Edgar Filing: DOMINION ENERGY INC /VA/

d-10q_20190331.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number	Exact name of registrants as specified in their charters, address of principal executive offices and registrants’ telephone number	I.R.S. Employer Identification Number

001-08489	DOMINION ENERGY, INC.	54-1229715

000-55337	VIRGINIA ELECTRIC AND POWER COMPANY	54-0418825

001-37591	DOMINION ENERGY GAS HOLDINGS, LLC	46-3639580

	120 Tredegar Street Richmond, Virginia 23219 (804) 819-2000

State or other jurisdiction of incorporation or organization of the registrants: Virginia

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

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

Dominion Energy Gas Holdings, LLC Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

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

Dominion Energy Gas Holdings, LLC Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Dominion Energy, Inc.

Large accelerated filer	☒		Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☐		Smaller reporting company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Virginia Electric and Power Company

Large accelerated filer	☐		Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☒		Smaller reporting company	☐

Dominion Energy Gas Holdings, LLC

Large accelerated filer	☐		Accelerated filer	☐	Emerging growth company	☐
Non-accelerated filer	☒		Smaller reporting company	☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

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

Dominion Energy Gas Holdings, LLC Yes ☐ No ☒

Securities registered pursuant to Section 12(b) of the Act:


Registrant	Trading Symbol	Title of Each Class	Name of Each Exchange on Which Registered
DOMINION ENERGY, INC.	D DCUD DRUA	Common Stock, no par value 2016 Series A 6.75% Corporate Units 2016 Series A 5.25% Enhanced Junior Subordinated Notes	New York Stock Exchange New York Stock Exchange New York Stock Exchange
DOMINION ENERGY GAS HOLDINGS, LLC		2014 Series C 4.6% Senior Notes	New York Stock Exchange

At April 12, 2019, the latest practicable date for determination, Dominion Energy, Inc. had 802,364,338 shares of common stock outstanding and Virginia Electric and Power Company had 274,723 shares of common stock outstanding. Dominion Energy, Inc. is the sole holder of Virginia Electric and Power Company’s common stock. Dominion Energy, Inc. holds all of the membership interests of Dominion Energy Gas Holdings, LLC.

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

VIRGINIA ELECTRIC AND POWER COMPANY AND DOMINION ENERGY GAS HOLDINGS, LLC MEET THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND ARE FILING THIS FORM 10-Q UNDER THE REDUCED DISCLOSURE FORMAT.

COMBINED INDEX

		Page Number
	Glossary of Terms	4

	PART I. Financial Information

Item 1.	Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	93
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	107
Item 4.	Controls and Procedures	108

	PART II. Other Information

Item 1.	Legal Proceedings	109
Item 1A.	Risk Factors	109
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	109
Item 6.	Exhibits	110

