Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 7, 1994 TAG: 9407070149
SECTION: BUSINESS PAGE: B-7 EDITION: METRO
SOURCE: Associated Press
DATELINE: RICHMOND LENGTH: Medium
The State Corporation Commission announced an investigation last month to determine if Dominion Resources had violated a commission order when it tried earlier this year to replace James T. Rhodes as president and chief executive officer of Virginia Power, the state's largest electric utility. In Western Virginia, the utility serves portions of Alleghany, Bath, Bedford, Botetourt and Rockbridge counties.
Dominion Resources lawyers on Tuesday issued a 42-page response to the investigation, saying the SCC has no right to intervene because neither utility rates nor service is affected.
``Although a corporate struggle such as this one is always significant, it is beyond the commission's jurisdiction,'' the company said.
In 1986, the SCC forbade Dominion Resources from dictating policy that would imperil the independence of Virginia Power. Dominion Resources is publicly held and answers to its stockholders. Virginia Power is regulated by the SCC, including its return on investment. Dominion Resources common stock closed Wednesday at $36.375 a share, down 12.5 cents from Tuesday.
SCC spokesman Ken Schrad said Wednesday that the commission had the right to launch the investigation to see if its orders were violated.
``That's really the purpose of the investigation, and the commission needs to make that determination,'' he said.
The SCC began its investigation June 17 on the companies' relationship and whether the utility's independence had been compromised. Schrad said there was no set time frame for completing the investigation.
Thomas E. Capps, Dominion Resources' chairman, president and chief executive officer, said the company has done nothing to violate the SCC order or jeopardize the interests of Virginia Power's 1.9 million customers.
``Our primary objective ... is to put this unfortunate conflict behind us and get on with meeting the tough challenge of managing for the more competitive era ahead,'' he said.
Dominion Resources lawyers questioned the validity of the SCC's authority to prevent the company from changing members of the utility's board of directors or management.
``Any attempt by the commission to take from [Dominion Resources] its right to elect or to remove any or all of Virginia Power's directors constitutes an invasion of its property rights,'' the company said.
Virginia Power said it would not oppose the investigation in any way.
by CNB