MD&A discusses Dominion Energy’s results of operations, general financial condition and liquidity and Virginia Power’s results of operations. MD&A should be read in conjunction with the Companies’ Consolidated Financial Statements. Virginia Power meets the conditions to file under the reduced disclosure format, and therefore has omitted certain sections of MD&A.
Contents of MD&A
MD&A consists of the following information:
•Forward-Looking Statements—Dominion Energy and Virginia Power
•Accounting Matters—Dominion Energy
•Results of Operations—Dominion Energy and Virginia Power
•Segment Results of Operations—Dominion Energy
•Outlook—Dominion Energy
•Liquidity and Capital Resources—Dominion Energy
•Future Issues and Other Matters—Dominion Energy
Forward-Looking Statements
This report contains statements concerning the Companies’ expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In most cases, the reader can identify these forward-looking statements by such words as “path”, “anticipate”, “believe”, “forecast”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “outlook”, “predict”, “project”, “should”, “strategy”, “continue”, “target”, “will”, “potential” 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:
•Risks and uncertainties that may impact the ability of the parties to complete the proposed NextEra Energy Merger at all, or within the terms and time frames initially anticipated, including the ability to obtain the requisite approvals of Dominion Energy and NextEra Energy’s shareholders, applicable regulatory approvals and any associated terms and conditions of such approvals and any other events or changes in circumstances that could give rise to the termination of the NextEra Energy Merger Agreement by either party;
•The impacts of the proposed NextEra Energy Merger, including certain covenants in the NextEra Energy Merger Agreement, and any related uncertainties and disruptions on the Companies’ business, including on the Companies’ ability to hire and retain employees and/or on the Companies’ relationships with regulators and other governmental agencies, customers, suppliers, vendors and/or other third parties;
•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, wildfires, 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 pandemic health event resulting from COVID-19, and their collateral consequences, including extended disruption of economic activity in the Companies’ markets and global supply chains;
•Federal, state and local legislative and regulatory developments;
•Changes in or interpretations of federal and state tax laws and regulations, including those related to tax credits or other incentives;
•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 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 the Companies share ownership with third parties, such as Stonepeak’s noncontrolling interest in the CVOW Commercial Project, including risks that result from lack of sole decision-making authority, disputes that may arise between the Companies and third-party participants and difficulties in exiting these arrangements;
•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 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;
•Risks and uncertainties associated with the timely receipt of future capital contributions, including optional capital
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contributions, if any, from Stonepeak associated with the construction of the CVOW Commercial Project;
•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 strategy and compliance, including those costs related to climate change;
•Changes in implementation and enforcement practices of regulators relating to environmental standards and litigation exposure for remedial activities;
•Difficulty in anticipating mitigation requirements associated with environmental and other regulatory approvals or related appeals;
•Unplanned outages at facilities in which the Companies have an ownership interest;
•The impact of operational hazards, including adverse developments with respect to 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 or construction costs;
•The availability of nuclear fuel, natural gas, purchased power or other materials utilized by the Companies to provide electric generation, transmission and distribution and/or gas distribution services to their customers;
•Domestic terrorism and other threats to the Companies’ physical and intangible assets, as well as cybersecurity threats or incidents;
•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, 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;
•Risks and uncertainties associated with increased energy demand or significant accelerated growth in demand due to new data centers, including the concentration of data centers primarily in Loudoun County, Virginia and the ability to obtain regulatory approvals, environmental and other permits to construct new facilities in a timely manner;
•The technological and economic feasibility of large-scale battery storage, carbon capture and storage, small modular reactors, hydrogen and/or other clean energy technologies;
•Receipt of approvals for, and timing of, closing dates for acquisitions and divestitures;
•Impacts of acquisitions, divestitures, transfers of assets to joint ventures or retirements of assets based on asset portfolio reviews;
•Adverse outcomes in litigation matters or regulatory proceedings;
•Counterparty credit and performance risk;
•Fluctuations in the value of investments held in nuclear decommissioning trusts by the Companies and in benefit plan trusts by Dominion Energy;
•Fluctuations in energy-related commodity prices and the effect these could have on Dominion Energy’s earnings and the Companies’ liquidity position and the underlying value of their assets;
•Fluctuations in interest rates;
•Changes in rating agency requirements or credit ratings and their effect on availability and cost of capital;
•Global capital market conditions, including the availability of credit and the ability to obtain financing on reasonable terms;
•Political and economic conditions, including tariffs, 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 may cause actual results to differ materially from predicted results are set forth in Part I. Item 1A. Risk Factors in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025 and Part II Item 1A. Risk Factors in this report.
The Companies’ forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. The Companies caution the reader not to place undue reliance on their forward-looking statements because the assumptions, beliefs, expectations and projections about future events may, and often do, differ materially from actual results. The Companies undertake no obligation to update any forward-looking statement to reflect developments occurring after the statement is made.
Accounting Matters
At June 30, 2026, there have been no significant changes with regard to the critical accounting policies and estimates disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025. The policies disclosed included the accounting for regulated operations, AROs, income taxes, accounting for derivative
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contracts and financial instruments at fair value, use of estimates in goodwill impairment testing, use of estimates in long-lived asset impairment testing, and employee benefit plans.
Results of Operations—Dominion Energy
Presented below is a summary of Dominion Energy’s consolidated results:
2026 2025 $ Change
(millions, except EPS)
Second Quarter
Net income attributable to Dominion Energy $ 340 $ 760 $ (420 )
Diluted EPS 0.37 0.88 (0.51 )
Year-to-Date
Net income attributable to Dominion Energy $ 961 $ 1,425 $ (464 )
Diluted EPS 1.07 1.65 (0.58 )
Overview
Second Quarter 2026 vs. 2025
Net income attributable to Dominion Energy decreased 55%, primarily due to an impairment charge associated with nonregulated renewable natural gas facilities, increased unrealized losses on economic hedging activities and higher interest on long-term debt. These decreases were partially offset by a benefit related to the revision of AROs for Millstone Unit 1, an increase in net investment earnings on nuclear decommissioning trust funds, higher rider equity returns reflecting capital investments at Virginia Power and the impacts of the 2025 Biennial Review at Virginia Power.
