Dominion Energy South Carolina Inc.
05/01/2026 | Press release | Distributed by Public on 05/01/2026 09:46
Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MD&A discusses DESC's results of operations and should be read in conjunction with DESC's Consolidated Financial Statements. DESC 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
•
Results of Operations
Forward-Looking Statements
This report contains statements concerning DESC's 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", "believe", "forecast", "could", "estimate", "expect", "intend", "may", "plan", "outlook", "predict", "project", "should", "strategy", "continue", "target", "will", "potential" or other similar words.
DESC makes 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 DESC's markets and global supply chains;
•
Federal, state and local legislative and regulatory developments;
•
Changes in or interpretations of federal and state tax laws and regulations, including those related to tax credits or other incentives;
•
Risks of operating businesses in regulated industries that are subject to changing regulatory structures;
•
Changes to regulated rates collected;
•
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;
•
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;
•
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;
•
The availability of nuclear fuel, natural gas, purchased power or other materials utilized by DESC to provide electric generation, transmission and distribution and/or gas distribution services to its customers;
•
Domestic terrorism and other threats to DESC's physical and intangible assets, as well as cybersecurity threats or incidents;
•
Additional competition from the development and deployment of alternative energy sources, such as self-generation and distributed generation technologies;
•
Competition in the development, construction and ownership of certain electric transmission facilities 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 services, including industrial, commercial and residential growth or decline in service areas, 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;
•
Adverse outcomes in litigation matters or regulatory proceedings;
•
Counterparty credit and performance risk;
•
Fluctuations in the value of investments held in nuclear decommissioning and benefit plan trusts;
•
Fluctuations in energy-related commodity prices and the effect these could have on DESC's liquidity position and the underlying value of its assets;
•
Fluctuations in interest rates;
•
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 tariffs, 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 may cause actual results to differ materially from predicted results are set forth in Part I. Item 1A. Risk Factors in DESC's Annual Report on Form 10-K for the year ended December 31, 2025.
DESC's forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. DESC cautions the reader not to place undue reliance on its forward-looking statements because the assumptions, beliefs, expectations and projections about future events may, and often do, differ materially from actual results. DESC undertakes no obligation to update any forward-looking statement to reflect developments occurring after the statement is made.
Results of Operations
Presented below is a summary of DESC's results:
|
First Quarter |
||||||||||||
|
(millions) |
2026 |
2025 |
$ Change |
|||||||||
|
Net income |
$ |
131 |
$ |
150 |
$ |
(19 |
) |
|||||
Overview
First Quarter 2026 vs. 2025
Net income decreased 13%, primarily due to the absence of a benefit associated with the remeasurement of an uncertain tax position.
Analysis of Consolidated Operations
Presented below are selected amounts related to DESC's results of operations:
|
First Quarter |
||||||||||||
|
(millions) |
2026 |
2025 |
$ Change |
|||||||||
|
Operating revenues |
$ |
1,149 |
$ |
986 |
$ |
163 |
||||||
|
Fuel used in electric generation |
269 |
204 |
65 |
|||||||||
|
Purchased power |
58 |
22 |
36 |
|||||||||
|
Gas purchased for resale |
176 |
126 |
50 |
|||||||||
|
Other operations and maintenance |
174 |
174 |
- |
|||||||||
|
Depreciation and amortization |
149 |
140 |
9 |
|||||||||
|
Other taxes |
89 |
82 |
7 |
|||||||||
|
Other income (expense), net |
2 |
3 |
(1 |
) |
||||||||
|
Interest charges |
72 |
71 |
1 |
|||||||||
|
Income tax expense |
33 |
20 |
13 |
|||||||||
An analysis of DESC's results of operations follows:
First Quarter 2026 vs. 2025
Operating revenues increased 17%, primarily reflecting:
•
A $149 million increase in fuel-related revenue primarily as a result of an increase in commodity costs and purchased power costs associated with sales to electric utility retail customers ($99 million) and gas utility customers ($50 million); and
•
An $8 million increase associated with increased infrastructure cost recovery under the Natural Gas Rate Stabilization Act.
These increases were partially offset by:
•
A $5 million decrease in sales to electric retail customers from the capital cost rider; and
•
A $5 million decrease in sales to gas utility customers associated with economic and other usage factors.
Fuel used in electric generation increased 32%, primarily due to increased fuel costs associated with electric utility retail customers, which are offset in operating revenue and do not impact net income.
Purchased power increased $36 million, primarily due to an increase in costs associated with electric utility customers, which are offset in operating revenue and do not impact net income.
Gas purchased for resale increased 40%, primarily due to an increase in costs associated with gas utility customers, which are offset in operating revenue and do not impact net income.
Income tax expense increased 65%, primarily due to the absence of a benefit associated with the remeasurement of an uncertain tax position.
Dominion Energy South Carolina Inc. published this content on May 01, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on May 01, 2026 at 15:46 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]