Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

MD&A discusses Dominion Energy’s results of operations and general financial condition and Virginia Power’s results of operations. MD&A should be read in conjunction with the Companies’ Consolidated Financial Statements. Virginia Power meets the conditions to file under the reduced disclosure format, and therefore has omitted certain sections of MD&A.

Contents of MD&A

MD&A consists of the following information:

Forward-Looking Statements—Dominion Energy and Virginia Power

Accounting Matters—Dominion Energy

Results of Operations—Dominion Energy and Virginia Power

Segment Results of Operations—Dominion Energy

Outlook—Dominion Energy

Liquidity and Capital Resources—Dominion Energy

Future Issues and Other Matters—Dominion Energy

Forward-Looking Statements

This report contains statements concerning the Companies’ expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In most cases, the reader can identify these forward-looking statements by such words as “path,” “anticipate,” “estimate,” “forecast,” “expect,” “believe,” “should,” “could,” “plan,” “may,” “continue,” “target” or other similar words.

The Companies make forward-looking statements with full knowledge that risks and uncertainties exist that may cause actual results to differ materially from predicted results. Factors that may cause actual results to differ are often presented with the forward-looking statements themselves. Additionally, other factors may cause actual results to differ materially from those indicated in any forward-looking statement. These factors include but are not limited to:

Unusual weather conditions and their effect on energy sales to customers and energy commodity prices;

Extreme weather events and other natural disasters, including, but not limited to, hurricanes, high winds, severe storms, earthquakes, flooding, wildfires, climate changes and changes in water temperatures and availability that can cause outages and property damage to facilities;

The impact of extraordinary external events, such as the pandemic health event resulting from COVID-19, and their collateral consequences, including extended disruption of economic activity in the Companies’ markets and global supply chains;

Federal, state and local legislative and regulatory developments, including changes in or interpretations of federal and state tax laws and regulations;

The direct and indirect impacts of implementing recommendations resulting from the business review concluded in March 2024;

Risks of operating businesses in regulated industries that are subject to changing regulatory structures;

Changes to regulated electric rates collected by the Companies and regulated gas distribution, transportation and storage rates collected by Dominion Energy;

Changes in rules for RTOs and ISOs in which the Companies join and/or participate, including changes in rate designs, changes in FERC’s interpretation of market rules and new and evolving capacity models;

Risks associated with Virginia Power’s membership and participation in PJM, including risks related to obligations created by the default of other participants;

Risks associated with entities in which Dominion Energy shares ownership with third parties, including risks that result from lack of sole decision making authority, disputes that may arise between Dominion Energy and third party participants and difficulties in exiting these arrangements;

Changes in future levels of domestic and international natural gas production, supply or consumption;

Timing and receipt of regulatory approvals necessary for planned construction or growth projects and compliance with conditions associated with such regulatory approvals;

The inability to complete planned construction, conversion or growth projects at all, or with the outcomes or within the terms and time frames initially anticipated, including as a result of increased public involvement, intervention or litigation in such projects;

Risks and uncertainties that may impact the Companies’ ability to construct the CVOW Commercial Project within the currently proposed timeline, or at all, and consistent with current cost estimates along with the ability to recover such costs from customers;

Changes to federal, state and local environmental laws and regulations, including those related to climate change, the tightening of emission or discharge limits for GHGs and other substances, more extensive permitting requirements and the regulation of additional substances;

Cost of environmental strategy and compliance, including those costs related to climate change;

Changes in implementation and enforcement practices of regulators relating to environmental standards and litigation exposure for remedial activities;

Difficulty in anticipating mitigation requirements associated with environmental and other regulatory approvals or related appeals;

Unplanned outages at facilities in which the Companies have an ownership interest;

The impact of operational hazards, including adverse developments with respect to pipeline and plant safety or integrity, equipment loss, malfunction or failure, operator error and other catastrophic events;

Risks associated with the operation of nuclear facilities, including costs associated with the disposal of spent nuclear fuel, decommissioning, plant maintenance and changes in existing regulations governing such facilities;

Changes in operating, maintenance and construction costs;

Domestic terrorism and other threats to the Companies’ physical and intangible assets, as well as threats to cybersecurity;

Additional competition in industries in which the Companies operate, including in electric markets in which Dominion Energy’s nonregulated generation facilities operate and potential competition from the development and deployment of alternative energy sources, such as self-generation and distributed generation technologies, and availability of market alternatives to large commercial and industrial customers;

Competition in the development, construction and ownership of certain electric transmission facilities in the Companies’ service territory in connection with Order 1000;

Changes in technology, particularly with respect to new, developing or alternative sources of generation and smart grid technologies;

Changes in demand for the Companies’ services, including industrial, commercial and residential growth or decline in the Companies’ service areas, changes in supplies of natural gas delivered to Dominion Energy’s pipeline system, failure to maintain or replace customer contracts on favorable terms, changes in customer growth or usage patterns, including as a result of energy conservation programs, the availability of energy efficient devices and the use of distributed generation methods;

Receipt of approvals for, and timing of, closing dates for acquisitions and divestitures;

Impacts of acquisitions, divestitures, transfers of assets to joint ventures and retirements of assets based on asset portfolio reviews;

The expected timing and likelihood of the completion of the PSNC Transaction, including the ability to obtain the requisite regulatory approvals and the terms and conditions of such approvals;

The expected timing and likelihood of the completion of the proposed sale of a 50% noncontrolling interest in the CVOW Commercial Project to Stonepeak, including the ability to obtain the requisite regulatory approvals and the terms and conditions of such approvals;

Adverse outcomes in litigation matters or regulatory proceedings;

Counterparty credit and performance risk;

Fluctuations in the value of investments held in nuclear decommissioning trusts by the Companies and in benefit plan trusts by Dominion Energy;

Fluctuations in energy-related commodity prices and the effect these could have on Dominion Energy’s earnings and the Companies’ liquidity position and the underlying value of their assets;

Fluctuations in interest rates;

The effectiveness to which existing economic hedging instruments mitigate fluctuations in currency exchange rates of the Euro and Danish Krone associated with certain fixed price contracts for the major offshore construction and equipment components of the CVOW Commercial Project;

Changes in rating agency requirements or credit ratings and their effect on availability and cost of capital;

Global capital market conditions, including the availability of credit and the ability to obtain financing on reasonable terms;

Political and economic conditions, including inflation and deflation;

Employee workforce factors including collective bargaining agreements and labor negotiations with union employees; and

Changes in financial or regulatory accounting principles or policies imposed by governing bodies.

Additionally, other risks that could cause actual results to differ from predicted results are set forth in Part I. Item 1A. Risk Factors in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023.

The Companies’ forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. The Companies caution the reader not to place undue reliance on their forward-looking statements because the assumptions, beliefs, expectations and projections about future events may, and often do, differ materially from actual results. The Companies undertake no obligation to update any forward-looking statement to reflect developments occurring after the statement is made.

Accounting Matters

As of June 30, 2024, there have been no significant changes with regard to the critical accounting policies and estimates disclosed in MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023. The policies disclosed included the accounting for regulated operations, AROs, income taxes, accounting for derivative contracts and financial instruments at fair value, use of estimates in goodwill impairment testing, use of estimates in long-lived asset impairment testing, held for sale classification and employee benefit plans.