GLOSSARY OF TERMS

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

Abbreviation or Acronym		Definition
2016 Equity Units		Dominion Energy's 2016 Series A Equity Units issued in August 2016
2017 Tax Reform Act		An Act to Provide for Reconciliation Pursuant to Titles II and V of the Concurrent Resolution on the Budget for Fiscal Year 2018 (previously known as The Tax Cuts and Jobs Act) enacted on December 22, 2017
AFUDC		Allowance for funds used during construction
AMI		Advanced Metering Infrastructure
AMR		Automated meter reading program deployed by East Ohio
AOCI		Accumulated other comprehensive income (loss)
ARO		Asset retirement obligation
Atlantic Coast Pipeline		Atlantic Coast Pipeline, LLC, a limited liability company owned by Dominion Energy, Duke and Southern Company Gas
BACT		Best available control technology
Bankruptcy Court		U.S. Bankruptcy Court for the Southern District of New York
bcf		Billion cubic feet
Blue Racer		Blue Racer Midstream, LLC, a joint venture between Caiman Energy II, LLC and FR BR Holdings, LLC effective December 2018
CAA		Clean Air Act
CAISO		California Independent System Operator
CCR		Coal combustion residual
CEO		Chief Executive Officer
CEP		Capital Expenditure Program, as established by House Bill 95, Ohio legislation enacted in 2011, deployed by East Ohio to recover certain costs associated with capital investment
CERCLA		Comprehensive Environmental Response, Compensation and Liability Act of 1980, also known as Superfund
CFO		Chief Financial Officer
CO₂		Carbon dioxide
Colonial Trail West		An approximately 142 MW proposed utility-scale solar power station located in Surry County, Virginia
Companies		Dominion Energy, Virginia Power and Dominion Energy Gas, collectively
Cooling degree days		Units measuring the extent to which the average daily temperature is greater than 65 degrees Fahrenheit, or 75 degrees Fahrenheit in DESC’s service territory, calculated as the difference between 65 or 75 degrees, as applicable, and the average temperature for that day
Cove Point		Dominion Energy Cove Point LNG, LP
Cove Point Holdings		Cove Point GP Holding Company, LLC
CPCN		Certificate of Public Convenience and Necessity
CWA		Clean Water Act
DECG		Dominion Energy Carolina Gas Transmission, LLC
DES		Dominion Energy Services, Inc.
DESC		Dominion Energy South Carolina, Inc. (formerly known as South Carolina Electric & Gas Company), its consolidated subsidiaries or operating segments, or the entirety of Dominion Energy South Carolina, Inc. and its consolidated subsidiaries

Abbreviation or Acronym		Definition
DETI		Dominion Energy Transmission, Inc.
DGI		Dominion Generation, Inc.
DOE		U.S. Department of Energy
Dominion Energy		The legal entity, Dominion Energy, Inc., one or more of its consolidated subsidiaries (other than Virginia Power and Dominion Energy Gas) or operating segments, or the entirety of Dominion Energy, Inc. and its consolidated subsidiaries
Dominion Energy Gas		The legal entity, Dominion Energy Gas Holdings, LLC, one or more of its consolidated subsidiaries or operating segment, or the entirety of Dominion Energy Gas Holdings, LLC and its consolidated subsidiaries
Dominion Energy Midstream		The legal entity, Dominion Energy Midstream Partners, LP, one or more of its consolidated subsidiaries, Cove Point Holdings, Iroquois GP Holding Company, LLC, DECG and Dominion Energy Questar Pipeline, or the entirety of Dominion Energy Midstream Partners, LP and its consolidated subsidiaries
Dominion Energy Questar Pipeline		Dominion Energy Questar Pipeline, LLC, one or more of its consolidated subsidiaries, or the entirety of Dominion Energy Questar Pipeline, LLC and its consolidated subsidiaries
DSM		Demand-side management
Dth		Dekatherm
Duke		The legal entity, Duke Energy Corporation, one or more of its consolidated subsidiaries or operating segments, or the entirety of Duke Energy Corporation and its consolidated subsidiaries
East Ohio		The East Ohio Gas Company, doing business as Dominion Energy Ohio
EPA		U.S. Environmental Protection Agency
EPS		Earnings per share
FASB		Financial Accounting Standards Board
FERC		Federal Energy Regulatory Commission
FILOT		Fee in lieu of taxes
Four Brothers		Four Brothers Solar, LLC, a limited liability company owned by Dominion Energy and Four Brothers Holdings, LLC, a subsidiary of GIP effective August 2018
FTRs		Financial transmission rights
GAAP		U.S. generally accepted accounting principles
Gal		Gallon
Gas Infrastructure		Gas Infrastructure Group operating segment
GHG		Greenhouse gas
GIP		The legal entity, Global Infrastructure Partners, one or more of its consolidated subsidiaries (including, effective August 2018, Four Brothers Holdings, LLC, Granite Mountain Renewables, LLC, and Iron Springs Renewables, LLC) or operating segments, or the entirety of Global Infrastructure Partners and its consolidated subsidiaries
Granite Mountain		Granite Mountain Holdings, LLC, a limited liability company owned by Dominion Energy and Granite Mountain Renewables, LLC, a subsidiary of GIP effective August 2018
GreenHat		GreenHat Energy, LLC
GTSA		Virginia Grid Transformation and Security Act of 2018
Heating degree days		Units measuring the extent to which the average daily temperature is less than 65 degrees Fahrenheit, or 60 degrees Fahrenheit in DESC’s service territory, calculated as the difference between 65 or 60 degrees, as applicable, and the average temperature for that day
Hope		Hope Gas, Inc., doing business as Dominion Energy West Virginia