Year-to-Date 2026 vs. 2025
Net income attributable to Dominion Energy decreased 33%, primarily due to impairment charges associated with nonregulated renewable natural gas facilities and certain nonregulated solar generation facilities, higher interest on long-term debt and increased unrealized losses on economic hedging activities. These decreases were partially offset by a benefit related to the revision of AROs for Millstone Unit 1, an increase in net investment earnings on nuclear decommissioning trust funds, higher rider equity returns reflecting capital investments at Virginia Power and the impacts of the 2025 Biennial Review at Virginia Power.
Analysis of Consolidated Operations
Presented below are selected amounts related to Dominion Energy’s results of operations:
Second Quarter Year-to-Date
2026 2025 $ Change 2026 2025 $ Change
(millions)
Operating revenue $ 4,480 $ 3,810 $ 670 $ 9,499 $ 7,886 $ 1,613
Electric fuel and other energy-related purchases 1,315 946 369 2,921 1,908 1,013
Purchased electric capacity 80 18 62 149 27 122
Purchased gas 53 43 10 196 190 6
Other operations and maintenance 984 883 101 1,969 1,781 188
Depreciation and amortization 615 580 35 1,246 1,162 84
Other taxes 210 194 16 438 403 35
Impairment of assets and other charges 894 50 844 859 96 763
Other income (expense) 678 442 236 681 452 229
Interest and related charges 555 505 50 1,116 986 130
Income tax expense 122 220 (98 ) 170 260 (90 )
Net income (loss) from discontinued operations including noncontrolling interests (1 ) 1 (2 ) (2 ) — (2 )
Noncontrolling interests (11 ) 54 (65 ) 153 100 53
An analysis of Dominion Energy’s results of operations follows:
Second Quarter 2026 vs. 2025
Operating revenue increased 18%, primarily reflecting:
•A $312 million net increase in fuel-related revenue as a result of an increase in commodity costs associated with sales to electric utility retail customers, including revenue for the deferred fuel securitization and electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges at Virginia Power;
•A $217 million increase to recover the costs and an authorized return, as applicable, associated with Virginia Power non-fuel riders;
•A $142 million increase associated with the 2025 Biennial Review at Virginia Power;
•A $33 million increase in sales to electric utility retail customers associated with economic and other usage factors;
•$18 million in sales of renewable natural gas and related environmental credits; and
•A $15 million increase in sales to electric utility retail customers associated with growth.
These increases were partially offset by:
•A $102 million net decrease associated with market prices affecting Millstone, including economic hedging impacts
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of net realized and unrealized losses on freestanding derivatives ($110 million).
Electric fuel and other energy-related purchases increased 39%, primarily due to higher commodity costs for electric utilities ($316 million) and an increase in the use of purchased renewable energy credits ($60 million), which are offset in operating revenue and do not impact net income.
Purchased electric capacity increased $62 million, primarily due to returning to PJM’s capacity market in June 2025 ($23 million) and an increase related to the 2026 annual PJM capacity market ($20 million).
Other operations and maintenance increased 11%, primarily due to renewable natural gas projects placed in service in late 2025 ($27 million), an increase in salaries, wages and benefits ($25 million) and an increase in outside services ($16 million).
Depreciation and amortization increased 6%, primarily due to various projects being placed into service ($46 million), partially offset by a decrease in amortization associated with non-fuel riders ($15 million), which is offset in operating revenue and does not impact net income.
Impairment of assets and other charges increased $844 million, primarily due to a charge associated with nonregulated renewable natural gas facilities ($820 million), an increase in charges for costs not expected to be recovered from customers on 100% of the CVOW Commercial Project ($195 million) and the disallowance of certain strategic undergrounding costs ($23 million), partially offset by a benefit related to the revision of AROs for Millstone Unit 1 ($195 million).
Other income increased 53%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($205 million) and an increase in AFUDC associated with rate-regulated projects ($13 million).
Interest and related charges increased 10%, primarily due to net issuances of long-term debt ($93 million) and an increase in the outstanding balance on variable rate debt ($18 million), partially offset by net unrealized gains in 2026 compared to net unrealized losses in 2025 associated with freestanding derivatives ($49 million).
Income tax expense decreased 45%, primarily due to lower pre-tax income ($115 million), partially offset by higher taxes on earnings within qualified decommissioning trusts ($22 million).
Noncontrolling interests decreased $65 million, due to a decrease in earnings from the CVOW Commercial Project, including the share of increased charges for costs not expected to be recovered from customers.
Year-to-Date 2026 vs. 2025
Operating revenue increased 20%, primarily reflecting:
•An $870 million net increase in fuel-related revenue as a result of an increase in commodity costs associated with sales to electric utility retail customers, including revenue for the deferred fuel securitization and electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges at Virginia Power;
•A $474 million increase to recover the costs and an authorized return, as applicable, associated with Virginia Power non-fuel riders;
•A $282 million increase associated with the 2025 Biennial Review at Virginia Power;
•$34 million in sales of renewable natural gas and related environmental credits;
•A $32 million net increase in sales to electric utility retail customers, primarily due to an increase in heating degree days during the heating season ($42 million), partially offset by a decrease in cooling degree days during the cooling season ($10 million);
•A $31 million increase in sales to electric utility retail customers associated with growth;
•A $24 million increase in sales to electric utility retail customers associated with economic and other usage factors;
•A $22 million increase attributable to sales at Millstone in the day-ahead energy market; and
•A $19 million increase attributable to a service contract with a government entity which commenced in late 2025.
These increases were partially offset by:
•A $167 million net decrease associated with market prices affecting Millstone, including economic hedging impacts of net realized and unrealized losses on freestanding derivatives ($202 million); and
•A $55 million decrease associated with severe weather events affecting Virginia Power.
Electric fuel and other energy-related purchases increased 53%, primarily due to higher commodity costs for electric utilities ($879 million) and an increase in the use of purchased renewable energy credits ($125 million), which are offset in operating revenue and do not impact net income.
Purchased electric capacity increased $122 million, primarily due to returning to PJM’s capacity market in June 2025 ($59 million), an increase related to the 2026 PJM capacity market ($20 million) and an increase due to the deferral of non-fuel rider costs ($17 million), which is offset in operating revenue and does not impact net income.