Results of Operations—Dominion Energy

Presented below is a summary of Dominion Energy’s consolidated results:

		2024				2023				$ Change
(millions, except EPS)
Second Quarter
Net income attributable to Dominion Energy		$	572			$	583			$	(11	)
Diluted EPS			0.65				0.67				(0.02	)
Year-To-Date
Net income attributable to Dominion Energy		$	1,246			$	1,564			$	(318	)
Diluted EPS			1.43				1.82				(0.39	)

Overview

Second Quarter 2024 vs. 2023

Net income attributable to Dominion Energy decreased 2%, primarily due to the closing of the East Ohio Transaction and the impact of 2023 Virginia legislation, partially offset by an increase in sales to electric utility customers attributable to weather and the absence of outages at Millstone.

Year-To-Date 2024 vs. 2023

Net income attributable to Dominion Energy decreased 20%, primarily due to the closing of the East Ohio Transaction, the absence of equity method earnings from the sale of Dominion Energy’s noncontrolling interest in Cove Point, increased unrealized losses on economic hedging activities and the impact of 2023 Virginia legislation, partially offset by the absence of depreciation expense associated with the East Ohio, PSNC and Questar Gas Transactions upon meeting the classification as held for sale, an increase in sales to electric utility customers attributable to weather, the absence of amortization associated with the 2021 Triennial Review and fewer outages at Millstone.

Analysis of Consolidated Operations

Presented below are selected amounts related to Dominion Energy’s results of operations:

		Second Quarter												Year-To-Date
		2024				2023				$ Change				2024				2023				$ Change
(millions)
Operating revenue		$	3,486			$	3,166			$	320			$	7,118			$	7,049			$	69
Electric fuel and other energy-related purchases			918				939				(21	)			1,877				1,961				(84	)
Purchased electric capacity			21				15				6				33				23				10
Purchased gas			44				49				(5	)			164				172				(8	)
Other operations and maintenance			841				782				59				1,697				1,524				173
Depreciation and amortization			621				607				14				1,242				1,229				13
Other taxes			170				164				6				372				355				17
Impairment of assets and other charges			67				37				30				97				135				(38	)
Losses (gains) on sales of assets			(1	)			(21	)			20				(2	)			(23	)			21
Other income (expense)			250				314				(64	)			685				590				95
Interest and related charges			469				395				74				1,043				874				169
Income tax expense			95				98				(3	)			229				274				(45	)
Net income from discontinued operations including noncontrolling interests			81				168				(87	)			195				449				(254	)

An analysis of Dominion Energy’s results of operations follows:

Second Quarter 2024 vs. 2023

Operating revenue increased 10%, primarily reflecting:

A $243 million increase to recover the costs and an authorized return, as applicable, associated with Virginia Power non-fuel riders;

A $128 million increase in sales to electric utility retail customers, primarily due to an increase in cooling degree days during the cooling season;

A $108 million increase from the absence of outages at Millstone, including the relative effect of the absence of a planned outage ($72 million) and unplanned outages ($36 million);

A $26 million net increase from electric utility customers who elect to pay market based or other negotiated rates, including settlements of economic hedges at Virginia Power prior to March 2024; and

A $22 million increase in sales to electric utility retail customers associated with growth.

These increases were partially offset by:

An $85 million decrease from the combination of certain riders into base rates at Virginia Power as a result of 2023 Virginia legislation;

A $70 million net decrease associated with market prices affecting Millstone, including economic hedging impacts of net realized and unrealized losses on freestanding derivatives ($63 million);

A $46 million decrease in sales to electric utility retail customers associated with economic and other usage factors; and

A $17 million net decrease in fuel-related revenue as a result of a decrease in commodity costs associated with sales to electric utility retail customers, including electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges at Virginia Power effective March 2024.

Electric fuel and other energy-related purchases decreased 2%, primarily due to lower commodity costs for electric utilities, which are offset in operating revenue and do not impact net income.

Other operations and maintenance increased 8%, primarily reflecting:

A $23 million increase from the combination of certain riders into base rates as a result of 2023 Virginia legislation;

A $15 million increase in costs associated with the business review completed in March 2024;

A $13 million increase in salaries, wages and benefits; and

A $13 million increase in outside services.

These increases were partially offset by:

A $52 million decrease in outage costs primarily at Millstone.

Depreciation and amortization increased 2%, primarily due to an increase in RGGI-related amortization ($87 million), which is offset in operating revenue and does not impact net income, partially offset by the absence of amortization of a regulatory asset established in the settlement of the 2021 Triennial Review ($61 million) and a decrease in amortization associated with Virginia Power non-fuel riders ($19 million).

Impairment of assets and other charges increased 81%, primarily due to a charge for the impairment of certain nonregulated renewable natural gas facilities ($33 million) and an impairment of a corporate office building ($17 million), partially offset by the absence of a charge for the write-off of certain previously deferred amounts related to the cessation of certain riders effective July 2023 ($36 million).

Gains on sales of assets decreased 95%, primarily due to the absences of gains on the sale ($11 million) and transfer ($11 million) of certain utility properties in South Carolina.

Other income decreased 20%, primarily due to a decrease in net investment gains on nuclear decommissioning trust funds.

Interest and related charges increased 19%, primarily due to lower unrealized gains in 2024 compared to 2023 associated with freestanding derivatives ($46 million) and net issuances of long-term debt ($58 million), partially offset by a decrease in borrowings under the 364-day term loan facilities ($30 million).

Income tax expense decreased 3%, primarily due to a nuclear production tax credit ($17 million), partially offset by higher pre-tax income ($11 million).

Net income from discontinued operations including noncontrolling interests decreased 52%, primarily due to the absence of earnings from operations following the closing of the East Ohio Transaction ($96 million), the absence of equity method earnings from the sale of Dominion Energy’s noncontrolling interest in Cove Point ($67 million), the absence of unrealized gains on interest rate derivatives for economic hedging of debt secured by Dominion Energy’s interest in Cove Point ($37 million) and higher tax expense associated with the PSNC Transaction ($14 million), partially offset by the absence of depreciation expense associated with the East Ohio, PSNC and Questar Gas Transactions upon meeting the classification as held for sale ($79 million), the absence of interest expense on variable rate debt secured by Dominion Energy’s interest in Cove Point ($28 million), a gain upon the closing of the Questar Gas Transaction ($17 million) and the absence of an impairment charge of certain nonregulated solar assets ($11 million).

Year-To-Date 2024 vs. 2023

Operating revenue increased 1%, primarily reflecting:

A $420 million increase to recover the costs and an authorized return, as applicable, associated with Virginia Power non-fuel riders;

A $171 million increase in sales to electric utility retail customers, primarily due to an increase in cooling degree days during the cooling season ($128 million) and an increase in heating degree days during the heating season ($43 million);

A $100 million increase from fewer outages at Millstone, including the relative effect of the absence of a planned outage ($72 million) and fewer unplanned outages ($28 million);

A $52 million net increase from electric utility customers who elect to pay market based or other negotiated rates, including settlements of economic hedges at Virginia Power prior to March 2024; and

A $49 million increase in sales to electric utility retail customers associated with growth.

These increases were partially offset by:

A $453 million net decrease associated with market prices affecting Millstone, including economic hedging impacts of net realized and unrealized losses on freestanding derivatives ($414 million);

A $187 million decrease from the combination of certain riders into base rates at Virginia Power as a result of 2023 Virginia legislation;

A $61 million net decrease in fuel-related revenue as a result of a decrease in commodity costs associated with sales to electric utility retail customers, including electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges at Virginia Power effective March 2024; and

A $37 million decrease in sales to electric utility retail customers associated with economic and other usage factors.

