off $318 million, primarily consisting of property, plant and ~~$98 million, respectively, exceeded its share~~equipment, net representing the utilization of ~~underlying equity~~a CCRO in ~~net assets by $8 million. The difference reflects equity method goodwill and is not being amortized. In May 2016, Dominion Energy Gas sold 0.65%~~accordance with the GTSA in connection with the proposed settlement of the ~~non-controlling partnership interest~~2021 Triennial Review. See Note 13 for additional information.

Acquisition of Gathering and Processing Assets

In November 2021, Wexpro closed on an agreement with a natural gas gathering systems operator to purchase an existing natural gas gathering system in ~~Iroquois to TransCanada Corporation~~Wyoming including pipelines, compressors and dehydration equipment for ~~approximately $7 million, which resulted in a $5 million ($3 million after-tax) gain, included in other income in Dominion Energy Gas’ Consolidated Statement~~total consideration of ~~Income.~~$41 million.

Note ~~11.~~12. Regulatory Assets and Liabilities

Regulatory assets and liabilities include the following:

September 30, 2017

December 31, 2016

(millions)

Dominion Energy

Regulatory assets:

Deferred rate adjustment clause costs⁽¹⁾

$
67

$
63

Deferred nuclear refueling outage costs⁽²⁾

67

71

Unrecovered gas costs⁽³⁾

51

19

Deferred cost of fuel used in electric generation⁽⁴⁾

30

—

Other

96

91

Regulatory assets-current

311

244

Unrecognized pension and other postretirement benefit costs⁽⁵⁾

1,296

1,401

Deferred rate adjustment clause costs⁽¹⁾

333

329

Derivatives⁽⁶⁾

230

174

PJM transmission rates⁽⁷⁾

215

192

Income taxes recoverable through future rates⁽⁸⁾

157

123

Utility reform legislation⁽⁹⁾

134

99

Other

138

155

Regulatory assets-noncurrent

2,503

2,473

Total regulatory assets

$
2,814

$
2,717

Regulatory liabilities:

PIPP⁽¹⁰⁾

$
20

$
28

Deferred cost of fuel used in electric generation⁽⁴⁾

5

61

Other

63

74

Regulatory liabilities-current

88

163

Provision for future cost of removal and AROs⁽¹¹⁾

1,477

1,427

Nuclear decommissioning trust⁽¹²⁾

1,034

902

Unrecognized pension and other postretirement benefit costs⁽⁵⁾

106

105

Derivatives⁽⁶⁾

78

69

Other

211

119

Regulatory liabilities-noncurrent

2,906

2,622

Total regulatory liabilities

$
2,994

$
2,785

Virginia Power

Regulatory assets:

Deferred nuclear refueling outage costs⁽²⁾

$
67

$
71

Deferred rate adjustment clause costs⁽¹⁾

47

51

Deferred cost of fuel used in electric generation⁽⁴⁾

30

—

Other

62

57

Regulatory assets-current⁽¹³⁾

206

179

Deferred rate adjustment clause costs⁽¹⁾

256

246

PJM transmission rates⁽⁷⁾

215

192

Derivatives⁽⁶⁾

197

133

Income taxes recoverable through future rates⁽⁸⁾

67

76

Other

103

123

Regulatory assets-noncurrent

838

770

Total regulatory assets

$
1,044

$
949

Regulatory liabilities:

Deferred cost of fuel used in electric generation⁽⁴⁾

$
5

$
61

Other

38

54

Regulatory liabilities-current⁽¹⁴⁾

43

115

Nuclear decommissioning trust⁽¹²⁾

1,034

902

Provision for future cost of removal⁽¹¹⁾

985

946

Derivatives⁽⁶⁾

78

69

	September 30, 2021		December 31, 2020
(millions)
Dominion Energy
Regulatory assets:
Deferred cost of fuel used in electric generation⁽¹⁾	$	147	$	—
Deferred project costs and DSM programs for gas utilities⁽²⁾		37		35
Unrecovered gas costs⁽³⁾		161		78
Deferred rider costs for Virginia electric utility⁽⁴⁾		49		98
Deferred nuclear refueling outage costs⁽⁵⁾		70		53
NND Project costs⁽⁶⁾		138		138
PJM transmission rates⁽⁷⁾		9		71
Deferred early plant retirement charges⁽⁸⁾		226		—
Derivatives⁽⁹⁾		161		33
Other		195		193
Regulatory assets-current		1,193		699
Pension and other postretirement benefit costs⁽¹⁰⁾		1,274		1,363
Deferred rider costs for Virginia electric utility⁽⁴⁾		442		311
Deferred project costs for gas utilities⁽²⁾		668		632
Interest rate hedges⁽¹¹⁾		838		1,042
AROs and related funding⁽¹²⁾		332		331
Cost of reacquired debt⁽¹³⁾		11		245
NND Project costs⁽⁶⁾		2,261		2,364
Ash pond and landfill closure costs⁽¹⁴⁾		2,361		2,301
Deferred cost of fuel used in electric generation⁽¹⁾		139		—
Deferred early plant retirement charges⁽⁸⁾		282		—
Other		605		544
Regulatory assets-noncurrent		9,213		9,133
Total regulatory assets	$	10,406	$	9,832
Regulatory liabilities:
Deferred cost of fuel used in electric generation⁽¹⁾	$	1	$	58
Provision for future cost of removal and AROs⁽¹⁵⁾		183		183
Reserve for refunds to electric utility customers⁽¹⁶⁾		422		128
Reserve for future credits to Virginia electric customers⁽¹⁷⁾		—		120
Cost-of-service impact of 2017 Tax Reform Act⁽¹⁸⁾		—		12
Income taxes refundable through future rates⁽¹⁹⁾		140		124
Monetization of guarantee settlement⁽²⁰⁾		67		67
Commodity derivatives⁽²¹⁾		106		9
Other		140		108
Regulatory liabilities-current		1,059		809
Income taxes refundable through future rates⁽¹⁹⁾		4,274		4,376
Provision for future cost of removal and AROs⁽¹⁵⁾		2,321		2,150
Nuclear decommissioning trust⁽²²⁾		1,958		1,719
Monetization of guarantee settlement⁽²⁰⁾		848		903
Reserve for refunds to electric utility customers⁽¹⁶⁾		480		540
Overrecovered other postretirement benefit costs⁽²³⁾		97		111
Other		368		388
Regulatory liabilities-noncurrent		10,346		10,187
Total regulatory liabilities	$	11,405	$	10,996

September 30, 2017

December 31, 2016

(millions)

Other

105

45

Regulatory liabilities-noncurrent

2,202

1,962

Total regulatory liabilities

$
2,245

$
2,077

Dominion Energy Gas

Regulatory assets:

Deferred rate adjustment clause costs⁽¹⁾

$
20

$
12

Unrecovered gas costs⁽³⁾

—

12

Other

2

2

Regulatory assets-current⁽¹³⁾

22

26

Unrecognized pension and other postretirement benefit costs⁽⁵⁾

300

358

Utility reform legislation⁽⁹⁾

134

99

Deferred rate adjustment clause costs⁽¹⁾

77

79

Income taxes recoverable through future rates⁽⁸⁾

32

23

Other

13

18

Regulatory assets-noncurrent⁽¹⁵⁾

556

577

Total regulatory assets

$
578

$
603

Regulatory liabilities:

PIPP⁽¹⁰⁾

$
20

$
28

Other

19

7

Regulatory liabilities-current⁽¹⁴⁾

39

35

Provision for future cost of removal and AROs⁽¹¹⁾

178

174

Other

74

45

Regulatory liabilities-noncurrent⁽¹⁶⁾

252

219

Total regulatory liabilities

$
291

$
254

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

~~(1)~~(2)

Primarilyreflects 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.

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

(4)

Reflects deferrals under ~~the~~Virginia Power’s electric transmission FERC formula rate and the deferral of costs associated with certain current and prospective rider ~~projects for Virginia Power. Reflects deferrals of costs associated with certain current and prospective rider projects for Dominion Energy Gas.~~projects. See Note 1213 for more information.

~~(2)~~(5)

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)~~(6)

Reflects ~~unrecovered gas costs at regulated gas operations, which are recovered through filings~~expenditures by DESC associated with the ~~applicable regulatory authority.~~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.

~~(4)~~(7)

Reflects ~~deferred fuel expenses~~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 ~~Virginia and North Carolina jurisdictions~~terms of ~~Dominion Energy's and Virginia Power's generation operations.~~a FERC settlement agreement in May 2018 resolving a PJM cost allocation matter.

~~(5)~~(8)

~~Represents unrecognized pension~~Reflects amounts from the early retirements of certain coal- and ~~other postretirement employee benefit costs expected~~oil-fired generating units to be ~~recovered or refunded~~amortized through ~~future rates generally over~~2023 in accordance with the ~~expected remaining service period~~proposed settlement of ~~plan participants by certain of Dominion Energy's and Dominion Energy Gas' rate-regulated subsidiaries.~~the 2021 Triennial Review. See Note 13 for additional information.

~~(6)~~(9)

For jurisdictions subject to cost-based rate regulation, changes in the fair value of derivative instruments result in the recognition of regulatory assets or regulatory liabilities as they are expected to be recovered from or refunded to customers.

~~(7)~~(10)

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.

(11)

Reflects ~~amounts~~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 September 30, 2021.

(12)

Represents deferred depreciation and accretion expense related to legal obligations associated with the ~~PJM~~future retirement of generation, transmission ~~cost allocation matter.~~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.

(13)

During the second quarter of 2021, DESC recorded a charge of $237 million ($178 million after-tax) in impairment of assets and other charges to write-off the balance of a regulatory asset that is no longer probable of recovery under the settlement agreement approved in DESC’s retail electric base rate case. See Note 1213 for more information.

(14)

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.

(15)

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. Reflects an increase of $66 million associated with the revision of certain gas distribution pipeline AROs in the third quarter of 2021. See Note 2 for more information.

~~(8)~~(16)

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. Also reflects amounts to be refunded to jurisdictional retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review. See Note 13 for additional information.

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

(18)

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.

(19)

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 and depreciation of property, plant and equipment for which deferred income taxes were not recognized for ratemaking purposes, including amounts attributable to tax rate changes.~~AFUDC equity.

~~(9)~~(20)

~~Ohio legislation under House Bill 95, which became effective~~Reflects amounts to be refunded to DESC electric service customers over a 20-year period ending in ~~September 2011. This law updates natural gas legislation by enabling gas companies~~2039 associated with the monetization of a bankruptcy settlement agreement. See Note 3 to include more up-to-date cost levels when filing rate cases. It also allows gas companies to seek approval of capital expenditure plans under which gas companies can recognize carrying costs on associated capital investments placed in service and can defer the ~~carrying costs plus depreciation and property tax expenses for recovery from ratepayers~~Consolidated Financial Statements in the ~~future.~~Companies’ Annual Report on Form 10-K for the year ended December 31, 2020 for more information.

~~(10)~~(21)

~~Under PIPP, eligible customers can make reduced payments based on their ability~~For jurisdictions subject to ~~pay. The difference between~~cost-based rate regulation, changes in the ~~customer's total bill and~~fair value of derivative instruments result in the ~~PIPP plan amount is deferred and collected~~recognition of regulatory assets or ~~returned annually under the PIPP rate adjustment clause according~~regulatory liabilities as they are expected to ~~East Ohio tariff provisions.~~be recovered from or refunded to customers.

~~(11)~~(22)

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.

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

	September 30, 2021		December 31, 2020
(millions)
Virginia Power
Regulatory assets:
Deferred cost of fuel used in electric generation⁽¹⁾	$	147	$	—
Deferred rider costs⁽²⁾		49		98
Deferred nuclear refueling outage costs⁽³⁾		70		53
PJM transmission rates⁽⁴⁾		9		71
Deferred early plant retirement charges⁽⁵⁾		226		—
Derivatives⁽⁶⁾		153		40
Other		36		33
Regulatory assets-current		690		295
Deferred rider costs⁽²⁾		442		311
Interest rate hedges⁽⁷⁾		540		733
Ash pond and landfill closure costs⁽⁸⁾		2,361		2,301
Deferred cost of fuel used in electric generation⁽¹⁾		139		—
Deferred early plant retirement charges⁽⁵⁾		282		—
Other		177		164
Regulatory assets-noncurrent		3,941		3,509
Total regulatory assets	$	4,631	$	3,804
Regulatory liabilities:
Deferred cost of fuel used in electric generation⁽¹⁾	$	1	$	58
Provision for future cost of removal⁽⁹⁾		152		152
Reserve for refunds to Virginia electric customers⁽¹⁰⁾		299		—
Reserve for future credits to Virginia electric customers⁽¹¹⁾		—		120
Income taxes refundable through future rates⁽¹²⁾		54		54
Derivatives⁽⁶⁾		92		8
Other		87		33
Regulatory liabilities-current		685		425
Income taxes refundable through future rates⁽¹²⁾		2,356		2,404
Nuclear decommissioning trust⁽¹³⁾		1,958		1,719
Provision for future cost of removal⁽⁹⁾		1,042		980
Deferred cost of fuel used in electric generation⁽¹⁾		—		54
Reserve for refunds to Virginia electric customers⁽¹⁰⁾		31		—
Other		173		181
Regulatory liabilities-noncurrent		5,560		5,338
Total regulatory liabilities	$	6,245	$	5,763

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

(2)	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 for more information.

(3)	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.

(4)	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.

(5)	Reflects amounts from the early retirements of certain coal- and oil-fired generating units to be amortized through 2023 in accordance with the proposed settlement of the 2021 Triennial Review. See Note 13 for additional information.

(6)	For jurisdictions subject to cost-based rate regulation, changes in the fair value of derivative instruments result in the recognition of regulatory assets or regulatory liabilities as they are expected to be recovered from or refunded to customers.

(7)

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 25 years as of September 30, 2021.

(8)

(9)	Rates charged to customers by ~~the Companies'~~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.

(10)	Reflects amounts to be refunded to jurisdictional retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review. See Note 13 for additional information.

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

(12)

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.

(13)

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~~Power’s utility nuclear generation stations, in excess of the related AROs.

~~(13)~~

~~Current regulatory assets are presented in other current assets in Virginia Power’s and Dominion Energy Gas’ Consolidated Balance Sheets.~~

~~(14)~~

~~Current regulatory liabilities are presented in other current liabilities in Virginia Power’s and Dominion Energy Gas’ Consolidated Balance Sheets.~~

~~(15)~~

~~Noncurrent regulatory assets are presented in other deferred charges and other assets in Dominion Energy Gas' Consolidated Balance Sheets.~~

~~(16)~~

~~Noncurrent regulatory liabilities are presented in other deferred credits and other liabilities in Dominion Energy Gas' Consolidated Balance Sheets.~~

At September 30, ~~2017, $323 million of~~2021, Dominion ~~Energy's~~Energy and ~~$242 million of~~ Virginia ~~Power's~~Power regulatory assets ~~represented past expenditures~~include $4.5 billion and $3.3 billion, respectively, on which they do not ~~currently~~expect to earn a ~~return.~~return during the applicable recovery period. With the exception of ~~the $215 million PJM transmission cost allocation matter,~~certain items discussed above, the majority of these expenditures are expected to be recovered within the next two years.

Note ~~12.~~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 ~~for which~~that the Companies cannot estimate, ~~a range of possible loss,~~ 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 ~~for which~~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.

~~FERC - Electric~~

Under the Federal Power Act, FERC regulates wholesale sales and transmission of electricity in interstate commerce by public utilities. Dominion Energy’s merchant generators sell electricity in the PJM, MISO, CAISO and ISO-NE wholesale markets, and to wholesale purchasers in the states of Virginia, North Carolina, Indiana, Connecticut, Tennessee, Georgia, California, South Carolina and Utah, under Dominion Energy’s market-based sales tariffs authorized by FERC or pursuant to FERC authority to sell as a qualified facility. Virginia Power purchases and, under its FERC market-based rate authority, sells electricity in the wholesale market. In addition, Virginia Power has FERC approval of a tariff to sell wholesale power at capped rates based on its embedded cost of generation. This cost-based sales tariff could be used to sell to loads within or outside Virginia Power’s service territory. Any such sales would be voluntary.

~~Rates~~

In April 2008, FERC granted an application for Virginia Power’s electric transmission operations to establish a forward-looking formula rate mechanism that updates transmission rates on an annual basis and approved an ROE of 11.4%, effective as of January 1, 2008. The formula rate is designed to recover the expected revenue requirement for each calendar year and is updated based on actual costs. The FERC-approved formula method, which is based on projected costs, allows Virginia Power to earn a current return on its growing investment in electric transmission infrastructure.

In March 2010, Old Dominion Electric Cooperative and North Carolina Electric Membership Corporation filed a complaint with FERC against Virginia Power claiming, among other issues, that the incremental costs of undergrounding certain transmission line projects were unjust, unreasonable and unduly discriminatory or preferential and should be excluded from Virginia Power’s transmission formula rate. A settlement of the other issues raised in the complaint was approved by FERC in May 2012.

In March 2014, FERC issued an order excluding from Virginia Power’s transmission rates for wholesale transmission customers located outside Virginia the incremental costs of undergrounding certain transmission line projects. FERC found it is not just and reasonable for non-Virginia wholesale transmission customers to be allocated the incremental costs of undergrounding the facilities because the projects are a direct result of Virginia legislation and Virginia Commission pilot programs intended to benefit the citizens of Virginia. The order is retroactively effective as of March 2010 and will cause the reallocation of the costs charged to wholesale transmission customers with loads outside Virginia to wholesale transmission customers with loads in Virginia. FERC determined that there was not sufficient evidence on the record to determine the magnitude of the underground increment and held a hearing to determine the appropriate amount of undergrounding cost to be allocated to each wholesale transmission customer in Virginia.

In October 2017, FERC issued an order determining the calculation of the incremental costs of undergrounding the transmission projects and affirming that the costs are to be recovered from the wholesale transmission customers with loads located in Virginia. FERC directed Virginia Power to rebill all wholesale transmission customers retroactively to March 2010 within 30 days of when the proceeding becomes final and no longer subject to rehearing. Parties have until November 2017 to seek rehearing. Virginia Power is evaluating the order, which is not expected to have a material effect on results of operations.

~~PJM Transmission Rates~~

In April 2007, FERC issued an order regarding its transmission rate design for the allocation of costs among PJM transmission customers, including Virginia Power, for transmission service provided by PJM. For new PJM-planned transmission facilities that operate at or above 500 kV, FERC established a PJM regional rate design where customers pay according to each customer’s share of the region’s load. For recovery of costs of existing facilities, FERC approved the existing methodology whereby a customer pays the cost of facilities located in the same zone as the customer. A number of parties appealed the order to the U.S. Court of Appeals for the Seventh Circuit.

In August 2009, the court issued its decision affirming the FERC order with regard to the existing facilities, but remanded to FERC the issue of the cost allocation associated with the new facilities 500 kV and above for further consideration by FERC. On remand, FERC reaffirmed its earlier decision to allocate the costs of new facilities 500 kV and above according to the customer’s share of the region’s load. A number of parties filed appeals of the order to the U.S. Court of Appeals for the Seventh Circuit. In June 2014, the court again remanded the cost allocation issue to FERC. In December 2014, FERC issued an order setting an evidentiary hearing and settlement proceeding regarding the cost allocation issue. The hearing only concerns the costs of new facilities approved by PJM prior to February 1, 2013. Transmission facilities approved after February 1, 2013 are allocated on a hybrid cost allocation method approved by FERC and not subject to any court review.

In June 2016, PJM, the PJM transmission owners and state commissions representing substantially all of the load in the PJM market submitted a settlement to FERC to resolve the outstanding issues regarding this matter. Under the terms of the settlement, Virginia Power would be required to pay in excess of $200 million to PJM over the next 10 years. Although the settlement agreement has not been accepted by FERC, and the settlement is opposed by a small group of parties to the proceeding, Virginia Power believes it is probable it will be required to make payment as an outcome of the settlement. Accordingly, as of September 30, 2017, Virginia Power has recorded a contingent liability of $223 million in other deferred credits and other liabilities, which is offset by a $215 million regulatory asset for the amount that will be recovered through retail rates in Virginia.

~~FERC – Gas~~

~~DETI~~

In July 2017, FERC audit staff communicated to DETI that it had substantially completed an audit of DETI’s compliance with the accounting and reporting requirements of FERC’s Uniform System of Accounts and provided a description of matters and preliminary recommendations that have the potential to result in adjustments which could be material to Dominion Energy and Dominion Energy Gas’ results of operations. DETI submitted its initial response to the audit staff in September 2017. In connection with one preliminary recommendation that management did not challenge, DETI recognized in the second quarter of 2017, a charge of $15 million ($9 million after-tax) recorded within other operations and maintenance expense in Dominion Energy’s and Dominion Energy Gas’ Consolidated Statements of Income to write-off the balance of a regulatory asset, originally established in 2008, that is no longer considered probable of recovery. Pending final resolution of the audit process and a determination by FERC, management is unable to estimate the potential impact of the other preliminary recommendations and no amounts have been recognized.

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, ~~2016 and Note 12 to the Consolidated Financial Statements in the Companies’ Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017.~~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 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 has requested authorization of an ROE of 10.8% based on Virginia Power’s current cost of equity. Pursuant to the Regulation Act, ~~Legislation~~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. In May 2021, Virginia Power filed supplemental

testimony to reflect updated test period earnings, including an earned ROE of 10.42%, before accounting for forgiven customer balances, and that no amount of eligible CCRO is necessary to be elected to be utilized.

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, including a charge of $200 million ($149 million after-tax) in the third quarter of 2020, included in impairment of assets and other charges (benefits) in its Consolidated Statements of Income. 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 (benefits) in its Consolidated Statements of Income to adjust its reserve related to the use of a CCRO in accordance with the GTSA.

In October 2021, Virginia Power, the Virginia Commission staff and other parties filed a comprehensive settlement agreement with the Virginia Commission for approval. The ~~Supreme Court~~comprehensive settlement agreement provides for $330 million in one-time refunds to customers made up of $255 million over a 6-month period and $75 million over three years, a $50 million going-forward base rate reduction and an authorized ROE of 9.35%. Additionally, Virginia ~~previously granted appeals~~Power has agreed to utilize $309 million of qualifying CCRO investments in the CVOW Pilot Project, deployment of AMI and a Customer Information Platform to offset available earnings and to amortize through 2023 the early retirement charges for coal- and oil-fired generation units recorded in 2019 and 2020. This matter is pending.

In connection with the proposed settlement agreement, Virginia Power recorded in the third quarter of 2021 a $350 million ($261 million after-tax) charge for refunds to be provided to customers in operating revenues in its Consolidated Statements of Income as well as a $549 million ($409 million after-tax) benefit primarily from the establishment of a regulatory asset associated with the early retirements of certain ~~industrial~~coal- and oil-fired generating units and a $318 million ($237 million after-tax) charge for CCRO benefits provided to customers in impairment of ~~Appalachian Power Company that challenged~~assets and other charges (benefits) in its Consolidated Statements of Income. The amounts recorded reflect the ~~constitutionality~~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 ~~2015 keeping Appalachian~~Virginia relating to the moratorium on utility disconnections during the COVID-19 pandemic and resulted in Virginia Power ~~Company’s base rates unchanged until at least~~forgiving Virginia jurisdictional retail electric customer balances that were more than 30 days past due as of September 30, 2020. ~~This legislation also keeps~~ 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 (benefits) 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 ~~base rates unchanged until at least~~2021 Triennial Review as discussed above.

Grid Transformation and Security Act of 2018

In June 2021, Virginia Power filed a petition with the Virginia Commission for approval of a plan for electric distribution grid transformation projects as authorized by the GTSA. The plan includes 14 projects covering 6 components: (i) smart meters; (ii) customer information platform; (iii) grid improvement projects; (iv) physical and cyber security; (v) telecommunications infrastructure and (vi) customer education (Phase II). For Phase II, the total proposed capital investment during 2022 – 2023 is $669 million and the proposed operations and maintenance investment is $110 million. This matter is pending.

Virginia Fuel Expenses

In May 2021, Virginia Power filed its annual fuel factor with the Virginia Commission to recover an estimated $1.4 billion in Virginia jurisdictional projected fuel expenses for the rate year beginning July 1, 2021 and $72 million of estimated net under-recovered balances through June 30, 2021. In June 2021, the Virginia Commission approved the annual fuel factor.

Renewable Generation 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 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.

In September ~~2017,~~2021, Virginia Power filed a petition with the ~~Supreme Court~~Virginia Commission for CPCNs to construct and operate 13 utility-scale projects totaling approximately 661 MW of ~~Virginia affirmed that~~solar generation and 70 MW of energy storage as part of its efforts to meet the ~~legislation~~renewable generation development requirements under the VCEA. The projects are expected to cost approximately $1.4 billion in the aggregate, excluding financing costs, and be placed into service between 2022 and 2023. This matter is ~~constitutional.~~pending.

~~Rate Adjustment Clauses~~In November 2021, Virginia Power filed an application with the Virginia Commission requesting approval and certification of the Virginia Facilities component of the CVOW Commercial Project. The onshore Virginia Facilities have an estimated cost of approximately $1.1 billion, excluding financing costs, which is included within the overall cost of the CVOW Commercial Project. In addition, Virginia Power requested approval from the Virginia Commission to enter into financial hedges with U.S. financial institutions to mitigate the foreign currency exchange risk associated with certain supplier contracts associated with the CVOW Commercial Project. This matter is pending.

Nuclear Life Extension Program

In October 2021, Virginia Power filed a petition with the Virginia Commission requesting a determination that it is reasonable and prudent for Virginia Power to pursue a nuclear life extension program to extend the operating licenses of Surry and North Anna and to carry out projects to upgrade or replace systems and equipment necessary to continue to safely and reliably operate these nuclear power stations. The nuclear life extension program is expected to cost approximately $3.9 billion, excluding financing costs. This matter is pending.

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.

In June 2021, Virginia Power proposed a $96 million total revenue requirement consisting of $61 million for previously ~~filed an application with the Virginia Commission to recover through~~approved phases and $35 million for phase six costs for Rider U costs for the first and second phases of a program to underground outage-prone overhead distribution lines. In September 2017, the Virginia Commission approved a total $22 million annual revenue requirement effective October 1, 2017, using a 9.4% ROE, and a total capital investment of $40 million for second phase conversions.

The Virginia Commission previously approved Riders C1A and C2A in connection with cost recovery for DSM programs. In October 2017, Virginia Power requested approval to extend one existing energy efficiency program for five years with a new $25 million cost cap, and proposed a total $31 million revenue requirement for the rate year beginning ~~July~~April 1, ~~2018, which~~2022. This total revenue requirement represents a $3$16 million increase over the previous year. This ~~case~~matter is pending.

•

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. In October 2021, the Virginia Commission approved the filing.

•

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.

•

The Virginia Commission previously approved Rider T1 concerning transmission rates. In May 2021, Virginia Power proposed a $874 million total revenue requirement consisting of $493 million for the transmission component of Virginia Power’s base rates and $381 million for Rider T1 for the rate year beginning September 1, 2021. This total revenue requirement represents a $190 million decrease versus the revenues to be produced during the rate year under current rates. In August 2021, the Virginia Commission approved the filing.

•

Pursuant to the VCEA, Virginia Power can recover costs of compliance with the mandatory renewable portfolio standard program. In December 2020, Virginia Power filed for approval of Rider RPS with a proposed $13 million revenue requirement for the rate year beginning August 1, 2021. In July 2021, the Virginia Commission approved the filing.

•

The Virginia Commission previously approved Rider GV relating to Greensville County. In June 2021, Virginia Power proposed a biennial update procedure for Rider GV with two consecutive rate years. The filing proposed a revenue requirement of $142 million for the rate year beginning April 1, 2022 and a revenue requirement of $127 million for the rate year beginning April 2023. This matter is pending.