Other operations and maintenance increased 11%, primarily reflecting:
•$57 million due to renewable natural gas projects placed in service in late 2025;
•A $47 million increase in salaries, wages and benefits;
•A $28 million increase in outside services;
•A $21 million increase in certain Virginia Power expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income; and
•An $18 million increase in outage costs primarily at Virginia Power.
These increases were partially offset by:
•A $24 million decrease in storm damage and restoration costs.
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Depreciation and amortization increased 7%, primarily due to various projects being placed into service ($97 million), partially offset by a decrease in amortization associated with non-fuel riders ($18 million), which is offset in operating revenue and does not impact net income.
Impairment of assets and other charges increased $763 million, primarily due to a charge associated with nonregulated renewable natural gas facilities ($820 million), charges associated with certain nonregulated solar generation facilities ($78 million), an increase in net charges for costs not expected to be recovered from customers on 100% of the CVOW Commercial Project ($33 million) and the disallowance of certain strategic undergrounding costs ($23 million), partially offset by a benefit related to the revision of AROs for Millstone Unit 1 ($195 million).
Other income increased 51%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($189 million), an increase in AFUDC associated with rate-regulated projects ($19 million) and an increase related to offshore wind installation vessel operations ($18 million), partially offset by a decrease in non-service components of pension and other postretirement employee benefit plan credits ($16 million).
Interest and related charges increased 13%, primarily due to net issuances of long-term debt ($189 million) and an increase in the outstanding balance on variable rate debt ($25 million), partially offset by net unrealized gains in 2026 compared to net unrealized losses in 2025 associated with freestanding derivatives ($58 million) and decreased interest expense associated with rider deferrals ($23 million), which is offset in operating revenue and does not impact net income.
Income tax expense decreased 35%, primarily due to lower pre-tax income ($119 million), partially offset by higher taxes on earnings within qualified decommissioning trusts ($21 million) and the absence of a benefit associated with the remeasurement of an uncertain tax position ($18 million).
Noncontrolling interests increased 53%, due to an increase in earnings associated with the CVOW Commercial Project, which includes the share of increased charges for costs not expected to be recovered from customers.
Results of Operations—Virginia Power
Presented below is a summary of Virginia Power’s consolidated results:
2026 2025 $ Change
(millions)
Second Quarter
Net income attributable to Virginia Power $ 597 $ 535 $ 62
Year-to-Date
Net income attributable to Virginia Power $ 1,220 $ 1,020 $ 200
Overview
Second Quarter 2026 vs. 2025
Net income increased 12%, primarily due to higher rider equity returns reflecting capital investments and the impacts of the 2025 Biennial Review.
Year-to-Date 2026 vs. 2025
Net income increased 20%, primarily due to higher rider equity returns reflecting capital investments and the impacts of the 2025 Biennial Review.
Analysis of Consolidated Operations
Presented below are selected amounts related to Virginia Power’s results of operations:
Second Quarter Year-to-Date
2026 2025 $ Change 2026 2025 $ Change
(millions)
Operating revenue $ 3,421 $ 2,712 $ 709 $ 7,117 $ 5,477 $ 1,640
Electric fuel and other energy-related purchases 1,071 729 342 2,443 1,498 945
Purchased electric capacity 78 17 61 143 24 119
Other operations and maintenance 616 553 63 1,295 1,163 132
Depreciation and amortization 415 396 19 838 794 44
Other taxes 98 92 6 205 189 16
Impairment of assets and other charges (benefits) 268 50 218 154 96 58
Other income (expense) 127 80 47 154 106 48
Interest and related charges 262 251 11 521 494 27
Income tax expense 154 115 39 299 205 94
Noncontrolling interests (11 ) 54 (65 ) 153 100 53
An analysis of Virginia Power’s results of operations follows:
Second Quarter 2026 vs. 2025
Operating revenue increased 26%, primarily reflecting:
•A $291 million net increase in fuel-related revenue as a result of an increase in commodity costs associated with sales to electric utility retail customers, including revenue for the deferred fuel securitization and electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges;
•A $217 million increase to recover the costs and an authorized return, as applicable, associated with non-fuel riders;
•A $142 million increase associated with the 2025 Biennial Review;
•A $19 million increase in sales to electric utility retail customers associated with economic and other usage factors;
•A $12 million increase in sales to electric utility retail customers associated with growth; and
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•An $8 million increase attributable to a service contract with a government entity which commenced in late 2025.
Electric fuel and other energy-related purchases increased 47%, primarily due to higher commodity costs for electric utilities ($295 million) and an increase in the use of purchased renewable energy credits ($60 million), which are offset in operating revenue and do not impact net income.
Purchased electric capacity increased $61 million, primarily due to returning to PJM’s capacity market in June 2025 ($23 million) and an increase related to the 2026 annual PJM capacity market ($20 million).
Other operations and maintenance increased 11%, primarily due to an increase in salaries, wages and benefits and administrative costs ($20 million) and an increase in outside services primarily attributable to a service contract with a government entity which commenced in late 2025 ($14 million), partially offset by a decrease in storm damage and restoration costs ($11 million).
Depreciation and amortization increased 5%, primarily due to various projects being placed into service ($32 million), partially offset by a decrease in amortization associated with non-fuel riders ($15 million), which is offset in operating revenue and does not impact net income.
Impairment of assets and other charges increased $218 million, primarily due to an increase in charges for costs not expected to be recovered from customers on 100% of the CVOW Commercial Project ($195 million) and the disallowance of certain strategic undergrounding costs ($23 million).
Other income increased 59%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($35 million) and an increase in AFUDC associated with rate-regulated projects ($14 million).
Income tax expense increased 34%, primarily due to higher pre-tax income.
Noncontrolling interests decreased $65 million, due to a decrease in earnings from the CVOW Commercial Project, including the share of increased charges for costs not expected to be recovered from customers.