Electric fuel and other energy-related purchases decreased 4%, primarily due to lower commodity costs for electric utilities ($89 million) and a decrease in the use of purchased renewable energy credits at Virginia Power ($20 million), which are offset in operating revenue and do not impact net income.

Other operations and maintenance increased 11%, primarily reflecting:

A $43 million increase from the combination of certain riders into base rates as a result of 2023 Virginia legislation;

A $31 million increase in costs associated with the business review completed in March 2024;

A $29 million increase in certain Virginia Power expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income;

A $20 million increase in salaries, wages and benefits;

An $18 million increase in storm damage and restoration costs in Virginia Power’s service territory; and

A $16 million increase in bad debt expense.

These increases were partially offset by:

A $39 million net decrease in outage costs due to lower outage costs at Millstone ($53 million) partially offset by higher outage costs at Virginia Power ($14 million).

Depreciation and amortization increased 1%, primarily due to an increase in RGGI-related amortization ($179 million), which is offset in operating revenue and does not impact net income, and various projects being placed into service ($32 million), partially offset by the absence of amortization of a regulatory asset established in the settlement of the 2021 Triennial Review ($122 million), a decrease in amortization associated with Virginia Power non-fuel riders ($54 million) and revised estimated useful lives at Millstone ($19 million).

Impairment of assets and other charges decreased 28%, primarily due to a decrease in impairments of corporate office buildings ($74 million) and the absence of a charge for the write-off of certain previously deferred amounts related to the cessation of certain riders effective July 2023 ($36 million), partially offset by a charge in connection with a settlement of an agreement ($47 million) and a charge for the impairment of certain nonregulated renewable natural gas facilities ($33 million).

Gains on sales of assets decreased 91%, primarily due to the absence of a gain on the transfer of certain utility property in South Carolina.

Other income increased 16%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds.

Interest and related charges increased 19%, primarily due to net issuances of long-term debt ($83 million), higher unrealized losses in 2024 compared to 2023 associated with freestanding derivatives ($31 million), higher interest rates on variable rate debt and cash flow interest rate swaps ($14 million), higher interest rates on commercial paper and long-term debt ($13 million), charges incurred due to early debt repayments associated with the business review completed in March 2024 ($12 million), premiums paid in 2024 compared to premiums received in 2023 on interest rate derivatives ($10 million) and an increase in borrowings under the 364-day term loan facilities ($9 million).

Income tax expense decreased 16%, primarily due to lower pre-tax income ($39 million) and a nuclear production tax credit ($17 million).

Net income from discontinued operations including noncontrolling interests decreased 57%, primarily due to the absence of equity method earnings from the sale of Dominion Energy’s noncontrolling interest in Cove Point ($124 million), the absence of earnings from operations following the closing of the East Ohio Transaction ($122 million), a loss on the closing of the East Ohio

Transaction ($113 million), an impairment associated with the Questar Gas Transaction ($78 million), charges for employee benefit items related to the East Ohio Transaction ($33 million), the absence of unrealized gains on interest rate derivatives for economic hedging of debt secured by Dominion Energy’s interest in Cove Point ($18 million) and higher tax expense associated with the PSNC Transaction ($16 million), partially offset by the absence of depreciation expense associated with the East Ohio, PSNC and Questar Gas Transactions upon meeting the classification as held for sale ($157 million), the absence of interest expense on variable rate debt secured by Dominion Energy’s interest in Cove Point ($53 million), lower tax expense to reflect the deferred taxes on the outside basis of Questar Gas, Wexpro and related affiliates’ stock ($22 million), a gain upon the closing of the Questar Gas Transaction ($17 million) and the absence of an impairment charge of certain nonregulated solar assets ($11 million).

Results of Operations—Virginia Power

Presented below is a summary of Virginia Power’s consolidated results:

		Second Quarter												Year-To-Date
		2024				2023				$ Change				2024				2023				$ Change
(millions)
Net income		$	479			$	334			$	145			$	944			$	689			$	255

Overview

Second Quarter 2024 vs. 2023

Net income increased 43%, primarily due to the absence of amortization associated with the 2021 Triennial Review and an increase in sales to electric utility customers attributable to weather and other customer-related factors, partially offset by a net decrease from riders primarily from 2023 Virginia legislation.

Year-To-Date 2024 vs. 2023

Net income increased 37%, primarily due to the absence of amortization associated with the 2021 Triennial Review and an increase in sales to electric utility customers attributable to weather and other customer-related factors, partially offset by a net decrease from riders primarily from 2023 Virginia legislation.

Analysis of Consolidated Operations

Presented below are selected amounts related to Virginia Power’s results of operations:

		Second Quarter												Year-To-Date
		2024				2023				$ Change				2024				2023				$ Change
(millions)
Operating revenue		$	2,537			$	2,252			$	285			$	5,026			$	4,636			$	390
Electric fuel and other energy-related purchases			707				707				—				1,408				1,506				(98	)
Purchased electric capacity			16				10				6				29				18				11
Other operations and maintenance			520				444				76				1,051				885				166
Depreciation and amortization			445				432				13				893				879				14
Other taxes			72				67				5				165				152				13
Impairment of assets and other charges (benefits)			15				38				(23	)			(2	)			45				(47	)
Other income (expense)			38				48				(10	)			101				84				17
Interest and related charges			204				182				22				394				363				31
Income tax expense			117				86				31				245				183				62

An analysis of Virginia Power’s results of operations follows:

Second Quarter 2024 vs. 2023

Operating revenue increased 13%, primarily reflecting:

A $243 million increase to recover the costs and an authorized return, as applicable, associated with non-fuel riders;

An $89 million increase in sales to electric utility retail customers, primarily due to an increase in cooling degree days during the cooling season;

A $25 million increase from electric utility customers who elect to pay market based or other negotiated rates, including settlements of economic hedges prior to March 2024;

A $24 million net increase in fuel-related revenue as a result of an increase in commodity costs associated with sales to electric utility retail customers, including electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges effective March 2024; and

A $15 million increase in sales to electric utility retail customers associated with growth.

These increases were partially offset by:

An $85 million decrease from the combination of certain riders into base rates as a result of 2023 Virginia legislation; and

A $29 million decrease in sales to electric utility retail customers associated with economic and other usage factors.

Other operations and maintenance increased 17%, primarily due to an increase from the combination of certain riders into base rates as a result of 2023 Virginia legislation ($23 million) and an increase in bad debt expense ($11 million).

Depreciation and amortization increased 3%, primarily due to an increase in RGGI-related amortization ($87 million), which is offset in operating revenue and does not impact net income, partially offset by the absence of amortization of a regulatory asset established in the settlement of the 2021 Triennial Review ($61 million) and a decrease in amortization associated with non-fuel riders ($19 million).

Impairment of assets and other charges decreased 61%, primarily due to the absence of a charge for the write-off of certain previously deferred amounts related to the cessation of certain riders effective July 2023.

Other income decreased 21%, primarily due to a decrease in net investment gains on nuclear decommissioning trust funds.

Interest and related charges increased 12%, primarily due to an increase in long-term debt borrowings ($41 million), partially offset by a decrease in principal on commercial paper and intercompany borrowings with Dominion Energy ($29 million).

Income tax expense increased 36%, primarily due to higher pre-tax income ($44 million), partially offset by a nuclear production tax credit ($17 million).

