EMPLOYEE BENEFIT PLANS

DOMINION

Dominion provides certain retirement benefits to eligible active employees, retirees and qualifying dependents. Under the terms of its benefit plans, Dominion reserves the right to change, modify or terminate the plans. From time to time in the past, benefits have changed, and some of these changes have reduced benefits.

Dominion maintains qualified noncontributory defined benefit pension plans covering virtually all employees. Retirement benefits are based primarily on years of service, age and the employee's compensation. Dominion's funding policy is to contribute annually an amount that is in accordance with the provisions of ERISA. The pension program also provides benefits to certain retired executives under a company-sponsored nonqualified employee benefit plan. The nonqualified plan is funded through contributions to a grantor trust. Dominion also provides retiree healthcare and life insurance benefits with annual employee premiums based on several factors such as age, retirement date and years of service.

Pension and other postretirement benefit costs are affected by employee demographics (including age, compensation levels and years of service), the level of contributions made to the plans and earnings on plan assets. These costs may also be affected by changes in key assumptions, including expected long-term rates of return on plan assets, discount rates, healthcare cost trend rates and the rate of compensation increases.

Dominion uses December 31 as the measurement date for all of its employee benefit plans. Dominion uses the market-related value of pension plan assets to determine the expected return on plan assets, a component of net periodic pension cost. The market-related value recognizes changes in fair value on a straight-line basis over a four-year period, which reduces year-to-year volatility. Changes in fair value are measured as the difference between the expected and actual plan asset returns, including dividends, interest and realized and unrealized investment gains and losses. Since the market-related value recognizes changes in fair value over a four-year period, the future market-related value of pension plan assets will be impacted as previously unrecognized changes in fair value are recognized.

Dominion's pension and other postretirement benefit plans hold investments in trusts to fund employee benefit payments. Aggregate actual returns for Dominion's pension and other postretirement plan assets were $959 million in 2013 and $743 million in 2012, versus expected returns of $554 million and $509 million, respectively. 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 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.

The Medicare Act introduced a federal subsidy to sponsors of retiree healthcare benefit plans that provide a prescription drug benefit that is at least actuarially equivalent to Medicare Part D. Dominion determined that the prescription drug benefit offered under its other postretirement benefit plans is at least actuarially equivalent to Medicare Part D. Dominion received a federal subsidy of $5 million for each of 2013 and 2012. Effective January 1, 2013, Dominion changed its method of receiving the subsidy under Medicare Part D for retiree prescription drug coverage from the Retiree Drug Subsidy to the EGWP. This change reduced other postretirement benefit costs by approximately $20 million annually beginning in 2012. As a result of the adoption of the EGWP, Dominion will begin to receive an increased level of Medicare Part D subsidies, in the form of reduced costs rather than a direct reimbursement, over the next few years.

Dominion remeasured all of its pension and other postretirement benefit plans in the second quarter of 2013. The remeasurement resulted in a reduction in the pension benefit obligation of approximately $354 million and a reduction in the accumulated postretirement benefit obligation of approximately $78 million. The impact of the remeasurement on net periodic benefit cost (credit) was recognized prospectively from the remeasurement date and reduced net periodic benefit cost for 2013 by approximately $36 million, excluding the impacts of curtailments. The discount rate used for the remeasurement was 4.80% for the pension plans and 4.70% for the other postretirement benefit plans. All other assumptions used for the remeasurement were consistent with the measurement as of December 31, 2012.

In the fourth quarter of 2013, Dominion remeasured its other postretirement benefit plans as a result of a plan amendment that changed medical coverage for certain Medicare-eligible retirees effective April 2014. The remeasurement resulted in a reduction in the accumulated postretirement benefit obligation of approximately $220 million. The impact of the remeasurement on net periodic benefit cost (credit) was recognized prospectively from the remeasurement date and reduced net periodic benefit cost for 2013 by approximately $8 million. The amendment is expected to reduce net periodic benefit cost by $40 million to $60 million for each of the next five years. The discount rate used for the remeasurement was 4.80%. All other assumptions used for the remeasurement were consistent with the measurement as of December 31, 2012.

