{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/56-581.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/56-581.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/56-581.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/56-581.html"}],"law_id":76009,"edition_id":1,"section_id":76009,"structure_id":13084,"section_number":"56-581","catch_line":"Regulation of rates subject to Commission’s jurisdiction","history":"1999, c. 411; 2000, c. 991; 2007, cc. 888, 933; 2023, cc. 497, 498, 757, 775.","full_text":"A\n\nThe Commission shall regulate the rates of investor-owned incumbent electric utilities for the transmission of electric energy, to the extent not prohibited by federal law, and for the generation of electric energy and the distribution of electric energy to retail customers pursuant to this section and § 56-585.1.B\n\nIn any proceeding to review base rates for a Phase I Utility that commences after July 1, 2023, if the Commission determines in its sole discretion that the utility’s existing base rates will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate of return or (ii) revenues below the utility’s authorized rate of return, then, notwithstanding any provision of law governing rate proceedings, the Commission shall order any reductions or increases, as applicable and necessary, to such base rates that it deems appropriate to ensure the resulting base rates (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate of return authorized pursuant to the provisions governing such review proceeding. Such determination shall be limited to the Phase I Utility’s base rates and shall not consider the costs or revenues recovered in any rate adjustment clause authorized pursuant to this chapter.C\n\nIn any proceeding to review base rates for a Phase II Utility that commences after July 1, 2023, if the Commission determines in its sole discretion that the utility’s existing base rates will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate of return or (ii) revenues below the utility’s authorized rate of return, then, notwithstanding any provision of subdivision A 8 of § 56-585.1, the Commission shall order any reductions or increases, as applicable and necessary, to such base rates that it deems appropriate to ensure the resulting base rates (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate of return on its base rates as determined in subdivision A 2 of § 56-585.1. Such determination shall be limited to the Phase II Utility’s base rates and shall not consider the costs or revenues recovered in any rate adjustment clause authorized pursuant to subdivision A 6 of § 56-585.1 that has not been combined with the utility’s base rates. The Commission shall use the most recently ended 12-month test period, along with normalization of nonrecurring test period costs and annualized adjustments for future costs, as the basis for determining the appropriateness of any rate adjustment. In any such filing to review base rates, a Phase II Utility shall separately project future costs over each 12-month period ending on December 31 of the year of the utility’s succeeding rate periods. The Commission may, to the extent it finds such action aligns with the utility’s projected cost of service, direct that any reduction or increase to the utility’s rates for generation and distribution services be implemented on a staggered basis at the commencement and midpoint of the succeeding review or rate period.D\n\nBeginning July 1, 1999, and thereafter, no cooperative that was a member of a power supply cooperative on January 1, 1999, shall be obligated to file any rate rider as a consequence of an increase or decrease in the rates, other than fuel costs, of its wholesale supplier, nor must any adjustment be made to such cooperative’s rates as a consequence thereof.E\n\nExcept for the provision of default services under § 56-585 or emergency services in § 56-586, nothing in this chapter shall authorize the Commission to regulate the rates or charges for electric service to the Commonwealth and its municipalities.F\n\nAs used in this section:\n\t\t\t“Base rates” means rates for generation and distribution services.\n\t\t\t“Phase I Utility” has the same meaning as provided in subdivision A 1 of § 56-585.1.\n\t\t\t“Phase II Utility” has the same meaning as provided in subdivision A 1 of § 56-585.1.","order_by":null,"text":{"0":{"id":272840,"text":"The Commission shall regulate the rates of investor-owned incumbent electric utilities for the transmission of electric energy, to the extent not prohibited by federal law, and for the generation of electric energy and the distribution of electric energy to retail customers pursuant to this section and § 56-585.1.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":272841,"text":"In any proceeding to review base rates for a Phase I Utility that commences after July 1, 2023, if the Commission determines in its sole discretion that the utility’s existing base rates will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate of return or (ii) revenues below the utility’s authorized rate of return, then, notwithstanding any provision of law governing rate proceedings, the Commission shall order any reductions or increases, as applicable and necessary, to such base rates that it deems appropriate to ensure the resulting base rates (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate of return authorized pursuant to the provisions governing such review proceeding. Such determination shall be limited to the Phase I Utility’s base rates and shall not consider the costs or revenues recovered in any rate adjustment clause authorized pursuant to this chapter.