Abbreviation or Acronym		Definition
Iron Springs		Iron Springs Holdings, LLC, a limited liability company owned by Dominion Energy and Iron Springs Renewables, LLC, a subsidiary of GIP effective August 2018
Iroquois		Iroquois Gas Transmission System, L.P.
ISO-NE		ISO New England, Inc.
Kewaunee		Kewaunee nuclear power station
kV		Kilovolt
Liquefaction Facility		A natural gas export/liquefaction facility at Cove Point
LNG		Liquefied natural gas
MATS		Utility Mercury and Air Toxics Standard Rule
MD&A		Management’s Discussion and Analysis of Financial Condition and Results of Operations
MGD		Million gallons a day
Millstone		Millstone nuclear power station
MW		Megawatt
MWh		Megawatt hour
NAV		Net asset value
NGL		Natural gas liquid
NND Project		V.C. Summer Units 2 and 3 new nuclear development project under which SCANA and Santee Cooper undertook to construct two Westinghouse AP1000 Advanced Passive Safety nuclear units in Jenkinsville, South Carolina
North Carolina Commission		North Carolina Utilities Commission
NO_x		Nitrogen oxide
NRC		U.S. Nuclear Regulatory Commission
NSPS		New Source Performance Standards
ODEC		Old Dominion Electric Cooperative
Ohio Commission		Public Utilities Commission of Ohio
Order 1000		Order issued by FERC adopting requirements for electric transmission planning, cost allocation and development
PIPP		Percentage of Income Payment Plan deployed by East Ohio
PIR		Pipeline Infrastructure Replacement program deployed by East Ohio
PJM		PJM Interconnection, L.L.C.
Power Delivery		Power Delivery Group operating segment
Power Generation		Power Generation Group operating segment
ppb		Parts-per-billion
PSD		Prevention of significant deterioration
PSNC		Public Service Company of North Carolina, Incorporated, doing business as Dominion Energy North Carolina
PURA		Connecticut’s Public Utility Regulatory Authority
Questar Gas		Questar Gas Company, doing business as Dominion Energy Utah, Dominion Energy Wyoming and Dominion Energy Idaho

Abbreviation or Acronym		Definition
Regulation Act		Legislation effective July 1, 2007, that amended the Virginia Electric Utility Restructuring Act and fuel factor statute, which legislation is also known as the Virginia Electric Utility Regulation Act, as amended in 2015 and 2018
RICO		Racketeer Influenced and Corrupt Organizations Act
Rider U		A rate adjustment clause associated with the recovery of costs of new underground distribution facilities
Rider US-3		A rate adjustment clause associated with the recovery of costs related to Colonial Trail West and Spring Grove 1
Riders C1A, C2A and C3A		Rate adjustment clauses associated with the recovery of costs related to certain DSM programs
ROE		Return on equity
Santee Cooper		South Carolina Public Service Authority
SBL Holdco		SBL Holdco, LLC, a wholly-owned subsidiary of DGI
SCANA		The legal entity, SCANA Corporation, one or more of its consolidated subsidiaries or the entirety of SCANA Corporation and its consolidated subsidiaries
SCANA Combination		Dominion Energy’s acquisition of SCANA completed on January 1, 2019 pursuant to the terms of the SCANA Merger Agreement
SCANA Merger Agreement		Agreement and plan of merger entered on January 2, 2018 between Dominion Energy and SCANA
SCANA Merger Approval Order		Final order issued by the South Carolina Commission on December 21, 2018 setting forth its approval of the SCANA Combination
SCDHEC		South Carolina Department of Health and Environmental Control
SCDOR		South Carolina Department of Revenue
SEC		U.S. Securities and Exchange Commission
South Carolina Commission		Public Service Commission of South Carolina
Southeast Energy		Southeast Energy Group operating segment
Spring Grove 1		An approximately 98 MW proposed utility-scale solar power station located in Surry County, Virginia
Standard & Poor’s		Standard & Poor’s Ratings Services, a division of S&P Global Inc.
Summer		V.C. Summer nuclear power station
Terra Nova Renewable Partners		A partnership comprised primarily of institutional investors advised by J.P. Morgan Asset Management-Global Real Assets
Three Cedars		Granite Mountain and Iron Springs, collectively
VDEQ		Virginia Department of Environmental Quality
VEBA		Voluntary Employees' Beneficiary Association
VIE		Variable interest entity
Virginia Commission		Virginia State Corporation Commission
Virginia Power		The legal entity, Virginia Electric and Power Company, one or more of its consolidated subsidiaries or operating segments, or the entirety of Virginia Electric and Power Company and its consolidated subsidiaries
VOC		Volatile organic compounds
WECTEC		WECTEC Global Project Services, Inc. (formerly known as Stone & Webster, Inc.), a wholly-owned subsidiary of Westinghouse
Westinghouse		Westinghouse Electric Company LLC
West Virginia Commission		Public Service Commission of West Virginia
White River Hub		White River Hub, LLC