Funded Status

The following table summarizes the changes in Dominion's pension plan and other postretirement benefit plan obligations and plan assets and includes a statement of the plans' funded status:



	Pension Benefits						Other Postretirement Benefits
Year Ended December 31,	2013			2012			2013			2012
(millions, except percentages)
Changes in benefit obligation:
Benefit obligation at beginning of year	$	6,125		$	4,981		$	1,719		$	1,493
Service cost	131			116			43			44
Interest cost	271			268			73			79
Benefits paid	(229		)	(208		)	(75		)	(88		)
Actuarial (gains) losses during the year	(650		)	967			(170		)	191
Plan amendments⁽¹⁾	1			1			(220		)	1
Settlements and curtailments⁽²⁾	(24		)	—			(16		)	(6		)
Special termination benefits	—			—			1			—
Medicare Part D reimbursement	—			—			5			5
Benefit obligation at end of year	$	5,625		$	6,125		$	1,360		$	1,719
Changes in fair value of plan assets:
Fair value of plan assets at beginning of year	$	5,553		$	5,145		$	1,156		$	1,042
Actual return on plan assets	781			611			178			132
Employer contributions	8			5			12			16
Benefits paid	(229		)	(208		)	(31		)	(34		)
Fair value of plan assets at end of year	$	6,113		$	5,553		$	1,315		$	1,156
Funded status at end of year	$	488		$	(572	)	$	(45	)	$	(563	)
Amounts recognized in the Consolidated Balance Sheets at December 31:
Noncurrent pension and other postretirement benefit assets	$	913		$	701		$	29		$	1
Other current liabilities	(15		)	(2		)	(3		)	(4		)
Noncurrent pension and other postretirement benefit liabilities	(410		)	(1,271		)	(71		)	(560		)
Net amount recognized	$	488		$	(572	)	$	(45	)	$	(563	)
Significant assumptions used to determine benefit obligations as of December 31:
Discount rate⁽³⁾	5.20%/5.30%			4.40		%	5.00%/5.10%			4.40		%
Weighted average rate of increase for compensation	4.21		%	4.21		%	4.22		%	4.22		%


(1)	Relates to a plan amendment that changed medical coverage for certain Medicare-eligible retirees.


(2)	2013 amounts relate primarily to the decommissioning of Kewaunee. 2012 amount relates to the sale of Salem Harbor.


(3)	Pension rates are 5.20% for the gas union plans and 5.30% for the nonunion and other union plans. OPEB rates are 5.00% for the gas union plans and 5.10% for the nonunion and other union plans.

The ABO for all of Dominion's defined benefit pension plans was $5.1 billion and $5.5 billion at December 31, 2013 and 2012, respectively.

Under its funding policies, Dominion evaluates plan funding requirements annually, usually in the fourth quarter after receiving updated plan information from its actuary. Based on the funded status of each plan and other factors, Dominion determines the amount of contributions for the current year, if any, at that time. During 2013, Dominion made no contributions to its qualified defined benefit pension plans and no contributions are currently expected in 2014. In July 2012, the Moving Ahead for Progress in the 21^st Century Act was signed into law. This Act includes an increase in the interest rates used to determine plan sponsors' pension contributions for required funding purposes. These new interest rates are expected to reduce required pension contributions through 2015. Dominion believes that required pension contributions will rise subsequent to 2015, resulting in little net impact to cumulative required contributions over a 10-year period.

Certain regulatory authorities have held that amounts recovered in utility customers' rates for other postretirement benefits, in excess of benefits actually paid during the year, must be deposited in trust funds dedicated for the sole purpose of paying such benefits. Accordingly, certain of Dominion's subsidiaries fund other postretirement benefit costs through VEBAs. Dominion's remaining subsidiaries do not prefund other postretirement benefit costs but instead pay claims as presented. Dominion expects to contribute approximately $12 million to the Dominion VEBAs in 2014.

Dominion does not expect any pension or other postretirement plan assets to be returned to the Company during 2014.

The following table provides information on the benefit obligations and fair value of plan assets for plans with a benefit obligation in excess of plan assets:



	Pension Benefits				Other Postretirement Benefits
As of December 31,	2013		2012		2013		2012
(millions)
Benefit obligation	$	4,978	$	5,462	$	1,233	$	1,591
Fair value of plan assets	4,553		4,189		1,158		1,027

The following table provides information on the ABO and fair value of plan assets for pension plans with an ABO in excess of plan assets:

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:



	Estimated Future Benefit Payments
	Pension Benefits		Other Postretirement Benefits
(millions)
2014	$	264	$	91
2015	269		93
2016	283		96
2017	300		98
2018	319		100
2019-2023	1,868		507