Year-to-Date 2026 vs. 2025
Operating revenue increased 30%, primarily reflecting:
•A $814 million net increase in fuel-related revenue as a result of an increase in commodity costs associated with sales to electric utility retail customers, including revenue for the deferred fuel securitization and electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges;
•A $474 million increase to recover the costs and an authorized return, as applicable, associated with non-fuel riders;
•A $282 million increase associated with the 2025 Biennial Review;
•A $38 million net increase in sales to electric utility retail customers, primarily due to an increase in heating degree days during the heating season ($43 million), partially offset by a decrease in cooling degree days during the cooling season ($5 million);
•A $25 million increase in sales to electric utility retail customers associated with growth;
•A $19 million increase attributable to a service contract with a government entity which commenced in late 2025; and
•A $10 million increase in sales to customers from non-jurisdictional solar generation facilities.
These increases were partially offset by:
•A $55 million decrease associated with severe weather events.
Electric fuel and other energy-related purchases increased 63%, primarily due to higher commodity costs for electric utilities ($823 million) and an increase in the use of purchased renewable energy credits ($125 million), which are offset in operating revenue and do not impact net income.
Purchased electric capacity increased $119 million, primarily due to returning to PJM’s capacity market in June 2025 ($59 million), an increase related to the 2026 annual PJM capacity market ($20 million), an increase due to the deferral of non-fuel rider costs ($17 million), which is offset in operating revenue and does not impact net income, and an increase related to changes in other capacity purchase contracts ($12 million).
Other operations and maintenance increased 11%, primarily due to an increase in salaries, wages and benefits and administrative costs ($65 million), an increase in outside services primarily attributable to a service contract with a government entity which commenced in late 2025 ($26 million), an increase in certain expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income ($21 million) and an increase in outage costs ($16 million), partially offset by a decrease in storm damage and restoration costs ($24 million).
Depreciation and amortization increased 6%, primarily due to various projects being placed into service ($59 million), partially offset by a decrease in amortization associated with non-fuel riders ($18 million), which is offset in operating revenue and does not impact net income.
Impairment of assets and other charges increased 60%, primarily due to an increase in net charges for costs not expected to be recovered from customers on 100% of the CVOW Commercial Project ($33 million) and the disallowance of certain strategic undergrounding costs ($23 million).
Other income increased 45%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds ($29 million) and an increase in AFUDC associated with rate-regulated projects ($20 million).
Interest and related charges increased 5%, primarily due to an increase in long-term debt borrowings ($67 million), partially offset by decreased interest expense associated with rider deferrals ($23 million), which is offset in operating revenue and does not impact net income.
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Income tax expense increased 46%, primarily due to higher pre-tax income.
Noncontrolling interests increased 53%, due to an increase in earnings associated with the CVOW Commercial Project, which includes the share of increased charges for costs not expected to be recovered from customers.
Segment Results of Operations
Segment results include the impact of intersegment revenues and expenses, which may result in intersegment profit and loss. Presented below is a summary of contributions by Dominion Energy’s operating segments to net income (loss) attributable to Dominion Energy:
Net Income (Loss) Attributable to Dominion Energy EPS(1)
2026 2025 $ Change 2026 2025 $ Change
(millions, except EPS)
Second Quarter
Dominion Energy Virginia $ 670 $ 549 $ 121 $ 0.76 $ 0.64 $ 0.12
Dominion Energy South Carolina 105 109 (4 ) 0.12 0.13 (0.01 )
Contracted Energy 31 47 (16 ) 0.03 0.05 (0.02 )
Corporate and Other (466 ) 55 (521 ) (0.54 ) 0.06 (0.60 )
Consolidated $ 340 $ 760 $ (420 ) $ 0.37 $ 0.88 $ (0.51 )
Year-to-Date
Dominion Energy Virginia $ 1,340 $ 1,110 $ 230 $ 1.53 $ 1.30 $ 0.23
Dominion Energy South Carolina 231 261 (30 ) 0.26 0.31 (0.05 )
Contracted Energy 150 156 (6 ) 0.17 0.18 (0.01 )
Corporate and Other (760 ) (102 ) (658 ) (0.89 ) (0.14 ) (0.75 )
Consolidated $ 961 $ 1,425 $ (464 ) $ 1.07 $ 1.65 $ (0.58 )
(1)Consolidated results are presented on a diluted EPS basis. The dilutive impacts, primarily consisting of potential shares which had not yet been issued, are included within the results of the Corporate and Other segment. EPS contributions for Dominion Energy’s operating segments are presented utilizing basic average shares outstanding for the period.
Dominion Energy Virginia
Presented below are selected operating statistics related to Dominion Energy Virginia’s operations:
Second Quarter Year-to-Date
2026 2025 % Change 2026 2025 % Change
Electricity delivered (million MWh) 24.7 23.7 4 % 51.2 49.1 4 %
Electricity supplied (million MWh):
Utility 24.7 23.7 4 51.2 49.1 4
Non-Jurisdictional 0.6 0.6 — 0.9 0.9 —
Degree days (electric distribution and utility service area):
Cooling 594 612 (3 ) 612 632 (3 )
Heating 238 176 35 2,269 2,118 7
Average electric distribution customer accounts (thousands) 2,829 2,804 1 2,827 2,802 1
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Presented below, on an after-tax basis, are the key factors impacting Dominion Energy Virginia’s net income contribution:
Second Quarter 2026 vs. 2025 Increase (Decrease) Year-to-Date 2026 vs. 2025 Increase (Decrease)
Amount EPS Amount EPS
(millions, except EPS)
Weather $ (3 ) $ — $ 29 $ 0.03
Customer usage and other factors 23 0.03 25 0.03
2025 Biennial Review impacts(1) 105 0.12 210 0.25
Rider equity return 79 0.09 163 0.19
Electric capacity (34 ) (0.04 ) (76 ) (0.09 )
Storm damage and restoration costs (9 ) (0.01 ) (14 ) (0.02 )
Planned outage costs (5 ) (0.01 ) (12 ) (0.01 )
Nuclear production tax credit (15 ) (0.02 ) (31 ) (0.04 )
Depreciation and amortization (11 ) (0.01 ) (20 ) (0.02 )
Salaries, wages and benefits & administrative costs (14 ) (0.02 ) (48 ) (0.06 )
Interest expense, net 8 0.01 7 0.01
Other (3 ) — (3 ) 0.01
Share dilution — (0.02 ) — (0.05 )
Change in net income contribution $ 121 $ 0.12 $ 230 $ 0.23
(1)Includes the impacts of non-jurisdictional customers.