Abbreviation or Acronym		Definition
Wyoming Commission		Wyoming Public Service Commission

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31,
	2019			2018
(millions, except per share amounts)
Operating Revenue⁽¹⁾	$	3,858		$	3,466
Operating Expenses
Electric fuel and other energy-related purchases		791			744
Purchased electric capacity		39			14
Purchased gas		730			340
Other operations and maintenance		1,002			795
Depreciation, depletion and amortization		651			498
Other taxes		292			199
Impairment of assets and other charges		835			1
Total operating expenses		4,340			2,591
Income (loss) from operations		(482	)		875
Other income		388			100
Interest and related charges		469			314
Income (loss) from operations including noncontrolling interests before income tax expense		(563	)		661
Income tax expense		114			135
Net Income (Loss) Including Noncontrolling Interests		(677	)		526
Noncontrolling Interests		3			23
Net Income (Loss) Attributable to Dominion Energy	$	(680	)	$	503
Earnings Per Common Share
Net income (loss) attributable to Dominion Energy - Basic	$	(0.86	)	$	0.77
Net income (loss) attributable to Dominion Energy - Diluted		(0.86	)		0.77

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

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

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	Three Months Ended March 31,
	2019			2018
(millions)
Net income (loss) including noncontrolling interests	$	(677	)	$	526
Other comprehensive income (loss), net of taxes:
Net deferred gains (losses) on derivatives-hedging activities⁽¹⁾		(24	)		111
Changes in unrealized net gains (losses) on investment securities⁽²⁾		16			(13	)
Amounts reclassified to net income:
Net derivative (gains) losses-hedging activities⁽³⁾		(31	)		8
Net realized (gains) losses on investment securities⁽⁴⁾		—			1
Net pension and other postretirement benefit costs⁽⁵⁾		8			25
Total other comprehensive income (loss)		(31	)		132
Comprehensive income (loss) including noncontrolling interests		(708	)		658
Comprehensive income attributable to noncontrolling interests		3			24
Comprehensive income (loss) attributable to Dominion Energy	$	(711	)	$	634

(1)	Net of $5 million and $(37) million tax for the three months ended March 31, 2019 and 2018, respectively.

(2)	Net of $(6) million and $4 million tax for the three months ended March 31, 2019 and 2018, respectively.

(3)	Net of $10 million and $(3) million tax for the three months ended March 31, 2019 and 2018, respectively.

(4)	Net of $— million tax for both the three months ended March 31, 2019 and 2018.

(5)	Net of $(14) million and $(1) million tax for the three months ended March 31, 2019 and 2018, respectively.