Plan Assets

Dominion's overall objective for investing its pension and other postretirement plan assets is to achieve appropriate long-term rates of return commensurate with prudent levels of risk. To minimize risk, funds are broadly diversified among asset classes, investment strategies and investment advisors. The strategic target asset allocations for its pension funds are 28% U.S. equity, 18% non-U.S. equity, 33% fixed income, 3% real estate and 18% other alternative investments. U.S. equity includes investments in large-cap, mid-cap and small-cap companies located in the United States. Non-U.S. equity includes investments in large-cap and small-cap companies located outside of the United States including both developed and emerging markets. A common/collective trust fund is a pooled fund operated by a bank or trust company for investment of the assets of various organizations and individuals in a well-diversified portfolio. Fixed income includes corporate debt instruments of companies from diversified industries and U.S. Treasuries. The U.S. equity, non-U.S. equity and fixed income investments are in individual securities as well as mutual funds. Common/collective trust funds are funds of grouped assets that follow various investment strategies. Real estate includes equity REITs and investments in partnerships. Other alternative investments include partnership investments in private equity, debt and hedge funds that follow several different strategies.

Strategic investment policies are established for Dominion's prefunded benefit plans based upon periodic asset/liability studies. Factors considered in setting the investment policy include employee demographics, liability growth rates, future discount rates, the funded status of the plans and the expected long-term rate of return on plan assets. Deviations from the plans' strategic allocation are a function of Dominion's assessments regarding short-term risk and reward opportunities in the capital markets and/or short-term market movements which result in the plans' actual asset allocations varying from the strategic target asset allocations. Through periodic rebalancing, actual allocations are brought back in line with the target. Future asset/liability studies will focus on strategies to further reduce pension and other postretirement plan risk, while still achieving attractive levels of returns. Financial derivatives may be used to obtain or manage market exposures and to hedge assets and liabilities.

For fair value measurement policies and procedures related to pension and other postretirement benefit plan assets, see Note 6.

The fair values of Dominion's pension plan assets by asset category are as follows:



	Fair Value Measurements
	Pension Plans
At December 31,	2013								2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
(millions)
Cash equivalents	$	53	$	126	—		$	179	—		$	195	—		$	195
U.S. equity:
Large Cap	1,220		—		—		1,220		927		104		—		1,031
Other	514		—		—		514		425		99		—		524
Non-U.S. equity:
Large Cap	308		—		—		308		313		68		—		381
Other	391		—		—		391		228		167		—		395
Common/collective trust funds	—		1,387		—		1,387		—		—		—		—
Fixed income:
Corporate debt instruments	43		451		—		494		27		1,026		—		1,053
U.S. Treasury securities and agency debentures	2		229		—		231		331		304		—		635
State and municipal	69		107		—		176		1		71		—		72
Other securities	7		50		—		57		5		43		—		48
Real estate:
REITs	32		—		—		32		29		—		—		29
Partnerships	—		—		227		227		—		—		321		321
Other alternative investments:
Private equity	—		—		530		530		—		—		456		456
Debt	—		—		180		180		—		—		192		192
Hedge funds	—		—		187		187		—		—		221		221
Total	$	2,639	$	2,350	$	1,124	$	6,113	$	2,286	$	2,077	$	1,190	$	5,553

The fair values of Dominion's other postretirement plan assets by asset category are as follows:



	Fair Value Measurements
	Other Postretirement Plans
At December 31,	2013								2012
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
(millions)
Cash equivalents	$	3	$	14	$	—	$	17	$	—	$	13	$	—	$	13
U.S. equity:
Large Cap	472		—		—		472		378		5		—		383
Other	26		—		—		26		21		45		—		66
Non-U.S. equity:
Large Cap	111		—		—		111		93		3		—		96
Other	20		—		—		20		11		8		—		19
Common/collective trust funds	—		502		—		502		—		—		—		—
Fixed income:
Corporate debt instruments	2		23		—		25		1		160		—		161
U.S. Treasury securities and agency debentures	—		12		—		12		16		266		—		282
State and municipal	4		5		—		9		—		9		—		9
Other securities	—		3		—		3		—		2		—		2
Real estate:
REITs	2		—		—		2		1		—		—		1
Partnerships	—		—		19		19		—		—		24		24
Other alternative investments:
Private equity	—		—		60		60		—		—		58		58
Debt	—		—		27		27		—		—		31		31
Hedge funds	—		—		10		10		—		—		11		11
Total	$	640	$	559	$	116	$	1,315	$	521	$	511	$	124	$	1,156

