Dominion Energy reported third-quarter results on Friday, October 30, that did two things at once: they made the regulated utility look as strong as it has in years, and they made the case for selling it look more complicated. Net income attributable to Dominion rose 15% year over year to $1.16 billion, or $1.30 per diluted share, from $1.006 billion, or $1.16 per share, a year earlier. Operating earnings — the non-GAAP measure Dominion uses as its primary performance yardstick — rose to $1.139 billion, or $1.28 per share, from $921 million, or $1.06 per share. Revenue reached $5.617 billion, up about 24% from $4.527 billion in the prior-year quarter. Management held full-year 2026 operating earnings guidance at $3.45 to $3.69 per share and said it expects results in the upper half of that range.
That is a good quarter by any standard, and it beat the consensus estimate of roughly $1.20 per share by a comfortable margin. But the quarter’s real significance is not the beat. It is the timing. In twelve days, on November 17, the Virginia State Corporation Commission opens its evidentiary hearing on NextEra Energy’s proposed $66.8 billion acquisition of Dominion — the largest power-sector deal in American history, covered in this column on October 31 — and the SCC’s decision, due by January 11, 2027, will turn in part on exactly the questions this quarter raises: how strong is the regulated business, how much of the rest of the company is a liability, and what is the buyer actually paying for?
Read the quarter the way the earnings explainer in this column teaches: operating earnings first, because that is what the dividend is paid from and what guidance is written against, and then the reconciliation, because the excluded items are often where the real story lives. Both readings matter here, and they point in opposite directions.
Operating earnings first: the regulated business delivered
Dominion Energy Virginia, the regulated utility at the center of the merger fight, supplied the largest year-over-year increase in operating earnings. Its contribution rose $183 million, to $862 million from $679 million a year earlier. Dominion Energy South Carolina posted the fastest percentage growth in the portfolio. Together, the regulated utilities more than offset a decline at Contracted Energy, the company’s nonregulated segment.
The Virginia drivers are worth itemizing, because the SCC will be reading the same list. The 2025 biennial review — the rate case that reset Dominion Virginia’s base rates — added $137 million to operating earnings in the quarter, or 16 cents per share. Rider equity returns, the earnings on the capital Dominion recovers through separate rate riders for large projects, added $112 million, or 13 cents. Weather added $55 million, or 6 cents. Customer usage and other factors added $19 million. Those gains were partly offset by higher electric capacity expense of $48 million, storm damage and service restoration costs of $16 million, depreciation, salaries and administrative costs, and interest expense.
The pattern is familiar to anyone who reads utility earnings reports for a living. The regulated earnings engine is doing what it is supposed to do: approved rates flowing through, rider-funded capital earning its authorized return, and load growth in the world’s largest data center market doing the rest. Dominion Energy Virginia’s revenue rose to $4.218 billion in the quarter from $3.311 billion a year earlier. And the load story behind that revenue kept growing: contracted data center capacity in Dominion’s Virginia territory reached about 54.9 gigawatts in September, up roughly 6.3 gigawatts, or 13%, from December 2025.
South Carolina tells the same story on a smaller scale: $46 million from base and Rate Stabilization Act rate-case impacts, $36 million from weather, and $19 million from customer usage. Weather, across both states, contributed a combined $91 million to operating earnings — a reminder that a hot summer flatters the numbers.
None of this is surprising, and that is the point. The regulated business is performing exactly as the merger thesis requires: a growing, rate-base-driven earnings stream anchored in Northern Virginia load.
Then the reconciliation: the write-down
Now read the reconciliation, because this is where the quarter gets complicated. GAAP earnings and operating earnings were close for the quarter — $1.160 billion against $1.139 billion, a gap of just $21 million. But over the first nine months of 2026, the gap was much larger: GAAP earnings of $2.121 billion against operating earnings of $2.698 billion. The difference is dominated by $719 million of nonregulated asset impairments and other charges recorded year to date.
The composition matters. The $719 million net figure is primarily an $820 million charge associated with nonregulated renewable natural gas facilities, plus a $79 million charge on certain nonregulated solar generation facilities, partly offset by a $195 million benefit from revising asset retirement obligations at the Millstone nuclear station. In other words, the nonregulated RNG business — a portfolio Dominion built up in the years when renewable natural gas credits looked like a growth market — has now been written down by more than four-fifths of a billion dollars.
This is the kind of item the earnings explainer warns about: adjustments are management’s narrative, and the reconciliation is the fact-check. Dominion excludes the impairment from operating earnings on the grounds that it is non-recurring. That is defensible accounting. But a utility that is writing down nearly a billion dollars of nonregulated assets in the same year it is being acquired is telling investors something about where its nonregulated bets went wrong — and about what the buyer will inherit.
The RNG charge also connects to a smaller line in the quarter’s operating results. Third-quarter operating earnings per share included 5 cents of income related to 45Z, the federal clean fuel production tax credit — real money while it lasts, and a reminder that parts of Dominion’s earnings depend on federal tax policy that has already been rewritten once this decade. Contracted Energy’s own quarter illustrates the tension: a $22 million margin improvement and a $36 million benefit from renewable energy production tax credits were not enough to offset a $43 million decline related to renewable energy investment tax credits, plus higher interest, depreciation, and other costs.