•

The Virginia Commission previously approved Rider R relating to Bear Garden. In June 2021, Virginia Power proposed a biennial update procedure for Rider R with two consecutive rate years. The filing proposed a revenue requirement of $59 million for the rate year beginning April 1, 2022 and a revenue requirement of $55 million for the rate year beginning April 1, 2023. This matter is pending.

•

The Virginia Commission previously approved Rider S relating to Virginia City Hybrid Energy Center. In June 2021, Virginia Power proposed a biennial update procedure for Rider S with two consecutive rate years. The filing proposed a revenue requirement of $192 million for the rate year beginning April 1, 2022 and a revenue requirement of $191 million for the rate year beginning April 1, 2023. This matter is pending.

•

Pursuant to Virginia legislation, Virginia Power can recover costs associated with participating in a market-based carbon trading program consistent with RGGI. In August 2021, the Virginia Commission approved Rider RGGI with a $168 million revenue requirement for the rate year beginning September 1, 2021, however, subsequently in August 2021, the Virginia

~~The Virginia Commission previously approved Rider BW in conjunction~~60

Commission issued an order granting reconsideration and suspended its order approving the revenue requirement. This matter is pending.

•

Pursuant to Virginia legislation, Virginia Power can recover costs associated with electric distribution grid transformation projects that the Virginia Commission has approved as authorized by the GTSA. In August 2021, Virginia Power filed for approval of Rider GT with a proposed $56 million revenue requirement for the rate year beginning June 1, 2022. This matter is pending.

•

The Virginia Commission previously approved Riders C1A, C2A and C3A in connection with cost recovery for DSM programs. In December 2020, Virginia Power filed a petition to approve an additional 10 new energy efficiency programs and 1 new demand response DSM program for five years, subject to future extension, with a $162 million cost cap, and proposed a total $78 million revenue requirement for the rate year beginning September 1, 2021. Virginia Power also requested approval to establish a new Rider C4A in connection with cost recovery for DSM programs. In September 2021, the Virginia Commission approved a total revenue requirement of $74 million, which represents a $14 million increase over the previous year. The Virginia Commission also established Rider C4A.

•

In September 2021, Virginia Power applied for approval of Rider CE associated with solar generation and energy storage projects requested for approval in September 2021, solar generation projects approved in April 2021 and certain small-scale solar projects with a proposed $71 million total revenue requirement for the rate year beginning May 1, 2022. This total revenue requirement represents a $61 million increase over the previous year. This matter is pending.

•

The Virginia Commission previously approved Rider BW relating to Brunswick County power station. In October 2021, Virginia Power proposed a biennial update procedure for Rider BW with two consecutive rate years. The filing proposed a revenue requirement of $145 million for the rate year beginning September 1, 2022 and a revenue requirement of $120 million for the rate year beginning September 1, 2023. This matter is pending.

•

In October 2021, Virginia Power filed a petition with the Virginia Commission for Rider SNA associated with costs relating to the preparation of the applications for subsequent license renewal to the NRC to extend the operating licenses of Surry and North Anna and related projects. Virginia Power requested approval of a cost recovery of approximately $1.2 billion through Rider SNA for the first phase of nuclear life extension program which includes investments through 2024 and proposed a $109 million revenue requirement for the rate year beginning September 1, 2022. This matter is pending.

•

In November 2021, Virginia Power filed an application with the Virginia Commission requesting approval of Rider OSW associated with costs incurred to construct, own and operate the CVOW Commercial Project. The filing proposed a revenue requirement of $79 million for the rate year beginning September 1, 2022. This matter is pending.

Additional significant riders associated with ~~Brunswick County. In October 2017,~~various Virginia Power ~~proposed a $132 million revenue requirement for the rate year beginning September 1, 2018, which represents a $5 million increase over the previous year. This case is pending.~~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

Rider BW

October 2020

July 2021

September 2021

113

Rider US-2

October 2020

July 2021

September 2021

—

Rider E

January 2021

September 2021

November 2021

(18

)

Rider B

June 2021

Pending

April 2022

)

Rider W

June 2021

Pending

April 2022

121

Rider US-3

August 2021

Pending

June 2022

Rider US-4

August 2021

Pending

June 2022

Rider US-2

October 2021

Pending

September 2022

The Virginia Commission previously approved Rider US-2 in conjunction with the Scott Solar, Whitehouse, and Woodland solar facilities. In October 2017, Virginia Power proposed a $15 million revenue requirement for the rate year beginning September 1, 2018, which represents a $5 million increase over the previous year. This case is pending.

Electric Transmission Projects

Virginia Power previously filed an application with the Virginia Commission for a CPCN to rebuild and rearrange its Idylwood substation in Fairfax County, Virginia. In September 2017, the Virginia Commission granted a CPCN for the project. The total estimated cost of the project is approximately $110 million.

Description and Location

of Project

Application

Date

Approval

Date

Type of

Line

Miles of

Lines

Cost Estimate

(millions)

Rebuild Clubhouse-Dry Bread Line and Dry Bread-Lakeview Line in Greensville County, Virginia

November 2020

July 2021

230 kV

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

April 2021

Pending

500 kV

Beaumeade-Belmont reconductor and rebuild projects in the County of Loudoun, Virginia

May 2021

Pending

230 kV

Extension to Cloud Switching Station and Easters Switching Station in the County of Mecklenburg, Virginia

June 2021

Pending

230 kV

105

Virginia Power previously filed an application with the Virginia Commission for a CPCN to construct and operate in multiple Virginia counties an approximately 38-mile overhead 230 kV transmission line between the Remington and Gordonsville substations, along with associated facilities. In August 2017, the Virginia Commission granted a CPCN for the project. The total estimated cost of the project is approximately $105 million.

In November 2013, the Virginia Commission issued an order granting Virginia Power a CPCN to construct approximately 7 miles of new overhead 500 kV transmission line from the existing Surry switching station in Surry County to a new Skiffes Creek switching station in James City County, and approximately 20 miles of new 230 kV transmission line in James City County, York County, and the City of Newport News from the proposed new Skiffes Creek switching station to Virginia Power’s existing Whealton substation in the City of Hampton. As of July 2017, Virginia Power has received all major required permits and approvals and is proceeding with construction of the project. In connection with the receipt of the permit from the U.S. Army Corps of Engineers in July 2017, Virginia Power was required to make payments totaling approximately $90 million to fund improvements to historical and cultural resources near the project. Accordingly, in July 2017, Virginia Power recorded an increase to property, plant and equipment and a corresponding liability for these payment obligations. Through September 30, 2017, Virginia Power had made $70 million of such payments, with the remaining $20 million paid in October 2017. Also in July 2017, the National Parks Conservation Association filed a lawsuit in U.S. District Court for the D.C. Circuit seeking to set aside the permit granted by the U.S. Army Corps of Engineers for the project and requested a preliminary injunction against the permit. In August 2017, the National Trust for Historic Preservation and Preservation Virginia filed a similar lawsuit in U.S. District Court for the D.C. Circuit. In October 2017, the preliminary injunction requests were denied. These lawsuits are pending.

North Carolina Regulation

Virginia Power North Carolina Fuel Filing

In August ~~2017,~~2021, Virginia Power submitted its annual filing to the North Carolina ~~Utilities~~ Commission to adjust the fuel component of its electric rates. Virginia Power updated its filing in October 2021 to reflect the increased commodity cost of fuel and proposed a total ~~$15~~$26 million increase to the fuel component of its electric rates for the rate year beginning February 1, 2022. This matter is pending.

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%.

In October 2021, PSNC, the North Carolina Commission public staff and certain other parties of record filed a stipulation of settlement with the North Carolina Commission for approval. The stipulation of settlement provides for a non-fuel, base rate increase of $29 million effective November 1, 2021, based on an ROE of 9.60%. The net revenue increase to customers, after considering the amortization of the previously deferred benefits of the 2017 Tax Reform Act, would be $4 million in the initial rate year, $23 million for the following rate year and then $25 million beginning for the third through fifth rate years. In addition, the stipulation of settlement provides for the recovery, over four years, of $106 million of operation and maintenance costs which PSNC has incurred and deferred through June 2021 to comply with federal standards for pipeline integrity and safety. In November 2021, PSNC implemented temporary rates consistent with the stipulation of settlement. If the North Carolina Commission deems the temporary rates excessive in the final order, the excess amount along with interest will be refunded to customers. This matter is pending.

Pipeline Integrity and Safety Program

The North Carolina Commission has authorized PSNC to use a tracker mechanism to recover the incurred capital investment and associated costs of complying with federal standards for pipeline integrity and safety requirements that are not in current base rates. In September 2021, the North Carolina Commission approved PSNC’s request to increase the integrity management annual revenue requirement to $34 million, an increase of $1 million over its previous filing, effective October 2021.

Rider D

Rider D allows PSNC to recover from customers all prudently incurred gas costs and certain related uncollectible expenses as well as losses on negotiated gas and transportation sales. In September 2021, PSNC submitted a filing with the North Carolina Commission for a $61 million gas cost increase. The North Carolina Commission approved the filing in September 2021 with rates effective October 2021.

South Carolina Regulation

South Carolina Electric Base Rate Case

In August 2020, DESC filed its retail electric base rate case and schedules with the South Carolina Commission. DESC proposed a non-fuel, base rate increase of $178 million, or 7.75%, based on an adjusted test year data, effective on or after the first billing cycle of March 2021. The base rate increase was proposed to recover the significant investment in assets and operating resources required to serve an expanding customer base, maintain the safety, reliability and efficiency of DESC’s system and meet increasingly stringent reliability, security and environmental requirements for the benefit of South Carolina customers. DESC presented an earned ROE of 5.90% based upon a fully-adjusted test period. The proposed rates would provide for an earned ROE equal to the current authorized earned ROE of 10.25% established in the previous rate case in 2012. In January 2021, the South Carolina Commission approved a

proposal made by the South Carolina Office of Regulatory Staff, and agreed to by DESC and other intervenors, to stay the base rate case due to the current economic conditions and to allow the parties more time to negotiate a settlement with a final order to be issued no later than August 2021.

In July 2021, DESC, the South Carolina Office of Regulatory Staff and other parties of record filed a comprehensive settlement agreement with the South Carolina Commission for approval. The comprehensive settlement agreement provides for a non-fuel, base rate increase of $62 million (resulting in a net increase of $36 million after considering an accelerated amortization of certain excess deferred income taxes) commencing with bills issued on September 1, 2021 and an authorized earned ROE of 9.50%. Additionally, DESC has agreed to commit up to $15 million to forgive retail electric customer balances that were more than 60 days past due as of May 31, 2021, and provide $15 million for energy efficiency upgrades and critical health and safety repairs to customer homes. Pursuant to the comprehensive settlement agreement, DESC would not filea retail electric base rate case prior to July 1, 2023, such that new rates would not be effective prior to January 1, ~~2018.~~2024, absent unforeseen extraordinary economic or financial conditions that may include changes in corporate tax rates. In July 2021, the South Carolina Commission approved the comprehensive settlement agreement and issued its final order in August 2021.

In connection with this matter, in the second quarter of 2021, Dominion Energy recorded charges of $249 million ($187 million after-tax) reflected within impairment of assets and other charges (benefits), including $237 million of regulatory assets associated with DESC’s purchases of its first mortgage bonds during 2019 that are no longer probable of recovery under the settlement agreement, and $18 million ($14 million after-tax) reflected within other income in its Consolidated Statements of Income.

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. In connection with the approval of the comprehensive settlement agreement in the South Carolina base rate case discussed above, the net lost revenue component of the DSM rider was adjusted resulting in a recovery of $43 million commencing with bills issued on September 1, 2021.

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.

Natural Gas Rates

In June 2021, DESC filed with the South Carolina Commission its monitoring report for the 12-month period ended March 31, 2021 with a total revenue requirement of $426 million. This ~~case~~represents a $9 million overall annual increase to its natural gas rates under the terms of the Natural Gas Rate Stabilization Act effective with the first billing cycle of November 2021. In October 2021, the South Carolina Commission issued an order approving a total revenue requirement of $424 million effective with the first billing cycle of November 2021. This represents a $7 million overall annual increase to DESC’s natural gas rates.

Ohio Regulation

PIR Program

In 2008, East Ohio began PIR, aimed at replacing approximately 25% of its pipeline system. In April 2021, the Ohio Commission approved East Ohio’s application 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.

~~Ohio Regulation~~

UEX Rider

East Ohio has approval for a UEX Rider through which it recovers the bad debt expense of most customers not participating in the PIPP Plus Program. The UEX Rider is adjusted annually to achieve dollar for dollar recovery of East Ohio’s actual write-offs of uncollectible amounts. In ~~September 2017,~~July 2021, the Ohio Commission approved East Ohio’s application ~~requesting approval of~~to adjust its UEX Rider to reflect ~~a refund~~an

increased annual revenue requirement of ~~over-recovered~~$20 million to provide for an under-recovered accumulated bad debt expense of ~~approximately $12~~$7 million as of March 31, ~~2017,~~2021, and recovery of ~~prospective~~ net bad debt expense projected to total ~~approximately $22~~$13 million for the twelve-month period ~~from April 2017~~ending March 2022.

West Virginia Regulation

West Virginia Base Rate Case

In September 2020, Hope filed its base rate case and schedules with the West Virginia Commission. Hope proposed a non-fuel, base rate increase of $28 million. The base rate increase was proposed to ~~March 2018.~~recover the significant investment in distribution infrastructure and costs associated with the acquisition of over 2,000 miles of gathering assets, both for the benefit of West Virginia customers. The proposed rates would provide for an ROE of 10.25% compared to the authorized ROE of 9.45%. In July 2021, the West Virginia Commission approved a non-fuel, base rate increase of $13 million for rates effective July 2021 with an ROE of 9.54%. In August 2021, Hope filed a petition for reconsideration with the West Virginia Commission regarding certain return calculations included in the July 2021 approval order.

PREP

In May 2021, Hope filed a PREP application with the West Virginia Commission requesting approval to recover PREP costs related to $54 million and $56 million of projected capital investment for 2021 and 2022, respectively. The application also includes a true-up of PREP costs related to the 2020 actual capital investment of $34 million and sets forth $9 million of annual PREP costs to be recovered in proposed rates effective November 1, 2021. In October 2021, the West Virginia Commission approved the request.

Utah ~~and Wyoming~~ Regulation

Purchased Gas

In ~~October 2017,~~May 2021, the Utah Commission approved Questar ~~Gas submitted filings with both the Public Service Commission of Utah and the Wyoming Public Service Commission~~Gas’ request for ~~an approximately $25~~a $43 million gas cost increase ~~reflecting forecasted increases in commodity and transportation costs. The Public Service~~with rates effective June 2021.

In October 2021, the Utah Commission ~~of Utah and the Wyoming Public Service Commission both~~ approved ~~the filings in October 2017~~Questar Gas’ request for an $83 million gas cost increase with rates effective November ~~2017.~~2021.

~~West Virginia Regulation~~

~~In October 2017,~~Note 14. Leases

Other than the ~~Public Service Commission of West Virginia approved Hope’s application for new PREP customer rates,~~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 ~~beginning November 1, 2017, that provide~~ended December 31, 2020.

Dominion Energy’s Consolidated Statements of Income include $58 million and $147 million for ~~projected~~the three and nine months ended September 30, 2021, respectively, and $61 million and $146 million for the three and nine months ended September 30, 2020, respectively, of rental revenue included in operating revenue. Dominion Energy’s Consolidated Statements of $4Income include $29 million and $87 million for the three and nine months ended September 30, 2021, respectively, and $26 million and $76 million for the three and nine months ended September 30, 2020, respectively, of depreciation expense included in depreciation, depletion and amortization, related to ~~capital investments of $21 million, $27 million and $31 million for 2016, 2017 and 2018, respectively.~~facilities subject to power purchase agreements under which Dominion Energy is the lessor.

~~FERC – Gas~~

~~DETI~~Corporate Office Leasing Arrangement

In December ~~2014, DETI entered into a precedent~~2019, Dominion Energy signed an agreement with ~~Atlantic Coast Pipeline for the Supply Header Project,~~ a ~~project to provide approximately 1,500,000 Dths per day of firm transportation service to various customers. This project is expected to be placed into service~~lessor, as amended in ~~late 2019 and cost approximately $550 million to $600 million to construct, excluding financing costs. In October 2017, DETI received FERC authorization~~May 2020, to construct and ~~operate~~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 ~~facilities.~~

costs. In ~~September 2017, DETI submitted~~March 2021, Dominion Energy notified the lessor of its ~~annual transportation cost rate adjustment~~intention to ~~FERC requesting approval~~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 recover $39 million. Also in September 2017, DETI submitted its annual electric power cost adjustment to FERC requesting approval to recover $6 million. In October 2017, FERC approved these adjustments.

~~Cove Point~~

~~In November 2016, pursuant~~be repaid to the terms of a previous settlement, Cove Point filed a general rate case for its FERC-jurisdictional services, with 23 proposed rates to be effective January 1, 2017. Cove Point proposed an annual cost-of-service of approximately $140 million. In December 2016, FERC accepted a January 1, 2017 effective date for all proposed rates but five which were suspended to be effective June 1, 2017. In August 2017, Cove Point filed a proposed stipulation and settlement agreement with FERC, which was supported or not opposed by the active parties. Under the terms of the settlement agreement, Cove Point’s rates effective October 2017 would result in decreases to annual revenues and depreciation expense of approximately $18 million and $3 million, respectively, compared to the rates in effect through December 2016. In September 2017, the Presiding Administrative Law Judge certified the uncontested settlement to FERC. Cove Point is awaiting final FERC approval of the settlement. This case is pending.lessor.

Note ~~13.~~15. Variable Interest Entities

There have been no significant changes regarding the entities the Companies consider VIEs as described in Note 1516 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

Dominion Energy

Dominion Energy’s Consolidated Balance Sheets include $264 million presented in current liabilities held for sale at September 30, 2021 as well as $32 million presented in securities due within one year and $239 million presented in long-term debt ~~include $29 million and $356 million, respectively, of~~at December 31, 2020, for debt issued ~~in 2016~~ 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~~nonregulated solar facilities.

Virginia Power

Virginia Power had long-term power and capacity contracts with three non-utility generators. Contracts with two of these non-utility generators expired during the third quarter of 2017 leaving a remaining aggregate summer generation capacity of approximately 218 MW. Virginia Power is not subject to any risk of loss from this remaining potential VIE other than its remaining purchase commitments which totaled $213 million as of September 30, 2017. Virginia Power paid $17 million and $37 million for electric capacity and $5 million and $11 million for electric energy to these entities for the three months ended September 30, 2017 and 2016, respectively. Virginia Power paid $73 million and $111 million for electric capacity and $20 million and $23 million for electric energy to these entities for the nine months ended September 30, 2017 and 2016, respectively.

~~Virginia Power and Dominion Energy Gas~~

~~Virginia Power and Dominion Energy Gas~~ purchased shared services from DES, an affiliated VIE, of ~~$83~~$89 million and ~~$31~~$81 million for the three months ended September 30, ~~2017, $80~~2021 and 2020, respectively, and $278 million and ~~$31 million for the three months ended September 30, 2016, $251 million and $93~~$260 million for the nine months ended September 30, ~~2017~~2021 and ~~$268~~2020, respectively. Virginia Power’s Consolidated Balance Sheets include amounts due to DES of $24 million and ~~$95~~$175 million ~~for the nine months ended~~at September 30, ~~2016, respectively.~~2021 and December 31, 2020, respectively, recorded in payables to affiliates.

Note ~~14.~~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

In June 2021, Dominion Energy amended its $6.0 billion joint revolving credit facility to provide for a discount in the pricing of certain annual fees and amounts borrowed by Dominion Energy under the facility if Dominion Energy achieves certain annual renewable electric generation and diversity and inclusion objectives. In addition, the amended facility incorporates certain administrative changes with respect to the anticipated transition from LIBOR to an alternative benchmark rate. The key financial covenants are unchanged from the previous facility.

At September 30, ~~2017,~~2021, Dominion Energy’s commercial paper and letters of credit outstanding, as well as its capacity available under the credit ~~facilities,~~facility, were as follows:

	Facility Limit		Outstanding Commercial Paper		Outstanding Letters of Credit		Facility Capacity Available		Facility Limit		Outstanding Commercial Paper		Outstanding Letters of Credit		Facility Capacity Available
(millions)
Joint revolving credit facility⁽¹⁾	$	5,000	$	3,060	$	—	$	1,940	$	6,000	$	3,494	$	99	$	2,407
Joint revolving credit facility⁽¹⁾		500		—		73		427
Total	$	5,500	$	3,060	$	73	$	2,367

(1)

~~These~~This credit ~~facilities mature~~facility matures in ~~April 2020~~June 2026, with the potential to be extended by the borrowers to June 2028, and can be used by the ~~Companies~~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 ~~financing is~~financings are supported through ~~its~~ access as ~~co-borrower~~co-borrowers to the ~~two~~ joint revolving credit ~~facilities~~facility discussed above with ~~Dominion Energy, Virginia Power and Dominion Energy Gas.~~the Companies. At September 30, ~~2017~~2021, the ~~aggregate sub-limit~~sub-limits for DESC and Questar Gas ~~was~~were $500 million and $250 ~~million.~~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 facilities 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 September 30, 2021 and December 31, 2020, Dominion Energy had $29 million and $30 million in letters of credit outstanding under this agreement, respectively.

In addition to the credit facilities mentioned above, SBL Holdco has $30 million of credit facilities which ~~have a~~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 ~~have a~~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 bothSeptember 30, ~~2017, no~~2021 and December 31, 2020, 0 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.

In July 2021, Dominion Energy entered into an approximately $1.3 billion term loan credit agreement following the termination of the Q-Pipe Transaction as discussed in Note 3.

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 as disclosed in Note 17 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. At September 30, 2021 and December 31, 2020, Dominion Energy’s Consolidated Balance Sheets include $391 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 two~~Dominion Energy’s $6.0 billion joint revolving credit ~~facilities. These credit facilities~~facility, as amended in June 2021. The facility can be used for working capital, as support for the combined commercial paper programs of ~~the Companies~~Virginia Power, Dominion Energy, Questar Gas and DESC and for other general corporate purposes.

At September 30, ~~2017,~~2021, Virginia Power’s share of commercial paper and letters of credit outstanding under ~~its~~the joint revolving credit ~~facilities~~facility with Dominion Energy, ~~Dominion Energy~~Questar Gas and ~~Questar Gas were~~DESC was as follows:

	Facility Limit⁽¹⁾		Outstanding Commercial Paper		Outstanding Letters of Credit		Facility Limit⁽¹⁾		Outstanding Commercial Paper		Outstanding Letters of Credit
(millions)
Joint revolving credit facility⁽¹⁾	$	5,000	$	320	$	—	$	6,000	$	896	$	12
Joint revolving credit facility⁽¹⁾		500		—		1
Total	$	5,500	$	320	$	1

~~(1)~~

(1)

The full amount of the ~~facilities~~facility is available to Virginia Power, less any amounts outstanding to co-borrowers Dominion Energy, ~~Dominion Energy~~Questar Gas and ~~Questar Gas. Sub-limits~~DESC. The sub-limit for Virginia Power ~~are~~is set ~~within~~pursuant to the terms of the facility ~~limit~~ but can be changed at the option of the ~~Companies~~borrowers multiple times per year. ~~In May 2017,~~At September 30, 2021, the ~~aggregate~~ sub-limit for Virginia Power was ~~decreased from $2.0 billion to $1.5~~$1.75 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. ~~These~~This credit ~~facilities mature~~facility matures in ~~April 2020 and~~June 2026, with the potential to be extended by the borrowers to June 2028. The credit facility 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.

In addition to the credit facility commitments mentioned above, Virginia Power also has a $100 million credit facility with a maturity date of April 2020. At September 30, 2017, this facility supports $100 million of certain variable rate tax-exempt financings of Virginia Power.

~~Dominion Energy Gas~~

Dominion Energy Gas’ short-term financing is supported by its access as co-borrower to the two joint revolving credit facilities. These credit facilities can be used for working capital, as support for the combined commercial paper programs of the Companies and for other general corporate purposes.

At September 30, 2017, Dominion Energy Gas' share of commercial paper and letters of credit outstanding under its joint credit facilities with Dominion Energy, Virginia Power and Questar Gas were as follows:

Facility
Limit⁽¹⁾

Outstanding
Commercial
Paper

Outstanding
Letters of
Credit

(millions)

Joint revolving credit facility⁽¹⁾

$
1,000

$
620

$
—

Joint revolving credit facility⁽¹⁾

500

—

—

Total

$
1,500

$
620

$
—

~~(1)~~

A maximum of a combined $1.5 billion of the facilities is available to Dominion Energy Gas, assuming adequate capacity is available after giving effect to uses by co-borrowers Dominion Energy, Virginia Power and Questar Gas. Sub-limits for Dominion Energy Gas are set within the facility limit but can be changed at the option of the Companies multiple times per year. In May 2017, the aggregate sub-limit for Dominion Energy Gas was increased from $500 million to $750 million. If Dominion Energy Gas 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. These credit facilities mature in April 2020 and can be used to support bank borrowings and the issuance of commercial paper, as well as to support up to $1.5 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 ~~January 2017, Dominion Energy~~March 2021, PSNC issued, ~~$400~~through private placement, $150 million of ~~1.875% senior notes and $400 million of 2.75%~~3.10% senior notes that mature in ~~2019 and 2022, respectively.~~2051.

In ~~March 2017,~~April 2021, Dominion Energy issued ~~through private placement $300~~$600 million of ~~3.496%~~1.45% senior notes and $500 million of 3.30% senior notes that mature in ~~2024. Also~~2026 and 2041, respectively.

In June 2021, Dominion Energy entered into a $900 million Sustainability Revolving Credit Agreement. This supplemental credit facility, which matures in ~~March 2017,~~June 2024 and bears interest at a variable rate, offers a reduced interest rate margin with respect to borrowed amounts allocated to certain environmental sustainability or social investment initiatives. Proceeds of the supplemental credit facility also may be used for general corporate purposes, but such proceeds are not eligible for a reduced interest rate margin. At September 30, 2021, $900 million was outstanding under the supplemental credit facility. The proceeds from these borrowings were used to support environmental sustainability and social investment initiatives ($250 million) and for general corporate purposes ($650 million). The maximum allowed total debt to total capital ratio under this supplemental credit facility is consistent with such allowed ratio under Dominion Energy’s joint revolving credit facility.

In July 2021, DESC redeemed the remaining principal outstanding of $30 million of its 3.22% first mortgage bonds, plus accrued interest. The bonds would have otherwise matured in October 2021.

In July 2021, Dominion Energy redeemed the remaining principal outstanding of $400 million of its 2.0% senior notes, plus accrued interest. The notes would have otherwise matured in August 2021.

In August 2021, Dominion Energy issued ~~an additional $100 million~~$1.0 billion of ~~its 3.90%~~2.25% senior notes that mature in ~~2025.~~2031. The proceeds from this offering will be used to finance and/or refinance, in whole or in part, existing and future expenditures associated with the development, construction, acquisition and operation of certain solar projects.

In August 2021, Dominion Energy redeemed the remaining principal outstanding of $800 million of its July 2016 hybrids, which matured in 2076 and were listed on the NYSE under the symbol DRUA. Expenses related to the early redemption of the hybrids were $23 million reflected within interest and related charges in the Consolidated Statements of Income for the three and nine months ended September 30, 2021.