Year-To-Date 2024 vs. 2023

Operating revenue increased 8%, primarily reflecting:

A $420 million increase to recover the costs and an authorized return, as applicable, associated with non-fuel riders;

A $119 million increase in sales to electric utility retail customers, primarily due to an increase in cooling degree days during the cooling season ($89 million) and an increase in heating degree days during the heating season ($30 million);

A $53 million increase from electric utility customers who elect to pay market based or other negotiated rates, including settlements of economic hedges prior to March 2024; and

A $36 million increase in sales to electric utility retail customers associated with growth.

These increases were partially offset by:

A $187 million decrease from the combination of certain riders into base rates as a result of 2023 Virginia legislation;

A $45 million net decrease in fuel-related revenue as a result of a decrease in commodity costs associated with sales to electric utility retail customers, including electric utility customers who elect to pay market based or other negotiated rates and related settlements of economic hedges effective March 2024; and

A $19 million decrease in sales to electric utility retail customers associated with economic and other usage factors.

Electric fuel and other energy-related purchases decreased 7%, primarily due to lower commodity costs for electric utilities ($73 million) and a decrease in the use of purchased renewable energy credits ($20 million), which are offset in operating revenue and do not impact net income.

Other operations and maintenance increased 19%, primarily reflecting:

A $43 million increase from the combination of certain riders into base rates as a result of 2023 Virginia legislation;

A $29 million increase in certain expenditures which are primarily recovered through state- and FERC-regulated rates and do not impact net income;

An $18 million increase in storm damage and restoration costs;

A $16 million increase in bad debt expense;

A $14 million increase in outage costs; and

A $12 million increase in materials and supplies expense.

Depreciation and amortization increased 2%, primarily due to an increase in RGGI-related amortization ($179 million), which is offset in operating revenue and does not impact net income, and various projects being placed into service ($22 million), partially offset by the absence of amortization of a regulatory asset established in the settlement of the 2021 Triennial Review ($122 million) and a decrease in amortization associated with non-fuel riders ($54 million).

Impairment of assets and other charges decreased $47 million, primarily due to the absence of a charge for the write-off of certain previously deferred amounts related to the cessation of certain riders effective July 2023 ($36 million) and a benefit from the establishment of a regulatory asset associated with previously incurred storm damage and restoration costs in connection with the settlement of the 2023 Biennial Review ($11 million).

Other income increased 20%, primarily due to an increase in net investment gains on nuclear decommissioning trust funds.

Interest and related charges increased 9%, primarily due to an increase in long-term debt borrowings ($85 million), partially offset by a decrease in principal on commercial paper and intercompany borrowings with Dominion Energy ($63 million).

Income tax expense increased 34%, primarily due to higher pre-tax income ($80 million), partially offset by a nuclear production tax credit ($17 million).

Segment Results of Operations

Segment results include the impact of intersegment revenues and expenses, which may result in intersegment profit and loss. Presented below is a summary of contributions by Dominion Energy’s operating segments to net income (loss) attributable to Dominion Energy:

		Net Income (Loss) Attributable to Dominion Energy												EPS**(1)**
		2024				2023				$ Change				2024				2023				$ Change
(millions, except EPS)
Second Quarter
Dominion Energy Virginia		$	485			$	394			$	91			$	0.58			$	0.47			$	0.11
Dominion Energy South Carolina			69				68				1				0.08				0.08				—
Contracted Energy			100				(45	)			145				0.12				(0.05	)			0.17
Corporate and Other			(82	)			166				(248	)			(0.13	)			0.17				(0.30	)
Consolidated		$	572			$	583			$	(11	)		$	0.65			$	0.67			$	(0.02	)
Year-To-Date
Dominion Energy Virginia		$	909			$	780			$	129			$	1.09			$	0.93			$	0.16
Dominion Energy South Carolina			149				159				(10	)			0.18				0.19				(0.01	)
Contracted Energy			222				66				156				0.26				0.08				0.18
Corporate and Other			(34	)			559				(593	)			(0.10	)			0.62				(0.72	)
Consolidated		$	1,246			$	1,564			$	(318	)		$	1.43			$	1.82			$	(0.39	)

(1)

Consolidated results are presented on a diluted EPS basis. The dilutive impacts, primarily consisting of potential shares which had not yet been issued, are included within the results of the Corporate and Other segment. EPS contributions for Dominion Energy’s operating segments are presented utilizing basic average shares outstanding for the period.

Dominion Energy Virginia

Presented below are selected operating statistics related to Dominion Energy Virginia’s operations:

		Second Quarter												Year-To-Date
		2024				2023				% Change				2024				2023				% Change
Electricity delivered (million MWh)			22.6				21.8				4	%			46.0				43.5				6	%
Electricity supplied (million MWh):
Utility			22.6				20.7				9				46.0				42.5				8
Non-Jurisdictional			0.6				0.6				—				0.9				0.9				—
Degree days (electric distribution and utility service area):
Cooling			648				358				81				652				361				81
Heating			179				204				(12	)			1,838				1,675				10
Average electric distribution customer accounts (thousands)			2,778				2,746				1				2,775				2,743				1

Presented below, on an after-tax basis, are the key factors impacting Dominion Energy Virginia’s net income contribution:

		Second Quarter 2024 vs. 2023 Increase (Decrease)								Year-To-Date 2024 vs. 2023 Increase (Decrease)
		Amount				EPS				Amount				EPS
(millions, except EPS)
Weather		$	67			$	0.08			$	89			$	0.11
Customer usage and other factors			(11	)			(0.01	)			12				0.01
Customer-elected rate impacts			19				0.02				40				0.05
Impact of 2023 Virginia legislation			(65	)			(0.08	)			(144	)			(0.17	)
Rider equity return			83				0.10				136				0.16
Storm damage and restoration costs			2				—				(13	)			(0.02	)
Planned outage costs			(3	)			—				(10	)			(0.01	)
Nuclear production tax credit			17				0.02				17				0.02
Depreciation and amortization			(2	)			—				(5	)			(0.01	)
Interest expense, net			16				0.02				23				0.03
Other			(32	)			(0.04	)			(16	)			(0.01	)
Share dilution			—				—				—				—
Change in net income contribution		$	91			$	0.11			$	129			$	0.16

Dominion Energy South Carolina

Presented below are selected operating statistics related to Dominion Energy South Carolina’s operations:

		Second Quarter												Year-To-Date
		2024				2023				% Change				2024				2023				% Change
Electricity delivered (million MWh)			5.5				5.2				6		%		10.5				10.2				3		%
Electricity supplied (million MWh)			5.8				5.5				5				11.1				10.7				4
Degree days (electric distribution service areas):
Cooling			281				113				149				281				114				146
Heating			20				25				(20	)			640				484				32
Gas distribution throughput (bcf):
Sales			13				16				(19	)			32				33				(3	)
Average distribution customer accounts (thousands):
Electric			808				789				2				802				786				2
Gas			459				441				4				456				439				4

Presented below, on an after-tax basis, are the key factors impacting Dominion Energy South Carolina’s net income contribution:

		Second Quarter 2024 vs. 2023 Increase (Decrease)								Year-To-Date 2024 vs. 2023 Increase (Decrease)
		Amount				EPS				Amount				EPS
(millions, except EPS)
Weather		$	29			$	0.03			$	39			$	0.05
Customer usage and other factors			(1	)			—				11				0.01
Customer-elected rate impacts			1				—				(1	)			—
Natural Gas Rate Stabilization Act impacts			(3	)			—				(2	)			—
Capital cost rider			(2	)			—				(3	)			—
Depreciation and amortization			(4	)			—				(9	)			(0.01	)
Interest expense, net			(3	)			—				(10	)			(0.01	)
Other			(16	)			(0.03	)			(35	)			(0.05	)
Share dilution			—				—				—				—
Change in net income contribution		$	1			$	—			$	(10	)		$	(0.01	)