Dominion Energy South Carolina
Presented below are selected operating statistics related to Dominion Energy South Carolina’s operations:
Second Quarter Year-to-Date
2026 2025 % Change 2026 2025 % Change
Electricity delivered (million MWh) 5.6 5.5 2 % 10.9 10.8 1 %
Electricity supplied (million MWh) 5.9 5.8 2 11.5 11.3 2
Degree days (electric distribution service areas):
Cooling 253 269 (6 ) 256 269 (5 )
Heating 10 10 — 821 853 (4 )
Gas distribution throughput (bcf):
Sales 15 15 — 38 37 3
Average distribution customer accounts (thousands):
Electric 833 819 2 829 813 2
Gas 484 471 3 482 469 3
Presented below, on an after-tax basis, are the key factors impacting Dominion Energy South Carolina’s net income contribution:
Second Quarter 2026 vs. 2025 Increase (Decrease) Year-to-Date 2026 vs. 2025 Increase (Decrease)
Amount EPS Amount EPS
(millions, except EPS)
Weather $ (4 ) $ — $ (5 ) $ (0.01 )
Customer usage and other factors 14 0.02 23 0.03
Customer-elected rate impacts (1 ) — (2 ) —
Base rate case & Natural Gas Rate Stabilization Act impacts 7 0.01 13 0.02
Capital cost rider (2 ) — (4 ) —
Depreciation and amortization (7 ) (0.01 ) (13 ) (0.02 )
Salaries, wages and benefits & administrative costs (4 ) — — —
Interest expense, net (2 ) — (4 ) —
Other (5 ) (0.02 ) (38 ) (0.06 )
Share dilution — (0.01 ) — (0.01 )
Change in net income contribution $ (4 ) $ (0.01 ) $ (30 ) $ (0.05 )
Contracted Energy
Presented below are selected operating statistics related to Contracted Energy’s operations:
Second Quarter Year-to-Date
2026 2025 % Change 2026 2025 % Change
Electricity supplied (million MWh) 4.2 4.0 5 % 9.1 8.9 2 %
Renewable natural gas supplied (million MMBtu) 0.5 — N/A 0.9 — N/A
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Presented below, on an after-tax basis, are the key factors impacting Contracted Energy’s net income contribution:
Second Quarter 2026 vs. 2025 Increase (Decrease) Year-to-Date 2026 vs. 2025 Increase (Decrease)
Amount EPS Amount EPS
(millions, except EPS)
Margin $ 28 $ 0.03 $ 78 $ 0.09
Planned Millstone outages(1) 4 — 4 —
Unplanned Millstone outages(1) (3 ) — (3 ) —
Depreciation and amortization (13 ) (0.02 ) (32 ) (0.04 )
Renewable energy investment tax credits 3 — 10 0.01
Renewable energy production tax credits(2) 7 0.01 21 0.02
Salaries, wages and benefits & administrative costs (2 ) — (8 ) (0.01 )
Interest expense, net (17 ) (0.02 ) (31 ) (0.04 )
Other (23 ) (0.02 ) (45 ) (0.03 )
Share dilution — — — (0.01 )
Change in net income contribution $ (16 ) $ (0.02 ) $ (6 ) $ (0.01 )
(1)Includes earnings impact from outage costs and lower energy margins.
(2)Includes an increase from renewable natural gas facilities of $6 million and $20 million for the quarter and year-to-date periods, respectively.
Corporate and Other
Presented below are the Corporate and Other segment’s after-tax results:
Second Quarter Year-to-Date
2026 2025 $ Change 2026 2025 $ Change
(millions, except EPS)
Specific items attributable to operating segments $ (379 ) $ 125 $ (504 ) $ (607 ) $ (7 ) $ (600 )
Specific items attributable to Corporate and Other segment 7 (14 ) 21 9 (20 ) 29
Net income (expense) from specific items (372 ) 111 (483 ) (598 ) (27 ) (571 )
Corporate and other operations:
Interest expense, net (165 ) (114 ) (51 ) (319 ) (223 ) (96 )
Equity method investments — — — — (5 ) 5
Pension and other postretirement benefit plans 63 57 6 125 114 11
Corporate service company costs (11 ) (11 ) — (27 ) (25 ) (2 )
Other 19 12 7 59 64 (5 )
Net expense from corporate and other operations (94 ) (56 ) (38 ) (162 ) (75 ) (87 )
Total net income (expense) $ (466 ) $ 55 $ (521 ) $ (760 ) $ (102 ) $ (658 )
EPS impact $ (0.54 ) $ 0.06 $ (0.60 ) $ (0.89 ) $ (0.14 ) $ (0.75 )
Corporate and Other includes specific items attributable to Dominion Energy’s primary operating segments that are not included in profit measures evaluated by executive management in assessing the segments’ performance or in allocating resources. See Note 20 to the Consolidated Financial Statements in this report for discussion of these items in more detail. Corporate and Other also includes items attributable to the Corporate and Other segment. For the three months ended June 30, 2026, this primarily included $21 million after-tax benefit for derivative mark-to-market changes. For the six months ended June 30, 2026, this primarily included $24 million after-tax benefit for derivative mark-to-market changes. For the three months ended June 30, 2025, this primarily included $15 million after-tax loss for derivative mark-to-market changes. For the six months ended June 30, 2025, this primarily included $20 million after-tax loss for derivative mark-to-market changes.
Outlook
At June 30, 2026, there have been no material changes to Dominion Energy’s 2026 outlook as described in Item 7. MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025. See Future Issues and Other Matters for a discussion of certain items that may have an impact on Dominion Energy’s 2026 net income on a per share basis.
Liquidity and Capital Resources
Dominion Energy depends on both cash generated from operations and external sources of liquidity to provide working capital and as a bridge to long-term financings. Dominion Energy’s material cash requirements include capital and investment expenditures, repaying short-term and long-term debt obligations and paying dividends on its common and preferred stock.
