Dominion Energy Inc (D) (Q2 2026) Earnings Call Highlights: Strong Demand and Strategic ...

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Operating Earnings: $0.79 per share for Q2 2026, including $0.03 of RNG 45Z credits. GAAP Earnings: $0.37 per share for Q2 2026. FFO to Debt: Full year 2025 and Q2 LTM metrics both above 15%. Data Center Capacity: Over 53 gigawatts in various stages of contracting, with approximately 12 gigawatts contracted under electric service agreements. CVOW Project Cost Estimate: Increased by approximately 2% to $11.65 billion, including $123 million of unused contingency. CVOW Completion: 81% complete, with 31 turbines installed and the 32nd in progress. CVOW Fuel Savings: Expected to generate approximately $5 billion in fuel savings for customers during the first 10 years of operation. Millstone PPA Savings: Expected to save customers over $300 million this year, including $190 million year-to-date, and over $900 million over the 10-year life.

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Release Date: July 31, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Dominion Energy Inc (NYSE:D) reaffirmed all financial guidance for 2026, including operating earnings, credit, dividend, and long-term growth targets, reflecting strong first-half performance. The company reported robust demand growth, with over 53 gigawatts of data center capacity in various stages of contracting, including 12 gigawatts under electric service agreements, and added 5 gigawatts of contracts since year-end. CVOW offshore wind project achieved 81% completion, with 31 turbines installed (over 450 MW) and all major components proven in service, significantly derisking the project. Regulatory outcomes have been constructive, including unanimous approval of the South Carolina rate case settlement and a final order approving 100% of the revenue request in the 2025 rider filing. The proposed merger with NextEra Energy is progressing, with regulatory filings submitted and procedural schedules set in Virginia, South Carolina, and federal agencies, and the company expects to deliver $2.25 billion in customer bill credits.

Negative Points

The final turbine installation for CVOW has been delayed by 6 months to year-end 2027, due to reduced weather and vessel maintenance contingency, longer loadout times, and extended jacking operations at certain locations. Project cost estimate for CVOW increased by approximately 2% to $11.65 billion, adding about $288 million for the two additional quarters of installation, though partially offset by other adjustments. A transmission line outage in Virginia caused data centers to switch to backup power, highlighting potential grid reliability challenges and the need for ongoing mitigation efforts. The company faces uncertainty regarding the Connecticut Millstone solicitation decision, with potential delays in contract negotiations and regulatory approval timelines. The merger with NextEra Energy faces regulatory scrutiny, with some stakeholders in Virginia requesting a more extended review period, though the company believes the current schedule is sufficient.

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Q & A Highlights

Q: Can you frame the risk of further slippage in the offshore wind timeline and what informs your confidence that the year-end 2027 final turbine date is now correct?A: (Company Representative) The strategic value of CVOW hasn't changed; it remains one of the fastest ways to bring power to customers and is one of the most affordable energy sources. The project is substantially derisked, with over 450 megawatts already on the grid and approximately half of project investment expected to be in service by year-end. The updated schedule is based on actual experience, including load-out timing at Portsmouth, added weather and vessel maintenance contingency, and longer jacking durations at certain challenging locations. The final turbine date has moved, but the project is already producing power, benefiting customers, and supporting regulatory recovery.

Q: Do you expect the procedural schedule for the NextEra Energy merger review to stay as is, given some headlines in Virginia suggesting a need for a more extended review period?A: (Company Representative) Conversations with stakeholders have gone well. The Virginia State Corporation Commission (SCC) staff indicated they are used to working with statutory deadlines and did not ask for more time or resources. The current timeframe is sufficient given the expertise of the Virginia Commission and staff, who handle complex rate cases within statutory timelines regularly. We believe the schedule makes sense and it doesn't make sense to change the rules in the middle of the game.

Q: Following the recent grid disruption event in Virginia where data centers shifted to backup power, do you see a need to incrementally strengthen the system with transmission or storage investments?A: (Company Representative & Edward Baine, EVP Utility Operations) The event was handled well by planners and system operators, but there are always lessons to be learned. We have been investing heavily in the transmission system for years, including specific projects in that area. We will continue to collaborate with customers to identify mitigation opportunities and implement lessons learned. We do not feel significant new investments are needed because of ongoing grid upgrades, but we will continue to implement other mitigating items.

Q: Can you provide a timeline or incremental color on when we should start seeing proposals to meet the new battery storage mandate from the legislature?A: (Company Representative) The legislation calls for an acceleration and increase in the target, and we are in the process of ramping up. We have $2 billion in the current 5-year forecast for battery storage. There will be a technical conference this fall sponsored by the commission to discuss feasibility, and our next Integrated Resource Plan (IRP) will incorporate our latest perspectives on accelerating deployment. We expect to need to ramp up more quickly, developing expertise and a pipeline of developers similar to what we did for solar after the Virginia Clean Economy Act.

Q: Where do you see the most opportunity for efficiency in the turbine installation timeline, given the reduction in days per turbine embedded in the new target?A: (Company Representative) The main areas for efficiency gains are quicker turnarounds at the Portsmouth Marine Terminal during reloadingthe most recent turnaround was the fastest to dateand the ability to jack the vessel up and down faster, especially at more challenging locations. As we complete more iterations, we continue to get faster and more efficient, consistent with the learning curve seen elsewhere on the project.

Q: Is the proposed Mount Storm combined cycle plant incremental to the base capital plan, and what other opportunities do you see in West Virginia given the state's focus on data center growth?A: (CFO Steven Ridge & CEO Robert Blue) The Mount Storm project is incremental to the current capital plan, which already includes an acceleration of capital towards the back end driven by natural gas investments. The IRP projects a continued build-out of these resources into the early 2030s. Regarding West Virginia, we have operated the Mount Storm power station for decades, and the opportunity to build new generation there supports our regulated footprint and growing demand. We have available property and gas access, making it a great opportunity to support our build program for regulated customers.

Q: Can you elaborate on the key drivers behind the updated CVOW project cost estimate and the expected cost-sharing impact?A: (CEO Robert Blue) The project cost estimate is updated by a little less than $250 million to $11.65 billion, a ~2% increase. This reflects a net reduction of ~$40 million from various adjustments (including $228 million for tariff costs, a $502 million reallocation of PJM network upgrade costs, and $234 million for miscellaneous costs like cable protection and mitigation for difficult jacking locations), offset by $288 million for the incremental two quarters to complete final turbine installation. Approximately one-third of the most recent cost increase will be shared with our financing partner, and the project continues to have minimal impact on LCOE or customer bills.

Q: What is the status of the Millstone nuclear facility's bid in Connecticut's zero carbon energy RFP, and what value has the existing contract delivered?A: (CEO Robert Blue) We expect a solicitation decision from the Connecticut Department of Energy and Environmental Protection in the near term. Negotiations with local utilities will begin thereafter, with contracts submitted to PURA for approval, a process that can take up to 180 days. The existing PPA has saved customers over $300 million this year, including $190 million year-to-date, and is expected to save over $900 million over its 10-year life based on current forward curves.

Q: Can you provide an update on the data center demand trends and how you are managing the associated load growth?A: (CFO Steven Ridge) We now have over 53 gigawatts of data center capacity in various stages of contracting, including approximately 12 gigawatts contracted under electric service agreements. We've added over 5 gigawatts of contracts (roughly 11%) since the end of last year. Demand remains robust and durable from high-quality, low-risk customers who need to stay in Virginia for network density and ecosystem advantages. We are bringing these customers onto the system using a large load framework that protects existing customers from cost shifts and mitigates stranded cost risk.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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