Contracted Energy

Presented below are selected operating statistics related to Contracted Energy’s operations:

		Second Quarter												Year-To-Date
		2024				2023				% Change				2024				2023				% Change
Electricity supplied (million MWh)			5.1				2.4				113	%			9.5				7.0				36	%

Presented below, on an after-tax basis, are the key factors impacting Contracted Energy’s net income contribution:

		Second Quarter 2024 vs. 2023 Increase (Decrease)								Year-To-Date 2024 vs. 2023 Increase (Decrease)
		Amount				EPS				Amount				EPS
(millions, except EPS)
Margin		$	35			$	0.04			$	36			$	0.04
Planned Millstone outages(1)(2)			83				0.10				85				0.10
Unplanned Millstone outages(1)			25				0.03				19				0.02
Depreciation and amortization			5				0.01				12				0.01
Other			(3	)			(0.01	)			4				0.01
Share dilution			—				—				—				—
Change in net income contribution		$	145			$	0.17			$	156			$	0.18

(1)

Includes earnings impact from outage costs and lower energy margins.

(2)

Includes the effect of a planned refueling outage in the second quarter of 2023 with no such outage in the second quarter of 2024.

Corporate and Other

Presented below are the Corporate and Other segment’s after-tax results:

		Second Quarter												Year-To-Date
		2024				2023				$ Change				2024				2023				$ Change
(millions, except EPS)
Specific items attributable to operating segments		$	(50	)		$	66			$	(116	)		$	74			$	370			$	(296	)
Specific items attributable to Corporate and Other segment			59				207				(148	)			126				369				(243	)
Net income from specific items			9				273				(264	)			200				739				(539	)
Corporate and other operations:
Interest expense, net			(137	)			(133	)			(4	)			(317	)			(253	)			(64	)
Equity method investments			—				1				(1	)			—				3				(3	)
Pension and other postretirement benefit plans			69				66				3				131				132				(1	)
Corporate service company costs			(25	)			(30	)			5				(52	)			(61	)			9
Other			2				(11	)			13				4				(1	)			5
Net expense from corporate and other operations			(91	)			(107	)			16				(234	)			(180	)			(54	)
Total net income (expense)		$	(82	)		$	166			$	(248	)		$	(34	)		$	559			$	(593	)
EPS impact		$	(0.13	)		$	0.17			$	(0.30	)		$	(0.10	)		$	0.62			$	(0.72	)

Corporate and Other includes specific items attributable to Dominion Energy’s primary operating segments that are not included in profit measures evaluated by executive management in assessing the segments’ performance or in allocating resources. See Note 21 to the Consolidated Financial Statements in this report for discussion of these items in more detail. Corporate and Other also includes items attributable to the Corporate and Other segment. For the three months ended June 30, 2024, this primarily included $81 million net income from discontinued operations, primarily associated with operations included in the PSNC and Questar Gas Transactions. For the six months ended June 30, 2024, this primarily included $195 million net income from discontinued operations, primarily associated with operations included in the East Ohio, PSNC and Questar Gas Transactions, including the loss on sale associated with the East Ohio Transaction, as well as an impairment charge associated with the Questar Gas Transaction, a $34 million after-tax loss for derivative mark-to-market changes and $25 million in after-tax costs associated with the business review completed in March 2024.

For the three months ended June 30, 2023, this primarily included $168 million net income from discontinued operations, primarily associated with operations included in the East Ohio, PSNC and Questar Gas Transactions and Dominion Energy’s noncontrolling interest in Cove Point, and a $36 million after-tax gain for derivative mark-to-market changes. For the six months ended June 30, 2023, this primarily included $449 million net income from discontinued operations, primarily associated with operations included in the East Ohio, PSNC and Questar Gas Transactions and Dominion Energy’s noncontrolling interest in Cove Point and a $68 million after-tax charge associated with the impairment of a corporate office building.

Outlook

As of June 30, 2024, there have been no material changes to Dominion Energy’s 2024 outlook as described in Item 7. MD&A in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023.

Liquidity and Capital Resources

Dominion Energy depends on both cash generated from operations and external sources of liquidity to provide working capital and as a bridge to long-term financings. Dominion Energy’s material cash requirements include capital and investment expenditures, repaying short-term and long-term debt obligations and paying dividends on its common and preferred stock.

Analysis of Cash Flows

Presented below are selected amounts related to Dominion Energy’s cash flows:

		2024				2023
(millions)
Cash, restricted cash and equivalents at January 1		$	301			$	341
Cash flows provided by (used in):
Operating activities(1)			2,838				3,194
Investing activities			1,328				(5,014	)
Financing activities			(4,260	)			1,794
Net decrease in cash, restricted cash and equivalents			(94	)			(26	)
Cash, restricted cash and equivalents at June 30		$	207			$	315

(1)

Includes cash outflows of $40 million and $41 million for energy efficiency programs in Virginia for the six months ended June 30, 2024 and 2023, respectively, and $12 million and $11 million for DSM programs in South Carolina for the six months ended June 30, 2024 and 2023, respectively.

Operating Cash Flows

Net cash provided by Dominion Energy’s operating activities decreased $356 million, inclusive of a $93 million increase from discontinued operations. Net cash provided by continuing operations decreased $449 million primarily due to higher net prepayments and deposits ($367 million), lower deferred fuel and purchased gas cost recoveries ($135 million), an increase in interest payments driven by higher interest rates and borrowings ($97 million) and a decrease from changes in working capital ($94 million), partially offset by a $244 million increase primarily due to higher operating cash flows from electric utility operations driven by weather and riders.

Investing Cash Flows

Net cash from Dominion Energy’s investing activities increased $6.3 billion, primarily due to net proceeds from the East Ohio and Questar Gas Transactions ($7.2 billion) and an increase in distributions from equity method affiliates ($125 million), partially offset by an increase in plant construction and other property additions ($884 million) and higher acquisitions of solar development projects ($175 million).

Financing Cash Flows

Net cash from Dominion Energy’s financing activities decreased $6.1 billion, primarily due to a $7.3 billion decrease due to net repayments on 364-day term loan facilities in 2024 versus net issuances in 2023, net repayments of short-term debt ($1.9 billion), net repayment of the supplemental credit facility ($450 million) and the partial repurchase of the Series B Preferred Stock ($440 million), partially offset by a $4.1 billion increase due to net issuances of long-term debt in 2024 versus net repayments in 2023.

Credit Facilities and Short-Term Debt

As discussed in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023, Dominion Energy generally uses proceeds from short-term borrowings, including commercial paper, to satisfy short-term cash requirements not met through cash from operations. The levels of borrowing may vary significantly during the course of the year, depending on the timing and amount of cash requirements not satisfied by cash from operations. There have been no significant changes to Dominion Energy’s use of credit facilities and/or short-term debt during the six months ended June 30, 2024.

Joint Revolving Credit Facility

Dominion Energy maintains a $6.0 billion joint revolving credit facility which provides for a discount in the pricing of certain annual fees and amounts borrowed by Dominion Energy under the facility if Dominion Energy achieves certain annual renewable electric generation and diversity and inclusion objectives. At June 30, 2024, Dominion Energy had $3.3 billion of unused capacity under its joint revolving credit facility. See Note 16 to the Consolidated Financial Statements in this report for the balances of commercial paper and letters of credit outstanding.