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Analysis of Cash Flows
Presented below are selected amounts related to Dominion Energy’s cash flows:
2026 2025
(millions)
Cash, restricted cash and equivalents at January 1 $ 343 $ 365
Cash flows provided by (used in):
Operating activities(1) 2,457 2,429
Investing activities (5,991 ) (6,385 )
Financing activities 3,558 4,004
Net increase in cash, restricted cash and equivalents 24 48
Cash, restricted cash and equivalents at June 30 $ 367 $ 413
(1)Includes cash outflows of $31 million and $39 million for energy efficiency programs in Virginia for the six months ended June 30, 2026 and 2025, respectively, and $14 million and $12 million for DSM programs in South Carolina for the six months ended June 30, 2026 and 2025, respectively.
Operating Cash Flows
Net cash provided by Dominion Energy’s operating activities increased $28 million, primarily due to higher operating cash flows from electric utility operations driven by riders and impacts from the 2025 Biennial Review ($754 million), partially offset by lower deferred fuel and purchased gas cost recoveries ($251 million), an increase in interest payments primarily driven by higher borrowings ($231 million) and lower settlements of interest rate swaps ($230 million).
Investing Cash Flows
Net cash used in Dominion Energy’s investing activities decreased $394 million, primarily due to timing of payments for plant construction and other property additions.
Financing Cash Flows
Net cash from Dominion Energy's financing activities decreased $446 million, primarily due to a decrease in net issuances of short-term debt ($1.3 billion), a decrease in capital contributions from Stonepeak to OSWP, net of distributions from OSWP to Stonepeak ($416 million) and a decrease in net issuances of long-term debt ($288 million), partially offset by 364-day term loan facility borrowings ($1.3 billion) and net supplemental credit facility borrowings ($200 million).
Credit Facilities and Short-Term Debt
As discussed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025, Dominion Energy generally uses proceeds from short-term borrowings, including commercial paper, to satisfy short-term cash requirements not met through cash from operations. The levels of borrowing may vary significantly during the course of the year, depending on the timing and amount of cash requirements not satisfied by cash from operations. There have been no significant changes to Dominion Energy’s use of credit facilities and/or short-term debt during the six months ended June 30, 2026.
Revolving Credit Facilities
Dominion Energy’s short-term financing is primarily supported by its joint revolving credit facility. At June 30, 2026, Dominion Energy had $5.9 billion of unused capacity under its revolving credit facilities. In April 2026, Dominion Energy’s $1.0 billion 364-day revolving credit facility matured. Subsequently, in April 2026, Dominion Energy entered into a $1.0 billion supplemental revolving credit facility which matures in April 2028. This credit facility can be used to support bank borrowings and the issuance of commercial paper. See Note 15 to the Consolidated Financial Statements in this report for the balances of commercial paper and letters of credit outstanding and for additional information on the revolving credit facilities.
Dominion Energy Reliability InvestmentSM Program
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 InvestmentSM. The registration limits the principal amount that may be outstanding at any one time to $1.0 billion. The notes are offered on a continuous basis and bear interest at a floating rate per annum determined by the Dominion Energy Reliability Investment Committee, or its designee, on a weekly basis. The notes have no stated maturity date, are non-transferable and may be redeemed in whole or in part by Dominion Energy or at the investor’s option at any time. At June 30, 2026, Dominion Energy’s Consolidated Balance Sheet included $375 million presented within short-term debt. The proceeds are used for general corporate purposes and to repay debt.
Other Facilities
In addition to the primary sources of short-term liquidity discussed above, from time to time Dominion Energy enters into separate supplementary credit facilities or term loans as discussed in Note 15 to the Consolidated Financial Statements in this report. In April 2026, Dominion Energy borrowed the remaining $450 million under its approximately $1.3 billion 364-day term loan facility entered into in February 2026, with the proceeds used for general corporate purposes. In July 2026, Dominion Energy repaid $300 million borrowed under this facility.
Long-Term Debt
Sustainability Revolving Credit Agreement
Dominion Energy maintains a Sustainability Revolving Credit Agreement which is described in Note 18 to the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025. At June 30, 2026, Dominion Energy had $200 million of borrowings outstanding under this facility with the proceeds used to support environmental sustainability and social investment initiatives, which was repaid in July 2026. See Note 15 to the Consolidated Financial Statements in this report for borrowings and repayments made during the six months ended June 30, 2026.
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Issuances and Borrowings of Long-Term Debt
During the six months ended June 30, 2026, Dominion Energy issued or borrowed the following long-term debt. Unless otherwise noted, the proceeds were used for the repayment of existing indebtedness and for general corporate purposes.
Month Type Public / Private Entity Principal Rate Stated Maturity
(millions)
March Senior notes Public Virginia Power $ 1,300 4.950 % 2036
March Senior notes Public Virginia Power 850 5.700 % 2056
June Senior notes Public Dominion Energy 825 5.350 % 2036
June Junior subordinated notes Public Dominion Energy 1,000 6.150 % (1) 2056
June Junior subordinated notes Public Dominion Energy 500 6.250 % (1) 2056
Total issuances and borrowings $ 4,475
(1)Rate subject to periodic reset as described in Note 15 to the Consolidated Financial Statements in this report.
Dominion Energy currently meets the definition of a well-known seasoned issuer under SEC rules governing the registration, communication and offering processes under the Securities Act of 1933, as amended. The rules provide for a streamlined shelf registration process to provide registrants with timely access to capital. This allows Dominion Energy to use automatic shelf registration statements to register any offering of securities, other than those for exchange offers or business combination transactions.
Dominion Energy anticipates, excluding potential opportunistic financings, issuing between approximately $6.0 billion and $9.5 billion of long-term debt during 2026, inclusive of amounts issued through June 30, 2026 as shown in the table above. Dominion Energy expects to issue long-term debt to satisfy cash needs for capital expenditures, net of reimbursements from Stonepeak for the CVOW Commercial Project, and maturing long-term debt to the extent such amounts are not satisfied from cash available from operations following the payment of dividends and any borrowings made from unused capacity of Dominion Energy’s credit facilities discussed above. The raising of external capital is subject to certain regulatory requirements, including registration with the SEC for certain issuances.
Repayments, Repurchases and Redemptions of Long-Term Debt
Dominion Energy may from time to time reduce its outstanding debt and level of interest expense through redemption of debt securities prior to maturity or repurchases of debt securities in the open market, in privately negotiated transactions, through tender offers or otherwise.