The following table presents the changes in Dominion's pension and other postretirement plan assets that are measured at fair value and included in the Level 3 fair value category:



	Fair Value Measurements using Significant Unobservable Inputs (Level 3)
	Pension Plans															Other Postretirement Plans
	Real Estate			Private Equity			Debt			Hedge Funds			Total			Real Estate			Private Equity			Debt			Hedge Funds			Total
Balance at December 31, 2010	$	271		$	400		$	262		$	345		$	1,278		$	22		$	61		$	40		$	17		$	140
Actual return on plan assets:
Relating to assets still held at the reporting date	38			70			10			10			128			3			11			1			—			15
Relating to assets sold during the period	(8		)	(34		)	(10		)	(15		)	(67		)	—			(4		)	(1		)	(1		)	(6		)
Purchases	57			76			34			48			215			3			8			3			2			16
Sales	(54		)	(64		)	(53		)	(98		)	(269		)	(4		)	(13		)	(7		)	(4		)	(28		)
Balance at December 31, 2011	$	304		$	448		$	243		$	290		$	1,285		$	24		$	63		$	36		$	14		$	137
Actual return on plan assets:
Relating to assets still held at the reporting date	21			46			17			21			105			1			3			4			1			9
Relating to assets sold during the period	(8		)	(41		)	(11		)	(2		)	(62		)	—			(1		)	—			—			(1		)
Purchases	35			79			15			—			129			2			6			1			—			9
Sales	(31		)	(76		)	(72		)	(88		)	(267		)	(3		)	(13		)	(10		)	(4		)	(30		)
Balance at December 31, 2012	$	321		$	456		$	192		$	221		$	1,190		$	24		$	58		$	31		$	11		$	124
Actual return on plan assets:
Relating to assets still held at the reporting date	15			98			32			21			166			(2		)	6			3			1			8
Relating to assets sold during the period	(36		)	(48		)	(34		)	(4		)	(122		)	1			3			—			1			5
Purchases	6			115			32			—			153			1			7			2			—			10
Sales	(79		)	(91		)	(42		)	(51		)	(263		)	(5		)	(14		)	(9		)	(3		)	(31		)
Balance at December 31, 2013	$	227		$	530		$	180		$	187		$	1,124		$	19		$	60		$	27		$	10		$	116

Investments in Common/Collective Trust Funds in Dominion’s pension and other postretirement plans are stated at fair value as determined by the issuer of the Common/Collective Trust Funds based on the fair value of the underlying investments. The Common/Collective Trusts do not have any unfunded commitments, and do not have any applicable liquidation periods or defined terms/periods to be held. The majority of the Common/Collective Trust Funds have limited withdrawal or redemption rights during the term of the investment. Strategies of the Common/Collective Trust Funds are as follows:

•

Wells Fargo Closed End Bond Trust-The Fund invests in stocks, bonds or a combination of both. Shares of the Fund are traded on a stock exchange and are subject to market risk like stocks, bonds and mutual funds. The Fund may invest in a less liquid portfolio of stocks and bonds because the fund does not need to sell securities to meet shareholder redemptions as mutual funds in order to keep a percentage of its portfolio in cash to pay back investors who withdraw shares.


•	JPMorgan Core Bond Trust-The Fund seeks to maximize total return by investing primarily in a diversified portfolio of intermediate- and long-term debt securities. The Fund invests primarily in investment-grade bonds; it generally maintains an average weighted maturity between four and 12 years. It may shorten its average weighted maturity if deemed appropriate for temporary defensive purposes.

•

SSgA Russell 2000 Value Index Common Trust-The Fund measures the performance of the small-cap value segment of the U.S. equity universe. The Russell 2000 Value Index is constructed to provide a comprehensive and unbiased barometer for the small-cap value segment. The Index is completely reconstituted annually to ensure larger stocks do not distort the performance and characteristics of the true small-cap opportunity set and that the represented companies continue to reflect value characteristics.

•

SSgA Daily MSCI Emerging Markets Index Non-Lending Fund-The Fund seeks an investment return that approximates as closely as practicable, before expenses, the performance of the MSCI Emerging Markets Index over the long term. The Fund may invest directly or indirectly in securities and other instruments, including in other pooled investment vehicles sponsored or managed by, or otherwise affiliated with the Trustee (State Street Bank and Trust Company).