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

DOMINION ENERGY, INC.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31, 2019			December 31, 2018⁽¹⁾
(millions)
ASSETS
Current Assets
Cash and cash equivalents	$	422		$	268
Customer receivables (less allowance for doubtful accounts of $22 and $14)		2,236			1,749
Other receivables (less allowance for doubtful accounts of $4 at both dates)⁽²⁾		203			331
Inventories		1,657			1,418
Regulatory assets		725			496
Other		732			899
Total current assets		5,975			5,161
Investments
Nuclear decommissioning trust funds		5,580			4,938
Investment in equity method affiliates		1,433			1,278
Other		357			344
Total investments		7,370			6,560
Property, Plant and Equipment
Property, plant and equipment		93,485			76,578
Accumulated depreciation, depletion and amortization		(26,918	)		(22,018	)
Total property, plant and equipment, net		66,567			54,560
Deferred Charges and Other Assets
Goodwill		8,960			6,410
Intangible assets, net		887			670
Regulatory assets		7,575			2,676
Operating lease assets		486			—
Other		2,234			1,877
Total deferred charges and other assets		20,142			11,633
Total assets	$	100,054		$	77,914

(1)	Dominion Energy’s Consolidated Balance Sheet at December 31, 2018 has been derived from the audited Consolidated Balance Sheet at that date.

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

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

DOMINION ENERGY, INC.

CONSOLIDATED BALANCE SHEETS—(Continued)

(Unaudited)

	March 31, 2019			December 31, 2018⁽¹⁾
(millions)
LIABILITIES AND EQUITY
Current Liabilities
Securities due within one year	$	3,080		$	3,624
Credit facility borrowings		—			73
Short-term debt		2,412			334
Accounts payable		920			914
Accrued interest, payroll and taxes		957			836
Regulatory liabilities		612			356
Other⁽²⁾		1,795			1,510
Total current liabilities		9,776			7,647
Long-Term Debt
Long-term debt		32,043			26,328
Junior subordinated notes		3,431			3,430
Remarketable subordinated notes		1,387			1,386
Total long-term debt		36,861			31,144
Deferred Credits and Other Liabilities
Deferred income taxes and investment tax credits		6,108			5,116
Regulatory liabilities		10,799			6,840
Asset retirement obligations		4,985			2,250
Operating lease liabilities		418			—
Other		3,508			2,869
Total deferred credits and other liabilities		25,818			17,075
Total liabilities		72,455			55,866
Commitments and Contingencies (see Note 17)
Equity
Common stock – no par⁽³⁾		20,834			12,588
Retained earnings		7,806			9,219
Accumulated other comprehensive loss		(1,731	)		(1,700	)
Total common shareholders' equity		26,909			20,107
Noncontrolling interests		690			1,941
Total equity		27,599			22,048
Total liabilities and equity	$	100,054		$	77,914

(1)	Dominion Energy’s Consolidated Balance Sheet at December 31, 2018 has been derived from the audited Consolidated Balance Sheet at that date.

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

(3)	1 billion shares authorized; 802 million shares and 681 million shares outstanding at March 31, 2019 and December 31, 2018, respectively.

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

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)

	Common Stock					Dominion Energy Shareholders						Total Common
	Shares		Amount			Retained Earnings			AOCI			Shareholders' Equity			Noncontrolling Interests			Total Equity
(millions)
December 31, 2017		645	$	9,865		$	7,936		$	(659	)	$	17,142		$	2,228		$	19,370
Cumulative-effect of changes in accounting principles				(127	)		1,029			(1,023	)		(121	)		127			6
Net income including noncontrolling interests							503						503			23			526
Issuance of common stock		8		580									580						580
Sale of Dominion Energy Midstream common units - net of offering costs													—			4			4
Stock awards (net of change in unearned compensation)				3									3						3
Dividends ($0.835 per common share) and distributions							(544	)					(544	)		(31	)		(575	)
Other comprehensive income, net of tax										131			131			1			132
Other				(5	)								(5	)		1			(4	)
March 31, 2018		653	$	10,316		$	8,924		$	(1,551	)	$	17,689		$	2,353		$	20,042