The offshore wind project is now a quarter built
The quarter’s other major operational update came from the water. Coastal Virginia Offshore Wind, the 2.6-gigawatt project off Virginia Beach, is now about 85% complete, up from about 81% at the end of the second quarter. Dominion has installed 44 of the project’s 176 turbines, with work on the 45th underway, representing more than 640 megawatts of generating capacity. The project delivered its first power to the Virginia grid in March 2026.
Two details from the update deserve emphasis. First, the budget is unchanged at $11.65 billion, including $123 million in unused contingency, and the schedule still calls for the third and final offshore substation to be energized by year-end 2026, with full completion targeted by the end of 2027. Installation slowed in September and October — CFO Steven Ridge attributed the slowdown to weather and maintenance on the Charybdis, the Jones Act-compliant installation vessel — but the company held its budget and schedule. Second, the project’s estimated levelized cost of energy, including renewable energy credits, has fallen to approximately $62 per megawatt-hour, down from $83 in the prior update, as higher renewable energy certificate revenues offset a gross generation cost unchanged at about $100 per megawatt-hour.
CVOW is the asset that most complicates the merger story, and the one the SCC will examine most closely. It is the largest offshore wind project in the United States, built on ratepayer-backed cost recovery, and its completion risk transfers to the buyer along with everything else. An 85%-complete project with an unchanged budget and a falling levelized cost is considerably easier to defend in a hearing room than the same project was a year ago — and the reason Dominion’s management led with it on the earnings call.
Twelve days to the hearing
The evidentiary hearing that opens November 17 is the central event in the merger’s approval calendar. The SCC case, numbered PUR-2026-00112, has been running on a 180-day clock since the companies filed on July 15, and the commission must decide by January 11, 2027. Attorney General Jay Jones has called on the SCC to restart the clock to give participants time to review the amended September benefits package; Governor Abigail Spanberger declined to call a special legislative session to extend the review period. As of this writing, the commission has not extended or restarted the clock. The January 11 date stands.
The hearing is where the concession negotiation becomes a record. The companies have already raised their Virginia benefits package once — residential bill credits of $10 a month extended from two years to four, $100 million more for the EnergyShare low-income bill-assistance program through 2038, $100 million for workforce development, up to $1 billion a year in Virginia supplier spending over five years, 600 new NextEra jobs in Virginia, and a five-year commitment to maintain Dominion’s Virginia headcount. The October 31 column laid out the four things Virginia actually wants: durable bill relief, ring-fencing, a binding clean-energy commitment, and jobs and local control. The hearing will test whether the offers on the table are enforceable, how long they last, and what happens when they expire.
The third quarter gives both sides ammunition. NextEra and Dominion can point to a regulated utility earning strongly on approved rates and rider returns, a data center pipeline that keeps growing, and an offshore wind project that is 85% built on budget. Intervenors can point to the same quarter and ask a different question: if the regulated business is this strong, why does Virginia need to sell it at all — and why should ratepayers accept the risk that a bigger parent, carrying a written-down nonregulated portfolio and a $66.8 billion acquisition, will look to the Virginia utility for cash when the next nonregulated bet goes wrong? That is the ring-fencing argument, and it is the one the SCC will spend the most time on.
What the merger math looks like now
Step back and the quarter resolves into a clean picture of what NextEra is buying and what it is not. It is buying a regulated earnings machine that just produced $1.28 per share in a single quarter, with full-year guidance pointing to the upper half of $3.45 to $3.69. It is buying 54.9 gigawatts of contracted data center load and the wires, substations, and generation needed to serve it. It is buying an offshore wind project that is a quarter built, on budget, with a falling cost of energy.
It is also buying the rest of the company: a nonregulated business that just absorbed an $820 million write-down on renewable natural gas assets, a Contracted Energy segment whose tax-credit economics are shifting under it, and $26 million a quarter in merger costs that will continue until closing. None of that is fatal to the deal. All of it is relevant to the price.
The federal track adds its own caution. On September 23, the Federal Energy Regulatory Commission deemed the companies’ merger application deficient and gave them 30 days to file an amendment addressing gaps including which entities need approval and the effect on rates. A deficiency letter is not a rejection — it is a routine, if pointed, request for a more complete filing — but it confirms that the federal review will not be a rubber stamp either. The Nuclear Regulatory Commission’s consent, covering the transfer of Dominion’s nuclear licenses, is a separate and exacting process.
And the merger remains, in the only sense that matters for investors, proposed rather than certain. Shareholders of both companies approved it on September 3. The regulatory gauntlet — Virginia, North Carolina, South Carolina, FERC, the NRC, plus antitrust clearance — is still ahead. The companies expect closing in the second half of 2027. The SCC’s January decision is the first and hardest test, and the November 17 hearing is where that test is administered.
What to watch next
Three things between now and the hearing. First, whether the SCC signals anything about the 180-day clock — a restart would change the negotiation dynamics more than any single filing. Second, the FERC amendment, due within 30 days of the September 23 deficiency letter, and whether it satisfies the commission on rates and market power. Third, the telephonic public testimony scheduled for November 5, 9, and 10, which will show whether the public-comment record keeps running against the deal or starts to stabilize.
The quarter itself is settled: strong regulated earnings, a big nonregulated write-down, guidance held and pointed upward. What is not settled is whether Virginia believes the company that produced those numbers is worth more inside NextEra than outside it. Twelve days from now, in a hearing room in Richmond, the commission starts finding out.