The following long-term debt was repaid, repurchased or redeemed during the six months ended June 30, 2026:
Month Type Entity Principal (1) Rate Stated Maturity
(millions)
Debt scheduled to mature in 2026 Multiple $ 1,398 various
Early repurchases and redemptions
None
Total repayments, repurchases and redemptions $ 1,398
(1)Total amount redeemed prior to maturity, if any, includes remaining principal plus accrued interest.
See Note 18 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025 for additional information regarding scheduled maturities of Dominion Energy’s long-term debt, including related average interest rates.
Remarketing of Long-Term Debt
During the six months ended June 30, 2026, Dominion Energy was not required to and did not complete the remarketing of any of its long-term debt. In 2026, Dominion Energy does not expect to remarket any of its tax-exempt bonds.
Credit Ratings
As discussed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025, Dominion Energy’s credit ratings affect its liquidity, cost of borrowing under credit facilities and collateral posting requirements under commodity contracts, as well as the rates at which it is able to offer its debt securities. The credit ratings for Dominion Energy are affected by its financial profile, mix of regulated and nonregulated businesses and respective cash flows, changes in methodologies used by the rating agencies and event risk, if applicable, such as major acquisitions or dispositions. A credit rating is not a recommendation to buy, sell or hold securities and should be evaluated independently of any other rating. Ratings are subject to revision or withdrawal at any time by the applicable rating organization. In May 2026, Dominion Energy’s credit ratings were revised as follows: Moody’s affirmed its credit ratings and revised its outlook from negative to positive; Standard & Poor’s affirmed its credit ratings and revised its outlook from stable to positive; and Fitch affirmed its credit ratings and revised its outlook from stable to positive watch. At June 30, 2026, there have been no other changes in Dominion Energy’s credit ratings from those described in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
Financial Covenants
As discussed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025, Dominion Energy is subject to various covenants present in the agreements underlying Dominion Energy’s debt. At June 30, 2026, there
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have been no material changes to these covenants, nor any events of default under these covenants.
As discussed in Note 15 to the Consolidated Financial Statements of this report, in April 2026, Dominion Energy entered into a new $1.0 billion credit facility, which includes a maximum allowed total debt to total capital ratio that is consistent with the allowed ratio under its joint revolving credit facility.
Common Stock, Preferred Stock and Other Equity Securities
In the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025, there is a discussion of Dominion Energy’s existing equity financing programs, including Dominion Energy Direct®. In May 2026, Dominion Energy began purchasing its common stock on the open market for these direct stock purchase plans. During the six months ended June 30, 2026, Dominion Energy issued $38 million of stock through these programs, net of fees and commissions.
During the third quarter of 2025, Dominion Energy entered into forward sale agreements under its May 2024 at-the-market program for approximately 2.4 million shares of its common stock expected to be settled by the fourth quarter of 2027 at a weighted-average initial forward price of $59.91 per share.
In February 2025, Dominion Energy entered into a new at-the-market-program, and during the second quarter of 2025, Dominion Energy entered into forward sale agreements for approximately 11.0 million shares of its common stock expected to be settled in the fourth quarter of 2026 at a weighted-average initial forward price of $55.83 per share. During the third quarter of 2025, Dominion Energy entered into forward sale agreements for approximately 9.6 million shares of its common stock expected to be settled by the fourth quarter of 2027 at a weighted-average initial forward price of $61.11 per share. In December 2025, Dominion Energy provided notice to elect physical settlement of approximately 5.4 million shares under these forward sales agreements, and in December 2025 settled the agreements at a weighted-average final forward price of $60.44 per share.
In October 2025, Dominion Energy increased the maximum amount of capacity available under its February 2025 at-the-market program by $1.8 billion.
During the first quarter of 2026, Dominion Energy entered into forward sale agreements under its February 2025 at-the-market program for approximately 3.2 million shares of its common stock expected to be settled by the fourth quarter of 2027 at a weighted-average initial forward price of $62.96 per share. During the second quarter of 2026, Dominion Energy entered into forward sale agreements for approximately 7.9 million shares of its common stock expected to be settled by the fourth quarter of 2026 at a weighted-average initial forward price of $67.88 per share. See Note 15 to the Consolidated Financial Statements in this report for additional information.
Through June 30, 2026, Dominion Energy has not repurchased and does not plan to repurchase shares of common stock in 2026, except for shares tendered by employees to satisfy tax withholding obligations on vested restricted stock, which does not impact the available capacity under its stock repurchase authorization. See Note 15 to the Consolidated Financial Statements in this report for additional information.
Capital Expenditures
At June 30, 2026, there have been no material changes to Dominion Energy’s expectation for planned capital expenditures as disclosed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
Dividends
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. See Notes 1 and 15 to the Consolidated Financial Statements in this report for additional information regarding certain dividend restrictions under the NextEra Energy Merger Agreement and Dominion Energy’s outstanding preferred stock and associated dividend rate, respectively.
Subsidiary Dividend Restrictions
At June 30, 2026, there have been no material changes to the subsidiary dividend restrictions disclosed in the Subsidiary Dividend Restrictions section of MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
Collateral and Credit Risk
Collateral requirements are impacted by capital projects, commodity prices, hedging levels, Dominion Energy’s credit ratings and the credit quality of its counterparties. At June 30, 2026, there have been no material changes to the collateral requirements disclosed in the Collateral and Credit Risk section of MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
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 at June 30, 2026 for these activities. Gross credit exposure for each counterparty is calculated as outstanding receivables plus any unrealized on- or off-balance sheet exposure, taking into account contractual netting rights.
Gross Credit Exposure Credit Collateral Net Credit Exposure
(millions)
Investment grade(1) $ 471 $ — $ 471
Non-investment grade(2) 1 — 1
No external ratings:
Internally rated—investment grade(3) 362 10 352
Internally rated—non-investment grade(4) 11 3 8
Total(5) $ 845 $ 13 $ 832
(1)Designations as investment grade are based upon minimum credit ratings assigned by Moody’s and Standard & Poor’s. The five largest counterparty exposures, combined, for this category represented approximately 56% 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.
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(3)The five largest counterparty exposures, combined, for this category represented approximately 42% of the total net credit exposure.
