Operating Segments

6 Months Ended

Jun. 30, 2011

Operating Segments

Note 19. Operating Segments

Dominion and Virginia Power are organized primarily on the basis of products and services sold in the U.S. A description of the operations included in the Companies' primary operating segments is as follows:

Primary Operating Segment	Description of Operations	Dominion	Virginia Power
DVP	Regulated electric distribution	X	X
	Regulated electric transmission	X	X
	Nonregulated retail energy marketing (electric and gas)	X
Dominion Generation	Regulated electric fleet	X	X
	Merchant electric fleet	X
Dominion Energy	Gas transmission and storage	X
	Gas distribution	X
	LNG import and storage	X
	Producer services	X

In addition to the operating segments above, the Companies also report a Corporate and Other segment.

The Corporate and Other Segment of Dominion includes its corporate, service company and other functions (including unallocated debt) and certain specific items that are not included in profit measures evaluated by executive management in assessing segment performance or allocating resources among the segments.

In the six months ended June 30, 2011, Dominion reported after-tax net expenses of $64 million for specific items in the Corporate and Other segment, with $56 million of these net expenses attributable to its operating segments. In the six months ended June 30, 2010, Dominion reported after-tax net benefits of $933 million for specific items in the Corporate and Other segment, with $1.1 billion of these net benefits attributable to its operating segments.

The net expenses for specific items in 2011 primarily related to the impact of the following items:

• A $55 million ($39 million after-tax) impairment charge related to State Line, attributable to Dominion Generation; and

• A $37 million ($20 million after-tax) loss from the operations of Kewaunee, attributable to Dominion Generation. Kewaunee's results of operations have been reflected in the Corporate and Other segment due to Dominion's decision in the first quarter of 2011 to pursue the sale of Kewaunee.

The net benefits for specific items in 2010 primarily related to the impact of the following items:

• A $2.5 billion ($1.4 billion after-tax) benefit resulting from the gain on the sale of substantially all of Dominion's Appalachian E&P operations net of charges related to the divestiture, attributable to Dominion Energy; partially offset by

• A $338 million ($206 million after-tax) charge primarily reflecting severance pay and other benefits related to a workforce reduction program, attributable to:

• DVP ($67 million after-tax);

• Dominion Energy ($24 million after-tax); and

• Dominion Generation ($115 million after-tax);

• A $134 million ($147 million after-tax) loss from the discontinued operations of Peoples primarily reflecting a net loss on the sale, attributable to the Corporate and Other segment; and

•	A $163 million ($95 million after-tax) impairment charge related to State Line, attributable to Dominion Generation.

The Corporate and Other Segment of Virginia Power primarily includes certain specific items that are not included in profit measures evaluated by executive management in assessing segment performance or allocating resources among the segments. In the six months ended June 30, 2011 and 2010, Virginia Power reported after-tax net expenses of $5 million and $141 million, respectively, for specific items attributable to its operating segments in the Corporate and Other segment.

The net expenses for specific items in 2010 primarily related to the impact of the following:

• A $202 million ($123 million after-tax) charge primarily reflecting severance pay and other benefits related to a workforce reduction program, attributable to:

• DVP ($63 million after-tax); and

• Dominion Generation ($60 million after-tax).

The following table presents segment information pertaining to Dominion's operations:

	DVP		Dominion Generation		Dominion Energy		Corporate and Other			Adjustments/ Eliminations			Consolidated Total
(millions)
Three Months Ended June 30,
2011
Total revenue from external customers	$	828	$	1,760	$	379	$	37		$	337		$	3,341
Intersegment revenue		18		87		294		151			(550	)		—
Total operating revenue		846		1,847		673		188			(213	)		3,341
Net income (loss) attributable to Dominion		115		194		104		(77	)		—			336
2010
Total revenue from external customers	$	787	$	1,831	$	450	$	(6	)	$	271		$	3,333
Intersegment revenue		19		108		294		167			(588	)		—
Total operating revenue		806		1,939		744		161			(317	)		3,333
Income from discontinued operations, net of tax		—		—		—		2			—			2
Net income attributable to Dominion		112		276		86		1,287			—			1,761
Six Months Ended June 30,
2011
Total revenue from external customers	$	1,879	$	3,623	$	1,213	$	73		$	610		$	7,398
Intersegment revenue		113		157		502		294			(1,066	)		—
Total operating revenue		1,992		3,780		1,715		367			(456	)		7,398
Net income (loss) attributable to Dominion		264		492		273		(214	)		—			815
2010
Total revenue from external customers	$	1,790	$	3,809	$	1,300	$	34		$	568		$	7,501
Intersegment revenue		107		210		567		399			(1,283	)		—
Total operating revenue		1,897		4,019		1,867		433			(715	)		7,501
Loss from discontinued operations, net of tax		—		—		—		(147	)		—			(147	)
Net income attributable to Dominion		226		601		261		847			—			1,935

Intersegment sales and transfers for Dominion are based on contractual arrangements and may result in intersegment profit or loss that is eliminated in consolidation.

