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Derivatives And Hedge Accounting Activities (Tables)

12 Months Ended

Dec. 31, 2018

The tables below present Dominion Energy’s derivative asset and liability balances by type of financial instrument, if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and cash collateral received or paid:


			December 31, 2018								December 31, 2017
			Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts		Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	175	$	12	$	—	$	163	$	174	$	9	$	—	$	165
Exchange		68		68		—		—		80		80		—		—
Interest rate contracts:
Over-the-counter		18		1		—		17		17		8		—		9
Foreign currency contracts:
Over-the-counter		26		2		—		24		32		2		—		30
Total derivatives, subject to a master netting or similar arrangement	$	287	$	83	$	—	$	204	$	303	$	99	$	—	$	204

(1)

Excludes $7 million and $4 million of derivative assets at December 31, 2018 and 2017, respectively, which are not subject to master netting or similar arrangements.

Offsetting Liabilities


	December 31, 2018								December 31, 2017
			Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts		Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	19	$	12	$	—	$	7	$	76	$	9	$	6	$	61
Exchange		115		68		47		—		120		80		40		—
Interest rate contracts:
Over-the-counter		142		1		—		141		85		8		—		77
Foreign currency contracts:
Over-the-counter		2		2		—		—		2		2		—		—
Total derivatives, subject to a master netting or similar arrangement	$	278	$	83	$	47	$	148	$	283	$	99	$	46	$	138

(1)

Excludes $1 million of derivative liabilities at December 31, 2018 and 2017, which are not subject to master netting or similar arrangements.

Schedule of Volume of Derivative Activity

The following table presents the volume of Dominion Energy’s derivative activity as of December 31, 2018. These volumes are based on open derivative positions and represent the combined absolute value of their long and short positions, except in the case of offsetting transactions, for which they represent the absolute value of the net volume of their long and short positions.


	Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		56		27
Basis		214		557
Electricity (MWh):
Fixed price⁽¹⁾		11,101,869		1,537,200
FTRs		45,351,415		—
Liquids (Gal)⁽²⁾		14,413,200		—
Interest rate⁽³⁾	$	2,700,000,000	$	3,915,839,913
Foreign currency⁽³⁾⁽⁴⁾	$	—	$	280,000,000

(1)

Includes options.

(2)

Includes NGLs and oil.

(3)

Maturity is determined based on final settlement period.

(4)

Euro equivalent volumes are € 250,000,000.

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following table presents selected information related to gains (losses) on cash flow hedges included in AOCI in Dominion Energy’s Consolidated Balance Sheet at December 31, 2018:

AOCI
After-Tax

Amounts Expected to be
Reclassified to Earnings
During the Next 12 Months
After-Tax

Maximum

Term

(millions)

Commodities:

Gas

$ —

$ 1

36 months

Electricity

24 months

Other

3 months

Interest rate

(276

)

(29

)

396 months

Foreign currency

)

90 months

Total

$(235

)

$ (2

)

Fair Value of Derivatives

Fair Value and Gains and Losses on Derivative Instruments

The following tables present the fair values of Dominion Energy’s derivatives and where they are presented in its Consolidated Balance Sheets:


	Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)

At December 31, 2018
ASSETS
Current Assets
Commodity		$ 55		$154	$	209
Interest rate		14		—		14
Total current derivative assets⁽¹⁾		69		154		223
Noncurrent Assets
Commodity		6		35		41
Interest rate		4		—		4
Foreign currency		26		—		26
Total noncurrent derivative assets⁽²⁾		36		35		71
Total derivative assets		$105		$189	$	294
LIABILITIES
Current Liabilities
Commodity		$ 17		$112	$	129
Interest rate		26		—		26
Foreign currency		2		—		2
Total current derivative liabilities⁽³⁾		45		112		157
Noncurrent Liabilities
Commodity		5		1		6
Interest rate		116		—		116
Total noncurrent derivative liabilities⁽⁴⁾		121		1		122
Total derivative liabilities		$166		$113	$	279
At December 31, 2017
ASSETS
Current Assets
Commodity		$ 5		$158	$	163
Interest rate		6		—		6
Total current derivative assets⁽¹⁾		11		158		169
Noncurrent Assets
Commodity		—		95		95
Interest rate		11		—		11
Foreign currency		32		—		32
Total noncurrent derivative assets⁽²⁾		43		95		138
Total derivative assets		$ 54		$253	$	307
LIABILITIES
Current Liabilities
Commodity		$103		$ 92	$	195
Interest rate		53		—		53
Foreign currency		2		—		2
Total current derivative liabilities⁽³⁾		158		92		250
Noncurrent Liabilities
Commodity		1		1		2
Interest rate		32		—		32
Total noncurrent derivative liabilities⁽⁴⁾		33		1		34
Total derivative liabilities		$191		$ 93	$	284

