Present: Kinser, C.J., Lemons, Millette, McClanahan, and 

Powell, JJ., and Lacy and Koontz, S.JJ.

VIRGINIA ELECTRIC AND POWER COMPANY

OPINION BY

v. Record Nos. 120519 SENIOR JUSTICE LAWRENCE L. KOONTZ, JR.

 & 120520 November 1, 2012

STATE CORPORATION COMMISSION, ET AL.

FROM THE STATE CORPORATION COMMISSION

These consolidated appeals arise from a final 

determination of the State Corporation Commission 

("Commission") in a mandated biennial review of "the rates, 

terms and conditions for the provision of generation, 

distribution and transmission services [of an] investor-owned 

incumbent electric utility" pursuant to the provisions of the 

Virginia Electric Utility Regulation Act. Code §§ 56-576 et 

seq. As amended by the General Assembly in 2007, the Act 

significantly altered the procedures and authority of the 

Commission with respect to electric utility ratemaking.1

As pertinent here, commencing in 2011, the Act requires 

the Commission to conduct biennial reviews of an electric 

utility's performance during the two successive 12-month 

periods immediately prior to such reviews. Code § 56-

 1 For a more detailed discussion of the legislative 

history of the regulatory scheme now incorporated in the Act 

and the intended goals of the Act see Appalachian Power Co. v. 

State Corporation Commission, 284 Va. ___, ___, ___ S.E.2d 

___, ___ (2012) (this day decided).
2

585.1(A). In doing so, the Commission is required to 

determine, among other things, "fair rates of return on common 

equity" ("ROE") and "the rates that the utility may charge 

until such rates are adjusted." Id.

These appeals present the first opportunity for this 

Court to consider the Commission's application of Code § 56-

585.1 in a biennial review. The principal focus of these

appeals is whether in the 2011 biennial review of the

performance of Virginia Electric and Power Company ("VEPCO")

in the 2009-2010 test period, the Commission erred in 

determining that the utility's authorized ROE of 10.9% would 

apply to the entire 2011-2012 test period in the next biennial 

review in 2013.

BACKGROUND

VEPCO is an investor-owned electric utility providing 

generation, distribution, and transmission services within 

Virginia. As such, the rates it charges for these services 

are subject to regulation under the Act.

In accord with the requirements of Code § 56-585.1(A), on 

March 31, 2009 VEPCO filed an application for the Commission 

to review VEPCO's prevailing rates, terms and conditions for 

generation, distribution, and transmission services and to 

determine VEPCO's authorized base rate. This rate case, 

frequently referred to as a "going-in" review, served as a 
3

transition to the new biennial review process commencing in 

2011. After completing its initial case, in an order entered 

March 11, 2010, the Commission adopted an agreed stipulation, 

made among VEPCO, the Office of the Attorney General Division 

of Consumer Counsel, and various other interested parties, 

that VEPCO's rates in the 2009-2010 biennial period would 

reflect an ROE of 11.9% "unless and until reset in the 

biennial review process" in 2011. Application of Virginia 

Electric and Power Co., Case No. PUE-2009-00081 (March 11, 

2010). In an addendum to the agreed stipulation, the parties 

clarified that VEPCO's ROE "shall be utilized for purposes of 

the Earnings Test prescribed for the Company's first biennial 

review." Id. Accordingly, although the order was entered in 

2010, under the agreed stipulation and addendum the 11.9% ROE 

would serve as the fair rate of return for the entire 2009-

2010 period to be reviewed in 2011.

Thereafter, on March 31, 2011, VEPCO filed an application 

with the Commission for the first biennial review as required 

by Code § 56-585.1(A)(3). In its application, VEPCO requested 

that the Commission approve a new ROE of 12.5% "to be applied 

. . . prospectively upon the effective date of the final order 

in this proceeding." Application of Virginia Electric and 

Power Co., Case No. PUE-2011-00027 (March 31, 2011).
4

The biennial review process prescribed by Code § 56-585.1 

includes many different elements, including a determination of 

whether the ROE from the prior biennial period permitted the 

utility to fully recover the costs of providing the utility's 

services and to earn a fair rate of return and, if not, to 

determine what recoupment or rebate would be applied to rates 

going forward. The Commission also must set the ROE for the 

current biennial period, as well as determine whether the 

individual rates allowed for the utility's generation, 

distribution, and transmission of electric power should be 

altered. Accordingly, the ratemaking process is necessarily 

fact driven, lengthy, and complex, generating a voluminous 

record.

In these appeals, VEPCO has not challenged any of the 

factual determinations of the Commission with regard to the 

rates applied in the 2009-2010 biennium and which continued to 

be charged while the review process was ongoing, or with 

regard to the rates to be charged going forward in the 2011-

2012 biennium and the ROE which will be used to evaluate

VEPCO's performance for the 2011-2012 biennium in the 2013 

biennial review. Rather, VEPCO has challenged only the 

Commission's determination, as detailed below, that the ROE 

set for the 2011-2012 biennial review would serve as the fair 

rate of return for the entire 2011-2012 biennium rather than 
5

for only the period following the date of the final order in 

the 2011 review. Accordingly, we need only briefly summarize 

the relevant rulings made by the Commission that relate to 

this issue.

On November 30, 2011, the Commission entered a final 

order on VEPCO's application, noting that it was "a first-ofits-kind" proceeding. Application of Virginia Electric and 

Power Co., Case No. PUE-2011-00027 (Nov. 30, 2007). After 

reviewing the evidence and assertions of VEPCO, the Office of 

the Attorney General Division of Consumer Affairs, other 

interested parties, and the report and recommendations of its 

staff, the Commission set a 10.9% ROE for the biennial period. 