In ~~March 2017, Virginia Power~~August 2021, Questar Gas issued ~~$750~~through private placements $125 million of ~~3.50%~~2.21% senior notesand $125 million of 3.15% senior notes that mature in ~~2027.~~2031 and 2051, respectively.

In ~~May 2017, Dominion Solar Projects III, Inc. borrowed $280~~November 2021, Virginia Power provided notice to redeem its 2.95% senior notes, which would have otherwise matured in January 2022, at the remaining principal outstanding of $450 million under a term loan agreement that bears interest at a variable rate. The term loan amortizes over an 18-year period and matures in May 2024. The debt is nonrecourse to Dominion Energy and is secured by Dominion Solar Projects III, Inc.’s interest in certain solar facilities.plus accrued interest.

Derivative Restructuring

In June ~~2017,~~2020, Dominion Energy amended a portfolio of interest rate swaps with a notional value of $2.0 billion, extending the mandatory termination dates from 2020 and 2021 to December 2024. As a result of this noncash financing activity with an embedded interest rate swap, Dominion Energy recorded $326 million in other long-term debt representing the net present value of the initial fair value measurement of the new contract as discussed in Note 18 to the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020. In August 2021, Dominion Energy settled certain of the outstanding interest rate swaps which would have otherwise matured in December 2024, resulting in a $39 million reduction in other long-term debt.

In August 2020, Virginia Power amended a portfolio of interest rate swaps with a notional value of $900 million, extending the mandatory termination dates from 2020 to December 2023. As a result of this noncash financing activity with an embedded interest rate swap, Virginia Power recorded $443 million in other long-term debt representing the net present value of the initial fair value measurement of the new contract as discussed in Note 18 to the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

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 September 30, 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 recorded dividends of $7 million ($4.375 per share) for both the three months ended September 30, 2021 and 2020, and $21 million ($13.125 per share) for both the nine months ended September 30, 2021 and 2020, on the Series A Preferred Stock. Dominion Energy also recorded dividends of $9 million ($11.625 per share) for both the three months ended September 30, 2021 and 2020, and $27 million ($34.875 per share) for both the nine months ended September 30, 2021 and 2020, on Series B Preferred Stock. The stock purchase contract liability associated with Dominion Energy’s 2019 Equity Units was $65 million and $129 million at September 30, 2021 and December 31, 2020, respectively. Stock purchase contract payments of $64 million and $62 million were made during the nine months ended September 30, 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.

There have been no significant changes to Dominion Energy’s Series A Preferred Stock and Series B Preferred Stock as 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, other than the item described below.

Series A Preferred Stock – Conversion Settlement Modification

In November 2021, Dominion Energy’s Articles of Incorporation were amended to require that any conversion of its Series A Preferred Stock be settled, at Dominion Energy’s election, either entirely in cash or in cash up to the first $1,000 per share and in shares of Dominion Energy common stock, cash or any combination thereof for any amounts in excess of $1,000 per share. As a result of establishing a minimum amount to be settled in cash if the holders elect to convert the Series A Preferred Stock, $1.6 billion will be reclassified from equity to mezzanine equity in the fourth quarter of 2021.

Issuance of Common Stock

Dominion Energy recorded, net of fees and commissions, $292 million from the issuance of 4million shares of common stock for the nine months ended September 30, 2021 and $481 million from the issuance of 6.2 million shares of common stock for the nine months ended September 30, 2020, through various programs including Dominion Energy Direct® and employee savings plans, as well as settlements of litigation 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.

In July 2021, Dominion Energy issued ~~through private placement $500 million of variable rate senior notes that mature in 2019.~~

In August 2017, Dominion Energy retired its $75 million variable rate Massachusetts Development Finance Agency Solid Waste Disposal Revenue Bonds, Series 2010B that would otherwise have matured in December 2041.

In September 2017, Virginia Power issued $550 million of 3.80% senior notes that mature in 2047. Also in September 2017, Virginia Power issued an additional $200 million of its 2.75% senior notes that mature in 2023.

In October 2017, Questar Gas entered into an agreement with certain investors to issue through private placements in November 2017, $100 million of 3.38% 15-year senior notes and, in April 2018, $50 million of 3.30% 12-year senior notes and $100 million of 3.97% 30-year senior notes.

~~Remarketable Subordinated Notes~~

In May 2017, Dominion Energy successfully remarketed the $1.0 billion 2014 Series A 1.50% RSNs due in 2020 pursuant to the terms of the 2014 Equity Units. In connection with the remarketing, the interest rate on the junior subordinated notes was reset to 2.579%, payable on a semi-annual basis and Dominion Energy ceased to have the ability to redeem the notes at its option or defer interest payments. At September 30, 2017, these securities are included in junior subordinated notes in Dominion Energy’s Consolidated Balance Sheets. Dominion Energy did not receive any proceeds from the remarketing. Remarketing proceeds belonged to the investors holding the related 2014 Equity Units and were temporarily used to purchase a portfolio of treasury securities. Upon maturity of the portfolio, the proceeds were applied on behalf of investors on the related stock purchase contracts settlement date in July 2017 to pay the purchase price to Dominion Energy for the issuance of 12.51.4 million shares of its common stock, ~~related~~valued at $104 million, to satisfy DESC’s obligation under a settlement agreement for the FILOT litigation discussed in Note 17.

In August 2021, Dominion ~~Energy’s 2014 Equity Units.~~ Energy issued 0.6 million shares of its common stock, valued at $45 million, to satisfy DESC’s obligation for the initial payment under a settlement agreement with the SCDOR discussed in Note 17.

~~Issuance~~In September 2020, Dominion Energy issued 4.1 million shares of ~~Common Stock~~its common stock to satisfy its obligation under a settlement agreement for the Santee Cooper Ratepayer Case discussed in Note 17. These shares were immediately repurchased as discussed below.

At-the-Market Program

In ~~June 2017, Dominion Energy filed an SEC shelf registration for the sale of debt and equity securities including the ability to sell common stock through an at-the-market program. Also in June 2017,~~August 2020, Dominion Energy entered into ~~three separate~~ sales agency agreements to effect sales under an at-the-market program as discussed in Note 20 to the ~~program and pursuant to which it may offer from time to time~~Consolidated Financial Statements in the Companies’ Annual Report Form 10-K for the year ended December 31, 2020. As of September 30, 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 ~~$500~~$1.0 billion of Dominion Energy’s common stock in addition to the $3.0 billion repurchase program authorized in July 2020 and completed in December 2020 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.

In August 2020, Dominion Energy began repurchasing shares under an open market agreement with a financial institution. During the third quarter of 2020, Dominion Energy repurchased 7.2 million shares of Dominion Energy common stock for $562 million.

In September 2020, Dominion Energy entered into2 prepaid accelerated share repurchase agreements with separate financial institutions as counterparties, which was ultimately completed in November 2020. Dominion Energy made payments totaling $1.5 billion to the counterparties in exchange for an aggregate ~~amount~~ of ~~its~~approximately 17.2 million shares of Dominion Energy common ~~stock. Sales~~stock, which represented approximately 90% of $1.5 billion worth of Dominion Energy shares based on the closing price of such shares on the date the agreements were executed. As a result, Dominion Energy recorded a reduction to common stock of $1.5 billion during the third quarter of 2020.

In September 2020, Dominion Energy repurchased 4.1 million shares of Dominion Energy common stock in a private transaction for $323 million.

Dominion Energy did 0t repurchase any shares of common stock ~~can be made by means of privately negotiated transactions, as transactions on~~during the New York Stock Exchange at market prices or in such other transactions as are agreed upon by Dominion Energy and the sales agents in conformance with applicable securities laws. No issuances have occurred under these agreements in 2017.nine months ended September 30, 2021.

~~In July 2017, Dominion Energy issued 12.5 million shares under the related stock purchase contracts entered into as part of Dominion Energy’s 2014 Equity Units.~~

Note ~~15.~~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 ~~for which~~that the Companies cannot estimate, ~~a range of possible loss,~~ 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 ~~for which~~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'~~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 of the Companies.~~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

~~CAA~~

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 ~~address all~~meet applicable requirements of the CAA. However, states may choose to develop regulatory programs that are more restrictive. Many of the ~~Companies'~~Companies’ facilities are subject to the ~~CAA's~~CAA’s permitting and other requirements.

Ozone Standards

~~MATS~~

~~In December 2011,~~The EPA published final non-attainment designations for the EPA issued MATS for coal- and oil-fired electric utility steam generating units. The rule establishes strict emission limits for mercury, particulate matter as a surrogate for toxic metals and hydrogen chloride as a surrogate for acid gases. The rule includes a limited use provision for oil-fired units with annual capacity factors under 8% that provides an exemption from emission limits, and allows compliance with operational work practice standards. Compliance was required by April 16,October 2015 ~~with certain limited exceptions. However,~~ozone standard in June 2014, the VDEQ granted a one-year MATS compliance extension for two coal-fired units at Yorktown power station to defer planned retirements and allow for continued operation of the units to address reliability concerns while necessary electric transmission upgrades are being completed. These coal units needed to continue operating through at least April 2017 due to delays in transmission upgrades needed to maintain electric reliability. Therefore, in October 2015, Virginia Power submitted a request to the EPA for an additional one year compliance extension under an EPA Administrative Order. The order was signed by the EPA in April 2016 allowing the Yorktown power station units to operate for up to one additional year, as2018 with states required ~~to maintain reliable power availability while transmission upgrades are being made. Virginia Power ceased operating the coal units at Yorktown power station in April 2017 as planned.~~

In June 2017, the U.S. DOE issued an order to PJM to direct Virginia Power to operate Yorktown power station’s Units 1 and 2 as needed to avoid reliability issues on the Virginia Peninsula. The order was effective for 90 days and can be reissued upon PJM’s request, if necessary, until required electricity transmission upgrades are completed approximately 23 months following the receipt in July 2017 of final permits and approvals for construction. In July 2017, the Sierra Club filed a petition for rehearing of the U.S. DOE order, which was denied by the U.S. DOE in September 2017. In August 2017, PJM filed a request for a 90-day renewal of the U.S. DOE order, which the U.S. DOE subsequently granted in September 2017. In October 2017, the Sierra Club filed a petition for rehearing of the U.S. DOE order granted in September 2017. This matter is pending.

In June 2015, the U.S. Supreme Court issued a decision holding that the EPA failed to take cost into account when the agency first decided to regulate the emissions from coal- and oil-fired plants, and remanded the MATS rule back to the U.S. Court of Appeals for the D.C. Circuit. However, the Supreme Court did not vacate or stay the effective date and implementation of the MATS rule. In November 2015, in response to the Supreme Court decision, the EPA proposed a supplemental finding that consideration of cost does not alter the agency’s previous conclusion that it is appropriate and necessary to regulate coal- and oil-fired electric utility steam generating units under Section 112 of the CAA. In December 2015, the U.S. Court of Appeals for the D.C. Circuit issued an order remanding the MATS rulemaking proceeding back to the EPA without setting aside judgment, noting that EPA had represented it was on track to issue a final finding regarding its consideration of cost. In April 2016, the EPA issued a final supplemental finding that consideration of costs does not alter its conclusion regarding appropriateness and necessity for the regulation. This regulation has been challenged in court. In April 2017, the EPA requested that the U.S. Court of Appeals for the D.C. Circuit delay oral arguments in the case to allow agency review of the rule. Since the MATS rule remains in effect and Dominion Energy is complying with the applicable requirements of the rule, Dominion Energy does not expect any adverse impacts to its operations at this time.

~~Ozone Standards~~

~~In October 2015, the EPA issued a final rule tightening the ozone standard from 75-ppb to 70-ppb. To comply with this standard, in April 2016 Virginia Power submitted the NO~~_X ~~Reasonable Available Control Technology analysis for Unit 5 at Possum Point power station. In December 2016, the VDEQ determined that NO~~_X ~~controls are required on Unit 5. Installation and operation of these NO~~_X ~~controls including an associated water treatment system will be required by mid-2019 with an expected cost in the range of $25 million to $35 million.~~

The statutory deadline for the EPA to complete attainment designations for a new standard was October 2017. While it is uncertain when the EPA will make final designations, states will have up to three years 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. ~~However, if significant~~The expenditures ~~are~~ required to implement additional controls it could ~~adversely affect~~have a material impact on the Companies’ results of operations and cash flows.

~~NSPS~~ACE Rule

In August 2012, the EPA issued the first NSPS impacting new and modified facilities in the natural gas production and gathering sectors and made revisions to the NSPS for natural gas processing and transmission facilities. These rules establish equipment performance specifications and emissions standards for control of VOC emissions for natural gas production wells, tanks, pneumatic controllers, and compressors in the upstream sector. In June 2016, the EPA issued a final NSPS regulation, for the oil and natural gas sector, to regulate methane and VOC emissions from new and modified facilities in transmission and storage, gathering and boosting, production and processing facilities. All projects which commenced construction after September 2015 are required to comply with this regulation. In April 2017, the EPA issued a notice that it is reviewing and, if appropriate, will issue a rulemaking to suspend, revise or rescind the June 2016 final NSPS for certain oil and gas facilities. In June 2017,July 2019, the EPA published ~~notice of reconsideration and partial stay~~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 ~~rule~~CAA and required states to develop plans by July 2022 establishing unit-specific performance standards for ~~90 days and proposed extending the stay for two years.~~existing coal-fired power plants. In ~~July 2017,~~January 2021, the U.S. Court of Appeals for the D.C. Circuit vacated the ~~90-day stay. Dominion Energy~~ACE Rule and ~~Dominion Energy Gas are implementing~~remanded it to the ~~final regulation. Dominion Energy~~EPA. This decision would take effect upon issuance of the court’s mandate. In March 2021, the court issued a partial mandate vacating and ~~Dominion Energy Gas are still evaluating whether potential impacts on results~~remanding all parts of ~~operations, financial condition and/or cash flows related to this matter will be material.~~

~~Climate Change Regulation~~

~~Carbon Regulations~~

the ACE Rule except for the portion of the ACE Rule that repealed the Clean Power Plan. In October ~~2013,~~2021, the U.S. Supreme Court ~~granted petitions filed by several industry groups, states, and the U.S. Chamber of Commerce seeking review~~agreed to hear a challenge of the U.S. Court of Appeals for the D.C. Circuit’s ~~June 2012~~ decision ~~upholding~~on the ~~EPA’s regulation of GHG emissions from stationary sources under the CAA’s permitting programs. In June 2014, the U.S. Supreme Court ruled that~~ACE Rule. While the EPA ~~lacked~~has stated its intention to replace the ~~authority under~~ACE Rule, it is unknown at this time if or how the ~~CAA to require PSD~~ EPA will issue a replacement for the ACE Rule and how that replacement will affect the Companies’ operations, financial condition and/or Title V permits for stationary sources based solely on GHG emissions. However, the Court upheld the EPA’s ability to require BACT for GHG for sources that are otherwise subject to PSD or Title V permitting for conventional pollutants. 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 ~~to set~~exceed a significant emissions rate atof 75,000 tons per year of CO₂ equivalent ~~emissions under which a source would not be required to apply BACT for its GHG~~ emissions. Until the EPA ultimately takes final action on this rulemaking, the Companies cannot predict the impact to their results of operations, financial ~~statements.~~condition and/or cash flows.

In ~~July 2011,~~December 2018, the EPA ~~signed~~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 ~~deferring~~affirming that fossil fuel-fired electric generating units meet the ~~need~~requirement that a source category “significantly contribute” to endangering air pollution for ~~PSD and Title V permitting for CO~~₂ ~~emissions for biomass projects. This rule temporarily deferred for a period~~the purposes of ~~up to three years the consideration of CO~~₂regulating GHG emissions from ~~biomass projects when determining whether~~new, modified and reconstructed stationary sources. The January 2021 rule also established a ~~stationary source meets the PSD and Title V applicability thresholds, including those~~threshold for the ~~application of BACT. The deferral policy expired in July 2014.~~“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 ~~July 2013,~~April 2021, the U.S. Court of Appeals for the D.C. Circuit vacated this rule; however, a mandate making this decision effective has not been issued. Virginia Power converted three coal-fired generating stations, Altavista, Hopewell and Southampton, to biomass during the CO₂ deferral period. It is unclear how the court's decision or the EPA's final policy regarding the treatment of specific feedstock will affect biomass sources that were permitted during the deferral period; however, the expenditures to comply with any new requirements could be material to Dominion Energy's and Virginia Power's financial statements.

~~Methane Emissions~~

~~In July 2015,~~granted an unopposed motion by the EPA ~~announced~~to vacate and remand the ~~next generation of its voluntary Natural Gas STAR Program, the Natural Gas STAR Methane Challenge Program.~~January 2021 rule. The program covers the entire natural gas sector from production to distribution, with more emphasis on transparency and increased reporting for both annual emissions and reductions achieved through implementation measures. In March 2016, East Ohio, Hope, DETI and Questar Gas (priorproposed revision to the ~~Dominion Energy Questar Combination) joined~~performance standards for coal-fired steam generating units remains pending. Until the EPA ~~as founding partners in~~ultimately takes final action on this rulemaking, the ~~new Methane Challenge program and submitted implementation plans in September 2016. DECG joined~~Companies cannot predict the ~~EPA’s voluntary Natural Gas STAR Program in July 2016 and submitted an implementation plan in September 2016. Dominion Energy and Dominion Energy Gas do not expect the costs related~~impact to ~~these programs to have a material impact on~~ 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~~5 mandatory facility-specific factors, including a social cost-benefit test, and ~~six~~6 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 1415 and 119 facilities, respectively, that ~~may be~~are subject to the final regulations. Dominion Energy ~~anticipates~~is also working with the EPA and state regulatory agencies to assess the applicability of Section 316(b) to 8 hydroelectric facilities, including 3 Virginia Power facilities. The Companies anticipate that ~~it will~~they may have to install impingement control technologies at ~~many~~certain of these stations that have once-through cooling systems. ~~Dominion Energy and Virginia Power~~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 ~~Dominion Energy’s and Virginia Power’s~~the Companies’ results of operations, financial condition and/or cash flows, the existing regulatory ~~framework~~frameworks in South Carolina and Virginia ~~provides~~provide rate recovery mechanisms that could substantially mitigate any such impacts for ~~Virginia Power.~~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 ~~establishes~~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. ~~Virginia Power has eight facilities that may be subject to additional wastewater treatment requirements associated with the final rule.~~ In April 2017, the EPA granted ~~two~~2 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 ~~U.S.’s~~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 offor certain waste streams regulations in the Effluent Limitations Guidelines final rule ~~for compliance with certain wastewater regulations~~ from November 2018 to November 2020; however, the latest date for compliance for these regulations ~~remains~~was December ~~2023. The~~2023. In October 2020, the EPA ~~is proposing~~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 ~~complete new rulemaking for these waste streams.~~2028. While the impacts of this rule could be material to ~~Dominion Energy’s and Virginia Power’s~~the Companies’ results of operations, financial condition and/or cash flows, the existing regulatory ~~framework~~frameworks in South Carolina and Virginia ~~provides~~provide rate recovery mechanisms that could substantially mitigate any such impacts for ~~Virginia Power.~~the regulated electric utilities.

~~Solid~~Waste Management and ~~Hazardous Waste~~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, ~~provides~~and similar state laws, may impose joint, several and strict liability for ~~immediate response and removal actions coordinated~~cleanup on potentially responsible parties who owned, operated or arranged for disposal at facilities affected by ~~the EPA in the event~~a release of ~~threatened~~hazardous substances. In addition, many states have created programs to incentivize voluntary remediation of sites where historical releases of hazardous substances ~~into the environment~~are identified and ~~authorizes the U.S. government either to clean up sites at which hazardous substances have created actual~~property owners or potential environmental hazards or to order persons responsible for the situation to do so. Under the CERCLA, as amended, generators and transporters of hazardous substances, as well as past and present owners and operators of contaminated sites, can be jointly, severally and strictly liable for the cost of cleanup. These potentially responsible parties ~~can be ordered~~decide to perform a cleanup, be sued for costs associated with an EPA-directed cleanup, voluntarily settle with the U.S. government concerning their liability for cleanup costs, or voluntarily begin a site investigation and site remediation under state oversight.initiate cleanups.

From time to time, ~~Dominion Energy, Virginia Power, or Dominion Energy Gas~~the Companies may be identified as a potentially responsible party toin connection with the alleged release of hazardous substances or wastes at a ~~Superfund~~ site. ~~The EPA (or a state) can either allow such a party to conduct~~Under applicable federal and ~~pay for a remedial investigation, feasibility study and remedial action or conduct~~state laws, the remedial investigation and action itself and then seek reimbursement from the potentially responsible parties. Each party can be held jointly, severally and strictly liable for the cleanup costs. These parties can also bring contribution actions against each other and seek reimbursement from their insurance companies. As a result, Dominion Energy, Virginia Power, or Dominion Energy Gas mayCompanies 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 ~~of remedial investigation~~incurred at such sites. The Companies also may identify, evaluate and ~~actions~~remediate other potentially impacted sites under voluntary state programs. Remediation costs may be subject to reimbursement under the ~~Superfund law~~Companies’ insurance policies, rate recovery mechanisms, or ~~other laws or regulations regarding~~both. Except as described below, the ~~remediation of waste. 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 19 former manufactured gas plant sites, ~~three of which pertain to~~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 remediation plans associated with 3 sites, including 1 at Virginia Power, and 12expects to commence remediation activities in 2021 or 2022 depending on receipt of ~~which pertain to~~final permits and approvals. At September 30, 2021 and December 31, 2020, Dominion Energy ~~Gas. Studies conducted~~had $40 million and $42 million, respectively, and Virginia Power had $25 million and $26 million, respectively, of reserves recorded. In addition, for 1 site associated with Dominion Energy, an updated work plan submitted to SCDHEC in September 2018, would increase costs by ~~other utilities at their former manufactured gas plant~~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, ~~have indicated that those sites contain coal tar and other potentially harmful materials. None of the former sites~~including 2 associated with Virginia Power, which ~~the Companies~~ are ~~associated is~~not under investigation by any

state or federal environmental ~~agency. At one~~agency nor the subject of the former sites, Dominion Energy is conducting a state-approved post closure groundwater monitoring program and an environmental land use restriction has been recorded. Another site has been accepted into a state-based voluntaryany current or proposed plans to perform remediation program. Virginia Power is currently evaluating the nature and extent of the contamination from this site as well as potential remedial options. Preliminary costs for options under evaluation for the site range from $1 million to $22 million.activities. Due to the uncertainty surrounding ~~the other~~such sites, the Companies are unable to make an estimate of the potential financial statement impacts.

~~See below for discussion on ash pond and landfill closure costs.~~

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.

~~Appalachian Gateway~~SCANA Legal Proceedings

~~Pipeline Contractor Litigation~~

~~Following the completion~~The following describes certain legal proceedings involving Dominion Energy, SCANA or DESC relating to events occurring before closing of the ~~Appalachian Gateway project in 2012, DETI received multiple change order requests~~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 other claims for additional payments from a pipeline contractor for the project. In July 2013, DETI filed a complaint in U.S. District Court for the Eastern District of Virginia for breach of contract as well as accounting and declaratory relief. The contractor filed a motion to dismiss, or in the alternative, a motion to transfer venue to Pennsylvania and/or West Virginia, where the pipelines were constructed. DETI filed an opposition to the contractor’s motion in August 2013. In November 2013, the court granted the contractor’s motion on the basis that DETI must first comply with the dispute resolution process. In July 2015, the contractor filed a complaint against DETI in U.S. District Court for the Western District of Pennsylvania. In August 2015, DETI filed a motion to dismiss, or in the alternative, a motion to transfer venue to Virginia. In March 2016, the Pennsylvania court granted the motion to dismiss and transferred the case to the U.S. District Court for the Eastern District of Virginia. In April 2016, the Virginia court issued an order staying the proceedings and ordering mediation. A mediation occurred in May 2016 but was unsuccessful. In July 2016, DETI filed a motion to dismiss. In March 2017, the court dismissed three of eight counts in the complaint. In May 2017, the contractor withdrew one of the counts in the complaint. This case is pending. DETI has accrued a liability of $6 million for this matter.unless otherwise noted therein, Dominion Energy ~~Gas cannot currently~~is unable to estimate ~~additional~~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 September 30, 2021 and December 31, 2020 include reserves of $196million and $208 million, respectively, included within other current liabilities, and insurance receivables of $41 million and $8 million, respectively, included within other receivables. During the nine months ended September 30, 2021, Dominion Energy’s Consolidated Statements of Income include charges of $100 million ($75 million after-tax), included within impairment of assets and other charges. During both the three and nine months ended September 30, 2020, Dominion Energy’s Consolidated Statements of Income include charges of $44 million ($33 million after-tax) included within impairment of assets and other charges. In addition, Dominion Energy’s Consolidated Statements of Income for the nine months ended September 30, 2020 include charges of $25 million ($25 million after-tax) included within other income.

~~Gas Producers Litigation~~Ratepayer Class Actions

In ~~connection~~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 ~~Appalachian Gateway project,~~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 ~~Field Services, Inc. (formerly known as~~and Santee Cooper establish a fund for the benefit of class members in the amount of $520 million, of which Dominion ~~Field Services, Inc.) entered into contracts for firm purchase rights with~~Energy’s portion was $320 million of shares of Dominion Energy common stock. In July 2020, the court issued a ~~group of small gas producers. In June 2016, certain~~final approval of the ~~gas producers~~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 ~~a complaint~~by certain Santee Cooper ratepayers against DESC, SCANA, Dominion Energy and former directors and officers of SCANA in the ~~Circuit~~State Court of ~~Marshall County, West Virginia against Dominion Energy, DETI~~Common Pleas in Orangeburg, South Carolina (the Luquire Case). In August 2019, DESC, SCANA and Dominion Energy ~~Field Services, Inc., among other defendants, claiming that~~were voluntarily dismissed from the ~~contracts are unenforceable~~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 ~~seeking compensatory and punitive damages. In~~ the ~~third quarter of 2016, Dominion Energy and DETI, with the consent~~Glibowski Case. This case was dismissed as part of the ~~other defendants, removed the case to~~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 ~~Northern~~ District of ~~West Virginia.~~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 ~~October 2016,~~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 (the State Court Derivative Case). 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 ~~remand.~~dismiss the appeal with the South Carolina Court of Appeals, which was granted in July 2020. In ~~February 2017,~~August 2020, the ~~U.S. District~~Supreme Court ~~entered an order remanding~~of South Carolina denied the ~~matter~~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 ~~Circuit~~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 ~~Marshall County, West Virginia.~~ South Carolina seeking appellate review of the denial of SCANA’s motion to dismiss. This petition was denied in June 2021. Also in June 2021, the parties reached an agreement in principle in the amount of $33 million to resolve this matter, subject to court approval. This settlement was reached in contemplation of and will be utilized to satisfy a portion of the Federal Court Merger Case and the State Court Merger Case discussed below.