(1)

Current derivative assets are presented in other current assets in Dominion Energy’s Consolidated Balance Sheets.

(2)

Noncurrent derivative assets are presented in other deferred charges and other assets in Dominion Energy’s Consolidated Balance Sheets.

(3)

Current derivative liabilities are presented in other current liabilities in Dominion Energy’s Consolidated Balance Sheets.

(4)

Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Dominion Energy’s Consolidated Balance Sheets.

Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location

The following tables present the gains and losses on Dominion Energy’s derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of Income:


Derivatives in cash flow hedging relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
(millions)

Year Ended December 31, 2018
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$ (90	)
Electric fuel and other energy-related purchases					14
Total commodity		$ 64			$(76	)		$ —
Interest rate⁽³⁾		(18	)		(48	)		39
Foreign currency⁽⁴⁾		(6	)		(13	)		—
Total		$ 40			$(137	)		$39
Year Ended December 31, 2017
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$ 81
Purchased gas					(2	)
Total commodity		$ 1			$ 79			$ —
Interest rate⁽³⁾		(8	)		(52	)		(58	)
Foreign currency⁽⁴⁾		18			20			—
Total		$ 11			$ 47			$(58	)
Year Ended December 31, 2016
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$330
Purchased gas					(13	)
Electric fuel and other energy-related purchases					(10	)
Total commodity		$164			$307			$ —
Interest rate⁽³⁾		(66	)		(31	)		(26	)
Foreign currency⁽⁴⁾		(6	)		(17	)		—
Total		$ 92			$259			$(26	)

(1)

Amounts deferred into AOCI have no associated effect in Dominion Energy’s Consolidated Statements of Income.

(2)

Represents net derivative activity deferred into and amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Dominion Energy’s Consolidated Statements of Income.

(3)

Amounts recorded in Dominion Energy’s Consolidated Statements of Income are classified in interest and related charges.

(4)

Amounts recorded in Dominion Energy’s Consolidated Statements of Income are classified in other income.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance


Derivatives not designated as hedging instruments	Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾
Year Ended December 31,	2018			2017			2016
(millions)
Derivative type and location of gains (losses):
Commodity:
Operating revenue		$(28	)		$ 18			$ 2
Purchased gas		11			(3	)		4
Electric fuel and other energy-related purchases		(9	)		(59	)		(70	)
Other operations & maintenance		—			(1	)		1
Total		$(26	)		$(45	)		$(63	)

(1)

Includes derivative activity amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Dominion Energy’s Consolidated Statements of Income.

Virginia Electric and Power Company

Offsetting Assets

The tables below present Virginia Power’s derivative asset and liability balances by type of financial instrument, if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and cash collateral received or paid:


	December 31, 2018								December 31, 2017
			Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts		Gross Assets Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Received		Net Amounts
(millions)

Commodity contracts:
Over-the-counter		$64		$ 6		$—		$58		$155		$ 4		$—		$151
Interest rate contracts:
Over-the-counter		3		—		—		3		—		—		—		—
Total derivatives, subject to a master netting or similar arrangement		$67		$ 6		$—		$61		$155		$ 4		$—		$151

(1)

Excludes $26 million and $11 million of derivative assets at December 31, 2018 and 2017, respectively, which are not subject to master netting or similar arrangements.