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":272842,"text":"In any proceeding to review base rates for a Phase II Utility that commences after July 1, 2023, if the Commission determines in its sole discretion that the utility’s existing base rates will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate of return or (ii) revenues below the utility’s authorized rate of return, then, notwithstanding any provision of subdivision A 8 of § 56-585.1, the Commission shall order any reductions or increases, as applicable and necessary, to such base rates that it deems appropriate to ensure the resulting base rates (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate of return on its base rates as determined in subdivision A 2 of § 56-585.1. Such determination shall be limited to the Phase II Utility’s base rates and shall not consider the costs or revenues recovered in any rate adjustment clause authorized pursuant to subdivision A 6 of § 56-585.1 that has not been combined with the utility’s base rates. The Commission shall use the most recently ended 12-month test period, along with normalization of nonrecurring test period costs and annualized adjustments for future costs, as the basis for determining the appropriateness of any rate adjustment. In any such filing to review base rates, a Phase II Utility shall separately project future costs over each 12-month period ending on December 31 of the year of the utility’s succeeding rate periods. The Commission may, to the extent it finds such action aligns with the utility’s projected cost of service, direct that any reduction or increase to the utility’s rates for generation and distribution services be implemented on a staggered basis at the commencement and midpoint of the succeeding review or rate period.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"3":{"id":272843,"text":"Beginning July 1, 1999, and thereafter, no cooperative that was a member of a power supply cooperative on January 1, 1999, shall be obligated to file any rate rider as a consequence of an increase or decrease in the rates, other than fuel costs, of its wholesale supplier, nor must any adjustment be made to such cooperative’s rates as a consequence thereof.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"E"},"4":{"id":272844,"text":"Except for the provision of default services under § 56-585 or emergency services in § 56-586, nothing in this chapter shall authorize the Commission to regulate the rates or charges for electric service to the Commonwealth and its municipalities.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"F"},"5":{"id":272845,"text":"As used in this section:\n\t\t\t“Base rates” means rates for generation and distribution services.\n\t\t\t“Phase I Utility” has the same meaning as provided in subdivision A 1 of § 56-585.1.\n\t\t\t“Phase II Utility” has the same meaning as provided in subdivision A 1 of § 56-585.1.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E"}},"ancestry":[{"id":13084,"edition_id":1,"name":"Virginia Electric Utility Regulation Act","identifier":"23","label":"chapter","depth":2,"order_by":1,"parent_id":12881,"metadata":{},"date_created":"2026-06-26 03:44:15","date_modified":"2026-06-26 03:44:15","permalink":{"id":250597,"object_type":"structure","relational_id":13084,"identifier":"23","token":"56\/23","url":"\/56\/23\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12881,"edition_id":1,"name":"Public Service Companies","identifier":"56","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:58","date_modified":"2026-06-26 03:43:58","permalink":{"id":248473,"object_type":"structure","relational_id":12881,"identifier":"56","token":"56","url":"\/56\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":62210,"structure_id":13084,"section_number":"56-576","catch_line":"Definitions","url":"\/56-576\/","token":"56\/23\/56-576","metadata":false},{"id":79838,"structure_id":13084,"section_number":"56-577","catch_line":"Schedule for transition to retail competition; Commission authority; exemptions; pilot programs","url":"\/56-577\/","token":"56\/23\/56-577","metadata":false},{"id":69790,"structure_id":13084,"section_number":"56-577.1","catch_line":"Electric utilities; retail competition; pilot program","url":"\/56-577.1\/","token":"56\/23\/56-577.1","metadata":false},{"id":66769,"structure_id":13084,"section_number":"56-578","catch_line":"Nondiscriminatory access to transmission and distribution 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This law was first created in 1999. The record of its establishment is cataloged in chapter 411<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 3 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2000, chapter 991<\/a>; in 2007, chapters 888<\/a> and 933<\/a>; in 2023, chapters 497<\/a>, 498<\/a>, 757<\/a>, and 775<\/a>.