In ~~March 2017, Dominion Energy~~January 2018, a purported class action was voluntarily dismissed from the case; however, DETI and Dominion Energy Field Services, Inc. remain parties to the matter. In April 2017, the case was transferred to the Business Court Division of West Virginia. This case is pending.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 ~~Gas cannot currently estimate financial statement impacts, but there could be~~aided and abetted these actions. Among other remedies, the plaintiff seeks to enjoin and/or rescind the merger. In February 2018, a ~~material impact~~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 ~~their financial condition and/or cash flows.~~

~~Ash Pond and Landfill Closure Costs~~

that described for the City of Warren Lawsuit. In September 2014, Virginia Power received a notice from the Southern Environmental Law Center on behalf of the Potomac Riverkeeper and Sierra Club alleging CWA violations at Possum Point power station. The notice alleges unpermitted discharges to surface water and groundwater from Possum Point power station’s historical and active ash storage facilities. A similar notice from the Southern Environmental Law Center on behalf of the Sierra Club was subsequently received related to Chesapeake power station. In December 2014, Virginia Power offered to close all of its coal ash ponds and landfills at Possum Point power station, Chesapeake and Bremo power stations as settlement of the potential litigation. The Southern Environmental Law Center declined the offer as presented in January 2015 and, in March 2015, filed a lawsuit related to its claims of the alleged CWA violations at Chesapeake power station. In March 2017,2019, the U.S. District Court for the ~~Eastern~~ District of ~~Virginia ruled that impacted groundwater associated with~~South Carolina granted the ~~on-site coal ash storage units was migrating~~plaintiffs’ motion to ~~adjacent surface water,~~consolidate the City of Warren Lawsuit and the Metzler Lawsuit (the Federal Court Merger Case). In October 2019, the plaintiffs filed an amended complaint against certain former directors and executive officers of SCANA and DESC, which ~~constituted~~stated substantially similar allegations to those in the City of Warren Lawsuit and the Metzler Lawsuit as well as an ~~unpermitted point source discharge in violation of~~inseparable fraud claim. In November 2019, the ~~CWA. The court, however, rejected Sierra Club’s claims that Virginia Power had violated specific conditions of its water discharge permit. Finding no harm~~defendants filed a motion to the environment, the court further declined to impose civil penalties or require excavation of the ash from the site as Sierra Club had sought. On remedy, the court ordered the parties to submit within 30 days a remedial plan (or separate plans) incorporating certain prescribed sediment, water and aquatic life monitoring. The court also ordered Virginia Power to reopen its solid waste permit application for closure of the coal ash storage units at Chesapeake power station.dismiss. In April ~~2017, Virginia Power submitted its remedial plan~~2020, the U.S. District Court for the District of South Carolina denied the motion to ~~the court,~~dismiss. In May 2020, SCANA filed a motion to intervene, which ~~included~~was denied in August 2020. In

September 2020, SCANA filed a ~~timetable for submitting a revised solid waste permit application to the VDEQ. The revised application will include a proposed remedial alternative to address groundwater impacts associated~~notice of appeal with coal ash storage at Chesapeake power station. Sierra Club submitted a separate remedial plan to the court. In July 2017, the court issued a final order requiring Virginia Power to perform additional specific sediment, water and aquatic life monitoring at and around the

Chesapeake power station for a period of at least two years. The court further directed Virginia Power to apply for a solid waste permit from VDEQ that includes corrective measures to address on-site groundwater impacts. In July 2017, Virginia Power appealed the court’s July 2017 final order to the U.S. Court of Appeals for the Fourth Circuit. In ~~August 2017,~~June 2021, the ~~Sierra Club filed a cross appeal. This case is pending.~~

~~In April 2015, the EPA’s final rule regulating the management of CCRs stored~~parties reached an agreement in ~~impoundments (ash ponds) and landfills was published~~principle in the Federal Register. The final rule regulates CCR landfills, existing ash ponds that still receive and manage CCRs, and inactive ash ponds that do not receive, but still store CCRs. Virginia Power currently operates inactive ash ponds, existing ash ponds, and CCR landfills subjectamount of $63 million to the final rule at eight different facilities. The enactment of the final rule in April 2015 created a legal obligation for Virginia Power to retrofit or close all of its inactive and existing ash ponds over a certain period of time,resolve this matter as well as ~~perform required monitoring, corrective action,~~the State Court Merger Case described below, subject to court approval. This settlement was reached in contemplation of and ~~post-closure care activities~~will be partially satisfied by the State Court Derivative Case settlement described above.

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 State Court Merger Case). 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. In June 2021, the parties reached an agreement in principle as ~~necessary.~~ described above relating to this matter as well as the Federal Court Merger Case and the State Court Derivative Case.

Employment Class Actions and Indemnification

In ~~April 2016,~~August 2017, a case was filed in the ~~EPA announced~~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 ~~partial settlement~~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 ~~certain environmental~~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 ~~industry organizations that had challenged~~are seeking damages, which could be as much as $100 million for 100% of the ~~final CCR rule~~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 ~~D.C.~~Fourth Circuit. ~~As part~~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. In July 2021, the parties executed a settlement ~~certain exemptions included~~agreement requiring DESC to pay $99 million, which could be satisfied in either cash or shares of Dominion Energy common stock. Also in July 2021, the State Court of Common Pleas in Fairfield County, South Carolina approved the settlement. In July 2021, Dominion Energy issued 1.4 million shares of Dominion Energy common stock to satisfy DESC’s obligation under the settlement agreement.

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 ~~final rule~~amount of $165 million to resolve this matter. In June 2021, the parties executed a settlement agreement which allows DESC to fund the settlement amount through a combination of cash, shares of Dominion Energy common stock or real estate with an initial payment of at least $43 million in shares of Dominion Energy common stock. In August 2021, Dominion Energy issued 0.6 million shares of its common stock to satisfy DESC’s obligation for ~~inactive ponds that closed~~the initial payment under the settlement agreement.

In September and October 2017, SCANA was served with subpoenas issued by ~~April 2018 will be removed, resulting in inactive ponds ultimately being subject~~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 ~~same requirements as existing ponds.~~NND Project. In ~~June 2016,~~February 2020, the ~~court~~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 ~~requires~~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 ~~EPA to modify provisions~~settlements in the ~~final CCR rule concerning inactive ponds.~~ 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 ~~August 2016,~~addition, the ~~EPA issued~~South Carolina Law Enforcement Division is conducting a ~~final rule, effective October 2016, extending certain compliance deadlines~~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 ~~final CCR rule~~U.S. District Court for ~~inactive ponds. Virginia Power does not believe~~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 ~~will substantially impact its closure plans~~in key contractors or subcontractors. These matters preceded the filing for ~~inactive ponds.~~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 ~~December 2016,~~September 2017, DESC, for itself and as agent for Santee Cooper, filed with the U.S. ~~Congress passed~~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 ~~President signed legislation that creates a framework for EPA- approved state CCR permit programs. Under this legislation, an approved state CCR permit program functions in lieu~~anticipatory repudiation and material breach by Westinghouse and WECTEC of the ~~self-implementing Federal CCR rule. The legislation allows states more flexibility~~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 ~~developing permit programs~~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 ~~implement~~work performed by Westinghouse subcontractors before the ~~environmental criteria~~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 ~~CCR rule. In August 2017,~~bankruptcy reorganization plan allocated by Westinghouse, it is possible that the ~~EPA issued interim guidance outlining~~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 ~~framework for state CCR program approval. The EPA has enforcement authority~~NND Project after the Westinghouse bankruptcy filing until state programs are approved. The EPA and states with approved programs both will have authority to enforce CCR requirements under their respective rules and programs. In September 2017, the EPA agreed to reconsider portionstermination of the ~~CCR rule~~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 ~~response~~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 ~~two petitions for reconsideration.~~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 ~~forecast potential incremental impacts or costs related~~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 ~~existing coal ash sites in connection with future implementation~~make payments on account of such claims that would exceed the portion of the ~~2016 CCR legislation and reconsideration~~Toshiba Settlement allocated for such balances within the SCANA Merger Approval Order recorded in regulatory liabilities on Dominion Energy’s Consolidated Balance Sheets.

Nuclear Operations

Nuclear Insurance

Other than the items discussed below, there have been no significant changes regarding the Companies’ nuclear insurance as described in Note 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2020.

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. In June 2021, the total liability protection per nuclear incident available to all participants in the Secondary Financial Protection Program decreased from $13.7 billion to $13.5 billion. These decreases do not impact Dominion Energy’s responsibility per active unit under the Price-Anderson Amendments Act of 1988.

Effective June 2021, Dominion Energy reduced the levels of nuclear property insurance coverage for each of the ~~CCR rule.~~reactor sites at Millstone, North Anna and Surry from $1.70 billion to the NRC minimum requirement of $1.06 billion. As a result of this reduction in nuclear property insurance coverage, Dominion Energy and Virginia Power’s maximum retrospective premium assessment for the current annual policy period was reduced to $76 million and $35 million, respectively.

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 ~~April 2017, the Governor of Virginia signed legislation into law that places~~June 2018, a ~~moratorium on the VDEQ issuing solid waste permits~~lawsuit for closure of ash ponds at Virginia Power’s Bremo, Chesapeake, Chesterfield and Possum Point power stations until May 2018. The law also requires Virginia Power to conduct an assessment of closure alternatives for the ash ponds at these four stations, to include an evaluation of excavation for recycling or off-site disposal, surface and groundwater conditions and safety. The assessments are due by December 1, 2017. Virginia Power has initiated a third-party evaluation of closure alternatives consistent with the legislation and is unable to estimate the potential financial statement impacts. The actual AROs related to the CCR rule may vary substantially from the estimates used to record the obligation.

~~Cove Point~~

Dominion Energy is constructing the Liquefaction Project at the Cove Point facility, which would enable the facility to liquefy domestically-produced natural gas and export it as LNG. In September 2014, FERC issued an order granting authorization for Cove Point to construct, modify and operate the Liquefaction Project. In October 2014, several partiesKewaunee was filed ~~a motion with FERC to stay the order and requested rehearing. In May 2015, FERC denied the requests for stay and rehearing.~~

~~Two parties have separately filed petitions for review of the FERC order~~ in the U.S. Court of ~~Appeals~~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 D.C. Circuit, which petitions were consolidated. Separately, one party requested a stay of the FERC order until the judicial proceedings are complete, which the court denied in June 2015. In July 2016, the court denied one party’s petition for review of the FERC order authorizing the Liquefaction Project. The court also issued a decision remanding the other party’s petition for review of the FERC order to FERC for further explanation of FERC’s decision that a previous transaction with an existing import shipper was not unduly discriminatory. In September 2017, FERC issued its order on remand from the U.S. Court of Appeals for the D.C. Circuit, and reaffirmed its ruling in its prior orders that Cove Point did not violate the prohibition against undue discrimination by agreeing to a capacity reduction and early contract termination with the existing import shipper.

In September 2013, the U.S. DOE granted Non-FTA Authorization approval for the export of up to 0.77 bcfe/day of natural gas to countries that do not have an FTA for trade in natural gas. In June 2016, a party filed a petition for review of this approval in the U.S. Court of Appeals for the D.C. Circuit.year ended December 31, 2018. This ~~case~~matter is pending.

In July 2017, Cove Point submitted an application for a temporary operating permit to the Maryland Department of the Environment, as required prior to the date of first production of LNG for commercial purposes of exporting LNG. In August 2017, Cove Point submitted an application to amend the CPCN issued by the Public Service Commission of Maryland in May 2014 to make necessary updates. These cases are pending.

~~FERC~~

FERC staff in the Office of Enforcement, Division of Investigations, is conducting a non-public investigation of Virginia Power's offers of combustion turbines generators into the PJM day-ahead markets from April 2010 through September 2014. FERC staff notified Virginia Power of its preliminary findings relating to Virginia Power's alleged violation of FERC's rules in connection with these activities. Virginia Power has provided its response to FERC staff's preliminary findings letter explaining why Virginia Power's conduct was lawful and refuting any allegation of wrongdoing. Virginia Power is cooperating fully with the investigation; however, it cannot currently predict whether or to what extent it may incur a material liability.

~~Greensville County~~

Virginia Power is constructing Greensville County and related transmission interconnection facilities. In August 2016, the Sierra Club filed an administrative appeal in the Circuit Court for the City of Richmond challenging certain provisions in Greensville County’s PSD air permit issued by the VDEQ in June 2016. In August 2017, the Circuit Court upheld the air permit, and no appeals were filed.

~~Nuclear Matters~~

In March 2011, a magnitude 9.0 earthquake and subsequent tsunami caused significant damage at the Fukushima Daiichi nuclear power station in northeast Japan. These events have resulted in significant nuclear safety reviews required by the NRC and industry groups such as the Institute of Nuclear Power Operations. Like other U.S. nuclear operators, Dominion Energy has been gathering supporting data and participating in industry initiatives focused on the ability to respond to and mitigate the consequences of design-basis and beyond-design-basis events at its stations.

In July 2011, an NRC task force provided initial recommendations based on its review of the Fukushima Daiichi accident and in October 2011 the NRC staff prioritized these recommendations into Tiers 1, 2 and 3, with the Tier 1 recommendations consisting of actions which the staff determined should be started without unnecessary delay. In December 2011, the NRC Commissioners approved the agency staff's prioritization and recommendations, and that same month an appropriations act directed the NRC to require reevaluation of external hazards (not limited to seismic and flooding hazards) as soon as possible.

Based on the prioritized recommendations, in March 2012, the NRC issued orders and information requests requiring specific reviews and actions to all operating reactors, construction permit holders and combined license holders based on the lessons learned from the Fukushima Daiichi event. The orders applicable to Dominion Energy requiring implementation of safety enhancements related to mitigation strategies to respond to extreme natural events resulting in the loss of power at plants, and enhancing spent fuel pool instrumentation have been implemented. The information requests issued by the NRC request each reactor to reevaluate the seismic and external flooding hazards at their site using present-day methods and information, conduct walkdowns of their facilities to ensure protection against the hazards in their current design basis, and to reevaluate their emergency communications systems and staffing levels. The walkdowns of each unit have been completed, audited by the NRC and found to be adequate. Reevaluation of the emergency communications systems and staffing levels was completed as part of the effort to comply with the orders. Reevaluation of the seismic and external flooding hazards is expected to continue through 2018. Dominion Energy and Virginia Power do not currently expect that compliance with the NRC's information requests will materially impact their financial position, results of operations or cash flows during the implementation period. The NRC staff is evaluating the implementation of the longer term Tier 2 and Tier 3 recommendations. Dominion Energy and Virginia Power do not expect material financial impacts related to compliance with Tier 2 and Tier 3 recommendations.

Guarantees, Surety Bonds and Letters of Credit

~~Dominion Energy~~

~~At September 30, 2017,~~Upon the closing of the GT&S Transaction, Dominion Energy ~~had issued $48 million of~~retained its 4 guarantees ~~primarily~~related to ~~support~~Cove Point, an equity method ~~investees.~~investment, in support of terminal services, transportation and construction. NaN of the Cove Point guarantees have a cumulative maximum exposure of $1.9 billion while the other 2 guarantees have 0 maximum limit. No ~~significant~~ amounts related to these guarantees have been recorded.

In ~~October 2017,~~addition, at September 30, 2021, Dominion Energy ~~entered into a guarantee agreement~~had issued an additional $25 million of guarantees, primarily to support a portion of Atlantic Coast Pipeline’s obligation under a $3.3 billion revolving credit facility, also entered in October 2017, with a stated maturity date of October 2021. Dominion Energy’s maximum potential loss exposure under the terms of the guarantee is limitedthird parties. No amounts related to 48% of the outstanding borrowings under the revolving credit facility, an equal percentage to Dominion Energy’s ownership in Atlantic Coast Pipeline. In October 2017, Dominion Energy recorded a liability of $30 million associated with this guarantee agreement. Through October 2017, Atlantic Coast Pipeline has borrowed $570 million against the revolving credit facility.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 September 30, ~~2017,~~2021, Dominion Energy had issued the following subsidiary guarantees:

Maximum
Exposure

(millions)

Commodity transactions⁽¹⁾

$
1,967

Nuclear obligations⁽²⁾

227

Cove Point⁽³⁾

1,900

Solar⁽⁴⁾

1,054

Other⁽⁵⁾

538

Total⁽⁶⁾

$
5,686

	Maximum Exposure
(millions)
Commodity transactions⁽¹⁾	$	1,892
Nuclear obligations⁽²⁾		242
Solar⁽³⁾		463
Other⁽⁴⁾		1,254
Total⁽⁵⁾	$	3,851

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

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

(3)	~~Guarantees related to Cove Point, in support of terminal services, transportation and construction.~~

~~(4)~~

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.

~~(5)~~(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. Also included are guarantees related to certain DGI subsidiaries' obligations for equity capital contributions and energy generation associated with Fowler Ridge and NedPower. As of September 30, 2017, Dominion Energy's maximum remaining cumulative exposure under these equity funding agreements is $20 million through 2019 and its maximum annual future contributions could range from approximately $4 million to $19 million.

~~(6)~~(5)

Excludes Dominion Energy's ~~guarantee~~guarantees for the ~~construction of a~~ new corporate office property asand an offshore wind installation vessel discussed in Note 2215 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

Additionally, at September 30, ~~2017,~~2021, Dominion Energy had purchased ~~$141~~$169 million of surety bonds, including ~~$63~~$95 million at Virginia Power, ~~and $24 million at Dominion Energy Gas,~~ and authorized the issuance of letters of credit by financial institutions of ~~$73~~$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 ~~16.~~18. Credit Risk

The ~~Companies'~~Companies’ accounting policies for credit risk are discussed in Note 2324 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, 2016. During the second quarter of 2017, Virginia Power recorded a $16 million ($10 million after-tax) charge related to a proposed settlement with a customer renting space on certain of Virginia Power’s electric distribution poles. This matter was settled during the third quarter of 2017.2020

At September 30, ~~2017,~~2021, Dominion ~~Energy's~~Energy’s credit exposure totaled $177 million, primarily related to price risk management activities. Of this amount, investment grade counterparties, including those internally rated, represented 91%. NaN single counterparty, whether investment grade or non-investment grade, exceeded $51 million of exposure. At September 30, 2021, Virginia Power’s exposure related to ~~energy marketing and price risk management activities~~wholesale customers totaled ~~$70~~$10 million. Of this amount, investment grade counterparties, including those internally rated, represented ~~49%~~80%. NoNaN single counterparty, whether investment grade or non-investment grade, exceeded $7$4 million of exposure. At September 30, 2017, Virginia Power's exposure related to sales to wholesale customers totaled $23 million. Of this amount, investment grade counterparties, including those internally rated, represented 52%. No single counterparty, whether investment grade or non-investment grade, exceeded $6 million of exposure.

Credit-Related Contingent Provisions

~~The majority~~Certain of Dominion ~~Energy's~~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 September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, Dominion Energy would have been required to post $102 million and $14 million, respectively, of additional collateral to its ~~counterparties of $6 million and $3 million, respectively.~~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 ~~not~~ posted ~~any~~$90 million and $1 million of collateral at September 30, ~~2017 or~~2021 and December 31, ~~2016~~2020, respectively, related to derivatives with credit-related contingent provisions that are in a liability position and not fully collateralized with cash. ~~The collateral posted includes any amounts paid related to non-derivative contracts and derivatives elected under the normal purchases and normal sales exception, per contractual terms.~~ 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 $192 million and $15 million at ~~both~~ September 30, ~~2017~~2021 and December 31, ~~2016 was $9 million,~~2020, respectively, which does not include the impact of any offsetting asset positions. ~~Credit-related~~

Certain of Virginia Power’s derivative instruments contain credit-related contingent provisions. These provisions ~~for~~require Virginia Power to provide collateral upon the occurrence of specific events, primarily a credit rate downgrade. If the credit-related contingent features underlying these instruments that are in a liability position and ~~Dominion Energy Gas~~not fully collateralized with cash were ~~not material~~fully triggered as of September 30, ~~2017~~2021 and December 31, ~~2016.~~ 2020, Virginia Power would have been required to post an additional $40 million and $2 million, respectively of additional collateral to its counterparties. The collateral that would be required to be posted includes the impacts of any offsetting asset position and any amounts already posted for derivatives and non-derivative contracts, per contractual terms. Virginia Power had posted $79 million of collateral at September 30, 2021 related to derivatives with credit-related contingent provisions that are in a liability position and not fully collateralized with cash. NaN such amounts were posted at December 31, 2020. 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 $119 million and $2 million at September 30, 2021 and December 31, 2020, respectively, which does not include the impact of any offsetting asset positions.

See Note 9 for further information about derivative instruments.

Note ~~17.~~19. Related-Party Transactions

Virginia Power ~~and Dominion Energy Gas engage~~engages in related-party transactions primarily with other Dominion Energy subsidiaries (affiliates). Virginia ~~Power's and Dominion Energy Gas'~~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 ~~and Dominion Energy Gas are~~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~~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 ~~swaps,~~purchases, to manage commodity price risks associated with purchases of natural gas. At September 30, ~~2017,~~2021, Virginia Power’s derivative assets and liabilities with affiliates were ~~$13~~$63 million and $5$2 million, respectively. At December 31, ~~2016,~~2020, Virginia Power’s derivative assets and liabilities with affiliates were ~~$41~~$3 million and $8$22 million, respectively. See Note 9 for more information.

Virginia Power participates in certain Dominion Energy benefit plans described in Note 2122 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020. At September 30, ~~2017~~2021 and December 31, ~~2016,~~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 ~~$478~~$500 million and ~~$396~~$436 million, respectively. At September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, Virginia Power's amounts due from Dominion Energy associated with the Dominion Energy Retiree Health and Welfare ~~plan~~Plan and included in ~~pension~~other deferred charges and other ~~postretirement benefit~~ assets in the Consolidated Balance Sheets were ~~$182~~$412 million and ~~$130~~$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~~Power’s significant transactions with DES and other affiliates:

	Three Months Ended September 30,				Nine Months Ended September 30,				Three Months Ended September 30,				Nine Months Ended September 30,
	2017		2016		2017		2016		2021		2020		2021		2020
(millions)
Commodity purchases from affiliates	$	170	$	172	$	519	$	416	$	219	$	135	$	526	$	450
Services provided by affiliates⁽¹⁾		109		105		333		347		116		108		363		343
Services provided to affiliates		5		5		17		17		6		5		15		14

(1)

Includes capitalized expenditures of ~~$33~~$39 million ~~and $32 million~~ for both the three months ended September 30, ~~2017~~2021 and ~~2016, respectively,~~2020, and ~~$104~~$121 million and ~~$109~~$107 million for the nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020, respectively.

Virginia Power has borrowed funds from Dominion Energy under short-term borrowing arrangements. There were ~~$36~~$310 million and ~~$262~~$380 million in short-term demand note borrowings from Dominion Energy as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. Virginia Power had no0 outstanding borrowings, net of repayments, under the Dominion Energy money pool for its nonregulated subsidiaries as of September 30, ~~2017~~2021 and December 31, ~~2016.~~2020. Interest charges related to Virginia ~~Power's~~Power’s borrowings from Dominion Energy were immaterial for the three and nine months ended September 30, ~~2017~~2021 and ~~2016.~~2020.

There were no0 issuances of Virginia ~~Power's~~Power’s common stock to Dominion Energy for the three and nine months ended September 30, ~~2017~~2021 and ~~2016.~~2020.

~~Dominion Energy Gas~~

~~Transactions with Related Parties~~

Dominion Energy Gas transacts with affiliates for certain quantities of natural gas and other commodities at market prices in the ordinary course of business. Additionally, Dominion Energy Gas provides transportation and storage services to affiliates. Dominion Energy Gas also enters into certain other contracts with affiliates, which are presented separately from contracts involving commodities or services. As of September 30, 2017 and December 31, 2016, all of Dominion Energy Gas' commodity derivatives were with affiliates. See Notes 7 and 9 for more information.

Dominion Energy Gas participates in certain Dominion Energy benefit plans as described in Note 18. At September 30, 2017 and December 31, 2016, amounts due from Dominion Energy associated with the Dominion Pension Plan included in noncurrent pension and other postretirement benefit assets in the Consolidated Balance Sheets were $725 million and $697 million, respectively. At September 30, 2017 and December 31, 2016, Dominion Energy Gas' amounts due from Dominion Energy associated with the Dominion Retiree Health and Welfare plan included in noncurrent pension and other postretirement benefit assets in the Consolidated Balance Sheets were $6 million and $2 million, respectively.

The financial statements for all years presented include costs for certain general, administrative and corporate expenses assigned by DES to Dominion Energy Gas on the basis of direct and allocated methods in accordance with Dominion Energy Gas’ 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. The costs of these services follow:

Three Months Ended September 30,

Nine Months Ended September 30,

2017

2016

2017

2016

(millions)

Purchases of natural gas and transportation and
storage services from affiliates

$
2

$
2

$
4

$
7

Sales of natural gas and transportation and
storage services to affiliates

15

16

51

51

Services provided by related parties⁽¹⁾

36

36

106

108

Services provided to related parties⁽²⁾

37

34

113

94

~~(1)~~

Includes capitalized expenditures of $13 million for both the three months ended September 30, 2017 and 2016, respectively, and $33 million and $37 million for the nine months ended September 30, 2017 and 2016, respectively.

~~(2)~~

~~Amounts primarily attributable to Atlantic Coast Pipeline, a related-party VIE.~~

~~The following table presents affiliated and related-party activity reflected in Dominion Energy Gas' Consolidated Balance Sheets:~~

September 30, 2017

December 31, 2016

(millions)

Other receivables⁽¹⁾

$
13

$
10

Imbalances receivable from affiliates

—

2

Imbalances payable to affiliates⁽²⁾

1

4

Affiliated notes receivable⁽³⁾

21

18

~~(1)~~

~~Represents amounts due from Atlantic Coast Pipeline, a related-party VIE.~~

~~(2)~~

~~Amounts are presented in other current liabilities in Dominion Energy Gas' Consolidated Balance Sheets.~~

~~(3)~~

~~Amounts are presented in other deferred charges and other assets in Dominion Energy Gas' Consolidated Balance Sheets.~~

Dominion Energy Gas' borrowings under the intercompany revolving credit agreement with Dominion Energy were $34 million and $118 million as of September 30, 2017 and December 31, 2016, respectively. Interest charges related to Dominion Energy Gas' total borrowings from Dominion Energy were immaterial for the three and nine months ended September 30, 2017 and 2016.

Note ~~18.~~20. Employee Benefit Plans

~~In the first quarter~~Net Periodic Benefit (Credit) Cost

The service cost component of 2016, the Companies announced an organizational design initiative that reduced their total workforces during 2016. The goal of the organizational design initiative was to streamline leadership structure and push decision making lower while also improving efficiency. During the nine months ended September 30, 2016, Dominion Energy recorded a $65 million ($40 million after-tax) charge, including $33 million ($20 million after-tax) at Virginia Power and $8 million ($5 million after-tax) at Dominion Energy Gas, primarily reflected in other operations and maintenance expense in their Consolidated Statements of Income due to severance pay and other costs related to the organizational design initiative. The terms of the severance under the organizational design initiative were consistent with the Companies’ existing severance plans.

~~Plan Amendment and Remeasurement~~

~~In the first quarter of 2017, Dominion Energy and Dominion Energy Gas remeasured an other postretirement~~net periodic benefit plan as a result of an amendment that changed post-65 retiree medical coverage for certain current and future Local 69 retirees effective July 1, 2017. The remeasurement resulted in a decrease in Dominion Energy's and Dominion Energy Gas' accumulated postretirement benefit obligation of $73 million and $61 million, respectively. As a result of regulatory accounting, the remeasurement will have an immaterial impact on net income for both Dominion Energy and Dominion Energy Gas. The discount rate used for the remeasurement was 4.30%. All other assumptions used were consistent with the measurement as of December 31, 2016.