Dominion Energy Reliability Investment**SM Program

Dominion Energy has an effective shelf registration statement with the SEC for the sale of up to $3.0 billion of variable denomination floating rate demand notes, called Dominion Energy Reliability InvestmentSM. The registration limits the principal amount that may be outstanding at any one time to $1.0 billion. The notes are offered on a continuous basis and bear interest at a floating rate per annum determined by the Dominion Energy Reliability Investment Committee, or its designee, on a weekly basis. The notes have no stated maturity date, are non-transferable and may be redeemed in whole or in part by Dominion Energy or at the investor’s option at any time. At June 30, 2024, Dominion Energy’s Consolidated Balance Sheet included $480 million presented within short-term debt. The proceeds are used for general corporate purposes and to repay debt.

Other Facilities

In addition to the primary sources of short-term liquidity discussed above, from time to time Dominion Energy enters into separate supplementary credit facilities or term loans as discussed in Note 16 to the Consolidated Financial Statements in this report.

In March 2024, Dominion Energy repaid the full $2.5 billion outstanding under its $2.5 billion 364-day term loan facility entered into in January 2023 as amended in January 2024, using after-tax proceeds received in connection with the East Ohio Transaction. The debt was scheduled to mature in July 2024.

In March 2024, Dominion Energy repaid $1.8 billion of its $2.25 billion 364-day term loan facility entered into in October 2023, using after-tax proceeds received in connection with the East Ohio Transaction. Subsequently in March 2024, Dominion Energy requested and received a $500 million increase to the amount of the facility and concurrently borrowed $500 million with the proceeds used for general corporate purposes. In May 2024, Dominion Energy repaid the full $976 million outstanding under the facility, using after-tax proceeds received in connection with the Questar Gas Transaction. The debt was scheduled to mature in October 2024.

Long-Term Debt

Sustainability Revolving Credit Facility

Dominion Energy maintains a $900 million Sustainability Revolving Credit Facility which, following an amendment in June 2024, matures in June 2025 and bears interest at a variable rate and is described in Note 18 to the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023. The facility offers a reduced interest rate margin with respect to borrowed amounts allocated to certain environmental sustainability or social investment initiatives. In May 2024, Dominion Energy used a portion of the proceeds from the issuance of the 2024 EJSNs discussed below to repay the outstanding balance of $450 million under the Sustainability Revolving Credit Facility.

Issuances and Borrowings of Long-Term Debt

During the six months ended June 30, 2024, Dominion Energy issued or borrowed the following long-term debt. Unless otherwise noted, the proceeds for senior notes were used for the repayment of existing indebtedness and for general corporate purposes. See Note 18 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023 for additional information, including use of proceeds and repayment provisions, on the securitization bonds issued in February 2024. See Note 16 to the Consolidated Financial Statements in this report for additional information, including use of proceeds, on the 2024 EJSNs issued in May 2024.

Month		Type		Public / Private		Entity		Principal				Rate						Stated Maturity
January		Senior notes		Public		Virginia Power		$	500				5.000		%			2034
January		Senior notes		Public		Virginia Power			500				5.350		%			2054
February		Senior secured deferred fuel cost bonds		Public		VPFS			439				5.088		%			2029
February		Senior secured deferred fuel cost bonds		Public		VPFS			843				4.877		%			2033
May		Enhanced junior subordinated notes		Public		Dominion Energy			1,000				6.875		%	(1)		2055
May		Enhanced junior subordinated notes		Public		Dominion Energy			1,000				7.000		%	(1)		2054
Total issuances and borrowings								$	4,282

(1)

Rate subject to periodic reset as described in Note 16 to the Consolidated Financial Statements in this report.

In July 2024, PSNC issued through private placement $150 million of 5.65% senior notes and $150 million of 6.04% senior notes that mature in 2034 and 2054, respectively.

Dominion Energy currently meets the definition of a well-known seasoned issuer under SEC rules governing the registration, communication and offering processes under the Securities Act of 1933, as amended. The rules provide for a streamlined shelf registration process to provide registrants with timely access to capital. This allows Dominion Energy to use automatic shelf registration statements to register any offering of securities, other than those for exchange offers or business combination transactions.

Dominion Energy anticipates, excluding potential opportunistic financings and the securitization bonds, issuing between approximately $3.0 billion and $4.8 billion of long-term debt during 2024, inclusive of amounts issued through June 30, 2024 as shown in the table above and the issuance of senior notes at PSNC in July 2024 discussed above. Dominion Energy expects to issue long-term debt to satisfy cash needs for capital expenditures and maturing long-term debt to the extent such amounts are not satisfied from cash available from operations following the payment of dividends, after-tax proceeds from the completion of the PSNC Transaction, after-tax proceeds from the completion of the proposed sale of a 50% noncontrolling interest in the CVOW Commercial

Project and any borrowings made from unused capacity of Dominion Energy’s credit facilities discussed above. The raising of external capital is subject to certain regulatory requirements, including registration with the SEC for certain issuances.

Repayments, Repurchases and Redemptions of Long-Term Debt

Dominion Energy may from time to time reduce its outstanding debt and level of interest expense through redemption of debt securities prior to maturity or repurchases of debt securities in the open market, in privately negotiated transactions, through tender offers or otherwise.

The following long-term debt was repaid, repurchased or redeemed during the six months ended June 30, 2024:

Month		Type		Entity		Principal (1)				Rate				Stated Maturity
						(millions)
Debt scheduled to mature in 2024				Multiple		$	663			various
Early redemptions
February		Secured senior notes		Eagle Solar		$	279				4.820	%		2042
Total repayments, repurchases and redemptions						$	942

(1)

Total amount redeemed prior to maturity includes remaining principal plus accrued interest.

See Note 18 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023 for additional information regarding scheduled maturities of Dominion Energy’s long-term debt, including related average interest rates.

Remarketing of Long-Term Debt

In May 2024, Virginia Power remarketed three series of tax-exempt bonds, with an aggregate outstanding principal of $243 million to new investors. All three series of bonds will bear interest at a coupon of 3.80% until May 2027, after which they will bear interest at a market rate to be determined at that time.

Credit Ratings

As discussed in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, Dominion Energy’s credit ratings affect its liquidity, cost of borrowing under credit facilities and collateral posting requirements under commodity contracts, as well as the rates at which it is able to offer its debt securities. The credit ratings for Dominion Energy are affected by its financial profile, mix of regulated and nonregulated businesses and respective cash flows, changes in methodologies used by the rating agencies and event risk, if applicable, such as major acquisitions or dispositions. A credit rating is not a recommendation to buy, sell or hold securities and should be evaluated independently of any other rating. Ratings are subject to revision or withdrawal at any time by the applicable rating organization. As of June 30, 2024, there have been no changes in Dominion Energy’s credit ratings from those described in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024. In June 2024, Standard & Poor’s revised its credit ratings outlook for Dominion Energy from negative to stable and affirmed all other current ratings.

Financial Covenants

As discussed in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, Dominion Energy is subject to various covenants present in the enabling agreements underlying Dominion Energy’s debt. As of June 30, 2024, there have been no material changes to covenants, nor any events of default under Dominion Energy’s covenants.