•

SSgA Daily MSCI ACWI Ex-USA Index Non-Lending Fund-The Fund seeks an investment return that approximates as closely as practicable, before expenses, the performance of the MSCI ACWI Ex-USA Index over the long term. The Fund may invest directly or indirectly in securities and other instruments, including in other pooled investment vehicles sponsored or managed by, or otherwise affiliated with the Trustee (State Street Bank and Trust Company).

•

SSgA S&P 400 MidCap Index - The Fund seeks an investment return that approximates as closely as practicable, before expenses, the performance of its benchmark index (the Index) over the long term. The S&P MidCap 400 is comprised of approximately 400 U.S. mid-cap securities and accounts for approximately 7% coverage of the U.S. stock market capitalization. SSgA will typically attempt to invest in the equity securities comprising the Index, in approximately the same proportions as they are represented in the Index.


•	JPMorgan Chase Bank U.S. Active Core Plus Equity Fund-The Fund seeks to outperform the S&P 500 Index (the Benchmark), gross of fees, over a market cycle. The Fund invests primarily in a portfolio of long and short positions in equity securities of large and mid capitalization U.S. companies with characteristics similar to those of the Benchmark.


•	Mondrian International Small Cap Equity Fund-The Fund’s investment objective is long-term total return. The Fund primarily invests in equity securities of non-U.S. small capitalization companies that, in the investment manager’s opinion, are undervalued at the time of purchase based on fundamental value analysis employed by the investment manager.

Net Periodic Benefit Cost

The components of the provision for net periodic benefit cost and amounts recognized in other comprehensive income and regulatory assets and liabilities are as follows:



	Pension Benefits									Other Postretirement Benefits
Year Ended December 31,	2013			2012			2011			2013			2012			2011
(millions, except percentages)
Service cost	$	131		$	116		$	108		$	43		$	44		$	48
Interest cost	271			268			258			73			79			94
Expected return on plan assets	(462		)	(430		)	(440		)	(92		)	(79		)	(79		)
Amortization of prior service (credit) cost	3			3			3			(15		)	(13		)	(13		)
Amortization of net actuarial loss	165			132			96			7			6			12
Settlements and curtailments⁽¹⁾	(2		)	—			—			(15		)	(4		)	1
Special termination benefits	—			—			—			1			—			—
Net periodic benefit cost	$	106		$	89		$	25		$	2		$	33		$	63
Changes in plan assets and benefit obligations recognized in other comprehensive income and regulatory assets and liabilities:
Current year net actuarial (gain) loss	$	(968	)	$	786		$	534		$	(255	)	$	139		$	(157	)
Prior service (credit) cost	1			—			—			(215		)	1			(70		)
Settlements and curtailments⁽¹⁾	(22		)	—			—			(7		)	(2		)	(1		)
Less amounts included in net periodic benefit cost:
Amortization of net actuarial loss	(165		)	(132		)	(96		)	(7		)	(6		)	(12		)
Amortization of prior service credit (cost)	(3		)	(3		)	(3		)	15			13			13
Total recognized in other comprehensive income and regulatory assets and liabilities	$	(1,157	)	$	651		$	435		$	(469	)	$	145		$	(227	)
Significant assumptions used to determine periodic cost:
Discount rate	4.40% - 4.80%			5.50		%	5.90		%	4.40% - 4.80%			5.50		%	5.90		%
Expected long-term rate of return on plan assets	8.50		%	8.50		%	8.50		%	7.75		%	7.75		%	7.75		%
Weighted average rate of increase for compensation	4.21		%	4.21		%	4.61		%	4.22		%	4.22		%	4.62		%
Healthcare cost trend rate⁽²⁾										7.00		%	7.00		%	7.00		%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)⁽²⁾										4.60		%	4.60		%	4.60		%
Year that the rate reaches the ultimate trend rate⁽²⁾										2062			2061			2060


(1)	2013 amount relates primarily to the decommissioning of Kewaunee. 2012 amount relates to the sale of Salem Harbor.


(2)	Assumptions used to determine periodic cost for the following year.