During the nine months ended September 30, 2017, Dominion Energy recorded a $7 million ($4 million after-tax) charge, including $6 million ($4 million after-tax) at Dominion Energy Gas, as a result of additional payments associated with the new collective bargaining agreement, which(credit) cost is reflected in other operations and maintenance expense in ~~their~~Dominion Energy’s Consolidated Statements of ~~Income.~~

Income, except for $3 million and $12 million for the three and nine months ended September 30, 2020, respectively, presented in discontinued operations. The non-service cost components of net periodic benefit (credit) cost are reflected in other income in Dominion ~~Energy~~

Energy’s Consolidated Statements of Income. The components of Dominion ~~Energy's~~Energy’s provision for net periodic benefit cost (credit) ~~were~~are as follows:

	Pension Benefits						Other Postretirement Benefits						Pension Benefits						Other Postretirement Benefits
	2017			2016			2017			2016			2021			2020			2021			2020
(millions)
Three Months Ended September 30,
Service cost	$	35		$	30		$	7		$	7		$	43		$	45		$	6		$	8
Interest cost		86			79			15			16			80			82			11			15
Expected return on plan assets		(160	)		(141	)		(32	)		(28	)		(209	)		(197	)		(43	)		(39	)
Amortization of prior service credit		—			—			(13	)		(9	)
Amortization of prior service cost (credit)														—			(1	)		(11	)		(12	)
Amortization of net actuarial loss		40			29			3			2			48			58			1			1
Settlements		1			—			—			—
Net periodic benefit cost (credit)	$	2		$	(3	)	$	(20	)	$	(12	)
Settlements ⁽¹⁾														—			3			—			—
Net periodic benefit credit													$	(38	)	$	(10	)	$	(36	)	$	(27	)
Nine Months Ended September 30,
Service cost	$	104		$	87		$	20		$	23		$	127		$	131		$	18		$	22
Interest cost		259			234			45			50			238			263			35			45
Expected return on plan assets		(480	)		(419	)		(95	)		(87	)		(625	)		(582	)		(130	)		(117	)
Amortization of prior service cost (credit)		1			1			(38	)		(23	)		—			—			(32	)		(37	)
Amortization of net actuarial loss		121			84			9			5			145			155			3			4
Settlements		2			—			—			—
Net periodic benefit cost (credit)	$	7		$	(13	)	$	(59	)	$	(32	)
Settlements ⁽¹⁾														5			5			—			—
Net periodic benefit credit													$	(110	)	$	(28	)	$	(106	)	$	(83	)

(1)	2021 amounts relate primarily to the Dominion Energy executive nonqualified pension plan. 2020 amounts related primarily to Dominion Energy’s sale of substantially all of its gas transmission and storage operations to BHE.

Employer Contributions

During the three and nine months ended September 30, ~~2017,~~2021, Dominion Energy made no0 contributions to its ~~defined benefit pension plans or other postretirement benefit plans, except for a $75 million contribution made in January 2017 to Dominion Energy Questar’s~~ qualified pension plan to satisfy a regulatory condition to closing of the Dominion Energy Questar Combination. Dominion Energy expects to contribute approximately $12 million to its other postretirement benefit plans through VEBAs during the remainder of 2017.

~~Dominion Energy Gas~~

Dominion Energy Gas participates in certain Dominion Energy benefit plans as described in Note 21 to the Consolidated Financial Statements in the Companies' Annual Report on Form 10-K for the year ended December 31, 2016. See Note 17 for more information.

~~The components of Dominion Energy Gas' provision for net periodic benefit credit for employees represented by collective bargaining units were as follows:~~

Pension Benefits

Other Postretirement Benefits

2017

2016

2017

2016

(millions)

Three Months Ended September 30,

Service cost

$
3

$
3

$
1

$
1

Interest cost

7

7

3

3

Expected return on plan assets

(34
)

(33
)

(7
)

(5
)
Amortization of prior service credit

—

—

(1
)

—

Amortization of net actuarial loss

4

3

1

—

Net periodic benefit credit

$
(20
)

$
(20
)

$
(3
)

$
(1
)
Nine Months Ended September 30,

Service cost

$
11

$
10

$
3

$
4

Interest cost

22

22

9

10

Expected return on plan assets

(105
)

(100
)

(19
)

(17
)
Amortization of prior service credit

—

—

(2
)

—

Amortization of net actuarial loss

12

10

2

1

Net periodic benefit credit

$
(60
)

$
(58
)

$
(7
)

$
(2
)

~~Employer Contributions~~

~~During the nine months ended September 30, 2017, Dominion Energy Gas made no contributions to its~~ defined benefit pension plans or other postretirement benefit plans. Dominion Energy ~~Gas expects~~is 0t required to ~~contribute approximately $12 million~~make any contributions to its qualified defined benefit pension plans or to VEBAs associated with its other postretirement ~~benefit~~ plans ~~through VEBAs, for both employees represented by collective bargaining units and employees not represented by collective bargaining units, during~~in 2021. Dominion Energy considers voluntary contributions from time to time, either in the ~~remainder~~form of ~~2017.~~cash or equity securities.

Note ~~19.~~21. Operating Segments

The Companies are organized primarily on the basis of products and services sold in the U.S. In connection with its corporate rebranding, the Companies changed the names of their principal operating segments to Power Delivery, Power Generation and Gas Infrastructure from Dominion Virginia Power, Dominion Generation and Dominion Energy, respectively. 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 ~~Gas~~
~~Power Delivery~~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	X
~~Power Generation~~	Regulated electric generation fleet	X	X
	~~Merchant electric fleet~~	X
~~Gas Infrastructure~~	~~Gas transmission and storage~~	X		X
	~~Gas~~Regulated gas distribution and storage	X		X
Contracted Assets	~~Gas gathering and processing~~Nonregulated electric generation fleet	X		X
	~~LNG import and storage~~	X
	~~Nonregulated retail energy marketing~~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) ~~and the net impact of~~as well as nonregulated retail energy marketing operations, ~~that are discontinued or sold.~~including Dominion Energy’s noncontrolling interest in Wrangler. In addition, Corporate and Other includes specific items attributable to Dominion ~~Energy's~~Energy’s operating segments that are not included in profit measures evaluated by executive management in assessing the ~~segments'~~segments’ performance or in allocating ~~resources.~~resources as well as the net impact of the gas transmission and storage operations presented in discontinued operations, which are discussed in Note 3.

In the nine months ended September 30, ~~2017,~~2021, Dominion Energy reported after-tax net expenses of ~~$17~~$642 million ~~for specific items~~ in the Corporate and Other segment, ~~with $1~~including $492 million of after-tax net expenses for specific items with $617 million of after-tax net expenses attributable to its operating segments. In the nine months ended September 30, ~~2016,~~2020, Dominion Energy reported after-tax net expenses of ~~$63 million for specific items~~$3.6 billion in the Corporate and Other segment, including $3.4 billion of after-tax net expenses for specific items with ~~$22 million~~$1.3 billion of ~~these~~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 $447 million ($336 million after-tax) loss related to economic hedging activities, attributable to Contracted Assets;

•	$266 million ($199 million after-tax) of charges associated with the settlement of the South Carolina electric base rate case, attributable to Dominion Energy South Carolina;

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

•	A $119 million ($89 million after-tax) net charge associated with the proposed settlement of the 2021 Triennial Review, attributable to Dominion Energy Virginia;

•	A $77 million ($57 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 $70 million ($53 million after-tax) charge associated with litigation acquired in the SCANA Combination, attributable to Dominion Energy South Carolina;

•	A $68 million ($50 million after-tax) charge associated with storm damage and service restoration in Virginia Power’s service territory, attributable to Dominion Energy Virginia; and

•	A $44 million ($35 million after-tax) charge related to a revision in estimated recovery of spent nuclear fuel costs associated with the decommissioning of Kewaunee, attributable to Contracted Assets; partially offset by

•	A $309 million ($248 million after-tax) gain related to investments in nuclear decommissioning trust funds, attributable to:

•

Contracted Assets ($218 million after-tax) and;

•

Dominion Energy Virginia ($30 million after-tax); and

•	A $130 million ($97 million after-tax) benefit for a change in the expected CCRO to be provided to Virginia retail electric customers under the GTSA, attributable to Dominion Energy Virginia.

The net expense for specific items attributable to Dominion ~~Energy's~~Energy’s operating segments in ~~2016~~2020 primarily related to the impact of the following ~~item:~~items:

~~A $59 million ($36 million after-tax) charge related to an organizational design initiative, attributable to:~~

•	A $751 million ($564 million after-tax) charge primarily related to the planned early retirement of certain Virginia Power electric generation facilities, attributable to Dominion Energy Virginia;

~~Power Delivery ($5 million after-tax);~~

•	A $405 million ($298 million after-tax) charge associated with certain nonregulated solar generation facilities, attributable to Contracted Assets;

~~Gas Infrastructure ($12 million after-tax); and~~

•	A $221 million ($171 million after-tax) charge associated with the sale of Fowler Ridge, attributable to Contracted Assets; and

•	A $200 million ($149 million after-tax) charge for the expected CCRO to be provided to Virginia retail electric utility customers under the GTSA, attributable to Dominion Energy Virginia.

~~Power Generation ($19 million after-tax).~~

~~A $29 million ($18 million after-tax) net gain on investments held in nuclear decommissioning trust funds, attributable to Dominion Generation~~

The following table presents segment information pertaining to Dominion Energy’s operations:

Power
Delivery

Power
Generation

Gas
Infrastructure

Corporate
and Other

Adjustments/
Eliminations

Consolidated
Total

(millions)

Three Months Ended September 30, 2017

Total revenue from external customers

$
580

$
1,931

$
459

$
3

$
206

$
3,179

Intersegment revenue

4

3

204

150

(361
)

—

Total operating revenue

584

1,934

663

153

(155
)

3,179

Net income (loss) attributable to Dominion Energy

138

369

187

(29
)

—

665

Three Months Ended September 30, 2016

Total revenue from external customers

$
614

$
1,947

$
359

$
2

$
210

$
3,132

Intersegment revenue

6

2

205

144

(357
)

—

Total operating revenue

620

1,949

564

146

(147
)

3,132

Net income (loss) attributable to Dominion Energy

139

650

135

(234
)

—

690

Nine Months Ended September 30, 2017

Total revenue from external customers

$
1,664

$
5,091

$
1,949

$
12

$
660

$
9,376

Intersegment revenue

16

8

645

451

(1,120
)

—

Total operating revenue

1,680

5,099

2,594

463

(460
)

9,376

Net income (loss) attributable to Dominion Energy

390

870

613

(186
)

—

1,687

Nine Months Ended September 30, 2016

Total revenue from external customers

$
1,682

$
5,204

$
1,235

$
8

$
522

$
8,651

Intersegment revenue

17

7

507

469

(1,000
)

—

Total operating revenue

1,699

5,211

1,742

477

(478
)

8,651

Net income (loss) attributable to Dominion Energy

363

1,066

483

(246
)

—

1,666

	Dominion Energy Virginia			Gas Distribution		Dominion Energy South Carolina		Contracted Assets		Corporate and Other			Adjustments & Eliminations			Consolidated Total
(millions)
Three Months Ended September 30, 2021
Total revenue from external customers	$	2,333		$	372	$	799	$	265	$	(612	)	$	18		$	3,175
Intersegment revenue		(3	)		1		1		17		221			(236	)		1
Total operating revenue		2,330			373		800		282		(391	)		(218	)		3,176
Net income from discontinued operations		0			0		0		0		65			0			65
Net income (loss) attributable to Dominion Energy		599			69		151		119		(284	)		0			654
Three Months Ended September 30, 2020
Total revenue from external customers	$	2,257		$	311	$	758	$	288	$	(11	)	$	9		$	3,612
Intersegment revenue		(3	)		3		1		13		233			(252	)		(5	)
Total operating revenue		2,254			314		759		301		222			(243	)		3,607
Net income (loss) from discontinued operations		0			0		0		51		(32	)		0			19
Net income (loss) attributable to Dominion Energy		613			64		157		112		(590	)		0			356
Nine Months Ended September 30, 2021
Total revenue from external customers	$	6,072		$	1,800	$	2,230	$	790	$	(857	)	$	46		$	10,081
Intersegment revenue		(10	)		4		5		55		686			(737	)		3
Total operating revenue		6,062			1,804		2,235		845		(171	)		(691	)		10,084
Net income from discontinued operations		0			0		0		0		119			0			119
Net income (loss) attributable to Dominion Energy		1,464			415		337		373		(642	)		0			1,947
Nine Months Ended September 30, 2020
Total revenue from external customers	$	6,013		$	1,597	$	2,105	$	810	$	112		$	36		$	10,673
Intersegment revenue		(10	)		9		3		36		703			(763	)		(22	)
Total operating revenue		6,003			1,606		2,108		846		815			(727	)		10,651
Net income (loss) from discontinued operations		0			0		0		153		(1,906	)		0			(1,753	)
Net income (loss) attributable to Dominion Energy		1,479			375		326		295		(3,558	)		0			(1,083	)

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.~~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 segments that are not included in profit measures evaluated by executive management in assessing the segments' performance or in allocating resources.~~

In the nine months ended September 30, 2017, Virginia Power reported after-tax net expenses of $7 million for specific items in the Corporate and Other segment, all of which was attributable to its operating segments. In the nine months ended September 30, 2016, Virginia Power reported an after-tax net expense of $18 million for specific items in the Corporate and Other segment, all of which was attributable to its operating segments.

~~The net expense for specific items attributable to Virginia Power's operating segments in 2017 primarily related to the impact of the following item which was attributable to Power Delivery:~~

~~A $16 million ($10 million after-tax) charge~~ ~~arising from a customer settlement.~~

~~The net expense for specific items attributable to Virginia Power’s operating segments in 2016 primarily related to the impact of the following item:~~

~~A $33 million ($20 million after-tax) charge related to an organizational design initiative, attributable to:~~

~~Power Delivery ($5 million after-tax); and~~

~~Power Generation ($15 million after-tax).~~

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

Power
Delivery

Power
Generation

Corporate
and Other

Consolidated
Total

(millions)

Three Months Ended September 30, 2017

Operating revenue

$
580

$
1,574

$
—

$
2,154

Net income

137

314

8

459

Three Months Ended September 30, 2016

Operating revenue

$
617

$
1,594

$
—

$
2,211

Net income

140

359

4

503

Nine Months Ended September 30, 2017

Operating revenue

$
1,670

$
4,062

$
—

$
5,732

Net income

387

735

11

1,133

Nine Months Ended September 30, 2016

Operating revenue

$
1,686

$
4,191

$
—

$
5,877

Net income (loss)

362

699

(15
)

1,046

~~Dominion Energy Gas~~

~~The Corporate and Other Segment of Dominion Energy Gas~~ ~~primarily includes specific items attributable to Dominion Energy Gas'~~ operating segment that are not included in profit measures evaluated by executive management in assessing the ~~segment's~~segment’s performance or in allocating ~~resources and the effect of certain items recorded at Dominion Energy Gas as a result of Dominion Energy's basis in the net assets contributed.~~resources.

In the nine months ended September 30, ~~2017, Dominion Energy Gas~~2021, Virginia Power reported after-tax net expenses of $9$118 million ~~for specific items~~ in the Corporate and Other segment, including $186 million of after-tax net expenses for specific items all of which was attributable to its operating segment. In the nine months ended September 30, ~~2016, Dominion Energy Gas~~2020, Virginia Power reported an after-tax net ~~benefit~~expenses of $5$792 million ~~for specific items~~ in the Corporate and Other segment, ~~with~~including $815 million of after-tax net ~~expense~~expenses for specific items all of ~~$7 million~~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 $119 million ($89 million after-tax) net charge associated with the proposed settlement of the 2021 Triennial Review;

•	A $77 million ($57 million after-tax) charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process; and

•	A $68 million ($50 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 expected CCRO to be provided to Virginia retail electric customers under the GTSA.

The net expense for specific items attributable to Virginia Power’s operating segment in ~~2017 was due to a $15 million ($9 million after-tax)~~ ~~charge to write-off the balance of a regulatory asset no longer considered probable of recovery.~~

~~The net expense for specific items in 2016~~2020 primarily related to ~~an $8~~a $751 million ($5559 million after-tax) charge related to ~~an organizational design initiative.~~the planned early retirement of certain Virginia Power electric generation facilities and a $200 million ($149 million after-tax) charge for the expected CCRO to be provided to Virginia retail electric utility customers under the GTSA.

The following table presents segment information pertaining to ~~Dominion Energy Gas'~~Virginia Power’s operations:

	Gas Infrastructure		Corporate and Other			Consolidated Total		Dominion Energy Virginia		Corporate and Other			Consolidated Total
(millions)
Three Months Ended September 30, 2017
Three Months Ended September 30, 2021
Operating revenue	$	401	$	—		$	401	$	2,326	$	(350	)	$	1,976
Net income (loss)		121		(4	)		117		601		(45	)		556
Three Months Ended September 30, 2016
Operating revenue	$	382	$	—		$	382
Net income		77		6			83
Nine Months Ended September 30, 2017
Three Months Ended September 30, 2020
Operating revenue	$	1,313	$	—		$	1,313	$	2,248	$	0		$	2,248
Net income (loss)		318		(16	)		302		615		(140	)		475
Nine Months Ended September 30, 2016
Nine Months Ended September 30, 2021
Operating revenue	$	1,181	$	—		$	1,181	$	6,048	$	(501	)	$	5,547
Net income (loss)		288		(2	)		286		1,462		(118	)		1,344
Nine Months Ended September 30, 2020
Operating revenue								$	5,983	$	0		$	5,983
Net income (loss)									1,477		(792	)		685

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

Contents of MD&A

MD&A consists of the following information:

~~Forward-Looking Statements~~

•	Forward-Looking Statements

~~Accounting Matters – Dominion Energy~~

•	Accounting Matters – Dominion Energy

~~Dominion Energy~~

•	Dominion Energy

~~Results of Operations~~

•

Results of Operations

~~Segment Results of Operations~~

•

Segment Results of Operations

~~Virginia Power~~

•	Virginia Power

~~Results of Operations~~

•

Results of Operations

~~Dominion Energy Gas~~

•	Liquidity and Capital Resources – Dominion Energy

~~Results of Operations~~

~~Liquidity and Capital Resources – Dominion Energy~~

~~Future Issues and Other Matters – Dominion Energy~~

•	Future Issues and Other Matters – Dominion Energy

Forward-Looking Statements

This report contains statements concerning the ~~Companies'~~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 and changes in water temperatures and availability that can cause outages and property damage to facilities;

~~Federal, state and local legislative and regulatory developments, including changes in federal and state tax laws and regulations;~~

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;~~

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;

•	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 and global supply chains;

•	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;

•	Risks and uncertainties that may impact the Companies’ ability to develop and construct the CVOW Commercial Project within the currently proposed timeline, or at all, and consistent with current cost estimates along with the ability to recover such costs from customers;

•	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;

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

~~Counterparty credit and performance risk;~~

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

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

~~Fluctuations in the value of investments held in nuclear decommissioning trusts by Dominion Energy and Virginia Power and in benefit plan trusts by Dominion Energy and Dominion Energy Gas;~~

~~Fluctuations in interest rates or foreign currency exchange rates;~~

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

~~Changes in financial or regulatory accounting principles or policies imposed by governing bodies;~~

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

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

Impacts of acquisitions, including the Dominion Energy Questar Combination, divestitures, transfers of assets to joint ventures or Dominion Energy Midstream, including the contribution of Dominion Energy Questar Pipeline to Dominion Energy Midstream, and retirements of assets based on asset portfolio reviews;

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

~~The timing and execution of Dominion Energy Midstream's growth strategy;~~

Changes in rules for regional transmission organizations and independent system operators in which Dominion Energy and Virginia Power participate, including changes in rate designs, changes in FERC's interpretation of market rules and new and evolving capacity models;

~~Political and economic conditions, including inflation and deflation;~~

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

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 and Dominion Energy Gas' pipeline and processing systems, 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;

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 Virginia Power's service territory in connection with FERC Order 1000;~~

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

Changes to regulated electric rates collected by Virginia Power and regulated gas distribution, transportation and storage rates, including LNG storage, collected by Dominion Energy and Dominion Energy Gas;

~~Changes in operating, maintenance and construction costs;~~

~~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;~~

•	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 nonregulated 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 completing the sales of the Q-Pipe Group and Kewaunee, 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; and~~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;

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.84

•	Fluctuations in interest rates;

•	Fluctuations in currency exchange rates of the Euro or Danish Krone associated with the CVOW Commercial Project;

•	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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020 and in Part II. Item 1A. Risk Factors in this report.

The ~~Companies'~~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 September 30, ~~2017,~~2021, there have been no significant changes with regard to the critical accounting policies and estimates disclosed in MD&A in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020 and in the Companies’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2021. The policies disclosed included the accounting for regulated operations, AROs, income taxes, accounting for derivative contracts and ~~other~~financial instruments at fair value, use of estimates in goodwill ~~and~~impairment testing, use of estimates in long-lived asset and equity method investment impairment testing, ~~and~~ employee benefit ~~plans.~~plans and held for sale classification.

Dominion Energy

Results of Operations

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

	2017		2016		$ Change			2021		2020			$ Change
(millions, except EPS)
Third Quarter
Net income attributable to Dominion Energy	$	665	$	690	$	(25	)	$	654	$	356		$	298
Diluted EPS		1.03		1.10		(0.07	)		0.79		0.41			0.38
Year-To-Date
Net income attributable to Dominion Energy	$	1,687	$	1,666	$	21
Net income (loss) attributable to Dominion Energy								$	1,947	$	(1,083	)	$	3,030
Diluted EPS		2.66		2.71		(0.05	)		2.35		(1.38	)		3.73

Overview

Third Quarter ~~2017~~2021 vs. ~~2016~~2020

Net income attributable to Dominion Energy decreased 4%, primarily due to lower anticipated renewable energy investment tax credits, milder weather during 2017 in Dominion Energy’s electric utility service territory and a decrease in Cove Point import contracts. These decreases were partially offset by the Dominion Energy Questar Combination and an increase in gains from agreements to convey shale development rights underneath several natural gas storage fields.

~~Year-To-Date 2017 vs. 2016~~

Net income attributable to Dominion Energy increased 1%84%, primarily due to the absence of charges associated with an impairment of interests in certain nonregulated solar generation facilities and the termination of a contract in connection with the sale of Fowler Ridge. In addition, there was a decrease in charges associated with Virginia Power’s 2021 Triennial Review. These increases were partially offset by a decrease in net investment earnings on nuclear decommissioning trust funds and increased unrealized losses on economic hedging activities.

Year-To-Date 2021 vs. 2020

Net income attributable to Dominion Energy ~~Questar Combination, an electric utility capacity benefit and~~increased $3.0 billion, primarily due to the absence of ~~2016 organizational design initiative costs.~~charges associated with the cancellation of the Atlantic Coast Pipeline Project and related portions of the Supply Header Project which are presented in discontinued operations, the planned early retirements of certain electric generation facilities in Virginia, an impairment of interests in certain nonregulated solar generation facilities and the termination of a contract in connection with the sale of Fowler Ridge. In addition, there was an increase in net investment earnings on nuclear decommissioning trust funds and a decrease in charges

associated with Virginia Power’s 2021 Triennial Review. These increases were ~~substantially~~partially offset by ~~lower anticipated renewable energy investment tax credits, an increase in interest expense, milder weather in Dominion Energy’s~~charges associated with the settlement of the South Carolina electric ~~utility service territory~~base rate case and ~~a decrease in Cove Point import contracts.~~increased unrealized losses on economic hedging activities.

Analysis of Consolidated Operations

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

	Third Quarter								Year-To-Date								Third Quarter									Year-To-Date
	2017		2016			$ Change			2017			2016		$ Change			2021			2020			$ Change			2021		2020			$ Change
(millions)
Operating revenue	$	3,179	$	3,132		$	47		$	9,376		$	8,651	$	725		$	3,176		$	3,607		$	(431	)	$	10,084	$	10,651		$	(567	)
Electric fuel and other energy-related purchases		638		606			32			1,711			1,791		(80	)		703			594			109			1,740		1,758			(18	)
Purchased (excess) electric capacity		21		(6	)		27			(8	)		107		(115	)
Purchased electric capacity																		26			23			3			62		36			26
Purchased gas		24		77			(53	)		441			252		189			60			37			23			665		561			104
Net revenue		2,496		2,455			41			7,232			6,501		731
Other operations and maintenance		649		765			(116	)		2,166			2,133		33			924			977			(53	)		2,806		2,720			86
Depreciation, depletion and amortization		485		400			85			1,421			1,112		309			621			595			26			1,833		1,751			82
Other taxes		162		145			17			519			448		71			223			203			20			702		663			39
Impairment of assets and other charges (benefits)																		(222	)		1,151			(1,373	)		194		1,963			(1,769	)
Earnings (loss) from equity method investees																		69			(5	)		74			214		—			214
Other income		73		63			10			249			189		60			133			286			(153	)		732		327			405
Interest and related charges		305		250			55			905			715		190			407			306			101			978		1,136			(158	)
Income tax expense		272		230			42			683			561		122
Income tax expense (benefit)																		35			(110	)		145			200		(123	)		323
Net income (loss) from discontinued operations including noncontrolling interests																		65			19			46			119		(1,753	)		1,872
Noncontrolling interests		31		38			(7	)		100			55		45			12			(225	)		237			22		(157	)		179

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

Third Quarter ~~2017~~2021 vs. ~~2016~~2020

~~Net~~Operating revenue ~~increased 2%~~decreased 12%, primarily reflecting:

~~A $161 million increase from the operations acquired in the Dominion Energy Questar Combination being included for all of 2017;~~

•	A $350 million decrease for refunds to be provided to retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review;

•	A $261 million decrease associated with market prices affecting Millstone, including economic hedging impacts of net realized and unrealized losses on freestanding derivatives ($295 million);

•	A $44 million decrease in sales to electric utility retail customers, primarily due to a decrease in cooling degree days;

•	A $19 million decrease associated with settlements of economic hedges of certain Virginia Power regulated electric sales; and

•	A $19 million decrease from Virginia Power riders.

~~A $29~~These decreases were partially offset by:

•	A $131 million increase in the fuel cost components included in utility rates as a result of an increase in commodity costs associated with sales to electric utility retail customers ($104 million) and gas utility customers ($27 million);

•	A $47 million increase in sales to electric utility customers associated with economic and other usage factors;

•	A $27 million increase from gas utility capital cost riders; and

•	A $23 million increase in sales to electric utility retail customers associated with growth.

Electric fuel and other energy-related purchases increased 18%, primarily due to ~~additional generation output from merchant solar generating projects;~~higher commodity costs for electric utilities, which are offset in operating revenue and do not impact net income.

~~A $16 million~~Purchased gas increased 62%, primarily due to an increase ~~from regulated natural~~in commodity costs for gas ~~transmission~~utilities, which are offset in operating revenue and do not impact net income.

Other operations and maintenance decreased 5%, primarily due to a decrease in certain Virginia Power expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income ($35 million), a decrease in storm damage

and restoration costs in Virginia Power’s service territory ($22 million) and a decrease in merger and integration-related costs associated with the SCANA Combination ($16 million).

Other taxes increased 10%, primarily due to increased property taxes related to growth projects placed into ~~service;~~service.

Impairment of assets and other charges (benefits) decreased $1.4 billion, primarily due to the absence of charges associated with certain nonregulated solar generation facilities ($665 million), the termination of a contract in connection with the sale of Fowler Ridge ($221 million) and litigation acquired in the SCANA Combination ($44 million). In addition, there was a decrease for a benefit from the establishment of a regulatory asset associated with the early retirements of certain coal- and oil-fired generating units associated with the proposed settlement of the 2021 Triennial Review ($549 million). These decreases were partially offset byincreased charges for CCRO benefits provided to retail electric customers in Virginia associated with Virginia Power’s 2021 Triennial Review ($118 million).

~~A $76~~

Earnings from equity method investees increased $74 million, ~~decrease~~primarily due to an increase in ~~sales~~equity method earnings from Cove Point following closing of the GT&S Transaction.

Other income decreased 53%, primarily due to ~~electric utility retail customers from~~ a decrease in ~~cooling degree days;~~

~~A $41 million decrease from Cove Point import contracts;~~

~~A $24 million~~net investment gains on nuclear decommissioning trust funds ($204 million) partially offset by the absence of a charge for social justice commitments ($35 million) and an increase in non-service components of pension and other postretirement employee benefit plan credits ($33 million).