(4)The five largest counterparty exposures, combined, for this category represented approximately 1% of the total net credit exposure.
(5)Excludes long-term purchase power agreements entered to satisfy legislative or state regulatory commission requirements.
Fuel and Other Purchase Commitments
There have been no material changes outside of the ordinary course of business to Dominion Energy’s fuel and other purchase commitments included in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
Other Material Cash Requirements
In addition to the financing arrangements discussed above, Dominion Energy is party to numerous contracts and arrangements obligating it to make cash payments in future years. Dominion Energy expects current liabilities to be paid within the next twelve months. In addition to the items already discussed, the following represent material expected cash requirements recorded on Dominion Energy’s Consolidated Balance Sheet at June 30, 2026. Such obligations include:
•Operating and finance lease obligations – See Note 13 to the Consolidated Financial Statements in this report and Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025;
•Regulatory liabilities – See Note 11 to the Consolidated Financial Statements in this report;
•AROs – See Note 2 to the Consolidated Financial Statements in this report and Note 14 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025;
•Employee benefit plan obligations – See Note 19 to the Consolidated Financial Statements in this report and Note 22 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025; and
•High load equipment deposits – See Note 2 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025.
In addition, Dominion Energy is party to contracts and arrangements which may require it to make material cash payments in future years that are not recorded on its Consolidated Balance Sheets. Such obligations include:
•Guarantees – See Note 16 to the Consolidated Financial Statements in this report.
Future Issues and Other Matters
See Item 1. Business, Future Issues and Other Matters in MD&A and Notes 13 and 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2025, Future Issues and Other Matters in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and Notes 1, 12 and 16 to the Consolidated Financial Statements in this report for additional information on the proposed NextEra Energy Merger as well as various environmental, regulatory, legal and other matters that may impact future results of operations, financial condition and/or cash flows.
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. Installation of the final turbines comprising the 2.6 GW project is expected to be completed by the end of 2027. The estimated total project cost is approximately $11.7 billion (excluding financing costs and including $0.1 billion of contingency) which reflects revised network upgrade costs assigned by PJM to the CVOW Commercial Project, an estimated impact of certain tariffs which became effective in April 2026 and updated turbine installation projections as well as previously included estimated impacts of a temporary suspension of work order, certain tariffs including those which became effective during 2025, the impact of the U.S. Supreme Court’s ruling in late February 2026 and tariffs which became effective in late February 2026. The Companies’ projected impact of tariffs on expected total project cost is subject to change due to the inherent uncertainty associated with which tariffs, if any, may be in effect and the associated requirements and rates of such tariffs. Virginia Power’s estimate for the project’s projected levelized cost of energy, including renewable energy credits, is approximately $83/MWh, compared to the initial filing submission of $80-90/MWh.
The expected total project cost reflects a decrease of approximately $0.4 billion, relative to both Virginia Power’s January and May 2026 construction update filings, associated with a revision to projected onshore electrical interconnection costs and network upgrade costs allocated by PJM to the CVOW Commercial Project. The expected total project cost also reflects an increase of approximately $0.4 billion, relative to both Virginia Power’s January and May 2026 construction update filings, $0.3 billion of which is associated with updated projections for turbine installations reflecting weather and other conditions with the remainder associated with other factors experienced, including increased fuel costs, during installations completed through July 2026. In addition, the expected total project cost reflects an increase of approximately $0.2 billion, relative to Virginia Power’s May 2026 construction update filing, associated with revised Section 232 tariffs enacted in April 2026 on equipment expected to be delivered from April 2026 through the end of 2027 that contains steel, aluminum and/or copper products, including the associated impact such revised tariffs had on tariffs enacted in late February 2026 on equipment expected to be delivered from February 2026 through July 2026 that originates from Mexico, Canada, a European Union member or other applicable countries. Relative to Virginia Power’s January 2026 construction update filing, the expected impact of tariffs is a net increase of approximately $0.1 billion as the increase discussed above related to April 2026 revision of Section 232 tariffs is partially offset by the reversal of approximately $0.2 billion associated with tariffs on equipment expected to be delivered from March 2025 through March 2026 that originates from Mexico, Canada, a European
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Union member or other applicable countries that were the subject of a U.S. Supreme Court’s ruling in late February 2026, and the estimated impact of new tariffs subsequently enacted in late February 2026 on equipment expected to be delivered from February 2026 through July 2026 that originates from Mexico, Canada, a European Union member or other applicable countries. The actual tariffs to be incurred are dependent upon the tariff requirements and rates, if any, at the time of delivery of the specific component.
The estimated total project cost above reflects the Companies’ best estimate of the remaining construction costs, including contingency of approximately 7% on such remaining amounts. Such estimate could potentially change for items, certain of which are beyond the Companies’ control, including but not limited to fuel for transportation and installation, the impact of applicable tariffs including any potential impact of Section 232 investigations, costs to maintain necessary permits, approvals and authorizations, any additional suspension of work orders, ability of key suppliers and contractors to timely satisfy their obligations under existing contracts, marine wildlife, actual network upgrade costs allocated by PJM, adverse weather and/or any severe weather events.
Virginia Power commenced major onshore construction activities for the CVOW Commercial Project in November 2023 following the receipt of a record of decision from BOEM in October 2023 for construction. Onshore construction activities to support first power delivery were completed in December 2025 with remaining project activities to support commercial operations anticipated to be completed by mid-2026. Virginia Power commenced major offshore construction activities in May 2024 following the receipt of final approval from BOEM authorizing offshore construction and necessary permits from the U.S. Army Corps of Engineers for offshore construction in January 2024. Virginia Power completed the installation of all monopiles in October 2025 and of all transition pieces in April 2026. The first of three offshore substations was installed in March 2025, with the second installed in November 2025 and the third installed in February 2026. Deepwater cables commenced being laid in late 2024 with the last of nine completed in July 2025. Of the 176 segments of interarray cable, expected to total 260 miles, 113 have been installed through July 2026 with the remaining expected to be laid throughout 2026. Installation commenced on turbines in December 2025 prior to being delayed by the temporary suspension of work order, with 31 of 176 completed through July 2026. The first turbines and associated infrastructure of the CVOW Commercial Project commenced operations in March 2026.
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