<\/p>","references":[{"id":67687,"section_number":"56-585.1","catch_line":"Generation, distribution, and transmission rates after capped rates terminate or expire","order_by":null,"url":"\/56-585.1\/"}],"refers_to":[{"id":66252,"section_number":"56-585","catch_line":"Default service","order_by":null,"url":"\/56-585\/"},{"id":67687,"section_number":"56-585.1","catch_line":"Generation, distribution, and transmission rates after capped rates terminate or expire","order_by":null,"url":"\/56-585.1\/"},{"id":78391,"section_number":"56-586","catch_line":"Emergency service provider","order_by":null,"url":"\/56-586\/"}],"permalink":{"id":250623,"object_type":"law","relational_id":76009,"identifier":"56-581","token":"56\/23\/56-581","url":"\/56-581\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/56-581\/","token":"56\/23\/56-581","dublin_core":{"Title":"Regulation of rates subject to Commission’s jurisdiction","Type":"Text","Format":"text\/html","Identifier":"\u00a7 56-581","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> The Commission<\/span> shall regulate the rates<\/span> of investor-owned incumbent electric utilities for the transmission of electric energy, to the extent not prohibited by federal law<\/span>, and for the generation of<\/span> electric energy and the distribution of<\/span> electric energy to retail customers<\/span> pursuant to this section and § 56-585.1<\/a>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> In any proceeding to review base rates<\/span> for a Phase I Utility<\/span> that commences after July 1, 2023, if the Commission<\/span> determines in its sole discretion that the utility’s existing base rates<\/span> will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate<\/span> of return or (ii) revenues below the utility’s authorized rate<\/span> of return, then, notwithstanding any provision of law<\/span> governing rate<\/span> proceedings, the Commission<\/span> shall order<\/span> any reductions or increases, as applicable and necessary, to such base rates<\/span> that it deems appropriate to ensure the resulting base rates<\/span> (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate<\/span> period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate<\/span> of return authorized pursuant to the provisions governing such review proceeding. Such determination shall be limited to the Phase I Utility<\/span>’s base rates<\/span> and shall not consider the costs or revenues recovered in any rate<\/span> adjustment clause authorized pursuant to this chapter. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> In any proceeding to review base rates<\/span> for a Phase II Utility<\/span> that commences after July 1, 2023, if the Commission<\/span> determines in its sole discretion that the utility’s existing base rates<\/span> will, on a going-forward basis, either produce (i) revenues in excess of the utility’s authorized rate<\/span> of return or (ii) revenues below the utility’s authorized rate<\/span> of return, then, notwithstanding any provision of subdivision A 8 of § 56-585.1<\/a>, the Commission<\/span> shall order<\/span> any reductions or increases, as applicable and necessary, to such base rates<\/span> that it deems appropriate to ensure the resulting base rates<\/span> (a) are just and reasonable and (b) provide the utility an opportunity to recover its costs of providing services over the rate<\/span> period ending on December 31 of the year of the utility’s succeeding review and earn a fair rate<\/span> of return on its base rates<\/span> as determined in subdivision A 2 of § 56-585.1<\/a>. Such determination shall be limited to the Phase II Utility<\/span>’s base rates<\/span> and shall not consider the costs or revenues recovered in any rate<\/span> adjustment clause authorized pursuant to subdivision A 6 of § 56-585.1<\/a> that has not been combined with the utility’s base rates<\/span>. The Commission<\/span> shall use the most recently ended 12-month test period, along with normalization of nonrecurring test period costs and annualized adjustments for future costs, as the basis for determining the appropriateness of any rate<\/span> adjustment. In any such filing to review base rates<\/span>, a Phase II Utility<\/span> shall separately project future costs over each 12-month period ending on December 31 of the year of the utility’s succeeding rate<\/span> periods. The Commission<\/span> may, to the extent it finds such action aligns with the utility’s projected cost of service, direct that any reduction or increase to the utility’s rates for generation and distribution services be implemented on a staggered basis at the commencement and midpoint of the succeeding review or rate<\/span> period. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> Beginning July 1, 1999, and thereafter, no cooperative<\/span> that was a member of a power supply<\/span> cooperative<\/span> on January 1, 1999, shall be obligated to file any rate<\/span> rider as a consequence of an increase or decrease in the rates, other than fuel costs, of its wholesale supplier<\/span>, nor must any adjustment be made to such cooperative<\/span>’s rates as a consequence thereof. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> Except for the provision of default<\/span> services under § 56-585<\/a> or emergency services in § 56-586<\/a>, nothing in this chapter shall authorize the Commission<\/span> to regulate the rates or charges for electric service to the Commonwealth and its municipalities. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> As used in this section:\n\t\t\t“Base rates<\/span>” means rates for generation and distribution services.\n\t\t\t“Phase I Utility<\/span>” has the same meaning as provided in subdivision A 1 of § 56-585.1<\/a>.\n\t\t\t“Phase II Utility<\/span>” has the same meaning as provided in subdivision A 1 of § 56-585.1<\/a>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nREGULATION OF RATES SUBJECT TO COMMISSION’S JURISDICTION (\u00a7 56-581)\n\nA. The Commission shall regulate the rates of investor-owned incumbent electric\nutilities for the transmission of electric energy, to the extent not prohibited\nby federal law, and for the generation of electric energy and the distribution\nof electric energy to retail customers pursuant to this section and §\n56-585.1.\n\nB. In any proceeding to review base rates for a Phase I Utility that commences\nafter July 1, 2023, if the Commission determines in its sole discretion that the\nutility’s existing base rates will, on a going-forward basis, either\nproduce (i) revenues in excess of the utility’s authorized rate of return\nor (ii) revenues below the utility’s authorized rate of return, then,\nnotwithstanding any provision of law governing rate proceedings, the Commission\nshall order any reductions or increases, as applicable and necessary, to such\nbase rates that it deems appropriate to ensure the resulting base rates (a) are\njust and reasonable and (b) provide the utility an opportunity to recover its\ncosts of providing services over the rate period ending on December 31 of the\nyear of the utility’s succeeding review and earn a fair rate of return\nauthorized pursuant to the provisions governing such review proceeding. Such\ndetermination shall be limited to the Phase I Utility’s base rates and\nshall not consider the costs or revenues recovered in any rate adjustment clause\nauthorized pursuant to this chapter.\n\nC. In any proceeding to review base rates for a Phase II Utility that commences\nafter July 1, 2023, if the Commission determines in its sole discretion that the\nutility’s existing base rates will, on a going-forward basis, either\nproduce (i) revenues in excess of the utility’s authorized rate of return\nor (ii) revenues below the utility’s authorized rate of return, then,\nnotwithstanding any provision of subdivision A 8 of § 56-585.1, the\nCommission shall order any reductions or increases, as applicable and necessary,\nto such base rates that it deems appropriate to ensure the resulting base rates\n(a) are just and reasonable and (b) provide the utility an opportunity to\nrecover its costs of providing services over the rate period ending on December\n31 of the year of the utility’s succeeding review and earn a fair rate of\nreturn on its base rates as determined in subdivision A 2 of § 56-585.1.\nSuch determination shall be limited to the Phase II Utility’s base rates\nand shall not consider the costs or revenues recovered in any rate adjustment\nclause authorized pursuant to subdivision A 6 of § 56-585.1 that has not\nbeen combined with the utility’s base rates. The Commission shall use the\nmost recently ended 12-month test period, along with normalization of\nnonrecurring test period costs and annualized adjustments for future costs, as\nthe basis for determining the appropriateness of any rate adjustment. In any\nsuch filing to review base rates, a Phase II Utility shall separately project\nfuture costs over each 12-month period ending on December 31 of the year of the\nutility’s succeeding rate periods. The Commission may, to the extent it\nfinds such action aligns with the utility’s projected cost of service,\ndirect that any reduction or increase to the utility’s rates for\ngeneration and distribution services be implemented on a staggered basis at the\ncommencement and midpoint of the succeeding review or rate period.\n\nD. Beginning July 1, 1999, and thereafter, no cooperative that was a member of a\npower supply cooperative on January 1, 1999, shall be obligated to file any rate\nrider as a consequence of an increase or decrease in the rates, other than fuel\ncosts, of its wholesale supplier, nor must any adjustment be made to such\ncooperative’s rates as a consequence thereof.\n\nE. Except for the provision of default services under § 56-585 or emergency\nservices in § 56-586, nothing in this chapter shall authorize the\nCommission to regulate the rates or charges for electric service to the\nCommonwealth and its municipalities.\n\nF. As used in this section:\n\t\t\t“Base rates” means rates for generation and distribution\nservices.\n\t\t\t“Phase I Utility” has the same meaning as provided in subdivision\nA 1 of § 56-585.1.\n\t\t\t“Phase II Utility” has the same meaning as provided in\nsubdivision A 1 of § 56-585.1.\n\nHISTORY: 1999, c. 411; 2000, c. 991; 2007, cc. 888, 933; 2023, cc. 497, 498,\n757, 775.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}