December 31, 2018		681	$	12,588		$	9,219		$	(1,700	)	$	20,107		$	1,941		$	22,048
Net income (loss) including noncontrolling interests							(680	)					(680	)		3			(677	)
Issuance of common stock		3		247									247						247
Acquisition of SCANA		96		6,818									6,818						6,818
Acquisition of public interest in Dominion Energy Midstream		22		1,181									1,181			(1,221	)		(40	)
Dividends ($0.9175 per common share) and distributions							(733	)					(733	)		(33	)		(766	)
Other comprehensive loss, net of tax										(31	)		(31	)					(31	)
March 31, 2019		802	$	20,834		$	7,806		$	(1,731	)	$	26,909		$	690		$	27,599

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

DOMINION ENERGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

Three Months Ended March 31,	2019			2018
(millions)
Operating Activities
Net income (loss) including noncontrolling interests	$	(677	)	$	526
Adjustments to reconcile net income (loss) including noncontrolling interests to net cash provided by operating activities:
Depreciation, depletion and amortization (including nuclear fuel)		734			572
Deferred income taxes and investment tax credits		106			131
Provision for refunds and rate credits to electric utility customers		988			215
Impairment of assets and other charges		835			—
Net (gains) losses on nuclear decommissioning trust funds and other investments		(271	)		25
Revision to future ash pond and landfill closure costs		(113	)		—
Other adjustments		(11	)		(56	)
Changes in:
Accounts receivable		153			47
Inventories		53			104
Deferred fuel and purchased gas costs, net		27			(264	)
Prepayments		89			(3	)
Accounts payable		(284	)		(57	)
Accrued interest, payroll and taxes		(329	)		(103	)
Customer deposits		(35	)		101
Margin deposit assets and liabilities		93			(33	)
Other operating assets and liabilities		(187	)		27
Net cash provided by operating activities		1,171			1,232
Investing Activities
Plant construction and other property additions (including nuclear fuel)		(1,002	)		(1,103	)
Cash and restricted cash acquired in the SCANA Combination		389			—
Acquisition of solar development projects		(29	)		(7	)
Proceeds from sales of securities		506			419
Purchases of securities		(494	)		(453	)
Proceeds from sales of assets and equity method investments		154			—
Contributions to equity method affiliates		(69	)		(87	)
Other		(7	)		48
Net cash used in investing activities		(552	)		(1,183	)
Financing Activities
Issuance (repayment) of short-term debt, net		1,905			(585	)
Issuance of short-term notes		—			950
Repayment of credit facility borrowings		(113	)		—
Issuance of long-term debt		600			950
Repayment of long-term debt, including redemption premiums		(2,217	)		(1,180	)
Issuance of common stock		247			581
Common dividend payments		(733	)		(544	)
Other		(72	)		(72	)
Net cash provided by (used in) financing activities		(383	)		100
Increase in cash, restricted cash and equivalents		236			149
Cash, restricted cash and equivalents at beginning of period		391			185
Cash, restricted cash and equivalents at end of period	$	627		$	334
Supplemental Cash Flow Information
Significant noncash investing and financing activities:^(1)(2)(3)
Accrued capital expenditures	$	201		$	175

(1)	See Note 2 for noncash investing and financing activities related to the adoption of a new accounting standard for leasing arrangements.

(2)	See Note 3 for noncash investing and financing activities related to the SCANA Combination.

(3)	See Note 16 for noncash financing activities related to the acquisition of the public interest in Dominion Energy Midstream.

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

VIRGINIA ELECTRIC AND POWER COMPANY

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

	Three Months Ended March 31,
	2019		2018
(millions)
Operating Revenue⁽¹⁾	$	1,965	$	1,748
Operating Expenses
Electric fuel and other energy-related purchases⁽¹⁾		596		591
Purchased electric capacity		33		14
Other operations and maintenance:
Affiliated suppliers		86		83
Other		193		316
Depreciation and amortization		304		297
Other taxes		85		83
Impairment of assets and other charges		546