The components of AOCI and regulatory assets and liabilities that have not been recognized as components of periodic benefit (credit) cost are as follows:



	Pension Benefits				Other Postretirement Benefits
At December 31,	2013		2012		2013			2012
(millions)
Net actuarial (gain) loss	$	1,709	$	2,865	$	(40	)	$	229
Prior service (credit) cost	10		11		(271		)	(71		)
Total⁽¹⁾	$	1,719	$	2,876	$	(311	)	$	158

(1)

As of December 31, 2013, of the $1.7 billion and $(311) million related to pension benefits and other postretirement benefits, $1.0 billion and $(156) million, respectively, are included in AOCI, with the remainder included in regulatory assets and liabilities. As of December 31, 2012, of the $2.9 billion and $158 million related to pension benefits and other postretirement benefits, $1.8 billion and $69 million, respectively, are included in AOCI, with the remainder included in regulatory assets and liabilities.

The following table provides the components of AOCI and regulatory assets and liabilities as of December 31, 2013 that are expected to be amortized as components of periodic benefit cost in 2014:

Dominion determines the expected long-term rates of return on plan assets for its pension plans and other postretirement benefit plans by using a combination of:


•	Expected inflation and risk-free interest rate assumptions;


•	Historical return analysis to determine long term historic returns as well as historic risk premiums for various asset classes;


•	Expected future risk premiums, asset volatilities and correlations;


•	Forecasts of an independent investment advisor;


•	Forward-looking return expectations derived from the yield on long-term bonds and the expected long-term returns of major stock market indices; and


•	Investment allocation of plan assets.

Dominion determines discount rates from analyses of AA/Aa rated bonds with cash flows matching the expected payments to be made under its plans.

Assumed healthcare cost trend rates have a significant effect on the amounts reported for Dominion's retiree healthcare plans. A one percentage point change in assumed healthcare cost trend rates would have had the following effects:



	Other Postretirement Benefits
	One percentage point increase		One percentage point decrease
(millions)
Effect on net periodic cost for 2014	$	16	$	(18	)
Effect on other postretirement benefit obligation at December 31, 2013	140		(118		)

An internal committee selects the final assumptions used for Dominion's pension and other postretirement plans, including discount rates, expected long-term rates of return and healthcare cost trend rates.

Defined Contribution Plans

In addition, Dominion sponsors defined contribution employee savings plans. During 2013, 2012 and 2011, Dominion recognized $40 million, $40 million and $38 million, respectively, as employer matching contributions to these plans.

VIRGINIA POWER

Virginia Power participates in the Dominion Pension Plan, a defined benefit pension plan sponsored by Dominion that provides benefits to multiple Dominion subsidiaries. Retirement benefits payable under this plan are based primarily on years of service, age and the employee's compensation. As a participating employer, Virginia Power is subject to Dominion's funding policy, which is to contribute annually an amount that is in accordance with the provisions of ERISA. During 2013 and 2012 Virginia Power made no contributions to the plan and no contributions are currently expected in 2014. Virginia Power's net periodic pension cost related to this pension plan was $96 million, $72 million and $50 million in 2013, 2012 and 2011, respectively. Employee compensation is the basis for determining Virginia Power's share of total pension costs.

Virginia Power also participates in the Dominion Retiree Health and Welfare Plan, a plan sponsored by Dominion that provides certain retiree healthcare and life insurance benefits to multiple Dominion subsidiaries. Annual employee premiums are based on several factors such as age, retirement date and years of service. Virginia Power's net periodic benefit cost related to this plan was $5 million, $13 million and $23 million in 2013, 2012 and 2011, respectively. Employee headcount is the basis for determining Virginia Power's share of total other postretirement benefit costs.

Certain regulatory authorities have held that amounts recovered in rates for other postretirement benefits, in excess of benefits actually paid during the year, must be deposited in trust funds dedicated for the sole purpose of paying such benefits. Accordingly, Virginia Power funds other postretirement benefit costs through a VEBA. During 2013 and 2012, Virginia Power made no contributions to the VEBA and does not expect to contribute to the VEBA in 2014.

Dominion holds investments in trusts to fund employee benefit payments for its pension and other postretirement benefit plans, in which Virginia Power's employees participate. Any investment-related declines in these trusts will result in future increases in the periodic cost recognized for such employee benefit plans and will be included in the determination of the amount of cash that Virginia Power will provide to Dominion for its share of employee benefit plan contributions.

Virginia Power also participates in Dominion-sponsored defined contribution employee savings plans that cover substantially all employees. During 2013, 2012 and 2011, Virgina Power recognized $16 million, $15 million and $14 million, respectively, as employer matching contributions to these plans.

As of December 31,

(millions)

Accumulated benefit obligation

Fair value of plan assets