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Bill

SB 251

Electric utilities; performance-based regulatory framework.

2026 Regular Session Introduced by Scott Surovell

Virginia directs the State Corporation Commission to design and report on performance-based regulation models for electric utilities, potentially shifting utility compensation from traditional rates to achievement-based incentives.

Acts of Assembly Chapter text (CHAP0702)
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Bill Summary · SB 251

Legislative bill overview

SB 251 establishes performance-based regulation requirements for electric utilities in Virginia, requiring the State Corporation Commission to develop and implement new regulatory frameworks that tie utility compensation to achievement of specific performance metrics rather than traditional rate-of-return models. The bill requires submission of a report detailing how performance-based regulation would work for Virginia's electric utilities.

Why is this important

Performance-based regulation represents a fundamental shift in how utilities are financially incentivized, potentially affecting electricity rates, grid reliability, and investment in renewable energy and infrastructure modernization. The outcome could influence utility behavior on issues ranging from customer service quality to renewable energy adoption to system resilience, with direct consequences for Virginia consumers and the state's energy transition goals.

Potential points of contention

  • Rate impact uncertainty: Unclear whether performance-based models will increase or decrease consumer electricity rates, depending on how performance metrics are structured and what utilities are incentivized to prioritize
  • Defining "performance": Significant disagreement likely over which metrics matter most (reliability, affordability, sustainability, customer service) and how to measure them fairly
  • Utility profit concerns: Utilities may resist models that decouple profits from capital investment, potentially reducing revenue predictability and affecting their ability to fund infrastructure upgrades

Compiled from official sources — confirm details with the bill’s official record.

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