Offsetting Liabilities


	December 31, 2018								December 31, 2017
			Gross Amounts Not Offset in the Consolidated Balance Sheet						Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts		Gross Liabilities Presented in the Consolidated Balance Sheet⁽¹⁾		Financial Instruments		Cash Collateral Paid		Net Amounts
(millions)

Commodity contracts:
Over-the-counter		$ 6		$ 6		$—		$—		$ 4		$ 4		$—		$ —
Interest rate contracts:
Over-the-counter		88		—		—		88		57		—		—		57
Total derivatives, subject to a master netting or similar arrangement		$94		$ 6		$—		$88		$61		$ 4		$—		$57

(1)

Excludes $9 million and $5 million of derivative liabilities at December 31, 2018 and 2017, respectively, which are not subject to master netting or similar arrangements.

Schedule of Volume of Derivative Activity

The following table presents the volume of Virginia Power’s derivative activity at December 31, 2018. These volumes are based on open derivative positions and represent the combined absolute value of their long and short positions, except in the case of offsetting transactions, for which they represent the absolute value of the net volume of their long and short positions.


	Current		Noncurrent
Natural Gas (bcf):
Fixed price⁽¹⁾		29		8
Basis		136		488
Electricity (MWh):
Fixed price⁽¹⁾		367,019		—
FTRs		45,351,415		—
Interest rate⁽²⁾	$	700,000,000	$	1,200,000,000

(1)

Includes options.

(2)

Maturity is determined based on final settlement period.

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following table presents selected information related to losses on cash flow hedges included in AOCI in Virginia Power’s Consolidated Balance Sheet at December 31, 2018:


	AOCI After-Tax			Amounts Expected to be Reclassified to Earnings During the Next 12 Months After-Tax			Maximum Term
(millions)
Interest rate	$	(13	)	$	(1	)		396 months
Total	$	(13	)	$	(1	)

Fair Value of Derivatives

The following tables present the fair values of Virginia Power’s derivatives and where they are presented in its Consolidated Balance Sheets:


	Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)
At December 31, 2018
ASSETS
Current Assets
Commodity		$ —		$ 60		$ 60
Interest rate		3		—		3
Total current derivative assets⁽¹⁾		3		60		63
Noncurrent Assets
Commodity		—		30		30
Total noncurrent derivative assets⁽²⁾		—		30		30
Total derivative assets		$ 3		$ 90		$ 93
LIABILITIES
Current Liabilities
Commodity		$ —		$ 15		$ 15
Interest rate		10		—		10
Total current derivative liabilities⁽³⁾		10		15		25
Noncurrent Liabilities
Interest rate		78		—		78
Total noncurrent derivatives liabilities⁽⁴⁾		78		—		78
Total derivative liabilities		$88		$ 15		$103
At December 31, 2017
ASSETS
Current Assets
Commodity		$ —		$ 75		$ 75
Total current derivative assets⁽¹⁾		—		75		75
Noncurrent Assets
Commodity		—		91		91
Total noncurrent derivative assets⁽²⁾		—		91		91
Total derivative assets		$ —		$166		$166
LIABILITIES
Current Liabilities
Commodity		$ —		$ 9		$ 9
Interest rate		44		—		44
Total current derivative liabilities⁽³⁾		44		9		53
Noncurrent Liabilities
Interest rate		13		—		13
Total noncurrent derivative liabilities⁽⁴⁾		13		—		13
Total derivative liabilities		$57		$ 9		$ 66

(1)

Current derivative assets are presented in other current assets in Virginia Power’s Consolidated Balance Sheets.

(2)

Noncurrent derivative assets are presented in other deferred charges and other assets in Virginia Power’s Consolidated Balance Sheets.

(3)

Current derivative liabilities are presented in other current liabilities in Virginia Power’s Consolidated Balance Sheets.

(4)

Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Virginia Power’s Consolidated Balance Sheets.

Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location

The following tables present the gains and losses on Virginia Power’s derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of Income:


Derivatives in cash flow hedging relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income			Increase (Decrease) in Derivatives Subject to Regulatory Treatment⁽²⁾
(millions)
Year Ended December 31, 2018
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	2		$	(1	)	$	39
Total	$	2		$	(1	)	$	39
Year Ended December 31, 2017
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(8	)	$	(1	)	$	(58	)
Total	$	(8	)	$	(1	)	$	(58	)
Year Ended December 31, 2016
Derivative type and location of gains (losses):
Interest rate⁽³⁾	$	(3	)	$	(1	)	$	(26	)
Total	$	(3	)	$	(1	)	$	(26	)

(1)

Amounts deferred into AOCI have no associated effect in Virginia Power’s Consolidated Statements of Income.

(2)

Represents net derivative activity deferred into and amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Virginia Power’s Consolidated Statements of Income.

(3)

Amounts recorded in Virginia Power’s Consolidated Statements of Income are classified in interest and related charges.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance


Derivatives not designated as hedging instruments	Amount of Gain (Loss) Recognized in Income on Derivatives⁽¹⁾
Year Ended December 31,	2018		2017		2016
(millions)
Derivative type and location of gains (losses):
Commodity⁽²⁾		$2		$(57)		$(70)
Total		$2		$(57)		$(70)

(1)

Includes derivative activity amortized out of regulatory assets/liabilities. Amounts deferred into regulatory assets/liabilities have no associated effect in Virginia Power’s Consolidated Statements of Income.

(2)

Amounts recorded in Virginia Power’s Consolidated Statements of Income are classified in electric fuel and other energy-related purchases.

Dominion Energy Gas Holdings, LLC

Offsetting Assets

The tables below present Dominion Energy Gas’ derivative asset and liability balances by type of financial instrument, if the gross amounts recognized in its Consolidated Balance Sheets were netted with derivative instruments and cash collateral received or paid:


	December 31, 2018								December 31, 2017
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Offset in the Consolidated Balance Sheet
	Gross Assets Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Received		Net Amounts		Gross Assets Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Received		Net Amounts
(millions)
Commodity contracts:
Over-the-counter	$	3	$	—	$	—	$	3	$	—	$	—	$	—	$	—
Foreign currency contracts:
Over-the-counter		26		2		—		24		32		2		—		30
Total derivatives, subject to a master netting or similar arrangement	$	29	$	2	$	—	$	27	$	32	$	2	$	—	$	30

Offsetting Liabilities


	December 31, 2018								December 31, 2017
	Gross Amounts Not Offset in the Consolidated Balance Sheet								Gross Amounts Not Off set in the Consolidated Balance Sheet
	Gross Liabilities Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Paid		Net Amounts		Gross Liabilities Presented in the Consolidated Balance Sheet		Financial Instruments		Cash Collateral Paid		Net Amounts
(millions)
Commodity contracts
Over-the-counter	$	—	$	—	$	—	$	—	$	6	$	—	$	—	$	6
Interest rate contracts:
Over-the-counter		17		—		—		17		—		—		—		—
Foreign currency contracts:
Over-the-counter		2		2		—		—		2		2		—		—
Total derivatives, subject to a master netting or similar arrangement	$	19	$	2	$	—	$	17	$	8	$	2	$	—	$	6

Schedule of Volume of Derivative Activity

The following table presents the volume of Dominion Energy Gas’ derivative activity at December 31, 2018. These volumes are based on open derivative positions and represent the combined absolute value of their long and short positions, except in the case of offsetting transactions, for which they represent the absolute value of the net volume of their long and short positions.


	Current		Noncurrent
NGLs (Gal)		14,413,200		—
Interest rate⁽¹⁾	$	300,000,000	$	750,000,000
Foreign currency⁽¹⁾⁽²⁾	$	—	$	280,000,000

(1)

Maturity is determined based on final settlement period.

(2)

Euro equivalent volumes are €250,000,000.