Interest and related charges increased 33%, primarily due to unrealized losses in 2021 as compared to unrealized gains in 2020 associated with freestanding derivatives ($83 million) and charges associated with the early redemption of certain securities in the third quarter of 2021 ($23 million), partially offset by the absence of borrowings in response to COVID-19 in 2020 ($18 million).

Income tax expense increased $145 million, primarily due to higher pre-tax income ($147 million) and the absence of prior year benefits including reductions in consolidated state deferred income taxes associated with gas transmission and storage operations ($45 million) and adjustments finalizing the effects of changes in tax status of certain subsidiaries in connection with the Dominion Energy Gas Restructuring ($24 million). These increases are partially offset by the absence of prior year income tax expense primarily associated with the impairment of nonregulated solar generating assets held in partnerships attributable to the noncontrolling interest ($55 million).

Net income from discontinued operations including noncontrolling interests increased $46 million, primarily due to the absence of charges associated with the Atlantic Coast Pipeline Project.

Noncontrolling interests increased $237 million, primarily due to the absence of impairments associated with certain nonregulated solar generation facilities ($267 million) partially offset by the closing of the GT&S Transaction in November 2020 ($32 million).

Year-To-Date 2021 vs. 2020

Operating revenue decreased 5%, primarily reflecting:

•	A $459 million decrease associated with market prices affecting Millstone, including economic hedging impacts of net realized and unrealized losses on freestanding derivatives ($515 million);

•	A $350 million decrease for refunds to be provided to retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review;

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

•	A $49 million decrease as a result of the contribution of certain nonregulated natural gas retail energy contracts to Wrangler;

•	A $47 million decrease in PJM off-system sales;

•	A $29 million decrease in sales to electric utility customers associated with economic and other usage factors; and

•	A $24 million decrease associated with settlements of economic hedges of certain Virginia Power regulated electric sales.

These decreases were partially offset by:

•	A $164 million increase in the fuel cost component included in utility rates as a result of an increase in commodity costs associated with sales to gas utility customers ($130 million) and electric utility retail customers ($34 million);

•	A $90 million increase from gas utility capital cost riders;

•	A $65 million increase in sales to electric utility retail customers from an increase in heating degree days during the heating season ($85 million) partially offset by a decrease in cooling degree days during the cooling season ($20 million);

•	A $61 million increase in sales to electric utility retail customers associated with growth;

•	A $30 million increase from Virginia Power riders; and

•	A $30 million increase from the absence of planned outages at Millstone.

Electric fuel and other energy-related purchases decreased 1%, primarily due to a decrease in PJM off-system sales ($47 million), partially offset by higher commodity costs for electric utilities ($34 million), which are offset in operating revenue and do not impact net income.

Purchased electric capacity increased 72%, primarily due to an increase in expense related ~~expenses due~~ to the annual PJM capacity performance market effective June ~~2017~~2020 ($~~68 million), partially offset by a benefit related to non-utility generators ($44 million); and~~

~~A $20 million decrease due to unfavorable pricing at merchant generation facilities.~~

~~Other operations and maintenance~~ ~~decreased 15%, primarily reflecting:~~

~~A $56 million increase in gains from agreements to convey shale development rights underneath several natural gas storage fields;~~

~~A $30 million decrease in certain electric transmission-related expenditures. These expenses are primarily recovered through state and FERC rates and do not impact net income;~~

~~A $26 million decrease in transaction and transition costs related to the Dominion Energy Questar Combination; and~~

~~A $21 million decrease due to the absence of costs related to 2016 labor contract renegotiations as well as costs resulting from a union workforce temporary work stoppage; partially offset by~~

~~A $45 million increase from the operations acquired in the Dominion Energy Questar Combination being included for all of 2017.~~

~~Depreciation, depletion and amortization~~ ~~increased 21%, primarily due to the operations acquired in the Dominion Energy Questar Combination being included for all of 2017 ($47~~17 million) and ~~various growth projects being placed into service ($40 million).~~

~~Interest and related charges~~ ~~increased 22%, primarily due to higher long-term debt interest expense resulting from debt issuances in the fourth quarter of 2016 and the first nine months of 2017($41 million) and debt acquired in the Dominion Energy Questar Combination ($11 million).~~

~~Income tax expense~~ ~~increased 18%, primarily due to an increased effective tax rate, principally due to lower anticipated renewable energy investment tax credits.~~

~~Noncontrolling interests~~ ~~decreased 18% primarily due to a decrease in earnings attributable to merchant solar partners ($22 million), partially offset by~~ an increase in ~~Dominion Energy Midstream earnings attributable to public unit holders ($15 million).~~

~~Year-To-Date 2017 vs. 2016~~

~~Net revenue~~ ~~increased 11%, primarily reflecting:~~

~~A $663 million increase from the operations acquired in the Dominion Energy Questar Combination being included for all of 2017;~~

~~A $119 million electric capacity benefit due~~expense related to the annual PJM capacity performance market effective June ~~2016~~2021 ($~~123~~13 million) ~~and a benefit related to non-utility generators ($86 million), partially offset by the annual PJM capacity performance market effective June 2017 ($90 million);~~.

~~A $74 million increase due to additional generation output from merchant solar generating projects;~~

~~A $57 million increase in sales to electric utility retail customers due to the effect of changes in customer usage and other factors;~~

~~A $49 million increase from regulated natural~~Purchased gas ~~transmission growth projects placed into service; and~~

~~A $36 million increase from rate adjustment clauses associated with electric utility operations; partially offset by~~

~~A $109 million decrease due to unfavorable pricing at merchant generation facilities;~~

~~A $104 million decrease from Cove Point import contracts; and~~

A decrease in sales to electric utility retail customers from a reduction in heating degree days during the heating season of 2017 ($52 million) and a decrease in cooling degree days during the cooling season of 2017 ($53 million).

~~Other operations and maintenance~~ increased ~~2%, primarily reflecting:~~

~~A $162 million increase from the operations acquired in the Dominion Energy Questar Combination being included for all of 2017; and~~

~~A $35 million increase in salaries, wages and benefits; partially offset by~~

~~An $88 million decrease in certain electric transmission-related expenditures. These expenses are primarily recovered through state and FERC rates and do not impact net income; and~~

~~The absence of organizational design initiative costs ($64 million).~~

~~Depreciation, depletion and amortization~~ increased 28%, primarily due to the operations acquired in the Dominion Energy Questar Combination being included for all of 2017 ($162 million) and various growth projects being placed into service ($120 million).

~~Other taxes~~ increased 16%, primarily due to the operations acquired in the Dominion Energy Questar Combination being included for all of 2017 ($35 million) and increased property taxes related to growth projects placed into service ($31 million).

~~Other income~~ ~~increased 32%, primarily reflecting:~~

~~A $26 million increase in earnings from equity method investments;~~

~~A $19 million increase in AFUDC associated with rate-regulated projects;~~

~~An $11 million increase in interest income associated with the settlement of state income tax refund claims; and~~

~~An $11 million increase in net realized gains (including investment income) on nuclear decommissioning trust funds.~~

~~Interest and related charges~~ increased 27%, primarily due to higher long-term debt interest expense resulting from debt issuances in 2016 and the first nine months of 2017 ($148 million) and debt acquired in the Dominion Energy Questar Combination ($39 million).

~~Income tax expense~~ ~~increased 22%, primarily due to higher pre-tax income and an increased effective tax rate, principally due to lower anticipated renewable energy investment tax credits.~~

~~Noncontrolling interests~~ ~~increased 82%~~19%, primarily due to an increase in commodity costs for gas utilities, which are offset in operating revenue and do not impact net income.

Other operations and maintenance increased 3%, primarily reflecting:

•	A $45 million increase in costs of employer-provided healthcare;

•	A $44 million charge related to a revision in estimated recovery of spent nuclear fuel costs associated with the decommissioning of Kewaunee;

•	A $40 million increase in storm damage and restoration costs in Virginia Power’s service territory; and

•	A $40 million increase in outside services; partially offset by

•	A $39 million decrease in merger and integration-related costs associated with the SCANA Combination;

•	The absence of a $30 million charge associated with credit risk on customer accounts related to COVID-19; and

•	A $20 million decrease in outage costs.

Impairment of assets and other charges (benefits) decreased 90%, primarily reflecting:

•	The absence of a charge associated with the planned early retirements of certain electric generation facilities in Virginia ($747 million);

•	The absence of a charge associated with certain nonregulated solar generation facilities ($665 million);

•	A benefit from the establishment of a regulatory asset associated with the early retirements of certain coal- and oil-fired generating units associated with the proposed settlement of the 2021 Triennial Review ($549 million);

•	The absence of a contract termination charge in connection with the sale of Fowler Ridge ($221 million);

•	The absence of dismantling costs associated with certain Virginia Power electric generation facilities ($30 million); and

•	A decrease in charges for CCRO benefits provided to retail electric customers in Virginia associated with Virginia Power’s 2021 Triennial Review ($12 million); partially offset by

•	Charges associated with the settlement of the South Carolina electric base rate case ($249 million);

•	A charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process ($77 million);

•	A charge for corporate office lease termination ($62 million);

•	An increase in charges associated with litigation acquired in the SCANA Combination ($56 million); and

•	A charge for the write-off of nonregulated retail software development assets ($20 million).

Earnings from equity method investees increased $214 million, primarily due to an increase in equity method earnings from Cove Point following closing of the GT&S Transaction.

Other income increased $405 million, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($267 million), an increase in non-service components of pension and other postretirement employee benefit plan credits ($97 million), the absence of a charge for social justice commitments ($40 million), the absence of charges associated with litigation acquired in the SCANA Combination ($25 million) and an increase in AFUDC associated with rate-regulated projects ($22 million), partially offset by charges associated with the settlement of the South Carolina electric base rate case ($18 million).

Interest and related charges decreased 14%, primarily due to unrealized gains in 2021 compared to unrealized losses in 2020 associated with freestanding derivatives ($150 million), the absence of borrowings in response to COVID-19 in 2020 ($42 million) and the absence of charges associated with the early redemption of certain securities in the first quarter of 2020 ($31 million), partially offset by charges associated with the early redemption of certain securities in the third quarter of 2021 ($23 million).

Income tax expense increased $323 million, primarily due to higher pre-tax income ($345 million) and the absence of prior year benefits including reductions in consolidated state deferred income taxes associated with gas transmission and storage operations ($45 million) and adjustments finalizing the effects of changes in tax status of certain subsidiaries in connection with the Dominion Energy ~~Midstream earnings~~Gas Restructuring ($24 million). These increases are partially offset by the benefit of a state legislative change ($21 million) and

the absence of prior year expense primarily associated with the impairment of nonregulated solar generating assets held in partnerships attributable to ~~public unitholders.~~the noncontrolling interest ($55 million).

Net income from discontinued operations including noncontrolling interests increased $1.9 billion, primarily due to a decrease in charges associated with the Atlantic Coast Pipeline Project and related portions of the Supply Header Project ($2.1 billion) partially offset by the absence of operations sold in the GT&S Transaction ($231 million).

Noncontrolling interests increased $179 million, primarily due to the absence of impairments associated with certain nonregulated solar generation facilities ($267 million) partially offset by the closing of the GT&S Transaction in November 2020 ($97 million).

Segment Results of Operations

Segment results include the impact of intersegment revenues and expenses, which may result in intersegment profit and loss. In connection with its corporate rebranding in May 2017, Dominion Energy changed the names of its principal operating segments to Power Delivery, Power Generation and Gas Infrastructure from Dominion Virginia Power, Dominion Generation and Dominion Energy, respectively. Presented below is a summary of contributions by Dominion Energy’s operating segments to net income (loss) attributable to Dominion Energy:

Net Income attributable to
Dominion Energy

Diluted EPS

2017

2016

$ Change

2017

2016

$ Change

(millions, except EPS)

Third Quarter

Power Delivery

$
138

$
139

$
(1
)

$
0.21

$
0.22

$
(0.01
)
Power Generation

369

650

(281
)

0.57

1.04

(0.47
)
Gas Infrastructure

187

135

52

0.29

0.21

0.08

Primary operating segments

694

924

(230
)

1.07

1.47

(0.40
)
Corporate and Other

(29
)

(234
)

205

(0.04
)

(0.37
)

0.33

Consolidated

$
665

$
690

$
(25
)

$
1.03

$
1.10

$
(0.07
)
Year-To-Date

Power Delivery

$
390

$
363

$
27

$
0.62

$
0.59

$
0.03

Power Generation

870

1,066

(196
)

1.37

1.74

(0.37
)
Gas Infrastructure

613

483

130

0.97

0.78

0.19

Primary operating segments

1,873

1,912

(39
)

2.96

3.11

(0.15
)
Corporate and Other

(186
)

(246
)

60

(0.30
)

(0.40
)

0.10

Consolidated

$
1,687

$
1,666

$
21

$
2.66

$
2.71

$
(0.05
)

	Net Income (Loss) Attributable to Dominion Energy									Diluted EPS
	2021			2020			$ Change			2021			2020			$ Change
(millions, except EPS)
Third Quarter
Dominion Energy Virginia	$	599		$	613		$	(14	)	$	0.74		$	0.74		$	—
Gas Distribution		69			64			5			0.08			0.08			—
Dominion Energy South Carolina		151			157			(6	)		0.19			0.19			—
Contracted Assets		119			112			7			0.15			0.13			0.02
Corporate and Other		(284	)		(590	)		306			(0.37	)		(0.73	)		0.36
Consolidated	$	654		$	356		$	298		$	0.79		$	0.41		$	0.38

Year-To-Date
Dominion Energy Virginia	$	1,464		$	1,479		$	(15	)	$	1.81		$	1.77		$	0.04
Gas Distribution		415			375			40			0.52			0.45			0.07
Dominion Energy South Carolina		337			326			11			0.42			0.39			0.03
Contracted Assets		373			295			78			0.46			0.35			0.11
Corporate and Other		(642	)		(3,558	)		2,916			(0.86	)		(4.34	)		3.48
Consolidated	$	1,947		$	(1,083	)	$	3,030		$	2.35		$	(1.38	)	$	3.73

~~Power Delivery~~

Dominion Energy Virginia

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

Third Quarter

Year-To-Date

2017

2016

% Change

2017

2016

% Change

Electricity delivered (million MWh)

23.0

24.1

(5
)%

63.2

64.2

(2
)%
Degree days (electric distribution service area):

Cooling

1,124

1,326

(15
)

1,698

1,755

(3
)
Heating

2

—

100

1,825

2,247

(19
)
Average electric distribution customer accounts
(thousands)⁽¹⁾

2,576

2,552

1

2,570

2,546

1

~~(1)~~

~~Period average.~~

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

Third Quarter
2017 vs. 2016
Increase (Decrease)

Year-To-Date
2017 vs. 2016
Increase (Decrease)

Amount

EPS

Amount

EPS

(millions, except EPS)

Regulated electric sales:

Weather

$
(13
)

$
(0.02
)

$
(19
)

$
(0.03
)
Other

1

—

12

0.02

FERC transmission equity return

5

0.01

14

0.02

Storm damage and service restoration

3

—

17

0.03

Other

3

—

3

—

Share dilution

—

—

—

(0.01
)
Change in net income contribution

$
(1
)

$
(0.01
)

$
27

$
0.03

~~Power Generation~~

~~Presented below are selected operating statistics related to Power Generation’s operations:~~

	Third Quarter							Year-To-Date							Third Quarter							Year-To-Date
	2017		2016		% Change			2017		2016		% Change			2021		2020		% Change			2021		2020		% Change
Electricity delivered (million MWh)																24.0		23.8		1	%		65.0		63.3		3	%
Electricity supplied (million MWh):
Utility		23.1		24.8		(7	)%		64.7		67.1		(4	)%		24.1		24.2		—			65.5		66.4		(1	)
Merchant		7.9		7.9		—			22.7		21.2		7
Degree days (electric utility service area):
Non-Jurisdictional																0.3		0.2		50			0.8		0.5		60
Degree days (electric distribution and utility service area):
Cooling		1,124		1,326		(15	)		1,698		1,755		(3	)		1,176		1,256		(6	)		1,696		1,708		(1	)
Heating		2		—	100				1,825		2,247		(19	)		—		19		(100	)		2,174		1,908		14
Average electric distribution customer accounts (thousands)																2,702		2,667		1			2,693		2,657		1

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

Third Quarter
2017 vs. 2016
Increase (Decrease)

Year-To-Date
2017 vs. 2016
Increase (Decrease)

Amount

EPS

Amount

EPS

(millions, except EPS)

Regulated electric sales:

Weather

$
(33
)

$
(0.05
)

$
(45
)

$
(0.07
)
Other

6

0.01

27

0.04

Electric capacity

(16
)

(0.03
)

70

0.11

Renewable energy investment tax credits⁽¹⁾

(242
)

(0.39
)

(187
)

(0.31
)
Merchant generation margin

6

0.01

(9
)

(0.02
)
Noncontrolling interests⁽²⁾

14

0.02

1

—

Depreciation and amortization

(12
)

(0.02
)

(38
)

(0.06
)
Other

(4
)

(0.01
)

(15
)

(0.02
)
Share dilution

—

(0.01
)

—

(0.04
)
Change in net income contribution

$
(281
)

$
(0.47
)

$
(196
)

$
(0.37
)

~~(1)~~

~~Tax credit is reflected in Power Generation segment once project is placed into service.~~

~~(2)~~

~~Represents noncontrolling interests related to merchant solar partnerships.~~

	Third Quarter 2021 vs. 2020 Increase (Decrease)						Year-To-Date 2021 vs. 2020 Increase (Decrease)
	Amount			EPS			Amount			EPS
(millions, except EPS)
Regulated electric sales:
Weather	$	(19	)	$	(0.02	)	$	46		$	0.05
Other		22			0.03			(18	)		(0.02	)
Rider equity return		16			0.02			26			0.03
Electric capacity		(8	)		(0.01	)		(21	)		(0.03	)
Planned outage costs		1			—			(13	)		(0.02	)
Depreciation and amortization		(12	)		(0.01	)		(23	)		(0.03	)
Renewable energy investment tax credits		(5	)		(0.01	)		(1	)		—
Other		(9	)		(0.02	)		(11	)		(0.01	)
Share accretion		—			0.02			—			0.07
Change in net income contribution	$	(14	)	$	—		$	(15	)	$	0.04

Gas ~~Infrastructure~~Distribution

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

	Third Quarter							Year-To-Date							Third Quarter							Year-To-Date
	2017		2016		% Change			2017		2016		% Change			2021		2020		% Change			2021		2020		% Change
Gas distribution throughput (bcf)⁽¹⁾:
Gas distribution throughput (bcf):
Sales		10		2		400	%		85		18		372	%		14		14		—	%		124		118		5	%
Transportation		143		106		35			469		364		29			216		188		15			705		628		12
Heating degree days (gas distribution service area):
Eastern region		66		22		200			2,940		3,435		(14	)
Western region⁽¹⁾		131		39		236			3,024		39		7,654
Average gas distribution customer accounts (thousands)⁽¹⁾⁽²⁾:
North Carolina																6		31		(81	)		1,979		1,679		18
Ohio and West Virginia																40		90		(56	)		3,489		3,336		5
Utah, Wyoming and Idaho																49		54		(9	)		2,982		2,933		2
Average gas distribution customer accounts (thousands):
Sales		1,234		472		161			1,234		329		275			1,936		1,896		2			1,929		1,887		2
Transportation		1,082		1,069		1			1,089		1,072		2			1,126		1,125		—			1,133		1,123		1
Average retail energy marketing customer accounts (thousands)⁽²⁾		1,463		1,377		6			1,447		1,368		6

~~(1)~~

~~Includes Dominion Energy Questar effective September 2016.~~

~~(2)~~

~~Period average.~~

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

Third Quarter
2017 vs. 2016
Increase (Decrease)

Year-To-Date
2017 vs. 2016
Increase (Decrease)

Amount

EPS

Amount

EPS

(millions, except EPS)

Dominion Energy Questar Combination

$
34

$
0.05

$
184

$
0.30

Assignment of Marcellus acreage

33

0.05

7

0.01

Cove Point import contracts

(27
)

(0.04
)

(63
)

(0.10
)
Noncontrolling interests⁽¹⁾

(9
)

(0.01
)

(28
)

(0.04
)
Transportation and storage growth projects

7

0.01

23

0.04

Other

14

0.02

7

0.01

Share dilution

—

—

—

(0.03
)
Change in net income contribution

$
52

$
0.08

$
130

$
0.19

	Third Quarter 2021 vs. 2020 Increase (Decrease)						Year-To-Date 2021 vs. 2020 Increase (Decrease)
	Amount			EPS			Amount			EPS
(millions, except EPS)
Regulated gas sales:
Weather	$	(1	)	$	—		$	2		$	—
Other		8			0.01			15			0.02
Rider equity return		8			0.01			29			0.03
Interest expense, net		(2	)		—			14			0.02
Other		(8	)		(0.02	)		(20	)		(0.02	)
Share accretion		—			—			—			0.02
Change in net income contribution	$	5		$	—		$	40		$	0.07

Dominion Energy South Carolina

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

	Third Quarter							Year-To-Date
	2021		2020		% Change			2021		2020		% Change
Electricity delivered (million MWh)		6.6		6.6		—	%		17.3		16.9		2	%
Electricity supplied (million MWh)		6.8		6.9		(1	)		18.1		17.6		3
Degree days (electric distribution service areas):
Cooling		448		597		(25	)		620		773		(20	)
Heating		—		—		—			839		610		38
Average electric distribution customer accounts (thousands)		769		756		2			765		748		2
Gas distribution throughput (bcf):
Sales		16		14		14			51		47		9
Average gas distribution customer accounts (thousands)		414		401		3			411		397		4

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

	Third Quarter 2021 vs. 2020 Increase (Decrease)						Year-To-Date 2021 vs. 2020 Increase (Decrease)
	Amount			EPS			Amount			EPS
(millions, except EPS)
Regulated electric sales:
Weather	$	(13	)	$	(0.02	)	$	2		$	—
Other		19			0.02			31			0.04
Capital cost rider		(2	)		—			(5	)		(0.01	)
Regulated gas sales		1			—			6			0.01
Interest expense, net		1			—			7			0.01
Other		(12	)		(0.01	)		(30	)		(0.03	)
Share accretion		—			0.01			—			0.01
Change in net income contribution	$	(6	)	$	—		$	11		$	0.03

Contracted Assets

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

	Third Quarter							Year-To-Date
	2021		2020		% Change			2021		2020		% Change
Electricity supplied (million MWh)		5.7		5.7		—	%		16.4		15.5		6	%

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

	Third Quarter 2021 vs. 2020 Increase (Decrease)					Year-To-Date 2021 vs. 2020 Increase (Decrease)
	Amount			EPS		Amount			EPS
(millions, except EPS)
Margin⁽¹⁾	$	(2	)	$	—	$	19		$	0.02
Planned outage costs		3			—		28			0.03
Renewable energy investment tax credits		—			—		23			0.03
Absence of contract associated with Fowler Ridge		3			—		14			0.02
Other		3			0.02		(6	)		(0.01	)
Share accretion		—			—		—			0.02
Change in net income contribution	$	7		$	0.02	$	78		$	0.11

(1)	~~Represents the portion of~~Includes earnings ~~attributable to Dominion Energy Midstream's public unitholders.~~associated with a 50% noncontrolling interest in Cove Point.

Corporate and Other

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

	Third Quarter									Year-To-Date									Third Quarter									Year-To-Date
	2017			2016			$ Change			2017			2016			$ Change			2021			2020			$ Change			2021			2020			$ Change
(millions, except EPS)
Specific items attributable to operating segments	$	—		$	4		$	(4	)	$	(1	)	$	(22	)	$	21		$	(303	)	$	(556	)	$	253		$	(617	)	$	(1,334	)	$	717
Specific items attributable to corporate operations		(7	)		(30	)		23			(16	)		(41	)		25
Specific items attributable to Corporate and Other segment																				39			(4	)		43			125			(2,083	)		2,208
Total specific items		(7	)		(26	)		19			(17	)		(63	)		46			(264	)		(560	)		296			(492	)		(3,417	)		2,925
Other corporate operations:
Renewable energy investment tax credits		52			(143	)		195			79			(11	)		90
Interest expense, net		(85	)		(63	)		(22	)		(258	)		(191	)		(67	)		(100	)		(95	)		(5	)		(317	)		(272	)		(45	)
Other		11			(2	)		13			10			19			(9	)		80			65			15			167			131			36
Total other corporate operations		(22	)		(208	)		186			(169	)		(183	)		14			(20	)		(30	)		10			(150	)		(141	)		(9	)
Total net expense	$	(29	)	$	(234	)	$	205		$	(186	)	$	(246	)	$	60		$	(284	)	$	(590	)	$	306		$	(642	)	$	(3,558	)	$	2,916
EPS impact	$	(0.04	)	$	(0.37	)	$	0.33		$	(0.30	)	$	(0.40	)	$	0.10		$	(0.37	)	$	(0.73	)	$	0.36		$	(0.86	)	$	(4.34	)	$	3.48

Total Specific Items

Corporate and Other includes specific items attributable to Dominion ~~Energy's~~Energy’s primary operating segments that are not included in profit measures evaluated by executive management in assessing ~~those~~the segments' performance or in allocating resources. See Note 1921 to the Consolidated Financial Statements in this report for discussion of these items in more detail. Corporate and ~~other~~Other also includes items attributable to the Corporate and Other segment. For the three months ended September 30, 2021, this primarily included $65 million net income of discontinued operations, primarily associated with the Q-Pipe Group, $17 million of after-tax charges associated with the early redemption of certain debt securities and an $11 million after-tax loss for derivative mark-to-market changes. For the nine months ended September 30, 2021, this primarily included $119 million net income of discontinued operations, primarily associated with the Q-Pipe Group, a $105 million after-tax benefit for derivative mark-to-market changes, $61 million of after-tax charges for workplace realignment, primarily related to a corporate office lease termination, $31 million of after-tax charges for merger and integration-related costs associated with the SCANA Combination and $17 million of after-tax charges associated with the early redemption of certain debt securities.

For the three months ended September 30, 2020, this primarily included $30 million of after-tax charges for social justice commitments, $11 million of after-tax charges for merger and integration-related costs associated with the SCANA Combination and $10 million of after-tax charges related to the effects of COVID-19, partially offset by $47 million after-tax income for derivative mark-to-market changes. For the nine months ended September 30, 2020, this primarily included $1.9 billion net loss of discontinued operations, including the results of operations of the entities included in the GT&S Transaction and Q-Pipe Group as well as charges associated with the cancellation of the Atlantic Coast Pipeline Project, $70 million of after-tax charges for merger and integration-related costs associated with the SCANA Combination, $30 million of after-tax charges for social justice commitments, $23 million of after-tax charges related to the effects of COVID-19 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:

	Third Quarter							Year-To-Date						Third Quarter						Year-To-Date
	2017		2016		$ Change			2017		2016		$ Change		2021		2020		$ Change		2021		2020		$ Change
(millions)
Net income	$	459	$	503	$	(44	)	$	1,133	$	1,046	$	87	$	556	$	475	$	81	$	1,344	$	685	$	659

Overview

Third Quarter ~~2017~~2021 vs. ~~2016~~2020

Net income ~~decreased 9%~~increased 17%, primarily due to ~~milder weather during 2017 and~~a decrease in charges associated with the ~~annual PJM capacity performance market effective June 2017, partially offset by a benefit related to non-utility generators.~~2021 Triennial Review.