The following table presents segment information pertaining to Virginia Power's operations:

	DVP		Dominion Generation		Corporate and Other			Consolidated Total
(millions)
Three Months Ended June 30,
2011
Operating revenue	$	430	$	1,328	$	(1	)	$	1,757
Net income (loss)		102		144		(5	)		241
2010
Operating revenue	$	398	$	1,313	$	—		$	1,711
Net income		105		160		2			267
Six Months Ended June 30,
2011
Operating revenue	$	883	$	2,632	$	(1	)	$	3,514
Net income (loss)		215		309		(5	)		519
2010
Operating revenue	$	800	$	2,650	$	—		$	3,450
Net income (loss)		198		303		(139	)		362

Virginia Electric and Power Company [Member]

Operating Segments

Note 19. Operating Segments

Dominion and Virginia Power are organized primarily on the basis of products and services sold in the U.S. A description of the operations included in the Companies' primary operating segments is as follows:

Primary Operating Segment	Description of Operations	Dominion	Virginia Power
DVP	Regulated electric distribution	X	X
	Regulated electric transmission	X	X
	Nonregulated retail energy marketing (electric and gas)	X
Dominion Generation	Regulated electric fleet	X	X
	Merchant electric fleet	X
Dominion Energy	Gas transmission and storage	X
	Gas distribution	X
	LNG import and storage	X
	Producer services	X

In addition to the operating segments above, the Companies also report a Corporate and Other segment.

The Corporate and Other Segment of Dominion includes its corporate, service company and other functions (including unallocated debt) and certain specific items that are not included in profit measures evaluated by executive management in assessing segment performance or allocating resources among the segments.

In the six months ended June 30, 2011, Dominion reported after-tax net expenses of $64 million for specific items in the Corporate and Other segment, with $56 million of these net expenses attributable to its operating segments. In the six months ended June 30, 2010, Dominion reported after-tax net benefits of $933 million for specific items in the Corporate and Other segment, with $1.1 billion of these net benefits attributable to its operating segments.

The net expenses for specific items in 2011 primarily related to the impact of the following items:

• A $55 million ($39 million after-tax) impairment charge related to State Line, attributable to Dominion Generation; and

• A $37 million ($20 million after-tax) loss from the operations of Kewaunee, attributable to Dominion Generation. Kewaunee's results of operations have been reflected in the Corporate and Other segment due to Dominion's decision in the first quarter of 2011 to pursue the sale of Kewaunee.

The net benefits for specific items in 2010 primarily related to the impact of the following items:

• A $2.5 billion ($1.4 billion after-tax) benefit resulting from the gain on the sale of substantially all of Dominion's Appalachian E&P operations net of charges related to the divestiture, attributable to Dominion Energy; partially offset by

• A $338 million ($206 million after-tax) charge primarily reflecting severance pay and other benefits related to a workforce reduction program, attributable to:

• DVP ($67 million after-tax);

• Dominion Energy ($24 million after-tax); and

• Dominion Generation ($115 million after-tax);

• A $134 million ($147 million after-tax) loss from the discontinued operations of Peoples primarily reflecting a net loss on the sale, attributable to the Corporate and Other segment; and

• A $163 million ($95 million after-tax) impairment charge related to State Line, attributable to Dominion Generation.

The Corporate and Other Segment of Virginia Power primarily includes certain specific items that are not included in profit measures evaluated by executive management in assessing segment performance or allocating resources among the segments. In the six months ended June 30, 2011 and 2010, Virginia Power reported after-tax net expenses of $5 million and $141 million, respectively, for specific items attributable to its operating segments in the Corporate and Other segment.

The net expenses for specific items in 2010 primarily related to the impact of the following:

• A $202 million ($123 million after-tax) charge primarily reflecting severance pay and other benefits related to a workforce reduction program, attributable to:

• DVP ($63 million after-tax); and

• Dominion Generation ($60 million after-tax).

The following table presents segment information pertaining to Dominion's operations:

	DVP		Dominion Generation		Dominion Energy		Corporate and Other			Adjustments/ Eliminations			Consolidated Total
(millions)
Three Months Ended June 30,
2011
Total revenue from external customers	$	828	$	1,760	$	379	$	37		$	337		$	3,341
Intersegment revenue		18		87		294		151			(550	)		—
Total operating revenue		846		1,847		673		188			(213	)		3,341
Net income (loss) attributable to Dominion		115		194		104		(77	)		—			336
2010
Total revenue from external customers	$	787	$	1,831	$	450	$	(6	)	$	271		$	3,333
Intersegment revenue		19		108		294		167			(588	)		—
Total operating revenue		806		1,939		744		161			(317	)		3,333
Income from discontinued operations, net of tax		—		—		—		2			—			2
Net income attributable to Dominion		112		276		86		1,287			—			1,761
Six Months Ended June 30,
2011
Total revenue from external customers	$	1,879	$	3,623	$	1,213	$	73		$	610		$	7,398
Intersegment revenue		113		157		502		294			(1,066	)		—
Total operating revenue		1,992		3,780		1,715		367			(456	)		7,398
Net income (loss) attributable to Dominion		264		492		273		(214	)		—			815
2010
Total revenue from external customers	$	1,790	$	3,809	$	1,300	$	34		$	568		$	7,501
Intersegment revenue		107		210		567		399			(1,283	)		—
Total operating revenue		1,897		4,019		1,867		433			(715	)		7,501
Loss from discontinued operations, net of tax		—		—		—		(147	)		—			(147	)
Net income attributable to Dominion		226		601		261		847			—			1,935

Intersegment sales and transfers for Dominion are based on contractual arrangements and may result in intersegment profit or loss that is eliminated in consolidation.

The following table presents segment information pertaining to Virginia Power's operations:

	DVP		Dominion Generation		Corporate and Other			Consolidated Total
(millions)
Three Months Ended June 30,
2011
Operating revenue	$	430	$	1,328	$	(1	)	$	1,757
Net income (loss)		102		144		(5	)		241
2010
Operating revenue	$	398	$	1,313	$	—		$	1,711
Net income		105		160		2			267
Six Months Ended June 30,
2011
Operating revenue	$	883	$	2,632	$	(1	)	$	3,514
Net income (loss)		215		309		(5	)		519
2010
Operating revenue	$	800	$	2,650	$	—		$	3,450
Net income (loss)		198		303		(139	)		362