Common Stock, Preferred Stock and Other Equity Securities

In the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, there is a discussion of Dominion Energy’s existing equity financing programs, including Dominion Energy Direct®. During the six months ended June 30, 2024, Dominion Energy issued $66 million of stock through these programs, net of fees and commissions. In May 2024, Dominion Energy entered into sales agency agreements to effect sales under a new at-the-market program, and through June 30, 2024 entered forward sale agreements for approximately 7.7 million shares of its common stock expected to be settled in the fourth quarter of 2024 at a weighted average initial forward price of $52.39 per share. See Note 16 to the Consolidated Financial Statements in this report for additional information.

As discussed in Note 16 to the Consolidated Financial Statements in this report, in June 2024, Dominion Energy completed a tender offer repurchasing 0.4 million of the 0.8 million shares of Series B Preferred Stock issued and outstanding representing $440 million in aggregate liquidation preference.

Through June 30, 2024, Dominion Energy has not repurchased and does not plan to repurchase shares of common stock in 2024, except for shares tendered by employees to satisfy tax withholding obligations on vested restricted stock, which does not impact the available capacity under its stock repurchase authorization.

Capital Expenditures

As of June 30, 2024, there have been no material changes to Dominion Energy’s expectation for planned capital expenditures as disclosed in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.

Dividends

Dominion Energy believes that its operations provide a stable source of cash flow to contribute to planned levels of capital expenditures and maintain or grow the dividend on common shares. See Note 16 to the Consolidated Financial Statements in this report for additional information regarding Dominion Energy’s outstanding preferred stock and associated dividend rates.

Subsidiary Dividend Restrictions

As of June 30, 2024, there have been no material changes to the subsidiary dividend restrictions disclosed in the Subsidiary Dividend Restrictions section of MD&A in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.

Collateral and Credit Risk

As of June 30, 2024, there have been no material changes to the collateral requirements disclosed in the Collateral and Credit Risk section of MD&A in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.

Dominion Energy’s exposure to potential concentrations of credit risk results primarily from its energy marketing and price risk management activities. Presented below is a summary of Dominion Energy’s credit exposure at June 30, 2024 for these activities. Gross credit exposure for each counterparty is calculated as outstanding receivables plus any unrealized on- or off-balance sheet exposure, taking into account contractual netting rights.

		Gross Credit Exposure				Credit Collateral				Net Credit Exposure
(millions)
Investment grade(1)		$	130			$	—			$	130
Non-investment grade(2)			12				—				12
No external ratings:
Internally rated—investment grade(3)			32				1				31
Internally rated—non-investment grade(4)			36				2				34
Total(5)		$	210			$	3			$	207

(1)

Designations as investment grade are based upon minimum credit ratings assigned by Moody’s Investors Service and Standard & Poor’s. The five largest counterparty exposures, combined, for this category represented approximately 46% of the total net credit exposure.

(2)

The five largest counterparty exposures, combined, for this category represented approximately 6% of the total net credit exposure.

(3)

The five largest counterparty exposures, combined, for this category represented approximately 15% of the total net credit exposure.

(4)

The five largest counterparty exposures, combined, for this category represented approximately 14% of the total net credit exposure.

(5)

Excludes long-term purchase power agreements entered to satisfy legislative or state regulatory commission requirements.

Fuel and Other Purchase Commitments

There have been no material changes outside of the ordinary course of business to Dominion Energy’s fuel and other purchase commitments included in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024.

Other Material Cash Requirements

In addition to the financing arrangements discussed above, Dominion Energy is party to numerous contracts and arrangements obligating it to make cash payments in future years. Dominion Energy expects current liabilities to be paid within the next twelve months. In addition to the items already discussed, the following represent material expected cash requirements recorded on Dominion Energy’s Consolidated Balance Sheet at June 30, 2024. Such obligations include:

Operating and finance lease obligations – See Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023;

Regulatory liabilities – See Note 12 to the Consolidated Financial Statements in this report;

AROs – See Note 2 to the Consolidated Financial Statements in this report and Note 14 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023;

Employee benefit plan obligations – See Note 20 to the Consolidated Financial Statements in this report and Note 22 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023;

In addition, Dominion Energy is party to contracts and arrangements which may require it to make material cash payments in future years that are not recorded on its Consolidated Balance Sheets. Such obligations include:

Off-balance sheet leasing arrangements – See Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023; and

Guarantees – See Note 17 to the Consolidated Financial Statements in this report.

Future Issues and Other Matters

See Item 1. Business, Future Issues and Other Matters in MD&A and Notes 13 and 23 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023, Future Issues and Other Matters in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024 and Notes 13 and 17 to the Consolidated Financial Statements in this report for additional information on various environmental, regulatory, legal and other matters that may impact future results of operations, financial condition and/or cash flows. There have been no updates to the matters discussed in Future Issues and Other Matters in the Companies’ Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, with the exception of the items described below.

Proposed and/or Recently Issued EPA Rules

In May 2024, the EPA released a final rule to regulate inactive surface impoundments located at retired generating stations that contained CCR and liquids after October 2015, and certain other inactive or previously closed surface impoundments, landfills or other areas that contain accumulations of CCR. Also in May 2024, the EPA released a final rule to further revise the Effluent Limitations Guidelines for the Steam Electric Power Generating Category, which apply primarily to wastewater discharges at coal and oil steam generating stations. Dominion Energy recorded an increase in its AROs of $1.1 billion to account for the expected impacts of compliance with these final rules. The actual AROs may vary substantially from the estimates used to record the obligation. See Notes 2 and 17 to the Consolidated Financial Statements in this report for additional information.

In addition, in May 2024, the EPA released a final rule to tighten aspects of the Mercury and Air Toxics Standards Risk and Technology Review, including the reduction of emissions limits for filterable particulate matter, and requiring the use of continuous emissions monitoring systems to demonstrate compliance. In May 2024, the EPA finalized a package of rules designed to reduce CO2 emissions from certain fossil fuel-fired electric generating units. The final rule sets standards of performance and emission guidelines for CO2 emissions from new and reconstructed gas-fired combustion turbines and modified coal-fired steam generating units. The rulemaking package also includes emission guidelines, including emission limits, for existing coal, oil and gas-fired steam generating units. In addition, in March 2024, the EPA published a final rule strengthening the national air quality annual standard for fine particulate matter. Further, Dominion Energy anticipates that the EPA will release additional rulemakings as part of an overall strategy to identify and mitigate PFAS exposure, beyond the national drinking water standards for PFAS issued in April 2024. Until specific state implementation plans are developed for final rules and/or Dominion Energy has sufficient time to develop implementation strategies for these final rules, Dominion Energy is unable to predict whether or to what extent the new rules will ultimately require additional controls or other actions. The expenditures required to implement additional controls or other actions could have a material impact on Dominion Energy’s financial condition and cash flows.

Offshore Wind Vessel Leasing Arrangement

In December 2020, Dominion Energy signed an agreement (subsequently amended in December 2022 and May 2023) with a lessor to complete construction of and lease a Jones Act compliant offshore wind installation vessel. This vessel is designed to handle current turbine technologies as well as next generation turbines. The lessor is providing equity and has obtained financing commitments from debt investors, totaling $625 million, to fund project costs. Including financing costs, total estimated project costs are approximately $715 million. The project is expected to be completed in late 2024 or early 2025. The initial lease term will commence once construction is substantially complete and the vessel is delivered and will mature in November 2027. See Note 15 to the Consolidated Financial Statements in the Companies’ Annual Report on Form 10-K for the year ended December 31, 2023 for additional information.