Year-To-Date ~~2017~~2021 vs. ~~2016~~2020

Net income increased 8%96%, primarily due to the ~~PJM capacity performance market, a benefit~~ absence of charges related to ~~non-utility generators, an increase~~the planned early retirements of certain electric generation facilities and a decrease in ~~customer usage and other factors and~~charges associated with the ~~absence of organizational design initiative costs, partially offset by milder weather during 2017.~~2021 Triennial Review.

Analysis of Consolidated Operations

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

	Third Quarter								Year-To-Date								Third Quarter								Year-To-Date
	2017		2016			$ Change			2017			2016		$ Change			2021			2020		$ Change			2021			2020			$ Change
(millions)
Operating revenue	$	2,154	$	2,211		$	(57	)	$	5,732		$	5,877	$	(145	)	$	1,976		$	2,248	$	(272	)	$	5,547		$	5,983		$	(436	)
Electric fuel and other energy-related purchases		549		516			33			1,414			1,527		(113	)		515			424		91			1,270			1,282			(12	)
Purchased (excess) electric capacity		21		(6	)		27			(8	)		107		(115	)		15			3		12			16			(14	)		30
Net revenue		1,584		1,701			(117	)		4,326			4,243		83
Other operations and maintenance		373		443			(70	)		1,126			1,279		(153	)		470			525		(55	)		1,382			1,319			63
Depreciation and amortization		288		270			18			854			765		89			343			324		19			990			942			48
Other taxes		76		74			2			233			218		15			86			85		1			262			257			5
Impairment of assets and other charges (benefits)																		(230	)		200		(430	)		(269	)		1,008			(1,277	)
Other income		13		13			—			57			47		10			21			34		(13	)		93			34			59
Interest and related charges		128		118			10			373			345		28			136			135		1			400			398			2
Income tax expense		273		306			(33	)		664			637		27			106			111		(5	)		245			140			105

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

Third Quarter ~~2017~~2021 vs. ~~2016~~2020

~~Net~~Operating revenue decreased 7%12%, primarily reflecting:

•	A $350 million decrease for refunds to be provided to retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review;

~~A $76~~
•
A $26 million decrease in sales to retail customers, primarily due to a decrease in cooling degree days;

•	A $19 million decrease associated with settlements of economic hedges of certain regulated electric sales;

•	A $19 million decrease from riders; and

•	A $12 million decrease in PJM off-system sales.

These decreases were partially offset by:

•	A $92 million increase in the fuel cost component included in utility rates as a result of a net increase in commodity costs associated with sales to electric utility retail customers;

•	A $32 million increase in sales to electric utility retail customers associated with economic and other usage factors;

•	A $16 million increase in sales to electric utility retail customers associated with growth; and

•	An $11 million increase in sales to customers from non-jurisdictional solar generation facilities.

Electric fuel and other energy-related purchases increased 21%, primarily due to higher commodity costs for electric utilities ($92 million), which are offset in operating revenue and do not impact net income, partially offset by a decrease in ~~cooling degree days; and~~PJM off-system sales ($12 million).

~~A $24~~

Purchased electric capacity increased $12 million, primarily due to an increase in ~~electric capacity~~expense related ~~expenses due~~ to the annual PJM capacity performance market effective June ~~2017~~2021.

Other operations and maintenance decreased 10%, primarily reflecting:

•	A $35 million decrease in certain expenses which are primarily recovered through state- and FERC-regulated rates and do not impact net income; and

•	A $22 million decrease in storm damage and service restoration costs; partially offset by

•	A $12 million increase in outside services.

Impairment of assets and other charges (benefits) decreased $430 million, due to a benefit from the establishment of a regulatory asset associated with the early retirements of certain coal- and oil-fired generating units associated with the proposed settlement of the 2021 Triennial Review ($68549 million), partially offset by ~~a benefit related~~increased charges for CCRO benefits provided to ~~non-utility generators~~retail electric customers in Virginia associated with the 2021 Triennial Review ($44118 million).

Other ~~operations and maintenance~~income decreased ~~16%~~38%, primarily due to a decrease in net investment gains on nuclear decommissioning trust funds.

Income tax expense decreased 5%, primarily due to increased investment tax credits ($20 million) partially offset by higher pre-tax income ($14 million).

Year-To-Date 2021 vs. 2020

Operating revenue decreased 7%, primarily reflecting:

•	A $350 million decrease for refunds to be provided to retail electric customers in Virginia associated with the proposed settlement of the 2021 Triennial Review;

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

•	A $47 million decrease in PJM off-system sales;

•	A $45 million decrease in sales to electric utility retail customers associated with economic and other usage factors; and

•	A $24 million decrease associated with settlements of economic hedges of certain regulated electric sales.

These decreases were partially offset by:

•	A $62 million increase in sales to retail customers from an increase in heating degree days during the heating season ($68 million) partially offset by a decrease in cooling degree days during the cooling season ($6 million);

•	A $40 million increase in sales to electric utility retail customers associated with growth;

•	A $30 million increase from riders;

•	A $23 million increase in the fuel cost component included in utility rates as a result of a net increase in commodity costs associated with sales to electric utility retail customers; and

•	A $19 million increase in sales to customers from non-jurisdictional solar generation facilities.

Electric fuel and other energy-related purchases decreased 1%, primarily due to a decrease in ~~certain~~PJM off-system sales ($47 million), partially offset by higher commodity costs for electric ~~transmission-related expenditures. These expenses~~utilities ($23 million), which are ~~primarily recovered through state and FERC rates~~offset in operating revenue and do not impact net ~~income;~~income.

~~An $11 million decrease due to the absence of 2016 union workforce contract renegotiations; and~~

~~A $9 million decrease in outside services due to the absence of certain utility projects.~~

~~Income tax expense~~ ~~decreased 11%,~~Purchased electric capacity increased $30 million, primarily due to ~~lower pre-tax income.~~

~~Year-To-Date 2017 vs. 2016~~

~~Net revenue~~ ~~increased 2%, primarily reflecting:~~

~~A $119 million electric capacity benefit due~~an increase in expense related to the annual PJM capacity performance market effective June ~~2016~~2020 ($~~123~~17 million) and ~~a benefit~~an increase in expense related to ~~non-utility generators ($86 million), partially offset by~~ the annual PJM capacity performance market effective June ~~2017~~2021 ($9013 million);.

~~An increase in sales to retail customers due to the effect of changes in customer usage and other factors ($57 million); and~~

~~An increase from rate adjustment clauses ($36 million); partially offset by~~

A decrease in sales to retail customers from a reduction in heating degree days during the heating season of 2017 ($52 million) and a decrease in cooling degree days during the cooling season of 2017 ($53 million).

Other operations and maintenance ~~decreased 12%~~increased 5%, primarily reflecting:

~~An $88 million decrease in certain electric transmission-related expenditures. These expenses are primarily recovered through state and FERC rates and do not impact net income;~~

•	A $40 million increase in storm damage and service restoration costs;

~~The absence of organizational design initiative costs ($32 million); and~~

•	A $34 million increase in outside services;

~~A $28 million decrease in storm damage and service restoration costs.~~

~~Depreciation and amortization~~ ~~increased 12%, primarily due to various growth projects being placed into service ($48 million) and revised depreciation rates ($32 million).~~

~~Other income~~ ~~increased 21%, primarily reflecting:~~

~~An $11 million increase in interest income associated with the settlement of state income tax refund claims; and~~

•	A $21 million increase in salaries, wages and benefits;

~~A $10 million increase from the assignment of Virginia Power’s electric transmission tower rental portfolio; partially offset by~~

•	A $18 million increase in planned outage costs; and

~~A $16 million charge associated with a customer settlement.~~

•	A $12 million increase in certain expenses which are primarily recovered through state- and FERC-regulated rates and do not impact net income; partially offset by

•	The absence of a $20 million charge associated with credit risk on customer accounts related to COVID-19; and

~~Dominion Energy Gas~~

~~Results of Operations~~

~~Presented below is a summary of Dominion Energy Gas' consolidated results:~~

Third Quarter

Year-To-Date

2017

2016

$ Change

2017

2016

$ Change

(millions)

Net income

$
117

$
83

$
34

$
302

$
286

$
16

~~Overview~~

~~Third Quarter 2017 vs. 2016~~

~~Net income increased 41%, primarily due to gains from agreements to convey shale development rights underneath several natural gas storage fields.~~

~~Year-To-Date 2017 vs. 2016~~

~~Net income increased 6%, primarily due to gas transportation and storage activities from growth projects placed into service.~~

~~Analysis of Consolidated Operations~~

~~Presented below are selected amounts related to Dominion Energy Gas' results of operations:~~

Third Quarter

Year-To-Date

2017

2016

$ Change

2017

2016

$ Change

(millions)

Operating revenue

$
401

$
382

$
19

$
1,313

$
1,181

$
132

Purchased gas

19

21

(2
)

100

71

29

Other energy-related purchases

4

4

—

11

8

3

Net revenue

378

357

21

1,202

1,102

100

Other operations and maintenance

73

133

(60
)

377

331

46

Depreciation and amortization

57

55

2

167

150

17

Other taxes

42

36

6

139

127

12

Earnings from equity method investee

4

5

(1
)

15

14

1

Other income

6

2

4

16

8

8

Interest and related charges

25

23

2

72

68

4

Income tax expense

74

34

40

176

162

14

•	A $10 million reduction in bad debt expense due to the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process.

~~An analysis~~Impairment of ~~Dominion Energy Gas' results of operations follows:~~

~~Third Quarter 2017 vs. 2016~~

~~Net revenue~~ ~~increased 6%,~~assets and other charges (benefits) decreased $1.3 billion, primarily reflecting:

~~A $13 million increase from regulated natural gas transmission growth projects placed into service;~~

•	The absence of charges associated with the planned early retirements of certain electric generation facilities ($747 million);

~~A $6 million increase in PIR program revenues; and~~

•	A benefit from the establishment of a regulatory asset associated with the early retirements of certain coal- and oil-fired generating units associated with the proposed settlement of the 2021 Triennial Review ($549 million);

~~A $6 million increase in services performed for Atlantic Coast Pipeline.~~

~~Other operations and maintenance~~ ~~decreased 45%, primarily reflecting:~~

~~The increase in gains from agreements to convey shale development rights underneath several natural gas storage fields ($56 million); and~~

•	The absence of charges for dismantling costs associated with certain electric generation facilities ($30 million); and

~~The absence of a union workforce temporary work stoppage ($8 million); partially offset by~~

•	A decrease in charges for CCRO benefits provided to retail electric customers in Virginia associated with the 2021 Triennial Review ($12 million); partially offset by

~~A $5 million increase in services performed for Atlantic Coast Pipeline. These expenses are billed to Atlantic Coast Pipeline and do not significantly impact net income.~~

~~Other taxes~~ ~~increased 17% primarily due to an increase in property taxes related to growth projects placed into service.~~

~~Income tax expense~~ ~~increased by $40 million due to higher pre-tax income ($28 million) and the absence of a 2016 settlement with a tax authority ($12 million).~~

~~Year-To-Date 2017 vs. 2016~~

~~Net revenue~~ ~~increased 9%, primarily reflecting:~~

~~A $38 million increase from regulated natural gas transmission growth projects placed into service;~~

~~A $22 million increase in services performed for Atlantic Coast Pipeline;~~

~~An $18 million increase in PIR program revenues; and~~

~~A $17 million increase in rate recovery for low income assistance programs associated with regulated natural gas distribution operations.~~

~~Other operations and maintenance~~ ~~increased 14%, primarily reflecting:~~

~~A $21 million increase in services performed for Atlantic Coast Pipeline. These expenses are billed to Atlantic Coast Pipeline and do not significantly impact net income;~~

A $17 million increase in bad debt expense at regulated natural gas distribution operations primarily related to low income assistance programs. These bad debt expenses are recovered through rates and do not impact net income;

~~A $15 million increase due to a charge to write-off the balance of a regulatory asset no longer considered probable of recovery; and~~

~~An $11 million increase in salaries, wages and benefits and general and administrative expenses; partially offset by~~

~~A $16 million increase in gains from agreements to convey shale development rights underneath several natural gas storage fields;~~

~~The absence of organizational design initiative costs ($10 million); and~~

~~The absence of a union workforce temporary work stoppage ($8 million).~~

•	A charge for the forgiveness of Virginia retail electric customer accounts in arrears pursuant to Virginia’s 2021 budget process ($77 million).

Other income increased ~~by $8~~$59 million, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($40 million) and an increase in AFUDC associated with rate-regulated projects ($1219 million).

Income tax expense increased 75%, primarily due to higher pre-tax income ($171 million) partially offset by increased investment tax credits ($47 million) and the ~~absence~~benefit of a ~~gain on the 2016 sale of a portion of Dominion Energy Gas’ interest in Iroquois~~state legislative change ($516 million).

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 September 30, ~~2017,~~2021, Dominion Energy had $2.4 billion of unused capacity under its joint revolving credit ~~facilities. See Note 14 to the Consolidated Financial Statements for more information.~~facility.

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

	2017			2016			2021			2020
(millions)
Cash and cash equivalents at January 1	$	261		$	607
Cash, restricted cash and equivalents at January 1							$	247		$	269
Cash flows provided by (used in):
Operating activities(1)		3,664			3,386			3,535			4,810
Investing activities(2)		(4,873	)		(9,029	)		(6,607	)		(4,860	)
Financing activities(3)		1,175			5,287			3,092			339
Net decrease in cash and cash equivalents		(34	)		(356	)
Cash and cash equivalents at September 30	$	227		$	251
Net increase in cash, restricted cash and equivalents								20			289
Cash, restricted cash and equivalents at September 30							$	267		$	558

(1)	Includes $172 million and $1.6 billion related to discontinued operations for 2021 and 2020, respectively.

(2)	Includes $(997) million and $(525) million related to discontinued operations for 2021 and 2020, respectively.

(3)	Includes $(174) 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 $1.3 billion, including approximately $1.4 billion from discontinued operations. Net cash provided by continuing operations increased ~~$278 million,~~ primarily due to distributions from Cove Point, the ~~operations acquired~~absence of a contract termination payment in connection with the ~~Dominion Energy Questar Combination being included for all~~sale of ~~2017, an electric utility capacity benefit, derivative activities~~Fowler Ridge, decreases in severance payments primarily related to a voluntary retirement program and ~~proceeds from the assignment of the electric transmission tower rental portfolio,~~other changes in working capital items, partially offset by lower deferred fuel cost recoveries ~~in the Virginia jurisdiction, milder weather in Dominion Energy’s electric utility service territory, higher interest expense, lower revenue from Cove Point’s import contracts~~ and ~~Dominion Energy’s contribution to Dominion Energy Questar’s pension plan.~~increased margin deposits.

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~~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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020 and in Part II. Item 1A. Risk Factors in this report.

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 September 30, ~~2017~~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		Gross Credit Exposure		Credit Collateral		Net Credit Exposure
(millions)
Investment grade⁽¹⁾	$	26	$	—	$	26	$	83	$	—	$	83
Non-investment grade⁽²⁾		3		—		3		2		5		1
No external ratings:
Internally rated—investment grade⁽³⁾		8		—		8		80		2		78
Internally rated—non-investment grade⁽⁴⁾		33		—		33		15		26		15
Total(5)	$	70	$	—	$	70	$	180	$	33	$	177

(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 ~~32%~~43% of the total net credit exposure.

(2)	The five largest counterparty exposures, combined, for this category represented less than 1% of the total net credit exposure.

(3)	The five largest counterparty exposures, combined, for this category represented approximately 4%41% of the total net credit exposure.

~~(3)~~(4)

The five largest counterparty exposures, combined, for this category represented approximately ~~11%~~5% of the total net credit exposure.

~~(4)~~

(5) Excludes the Millstone 2019 power purchase agreements.

~~The five largest counterparty exposures, combined, for this category represented approximately 18% of the total net credit exposure.~~

Investing Cash Flows

Net cash used in Dominion Energy’s investing activities ~~decreased $4.2~~increased $1.7 billion, primarily due to the ~~absence~~repayment of the ~~acquisition of Dominion Energy Questar~~Q-Pipe Transaction deposit and ~~decreases~~an increase in contributions to equity method affiliates including Atlantic Coast Pipeline, partially offset by a decrease in plant construction and other property additions ~~partially offset by an increase in~~and the absence of the acquisitions of ~~solar development projects~~Pivotal LNG, Inc. and ~~increased investment~~an additional interest in Atlantic Coast 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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~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, ~~communications~~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 ~~decreased $4.1~~increased $2.8 billion primarily due to the absence of ~~debt and~~ common stock repurchases and lower common stock dividend payments, partially offset by lower net issuances ~~utilized~~of debt.

Dominion Energy has an effective shelf registration statement with the SEC for the sale of up to ~~finance~~$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 ~~Questar Combination.~~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 September 30, 2021, Dominion Energy’s Consolidated Balance Sheets include $391 million with respect to such notes presented within short-term debt. The proceeds are used for general corporate purposes and to repay debt.

See ~~Notes 3 and 14~~Note 16 to the Consolidated Financial Statements ~~in this report~~ for further information regarding Dominion ~~Energy's~~Energy’s credit facilities, liquidity and significant financing ~~transactions.~~transactions, including a $900 million Sustainability Revolving Credit Agreement entered into in June 2021, a $1.3 billion term loan credit agreement entered into in July 2021, the issuance of $1.0 billion of 2.25% senior notes in August 2021 and the redemption of the remaining principal outstanding of $800 million of its July 2016 hybrids in August 2021.

In November 2021, Dominion Energy received commitments from lenders for its subsidiary holding its noncontrolling interest in Cove Point to issue approximately $2.5 billion in long-term debt secured by its noncontrolling interest in Cove Point. The proceeds are expected to be utilized to repay portions of Dominion Energy’s long-term debt.

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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~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 September 30, ~~2017,~~2021, there have been no changes in Dominion ~~Energy's~~Energy’s credit ratings.

Debt Covenants

In the Debt Covenants section of MD&A in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2020, there is a discussion on the various covenants present in the enabling agreements underlying Dominion ~~Energy's~~Energy’s debt. As of September 30, ~~2017,~~2021, there have been no material changes to debt covenants, nor any events of default under Dominion ~~Energy's~~Energy’s debt covenants. ~~Pursuant~~

Subsidiary Dividend Restrictions

As of September 30, 2021, there have been no material changes to ~~a waiver received~~the subsidiary dividend restrictions disclosed in ~~April 2016 and~~MD&A in ~~connection with~~ the ~~closing of~~Companies’ Annual Report on Form 10-K for the Dominion Energy Questar Combination, the 65% maximum debt to total capital ratio in Dominion Energy’s credit agreements was, with respect to Dominion Energy only, temporarily increased to 70% through the fiscal quarteryear ended ~~June 30, 2017. Effective July 2017, the maximum debt to total capital ratio in Dominion Energy’s credit agreements was reset to 65%.~~December 31, 2020.

Future Cash Payments for Contractual Obligations and Planned Capital Expenditures

As of September 30, ~~2017,~~2021, there have been no material changes outside the ordinary course of business to Dominion ~~Energy's~~Energy’s contractual obligations nor any material changes to planned capital expenditures as disclosed in MD&A in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020.

Use of Off-Balance Sheet Arrangements

As of September 30, ~~2017,~~2021, there have been no material changes into the off-balance sheet arrangements disclosed in MD&A in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2020, with the exception of the matter disclosed in the Use of Off-Balance Sheet Arrangements section in MD&A in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.

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, ~~2016 and~~ 2020, Future Issues and Other Matters in MD&A in the Companies’ Quarterly ~~Reports~~Report on Form 10-Q for the quarters ended March 31, ~~2017~~2021 and June 30, ~~2017.~~2021 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 2223 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2020 and Note 1517 to the Consolidated Financial Statements ~~in the Companies’ Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017, and~~ in this report for additional information on various environmental matters.

~~Air~~

In August 2015, the EPA issued final carbon standards for existing fossil fuel power plants. Known as the Clean Power Plan, the rule uses a set of measures for reducing emissions from existing sources that includes efficiency improvements at coal plants, displacing coal-fired generation with increased utilization of natural gas combined cycle units and expanding renewable resources. The new rule requires states to impose standards of performance limits for existing fossil fuel-fired electric generating units or equivalent statewide intensity-based or mass-based CO₂ binding goals or limits. States are required to submit final plans identifying how they will comply with the rule by September 2018. The EPA also issued a proposed federal implementation plan and model trading rule that states can adopt or that would be put in place if, in response to the final guidelines, a state either does not submit a state plan or its plan is not approved by the EPA. The

final rule has been challenged in the U.S. Court of Appeals for the D.C. Circuit. In February 2016, the U.S. Supreme Court issued a stay of the Clean Power Plan until the disposition of the petitions challenging the rule now before the Court of Appeals, and, if such petitions are filed in the future, before the U.S. Supreme Court. In June 2016, the Governor of Virginia signed an executive order directing the Virginia Natural Resources Secretary to convene a workgroup charged with recommending concrete steps to reduce carbon pollution from power plants which could include reductions at levels similar to the Clean Power Plan as an option. In March 2017, the President issued an Executive Order directing the EPA to undertake a review of the Clean Power Plan that could result in significant revisions to, or rescinding of, the rule. In April 2017, the U.S. Court of Appeals for the D.C. Circuit issued an order suspending the cases challenging the Clean Power Plan for 60 days to allow the EPA time to determine whether to revise or rescind the rule. Also ~~in April 2017, the~~ EPA issued a notice withdrawing the proposed federal implementation plan and model trading rules. In June 2017, the Governor of Virginia issued a directive for development of state carbon regulations with a December 2017 deadline for submittal of draft rules to the Virginia State Air Pollution Control Board for approval to notice for public comment. In October 2017, the EPA issued a proposed rule to repeal the Clean Power Plan on the basis that the rule promulgated in 2015 exceeds the EPA’s authority under the CAA. The proposal does not include a replacement rule. The proposal also does not impact the EPA’s regulation of GHG emissions from stationary sources under the CAA permitting programs or the GHG performance standards for new sources, which remain in place. Given these developments and associated federal and state regulatory and legal uncertainties, Dominion Energy cannot predict the potential financial statement impacts but believes the potential expenditures to comply could be material.

~~State Actions~~

~~In August 2017, the Ozone Transport Commission released a draft model rule for control of NO~~_x emissions from natural gas pipeline compressor fuel-fire prime movers. States within the ozone transport region, including states in which Dominion Energy has natural gas operations, are expected to develop reasonably achievable control technology rules for existing sources based on the Ozone Transport Commission model rule. States outside of the Ozone Transport Commission may also consider the model rules in setting new reasonably achievable control technology standards. Several states in which Dominion Energy operates, including Pennsylvania, New York and Maryland, are moving ahead with state-specific climate change regulations, including methane. Dominion Energy cannot currently estimate the potential financial statements impacts on results of operations, financial condition and/or cash flows related to these matters.

~~Significant Power Delivery Project~~

In September 2017, Virginia Power filed an application with the Virginia Commission for a CPCN to rebuild and operate in Augusta County, Virginia approximately 18 miles of the existing 500 kV transmission line between the Dooms substation and the Valley substation, along with associated substation work, for a total estimated cost of approximately $65 million. This case is pending.

~~Significant Gas Infrastructure Projects~~

~~Eastern Market Access~~

In November 2016, Cove Point filed an application to request FERC authorization to construct the approximately $150 million Eastern Market Access Project. Construction on the project is expected to begin in the first quarter of 2018, and the project facilities are expected to be placed into service in late 2018.

~~Atlantic Coast Pipeline~~

In October 2017, Atlantic Coast Pipeline received the FERC order authorizing the construction and operation of an approximately 600-mile natural gas pipeline running from West Virginia through Virginia to North Carolina. The project remains subject to other pending federal and state approvals.

~~Other Matters~~

While management currently has no plans which may affect the carrying value of Millstone, based on potential future economic and other factors, including, but not limited to, market power prices, results of capacity auctions, legislative and regulatory solutions to ensure nuclear plants are fairly compensated for their carbon-free emissions, and the impact of final rules from the EPA and the efforts of states to implement those final rules; there is risk that Millstone may be evaluated for an early retirement date. Should management make any decision on a potential early retirement date, the precise date and the resulting financial statement impacts, which could be material to Dominion Energy, may be affected by a number of factors, including any potential regulatory or legislative solutions, results of any transmission system reliability study assessments, and decommissioning requirements, among other factors.

Legal Matters

SeeNotes 13 and 2223 to the Consolidated Financial Statements ~~and~~ ~~Item 3. Legal Proceedings~~in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2020 and Notes 1213 and 1517 to the Consolidated Financial Statements ~~in the Companies’ Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017~~ and ~~June 30, 2017, and~~Item 1. Legal Proceedingsin this report for additional information on various legal matters.

Regulatory Matters

See ~~Note~~Notes 3 and 13 to the Consolidated Financial Statements in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2020 and Note 1213 to the Consolidated Financial Statements ~~in the Companies’ Quarterly Reports on Form 10-Q for the quarters ended March 31, 2017 and June 30, 2017, and~~ in this report for additional information on various regulatory matters.

CVOW Commercial Project

In September 2019, Virginia Power filed applications with PJM for the CVOW Commercial Project and for certain approvals and rider recovery from the Virginia Commission in November 2021. The total cost of the project is estimated to be approximately $10 billion, excluding financing costs. Virginia Power’s estimate for the 2.6 GW project’s projected levelized cost of energy is approximately $80-90/MWh. Following a competitive procurement process, Virginia Power has entered into or is in the final stages of negotiating fixed price contracts for the major offshore construction and equipment components. The contracts include services denominated in currencies other than the U.S. dollar for approximately €2.9 billion and 3.9 billion kr., which have been included within the cost estimate above based on a spot price from the third quarter of 2021. In addition, certain of the fixed price contracts, approximately €0.7 billion, contain commodity indexing provisions linked to steel. As a result, any changes in applicable exchange rates or commodity indices could result in a change to the ultimate cost of the project. Virginia Power is evaluating hedging strategies, subject to approval by the Virginia Commission, to mitigate such risk. In addition, the offshore construction scope is expected to include an approximately 20-month lease contract with an affiliated entity, pending approval by the Virginia Commission, for the use of a Jones Act compliant offshore wind installation vessel currently under development. Virginia Power has completed the conceptual design phase for the project’s onshore electric transmission facilities and selected a recommended route with consideration given for resiliency and minimizing environmental impacts. Any changes to the onshore route necessitated during the receipt of various permitting approvals could result in upward pressure on the estimated cost of the project. Upon receiving approvals from the Virginia Commission and other permitting entities, Virginia Power anticipates commencing major construction activities in 2023 and the project is expected to be placed in service by the end of 2026. Virginia Power expects to incur approximately 80% of the project costs from 2023 through 2025. Through September 30, 2021, Virginia Power had incurred approximately $170 million of project costs. Virginia Power anticipates funding the project consistent with its approved debt to equity capitalization structure. The project is vital for Virginia Power to meet the renewable energy portfolio standard established in the VCEA and is consistent with the criteria within the VCEA for the construction of an offshore wind facility deemed to be in the public interest as well as the guidelines facilitating cost recovery. See additional discussion of the VCEA provisions concerning renewable generation projects in Note 13 to the Companies’ Annual Report on Form 10-K for year ended December 31, 2020.

Southeast Energy Exchange Market

In February 2021, DESC and the other members of the Southeast Energy Exchange Market submitted the Southeast Energy Exchange Market Agreement to FERC for authorization. This agreement sets forth the framework and rules for establishing and maintaining a new electronic trading platform designed to enhance the existing bilateral market in the Southeast utilizing zero-charge transmission service. That transmission service, in turn, will be voluntarily provided by participating transmission service providers, including DESC. In October 2021, the Southeast Energy Exchange Market Agreement became effective by operation of law as a result of a split FERC vote. The members expect the Southeast Energy Exchange Market platform to be operational in 2022.

