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Dominion Retail *Natural Gas* Customer Count Drops by One-Third
Dominion Retail has lost one-third of the natural gas customers it was serving during the first quarter of 2014, according to Dominion's second quarter earnings report.
With the sale of Dominion Retail's electric book, a large drop in total customers was expected.
However, while the Dominion Retail natural gas book had been shrinking, such a large loss was not expected. The loss was so large, we wanted to check to ensure it did not reflect the loss of formerly served tranches in the Ohio SCO auctions, but Dominion Retail had not won SCO tranches in any of the 2013 (or 2014) SCO auctions.
A cursory review of Dominion's 10-Q also does not indicate any sales of a natural gas book, except for a sale in Illinois completed last summer, and which is not driving the comparison versus March 31, 2014.
Specifically, Dominion Retail was serving an average of 320,000 natural gas customers during the three months ending June 30, 2014. That's a decrease of one-third versus the average of 481,000 natural gas customers served during the three months ending March 31, 2014. Dominion Retail had served an average of 518,000 natural gas customers during the three months ending December 31, 2013, and 515,000 during the three months ending September 30, 2013, illustrating the accelerated net churn during the second quarter of 2014.
Natural gas volumes were 13,812 mmcf for the three months ending June 30, 2014, versus 17,310 mmcf in the year-ago quarter.
Dominion Retail's products and services book consisted of an average of 925,000 customers served during the three months ending June 30, 2014, versus an average of 964,000 during the three months ending March 31, 2014
Dominion Retail EBIT was $11 million for the three months ending June 30, 2014
Dominion recorded a $31 million write-off of goodwill associated with its exit from the competitive retail electric business. Proceeds from the sale of this business to NRG Energy were approximately $187 million, net of transaction costs. The sale resulted in a gain, subject to post-closing adjustments, of approximately $100 million ($57 million after-tax) net of the $31 million write-off of goodwill.
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July 31, 2014
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Copyright 2010-14 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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