ITEM 3.

QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

The matters discussed in this Item may contain “forward-looking statements” as described in the introductory paragraphs under Part I., Item 2. MD&A in this report. The reader’s attention is directed to those paragraphs for discussion of various risks and uncertainties that may impact the Companies.

Market Risk Sensitive Instruments and Risk Management

The Companies’ financial instruments, commodity contracts and related financial derivative instruments are exposed to potential losses due to adverse changes in commodity prices, interest rates, foreign currency exchange rates and equity securities prices as described below. Commodity price risk is present in the Companies’ electric operations and Dominion Energy’s natural gas procurement and marketing operations due to the exposure to market shifts in prices received and paid for electricity, natural gas and other commodities. The Companies use commodity derivative contracts to manage price risk exposures for these operations. Interest rate risk is generally related to their outstanding debt and future issuances of debt. In addition, the Companies are exposed to investment price risk through various portfolios of equity and debt securities. The Companies’ exposure to foreign currency exchange rate risk is related to certain fixed price contracts associated with the CVOW Commercial Project which it manages through foreign currency exchange rate derivatives. The contracts include services denominated in currencies other than the U.S. dollar for approximately €2.6 billion and 5.1 billion kr. In addition, certain of the fixed price contracts, approximately €0.7 billion, contain commodity indexing provisions linked to steel.

The following sensitivity analysis estimates the potential loss of future earnings or fair value from market risk sensitive instruments over a selected time period due to a 10% change in commodity prices, interest rates or foreign currency exchange rates.

Commodity Price Risk

To manage price risk, the Companies hold commodity-based derivative instruments held for non-trading purposes associated with purchases and sales of electricity, natural gas and other energy-related products.

The derivatives used to manage commodity price risk are executed within established policies and procedures and may include instruments such as futures, forwards, swaps, options and FTRs that are sensitive to changes in the related commodity prices. For sensitivity analysis purposes, the hypothetical change in market prices of commodity-based derivative instruments is determined based on models that consider the market prices of commodities in future periods, the volatility of the market prices in each period, as well as the time value factors of the derivative instruments. Prices and volatility are principally determined based on observable market prices.

A hypothetical 10% increase in commodity prices would have resulted in a decrease of $29 million and $62 million in the fair value of Dominion Energy’s commodity-based derivative instruments as of June 30, 2024 and December 31, 2023, respectively.

A hypothetical 10% decrease in commodity prices would have resulted in a decrease of $19 million and a hypothetical 10% increase in commodity prices would have resulted in a decrease of $24 million in the fair value of Virginia Power’s commodity-based derivative instruments as of June 30, 2024 and December 31, 2023, respectively.

The impact of a change in energy commodity prices on the Companies’ commodity-based derivative instruments at a point in time is not necessarily representative of the results that will be realized when the contracts are ultimately settled. Net losses from commodity-based financial derivative instruments used for hedging purposes, to the extent realized, will generally be offset by recognition of the hedged transaction, such as revenue from physical sales of the commodity.

Interest Rate Risk

The Companies manage their interest rate risk exposure predominantly by maintaining a balance of fixed and variable rate debt. For variable rate debt outstanding for Dominion Energy, a hypothetical 10% increase in market interest rates would result in a $18 million and $56 million decrease in earnings at June 30, 2024 and December 31, 2023, respectively. For variable rate debt outstanding for Virginia Power, a hypothetical 10% increase in market interest rates would result in an $8 million and $5 million decrease in earnings at June 30, 2024 and December 31, 2023, respectively.

The Companies also use interest rate derivatives, including forward-starting swaps, interest rate swaps and interest rate lock agreements to manage interest rate risk. As of June 30, 2024, Dominion Energy and Virginia Power had $14.0 billion and $2.3 billion, respectively, in aggregate notional amounts of these interest rate derivatives outstanding. A hypothetical 10% decrease in market interest rates would have resulted in a decrease of $68 million and $104 million, respectively, in the fair value of Dominion Energy and Virginia Power’s interest rate derivatives at June 30, 2024. As of December 31, 2023, Dominion Energy and Virginia Power had

$16.3 billion and $3.3 billion, respectively, in aggregate notional amounts of these interest rate derivatives outstanding. A hypothetical 10% decrease in market interest rates would have resulted in a decrease of $120 million and $151 million, respectively, in the fair value of Dominion Energy and Virginia Power’s interest rate derivatives at December 31, 2023.

The impact of a change in interest rates on the Companies’ interest rate-based financial derivative instruments at a point in time is not necessarily representative of the results that will be realized when the contracts are ultimately settled. Net gains and/or losses from interest rate derivative instruments used for hedging purposes, to the extent realized, will generally be offset by recognition of the hedged transaction.

Foreign Currency Exchange Rate Risk

The Companies utilize foreign currency exchange rate swaps to economically hedge the foreign currency exchange risk associated with fixed price contracts related to the CVOW Commercial Project denominated in foreign currencies. As of June 30, 2024 and December 31, 2023, Dominion Energy had €1.7 billion and €2.1 billion, respectively, in aggregate notional amounts of these foreign currency forward purchase agreements outstanding. A hypothetical 10% increase in exchange rates would have resulted in a decrease of $161 million and $202 million in the fair value of Dominion Energy’s foreign currency swaps at June 30, 2024 and December 31, 2023, respectively.

The impact of a change in exchange rates on the Companies’ foreign currency-based financial derivative instruments at a point in time is not necessarily representative of the results that will be realized when the contracts are ultimately settled. Net gains and/or losses from foreign exchange derivative instruments used for hedging purposes, to the extent realized, will generally be offset by recognition of the hedged transaction.

Investment Price Risk

The Companies are subject to investment price risk due to securities held as investments in nuclear decommissioning and rabbi trust funds that are managed by third-party investment managers. These trust funds primarily hold marketable securities that are reported in the Companies’ Consolidated Balance Sheets at fair value.

Dominion Energy recognized net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $703 million, $562 million and $879 million for the six months ended June 30, 2024 and 2023 and the year ended December 31, 2023, respectively. Net realized gains and losses include gains and losses from the sale of investments as well as any other-than-temporary declines in fair value. Dominion Energy recorded in AOCI and regulatory liabilities, a net decrease in unrealized gains on debt investments of $34 million for the six months ended June 30, 2024 and a net increase of $117 million and $39 million for the year ended December 31, 2023 and the six months ended June 30, 2023, respectively.

Virginia Power recognized net investment gains (including investment income) on nuclear decommissioning and rabbi trust investments of $361 million, $283 million and $448 million for the six months ended June 30, 2024 and 2023 and the year ended December 31, 2023, respectively. Net realized gains and losses include gains and losses from the sale of investments as well as any other-than-temporary declines in fair value. Virginia Power recorded in AOCI and regulatory liabilities, a net decrease in unrealized gains on debt investments of $18 million for the six months ended June 30, 2024 and a net increase of $24 million and $66 million for the for the six months ended June 30, 2023 and the year ended December 31, 2023, respectively.

Dominion Energy sponsors pension and other postretirement employee benefit plans that hold investments in trusts to fund employee benefit payments. Virginia Power employees participate in these plans. Differences between actual and expected returns on plan assets are accumulated and amortized during future periods. As such, any investment-related declines in these trusts will result in future increases in the net periodic cost recognized for such employee benefit plans and will be included in the determination of the amount of cash to be contributed to the employee benefit plans.