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,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'~~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 ~~Dominion Energy's and Virginia Power's~~the Companies’ electric operations and Dominion ~~Energy's and Dominion Energy Gas'~~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, ~~Dominion Energy and Virginia Power~~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 and Dominion Energy Gas holds commodity-based financial derivative instruments held for non-trading purposes associated with purchases and sales of~~ 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 of $24 million in the fair value of Dominion Energy’s commodity-based derivative instruments as of September 30, 2021. A hypothetical 10% decrease in commodity prices would have resulted in a decrease of $2 million in the fair value of ~~$28 million and $27 million of~~ Dominion ~~Energy's~~Energy’s commodity-based derivative instruments as of ~~September 30, 2017 and~~ December 31, ~~2016, respectively.~~2020.

A hypothetical 10% decrease in commodity prices would have resulted in a decrease in ~~the~~ fair value of ~~$48~~$2 million and ~~$62~~$35 million of Virginia ~~Power's~~Power’s commodity-based derivative instruments as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively.

A hypothetical 10% increase in commodity prices would have resulted in a decrease in fair value of $4 million of Dominion Energy Gas' commodity-based derivative instruments as of both September 30, 2017 and December 31, 2016.

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 ~~and interest rate swaps designated under fair value hedging and~~ outstanding for ~~the Companies,~~Dominion Energy and Virginia Power, a hypothetical 10% increase in market interest rates would not have resulted in a material change in earnings at September 30, ~~2017~~2021 or December 31, ~~2016.~~2020.

The Companies also use interest rate derivatives, including forward-starting swaps, ~~as cash flow hedges of forecasted~~ interest ~~payments.~~rate swaps and interest rate block agreements to manage interest rate risk. As of September 30, ~~2017,~~2021, Dominion Energy and Virginia Power had ~~$3.5~~$8.3 billion and ~~$1.5~~$2.8 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 ~~$55~~$143 million and ~~$42~~$115 million, respectively, in the fair value of Dominion ~~Energy's~~Energy and Virginia ~~Power's~~Power’s interest rate derivatives at September 30, ~~2017.~~2021. As of December 31, ~~2016,~~2020, Dominion Energy and Virginia Power had ~~$2.9~~$6.9 billion and ~~$1.7~~$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 ~~$58~~$124 million and ~~$45~~$75 million, respectively, in the fair value of Dominion ~~Energy's~~Energy and Virginia ~~Power's~~Power’s interest rate derivatives at December 31, ~~2016.~~2020.

Dominion Energy Gas holds foreign currency swaps for the purpose of hedging the foreign currency exchange risk associated with Euro denominated debt. As of September 30, 2017 and December 31, 2016, Dominion Energy and Dominion Energy Gas had $280 million (€250 million) in aggregate notional amounts of these foreign currency swaps outstanding. A hypothetical 10% decrease in market interest rates would have resulted in a $3 million and $5 million decrease in the fair value of Dominion Energy Gas' foreign currency swaps at September 30, 2017 and December 31, 2016, respectively.99

The impact of a change in interest rates on the ~~Companies'~~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

~~Dominion Energy and Virginia Power~~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 ~~Dominion Energy's and Virginia Power's~~the Companies’ Consolidated Balance Sheets at fair value.

Dominion Energy recognized net ~~realized~~investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of ~~$137~~$678 million, $130 million and ~~$113~~$662 million for the nine months ended September 30, ~~2017~~2021 and ~~2016, respectively,~~2020, and ~~$144 million for~~ the year ended December 31, ~~2016.~~2020, respectively. Net realized gains and losses include gains and losses from the sale of ~~investments as well as any other-than-temporary declines in fair value.~~investments. Dominion Energy recorded in AOCI and regulatory liabilities, a net ~~increase~~decrease in unrealized gains on ~~these~~debt investments of ~~$271 million and $146~~$50 million for the nine months ended September 30, ~~2017~~2021, and ~~2016, respectively,~~a net increase in unrealized gains on debt investments of $42 million and ~~$183~~$57 million for the nine months ended September 30, 2020 and the year ended December 31, ~~2016.~~2020, respectively.

Virginia Power recognized net ~~realized~~investment gains (including investment income) on nuclear decommissioning trust investments of ~~$59~~$335 million, $31 million and ~~$51~~$287 million for the nine months ended September 30, ~~2017~~2021 and ~~2016, respectively,~~2020, and ~~$67 million for~~ the year ended December 31, ~~2016.~~2020, respectively. Net realized gains and losses include gains and losses from the sale of ~~investments as well as any other-than-temporary declines in fair value.~~investments. Virginia Power recorded in AOCI and regulatory liabilities, a net ~~increase~~decrease in unrealized gains on ~~these~~debt investments of ~~$127 million and $77~~$24 million for the nine months ended September 30, ~~2017~~2021, and ~~2016, respectively,~~a net increase in unrealized gains on debt investments of $22 million and ~~$93~~$29 million for the nine months ended September 30, 2020 and the year ended December 31, ~~2016.~~2020, respectively.

Dominion Energy sponsors pension and other postretirement employee benefit plans that hold investments in trusts to fund employee benefit payments. Virginia Power ~~and Dominion Energy Gas~~ 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 ~~each of~~both Dominion Energy and Virginia Power, ~~and~~including Dominion Energy ~~Gas, including Dominion Energy’s,~~and Virginia Power’s ~~and Dominion Energy Gas'~~ CEO and CFO, evaluated the effectiveness of each ~~of their respective Company’s~~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’s,~~Energy and Virginia Power’s ~~and Dominion Energy Gas'~~ CEO and CFO have concluded that each ~~of their respective Company’s~~company’s disclosure controls and procedures are effective.

There were no changes ~~in Dominion Energy’s, Virginia Power’s, or Dominion Energy Gas' internal control over financial reporting~~ that occurred during the last fiscal quarter that ~~have~~ materially affected, or are reasonably likely to materially affect, ~~the Companies’~~Dominion Energy or Virginia Power’s internal control over financial reporting.

100

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

From time to time, the Companies are ~~alleged~~parties to ~~be in violation~~various legal, environmental or in default under orders, statutes, rules or regulations relating to the environment, compliance plans imposed upon or agreed to by the Companies, or permits issued by various local, state and/or federal agencies for the construction or operation of facilities. Administrativeother regulatory proceedings, ~~may also be pending on these matters. In addition,~~including in the ordinary course of ~~business,~~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 ~~and their subsidiaries are involved in various legal~~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 22 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, 2016.~~

•	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 12 and 15 to the Consolidated Financial Statements in the Companies’ Quarterly Reports on Form 10-Q for the quarter ended March 31, 2017.~~

~~Notes 12 and 15 to the Consolidated Financial Statements in the Companies’ Quarterly Reports on Form 10-Q for the quarter ended June 30, 2017.~~

•	Notes 1213 and 1517 to the Consolidated Financial Statements in this report.

ITEM 1A. RISK FACTORS

The ~~Companies'~~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'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016,~~ 2020,which should be taken into consideration when reviewing the information contained in this report. ~~There~~Other than the risk factor discussed below, there have been no material changes with regard to the risk factors previously disclosed in the ~~Companies'~~Companies’ Annual Report on Form 10-K for the year ended December 31, ~~2016.~~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.

The development and construction of the CVOW Commercial Project involves significant risks.

The CVOW Commercial Project is a large-scale, complex project that will take several years to complete. Significant delays or cost increases, or an inability to recover certain project costs, could have an adverse effect on the Companies’ financial condition, cash flows and results of operations. If the Companies are unable to complete the development and construction of the CVOW Commercial Project or decide in the future to delay or cancel the project, the Companies may not be able to recover all or a portion of their investment in the project and may incur substantial cancellation payments under existing contracts or other substantial costs associated with any such delay or cancellation. The Companies’ ability to complete the CVOW Commercial Project within the currently proposed timeline, or at all, and consistent with current cost estimates is subject to various risks and uncertainties, certain of which are beyond the Companies’ control.

The development and construction of the CVOW Commercial Project is dependent on the Companies’ ability to obtain and maintain various local, state and federal permits and other regulatory approvals, including Virginia Commission approval for rider recovery of project costs. In addition, the design and route of the project’s onshore electric transmission and other facilities remain subject to regulatory review and approval. Changes in the design and route of these onshore facilities, including an increase in amount of undergrounding, would likely increase project costs. Also, the CVOW Commercial Project may become the subject of litigation or other forms of intervention by third parties, including stakeholders or advocacy groups, that may impact the timing and receipt of permits or other regulatory approvals or otherwise delay or increase the cost of the project.

The Companies’ ability to invest the significant financial resources necessary for the CVOW Commercial Project is dependent on the Companies’ access to the financial markets in a timely and cost-effective manner. A decline in the Companies’ credit worthiness, an unfavorable market reputation of either the Companies or their industry or general market disruptions could adversely impact financing costs and increase the overall cost of the project.

The development and construction of the CVOW Commercial Project is also dependent on the ability of certain key suppliers and contractors to timely satisfy their obligations under contracts entered into or expected to be entered into. Given the unique equipment and expertise required for this project, the Companies may not be able to remedy in a timely and cost-effective manner, if at all, any failure by one or more of these suppliers or contractors to timely satisfy their contractual obligations. Certain of the fixed price contracts for major offshore construction and equipment components are denominated in Euros and Danish kroner, including those which contain commodity indexing provisions linked to steel. Accordingly, to the extent the Companies are unable to, including from the inability to receive approval from the Virginia Commission, or elect not to, hedge their exposure to these currencies, adverse fluctuations in the applicable exchange rates would likely adversely affect the cost of the CVOW Commercial Project. Similarly, adverse fluctuations in the price of certain raw materials, including steel, would likely, to the extent not hedged by the Companies, adversely affect the overall costs incurred to develop and construct the project.

The development and construction of the CVOW Commercial Project involves the use of new turbine technology and will take place in a marine environment, which presents unique challenges and will require the use of a specialized workforce and specialized equipment. In addition, the timely installation of the turbines is dependent on the completion and availability of a Jones Act compliant vessel currently under construction, and regulatory approval for Virginia Power to use an affiliate’s vessel.

The timeline for development and construction of the CVOW Commercial Project may also be negatively impacted by severe weather events or marine wildlife, including migration patterns of endangered and protected species, both of which are outside of the control of the Companies and its contractors. Any significant delays in the project timeline, including from any of the factors discussed above, resulting in both the delay of commencement of construction to 2024 or later combined with a delay to the in-service date to 2028 or later may impact the ability of the Companies to recover the costs of the CVOW Commercial Project.

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

Dominion Energy

~~ISSUER PURCHASES OF EQUITY SECURITIES~~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⁾
7/1/17-7/31/17

—

$
—

—

19,629,059 shares/
$1.18 billion
8/1/17-8/31/17

217

77.30

—

19,629,059 shares/
$1.18 billion
9/1/17-9/30/17

5,932

79.50

—

19,629,059 shares/
$1.18 billion
Total

6,149

$
79.42

—

19,629,059 shares/
$1.18 billion

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⁾
7/1/21 - 7/31/21		—	$	—		—	$ 0.92 billion
8/1/21 - 8/31/21		—		—		—	0.92 billion
9/1/21 - 9/30/21		321		74.58		—	0.92 billion
Total		321		74.58		—	$ 0.92 billion

(1)	~~In August and September 2017, 217~~Represents shares ~~and 5,932 shares, respectively,~~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)

~~The remaining repurchase authorization is pursuant to repurchase authority granted by~~In November 2020, the Dominion Energy Board of Directors ~~in February 2005, as~~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, ~~in June 2007. The aggregate authorization granted by~~suspended or terminated at any time. Shares may be purchased through open market or privately negotiated transactions or otherwise at the ~~Dominion Energy Board~~discretion of ~~Directors was 86 million shares (as adjusted~~management subject to ~~reflect a two-for-one stock split distributed in November 2007) not to exceed $4 billion.~~prevailing market conditions, applicable securities laws and other factors.

ITEM 5. OTHER INFORMATION

Effective November 3, 2021, Dominion Energy amended Section IIIA(9)(d)(i) of its Articles of Incorporation to provide that, in connection with the conversion of any share of Series A Preferred Stock, Dominion Energy will (i) select as the “settlement method” either “cash settlement” or “combination settlement” and (ii) in the event it selects “combination settlement,” specify a “specified dollar amount” of not less than $1,000. Under the terms of the Articles of Incorporation, the amendment did not require shareholder approval. The foregoing description is qualified in its entirety by reference to the full text of the Articles of Incorporation, as amended, which are filed as Exhibit 3.1.a hereto and incorporated herein by reference.

102

ITEM 6. EXHIBITS

Exhibit

Number

Description

Dominion Energy

Virginia Power

~~Dominion Energy Gas~~

~~3.1.a~~

~~Dominion Energy, Inc. Articles of Incorporation as amended and restated, effective May 10, 2017 (Exhibit 3.1, Form 8-K filed May 10, 2017, File No.1-8489).~~

~~3.1.b~~3.1.a

~~Virginia Electric and Power Company Amended and Restated~~Dominion Energy, Inc. Articles of Incorporation, as ~~in effect on October 30, 2014 (Exhibit 3.1.b, Form 10-Q filed~~restated and further amended, effective November 3, ~~2014, File No. 1-2255).~~2021 (filed herewith)

~~3.1.c~~3.1.b

Virginia Electric and Power Company Amended and Restated Articles of ~~Organization of Dominion Energy Gas Holdings, LLC~~Incorporation, as in effect on October 30, 2014 (Exhibit ~~3.1,~~3.1.b, Form ~~S-4~~10-Q filed ~~April 4,~~November 3, 2014, File No. ~~333-195066)~~1-2255).

3.2.a

Dominion Energy, Inc. Bylaws, as amended and restated, effective May 5, 2021 (Exhibit 3.1, Form 8-K filed May 6, 2021, File No. 1-8489).

~~3.1.d~~

3.2.b

~~Articles of Amendment to the Articles of Organization of Dominion Energy Gas Holdings, LLC~~Virginia Electric and Power Company Amended and Restated Bylaws, effective June 1, 2009 (Exhibit 3.1, Form 8-K filed ~~May 16, 2017,~~June 3, 2009, File No. ~~1-37591)~~1-2255).

~~3.2.a~~

~~Dominion Energy, Inc. Amended and Restated Bylaws, effective May 10, 2017 (Exhibit 3.2, Form 8-K filed May 10, 2017, File No. 1-8489).~~

~~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).~~

~~3.2.c~~

~~Operating Agreement of Dominion Energy Gas Holdings, LLC, amended and restated as of May 12, 2017 (Exhibit 3.2, Form 8-K filed May 16, 2017, File No. 001-37591).~~

~~4.1~~4

Dominion Energy, Inc., and Virginia Electric and Power Company ~~and Dominion Energy Gas Holdings, LLC~~ 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.

~~4.2~~4.1

10.1

Dominion Energy, Inc. Deferred Compensation Plan, effective July 1, 2021 (Exhibit 10.18, Form 10-K for the fiscal year ended December 31, 2020, filed February 25, 2021, File No. 1-8489), as amended September 23, 2021 (filed herewith).

~~4.3~~

31.a

~~Senior Indenture, dated as~~Certification by Chief Executive Officer of ~~September 1, 2017, between Virginia Electric and Power Company and U.S. Bank National Association, as Trustee (Exhibit 4.1, Form 8-K filed September 13, 2017, File No.000-55337);~~ ~~First Supplemental Indenture, dated as~~Dominion Energy, Inc. pursuant to Section 302 of ~~September 1, 2017 (Exhibit 4.2, Form 8-K filed September 13, 2017, File No.000-55337)~~the Sarbanes-Oxley Act of 2002 (filed herewith).

~~12.1~~31.b

~~Ratio~~Certification by Chief Financial Officer of ~~earnings to fixed charges for~~ Dominion Energy, Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

~~12.2~~

~~Ratio of earnings to fixed charges for Virginia Electric and Power Company (filed herewith).~~

~~12.3~~31.c

~~Ratio~~Certification by Chief Executive Officer of ~~earnings~~Virginia Electric and Power Company pursuant to ~~fixed charges for Dominion Energy Gas Holdings, LLC~~Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).

~~31.a~~

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

~~31.b~~

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

~~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).~~

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).

~~Exhibit~~

~~Number~~

~~Description~~

~~Dominion Energy~~

~~Virginia Power~~

~~Dominion Energy Gas~~

~~31.e~~

~~Certification by Chief Executive Officer of Dominion Energy Gas Holdings, LLC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).~~

~~31.f~~

~~Certification by Chief Financial Officer of Dominion Energy Gas Holdings, LLC pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith).~~

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).

103

Exhibit

Number

Description

Dominion Energy

Virginia Power

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).

~~32.c~~

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

Condensed consolidated earnings statements (filed herewith).

101

The following financial statements from Dominion Energy, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, ~~2017,~~2021, filed on November ~~1, 2017,~~5, 2021, formatted in ~~XBRL:~~iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income (iii) Consolidated Balance Sheets, ~~(iii)~~(iv) Consolidated Statements of Equity, ~~(iv) Consolidated Statements of Comprehensive Income,~~ (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 September 30, ~~2017,~~2021, filed on November ~~1, 2017,~~5, 2021, formatted in ~~XBRL:~~iXBRL (Inline eXtensible Business Reporting Language): (i) Consolidated Statements of Income, (ii) Consolidated Statements of Comprehensive Income, (iii) Consolidated Balance Sheets, ~~(iii)~~(iv) Consolidated Statements of Common Shareholder’s Equity (v) Consolidated Statements of Cash Flows, and (iv) the Notes to Consolidated Financial Statements. The following financial statements from Dominion Energy Gas Holdings, LLC’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2017, filed on November 1, 2017, formatted in XBRL: (i) Consolidated Statements of Income, (ii) Consolidated Balance Sheets, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Cash Flows, and (v)(vi) the Notes to Consolidated Financial Statements.

104

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

~~SIGNATURE~~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

November ~~1, 2017~~5, 2021	/s/ Michele L. Cardiff
	Michele L. Cardiff Senior Vice President, Controller and Chief Accounting Officer

	VIRGINIA ELECTRIC AND POWER COMPANY Registrant

November ~~1, 2017~~5, 2021	/s/ Michele L. Cardiff
	Michele L. Cardiff Senior Vice President, Controller and Chief Accounting Officer

	~~DOMINION ENERGY GAS HOLDINGS, LLC~~ ~~Registrant~~

~~November 1, 2017~~	~~/s/ Michele L. Cardiff~~
	~~Michele L. Cardiff~~ ~~Vice President, Controller and~~ ~~Chief Accounting Officer~~

~~101~~105

	Common Stock					Dominion Energy Shareholders						Total Common
	Shares		Amount			Retained Earnings			AOCI			Shareholders' Equity			Noncontrolling Interests			Total Equity
(millions)
December 31, 2015		596	$	6,680		$	6,458		$	(474	)	$	12,664		$	938		$	13,602
Net income including noncontrolling interests							1,666						1,666			55			1,721
Contributions from SunEdison to Four Brothers and Three Cedars													—			178			178
Sale of interest in merchant solar projects				22									22			117			139
Purchase of Dominion Energy Midstream common units				(3	)								(3	)		(14	)		(17	)
Issuance of common stock		31		2,079									2,079						2,079
Stock awards (net of change in unearned compensation)				10									10						10
Present value of stock purchase contract payments related to RSNs				(191	)								(191	)					(191	)
Dividends and distributions							(1,287	)					(1,287	)		(39	)		(1,326	)
Other comprehensive income, net of tax										3			3						3
Other				(5	)								(5	)		(1	)		(6	)
September 30, 2016		627	$	8,592		$	6,837		$	(471	)	$	14,958		$	1,234		$	16,192

December 31, 2016		628	$	8,550		$	6,854		$	(799	)	$	14,605		$	2,235		$	16,840
Net income including noncontrolling interests							1,687						1,687			100			1,787
Contributions from NRG to Four Brothers and Three Cedars													—			9			9
Issuance of common stock		16		1,232									1,232						1,232
Stock awards (net of change in unearned compensation)				17									17						17
Dividends and distributions							(1,435	)					(1,435	)		(123	)		(1,558	)
Other comprehensive income, net of tax										171			171						171
Other				(10	)		13		.				3		1				4
September 30, 2017		644	$	9,789		$	7,119		$	(628	)	$	16,280		$	2,222		$	18,502

	Three Months Ended September 30, 2016⁽¹⁾		Nine Months Ended September 30, 2016⁽¹⁾
(millions, except EPS)
Operating Revenue	$	3,261	$	9,410
Net income attributable to Dominion Energy		732		1,835
Earnings Per Common Share – Basic	$	1.17	$	2.99
Earnings Per Common Share – Diluted	$	1.17	$	2.99

	Operating Revenue		Electric Fuel and Other Energy - Related Purchases			Total
(millions)
Three Months Ended September 30, 2017
Total gains (losses) included in earnings	$	1	$	(12	)	$	(11	)
The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets/liabilities still held at the reporting date		1		—			1
Three Months Ended September 30, 2016
Total gains (losses) included in earnings	$	—	$	(7	)	$	(7	)
Nine Months Ended September 30, 2017
Total gains (losses) included in earnings	$	1	$	(37	)	$	(36	)
The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets/liabilities still held at the reporting date		1		—			1
Nine Months Ended September 30, 2016
Total gains (losses) included in earnings	$	—	$	(23	)	$	(23	)

	September 30, 2017						December 31, 2016
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Assets Presented in the Consolidated Balance Sheet		Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Assets Presented in the Consolidated Balance Sheet
(millions)
Commodity contracts:
Over-the-counter	$	186	$	—	$	186	$	211	$	—	$	211
Exchange		24		—		24		44		—		44
Interest rate contracts:
Over-the-counter		11		—		11		17		—		17
Foreign currency contracts:
Over-the-counter		25		—		25		—		—		—
Total derivatives, subject to a master netting or similar arrangement		246		—		246		272		—		272
Total derivatives, not subject to a master netting or similar arrangement		3		—		3		7		—		7
Total	$	249	$	—	$	249	$	279	$	—	$	279

	September 30, 2017						December 31, 2016
	Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Assets Presented in the Consolidated Balance Sheet		Gross Amounts of Recognized Assets		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Assets Presented in the Consolidated Balance Sheet
(millions)
Commodity contracts:
Over-the-counter	$	156	$	—	$	156	$	147	$	—	$	147
Interest rate contracts:
Over-the-counter		—		—		—		6		—		6
Total derivatives, subject to a master netting or similar arrangement		156		—		156		153		—		153
Total derivatives, not subject to a master netting or similar arrangement		12		—		12		41		—		41
Total	$	168	$	—	$	168	$	194	$	—	$	194

	September 30, 2017						December 31, 2016
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Liabilities Presented in the Consolidated Balance Sheet		Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Consolidated Balance Sheet		Net Amounts of Liabilities Presented in the Consolidated Balance Sheet
(millions)
Commodity contracts:
Over-the-counter	$	6	$	—	$	6	$	5	$	—	$	5
Foreign currency contracts:
Over-the-counter		4		—		4		6		—		6
Total derivatives, subject to a master netting or similar arrangement		10		—		10		11		—		11
Total	$	10	$	—	$	10	$	11	$	—	$	11

	Fair Value-Derivatives Under Hedge Accounting		Fair Value-Derivatives Not Under Hedge Accounting		Total Fair Value
(millions)
September 30, 2017
ASSETS
Current Assets
Commodity	$	—	$	1	$	1
Total current derivative assets⁽¹⁾		—		1		1
Noncurrent Assets
Foreign currency		25		—		25
Total noncurrent derivative assets⁽²⁾		25		—		25
Total derivative assets	$	25	$	1	$	26
LIABILITIES
Current Liabilities
Commodity	$	6	$	—	$	6
Foreign currency		4		—		4
Total current derivative liabilities⁽³⁾		10		—		10
Total derivative liabilities	$	10	$	—	$	10
December 31, 2016
LIABILITIES
Current Liabilities
Commodity	$	4	$	—	$	4
Foreign currency		3		—		3
Total current derivative liabilities⁽³⁾		7		—		7
Noncurrent Liabilities
Commodity		1		—		1
Foreign currency		3		—		3
Total noncurrent derivative liabilities⁽⁴⁾		4		—		4
Total derivative liabilities	$	11	$	—	$	11

Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income
(millions)
Three Months Ended September 30, 2017
Derivative Type and Location of Gains (Losses):
Commodity:
Operating revenue				$	(2	)
Total commodity	$	(10	)	$	(2	)
Interest rate⁽²⁾		—			(1	)
Foreign currency⁽³⁾		12			10
Total	$	2		$	7
Three Months Ended September 30, 2016
Derivative Type and Location of Gains (Losses):
Commodity:
Operating revenue				$	1
Total commodity	$	—		$	1
Interest rate⁽²⁾		—			(1	)
Foreign currency⁽³⁾		12			3
Total	$	12		$	3
Nine Months Ended September 30, 2017
Derivative Type and Location of Gains (Losses):
Commodity:
Operating revenue				$	(4	)
Total commodity	$	(5	)	$	(4	)
Interest rate⁽²⁾		—			(3	)
Foreign currency⁽³⁾		10			15
Total	$	5		$	8
Nine Months Ended September 30, 2016
Derivative Type and Location of Gains (Losses):
Commodity:
Operating revenue				$	6
Total commodity	$	(7	)	$	6
Interest rate⁽²⁾		(8	)		(2	)
Foreign currency⁽³⁾		4			1
Total	$	(11	)	$	5

	Power Delivery		Power Generation		Gas Infrastructure		Corporate and Other			Adjustments/ Eliminations			Consolidated Total
(millions)
Three Months Ended September 30, 2017
Total revenue from external customers	$	580	$	1,931	$	459	$	3		$	206		$	3,179
Intersegment revenue		4		3		204		150			(361	)		—
Total operating revenue		584		1,934		663		153			(155	)		3,179
Net income (loss) attributable to Dominion Energy		138		369		187		(29	)		—			665
Three Months Ended September 30, 2016
Total revenue from external customers	$	614	$	1,947	$	359	$	2		$	210		$	3,132
Intersegment revenue		6		2		205		144			(357	)		—
Total operating revenue		620		1,949		564		146			(147	)		3,132
Net income (loss) attributable to Dominion Energy		139		650		135		(234	)		—			690
Nine Months Ended September 30, 2017
Total revenue from external customers	$	1,664	$	5,091	$	1,949	$	12		$	660		$	9,376
Intersegment revenue		16		8		645		451			(1,120	)		—
Total operating revenue		1,680		5,099		2,594		463			(460	)		9,376
Net income (loss) attributable to Dominion Energy		390		870		613		(186	)		—			1,687
Nine Months Ended September 30, 2016
Total revenue from external customers	$	1,682	$	5,204	$	1,235	$	8		$	522		$	8,651
Intersegment revenue		17		7		507		469			(1,000	)		—
Total operating revenue		1,699		5,211		1,742		477			(478	)		8,651
Net income (loss) attributable to Dominion Energy		363		1,066		483		(246	)		—			1,666

	Third Quarter 2017 vs. 2016 Increase (Decrease)						Year-To-Date 2017 vs. 2016 Increase (Decrease)
	Amount			EPS			Amount			EPS
(millions, except EPS)
Regulated electric sales:
Weather	$	(13	)	$	(0.02	)	$	(19	)	$	(0.03	)
Other		1			—			12			0.02
FERC transmission equity return		5			0.01			14			0.02
Storm damage and service restoration		3			—			17			0.03
Other		3			—			3			—
Share dilution		—			—			—			(0.01	)
Change in net income contribution	$	(1	)	$	(0.01	)	$	27		$	0.03