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following table presents selected information related to gains (losses) on cash flow hedges included in AOCI in Dominion Energy Gas’ Consolidated Balance Sheet at December 31, 2018:

AOCI
After-Tax

Amounts Expected
to be Reclassified
to Earnings During
the Next 12
Months After-Tax

Maximum
Term

(millions)

Commodities:

NGLs

$ 2

3 months

Interest rate

(39

)

312 months

Foreign currency

)

90 months

Total

$(25

)

$(4

)

Fair Value of Derivatives

The following table presents the fair values of Dominion Energy Gas’ derivatives and where they are presented in its Consolidated Balance Sheets:


	Fair Value – Derivatives under Hedge Accounting		Fair Value – Derivatives not under Hedge Accounting		Total Fair Value
(millions)

At December 31, 2018
ASSETS
Current Assets
Commodity		$ 3		$—		$ 3
Total current derivative assets⁽¹⁾		3		—		3
Noncurrent Assets
Foreign currency		26		—		26
Total noncurrent derivative assets⁽²⁾		26		—		26
Total derivative assets		$29		$—		$29
LIABILITIES
Current Liabilities
Interest rate		$ 9		$—		$ 9
Foreign currency		2		—		2
Total current derivative liabilities⁽³⁾		11		—		11
Noncurrent Liabilities
Interest rate		8		—		8
Total noncurrent derivative liabilities⁽⁴⁾		8		—		8
Total derivative liabilities		$19		$—		$19
At December 31, 2017
ASSETS
Noncurrent Assets
Foreign currency	$32		$—		$32
Total noncurrent derivative assets⁽²⁾		32		—		32
Total derivative assets		$32		$—		$32
LIABILITIES
Current Liabilities
Commodity		$ 6		$—		$ 6
Foreign currency		2		—		2
Total current derivative liabilities⁽³⁾		8		—		8
Total derivative liabilities		$ 8		$—		$ 8

(1)

Current derivative assets are presented in other current assets in Dominion Energy Gas’ Consolidated Balance Sheets.

(2)

Noncurrent derivative assets are presented in other deferred charges and other assets in Dominion Energy Gas’ Consolidated Balance Sheets.

(3)

Current derivative liabilities are presented in other current liabilities in Dominion Energy Gas’ Consolidated Balance Sheets.

(4)

Noncurrent derivative liabilities are presented in other deferred credits and other liabilities in Dominion Energy Gas’ Consolidated Balance Sheets.

Schedule of Cash Flow Hedging Instruments, Statements of Financial Performance and Financial Position, Location

The following tables present the gains and losses on Dominion Energy Gas’ derivatives, as well as where the associated activity is presented in its Consolidated Balance Sheets and Statements of Income:


Derivatives in cash flow hedging relationships	Amount of Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)⁽¹⁾			Amount of Gain (Loss) Reclassified From AOCI to Income
(millions)
Year Ended December 31, 2018
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$ (8	)
Total commodity		$ 1			$ (8	)
Interest rate⁽²⁾		(18	)		(6	)
Foreign currency⁽³⁾		(6	)		(13	)
Total		$(23	)		$(27	)
Year Ended December 31, 2017
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$ (8	)
Total commodity		$(10	)		$ (8	)
Interest rate⁽²⁾		—			(5	)
Foreign currency⁽³⁾		18			20
Total		$ 8			$ 7
Year Ended December 31, 2016
Derivative type and location of gains (losses):
Commodity:
Operating revenue					$ 4
Total commodity		$(12	)		$ 4
Interest rate⁽²⁾		(8	)		(2	)
Foreign currency⁽³⁾		(6	)		(17	)
Total		$(26	)		$(15	)

(1)

Amounts deferred into AOCI have no associated effect in Dominion Energy Gas’ Consolidated Statements of Income.

(2)

Amounts recorded in Dominion Energy Gas’ Consolidated Statements of Income are classified in interest and related charges.

(3)

Amounts recorded in Dominion Energy Gas’ Consolidated Statements of Income are classified in other income.

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance


Derivatives not designated as hedging instruments	Amount of Gain (Loss) Recognized in Income on Derivatives
Year Ended December 31,	2018			2017		2016
(millions)
Derivative type and location of gains (losses):
Commodity
Operating revenue		$(11	)		$—		$1
Total		$(11	)		$—		$1