The order further stated that "[t]he 10.9% ROE determined in 

this proceeding . . . will serve as the fair combined rate of 

return against which [VEPCO]'s earned return will be compared 

in its next biennial review proceeding" in 2013.

VEPCO filed a timely petition for reconsideration of the 

November 30, 2011 final order. 5 VAC § 5-20-220. VEPCO 

maintained in the petition that the Commission had "adopted" 

the view expressed by VEPCO in the proceeding that the ROE 

determined in the proceeding would apply prospectively only, 

but wanted "confirmation" of this point. The Commission

granted VEPCO's petition in an order dated December 16, 2011, 
6

stating that "[r]econsideration is granted for the purpose of 

continuing the Commission's jurisdiction over these matters."

After setting a briefing schedule, the Commission 

received briefs from its staff counsel, the Office of the 

Attorney General Division of Consumer Counsel, and other 

interested parties. VEPCO filed a response that, for all 

intents and purposes, mirrors the positions it has taken in 

these appeals. These arguments will be detailed in the 

discussion below.

The Commission entered an order and opinion addressing 

VEPCO's petition for reconsideration on March 29, 2012. The 

Commission first opined that Code § 56-585.1(A) "is not 

prescriptive but, rather, is discretionary as to when the ROE 

- as determined by the Commission - becomes applicable for any 

particular two-year biennial review period." The Commission 

noted that the General Assembly had made express provision for 

many aspects of determining ROE which limited the Commission's 

discretion, but had not made any express provision for melding 

two different ROEs in the same biennial period, as VEPCO had 

requested the Commission to do. The Commission further noted

that the stipulation from 2010, which set the ROE to be used 

for review of VEPCO's 2009-2010 earnings, had been advocated 

by VEPCO as an appropriate exercise of the Commission's 

authority.
7

The Commission rejected the position maintained by VEPCO 

that "unless and until reset in the biennial review process" 

language of the stipulation was intended to carry the 2009-

2010 ROE forward into 2011. To the contrary, the Commission 

was of opinion that the language did no more than recognize 

that the Commission would reset the ROE for the new biennial 

period.

Finally, the Commission noted that the ROE for a given 

biennial period does not "result in a rate change and is not 

the same as setting rates." This is so, because the ROE for a 

biennial period does not alter the rates to be charged during 

that period but, rather, is only used to adjust the rates, if 

necessary, in the next biennial review to allow the utility to 

recoup a shortfall in revenue or rebate any excess revenue to 

customers as determined by applying the ROE for that biennium. 

Thus, the Commission concluded that utilizing the ROE set in 

2011 for the entire 2011-2012 biennium was consistent with its 

function within the ratemaking process because "[f]or purposes 

of the biennial review, the relevant ROE interrogative is not 

'when,' but 'what.' The proper question is not 'when' did the 

Commission make such finding but, rather, 'what' is the ROE"

for the new biennial period.

The Commission concluded that Code § 56-585.1 "does not 

mandate the specific time period of any ROE application in any 
8

biennial review," and thus, the General Assembly intended for 

this determination to be committed to the Commission's sound 

discretion. Accordingly, the Commission ruled that in the 

2013 biennial review the 10.9% ROE would serve as the fair 

rate of return for the entire 2011-2012 biennium. These 

appeals followed.

DISCUSSION

VEPCO noted appeals from both the Commission's November 

30, 2011 order and its March 29, 2012 order, but assigned 

identical errors in each appeal:

1. The State Corporation Commission ("Commission") 

erred in its November 30, 2011 Final Order in Case 

No. PUE-2011-00027 ("Final Order"), as clarified in 

its March 29, 2012 Order on Reconsideration and 

Opinion ("Order on Reconsideration"), when, in 

determining the Company's authorized fair rate of 

return on common equity ("ROE") pursuant to the

biennial review process mandated by Va. Code § 56-

585.1, it held that it will apply the 10.9% ROE 

authorized in the Final Order retroactively to 

January 1, 2011, rather than prospectively from the 

date of the Final Order, contrary to Va. Code § 56-

585.1.

2. The Commission erred in its Final Order, as 

clarified in its Order on Reconsideration, when it 

held that the determination of the effective date of 

the Company's authorized ROE pursuant to Va. Code 

§ 56-585.1 falls within the discretion of the 

Commission, and thus erroneously held that it may 

apply the 10.9% ROE authorized in the Final Order 

retroactively to January 1, 2011, rather than 

prospectively from the date of the Final Order.

3. The Commission erred in its Final Order, as 

clarified in its Order on Reconsideration, when, in 

determining the Company's authorized ROE pursuant to 
9

the biennial review process mandated by Va. Code 

§ 56-585.1, it held that it will apply the 10.9% ROE 

authorized in the Final Order retroactively to 

January 1, 2011, rather than prospectively from the 

date of the Final Order, implicating an unlawful 

retroactive change in rates of service authorized by 

the Commission to be charged by the Company in 

contravention of Virginia common law and the 

Constitutions of the Commonwealth of Virginia and 

the United States.

4. The Commission erred in its Final Order, as 

clarified in its Order on Reconsideration, when, in 

determining the Company's authorized ROE pursuant to 

the biennial review process mandated by Va. Code 

§ 56-585.1, it held that its retroactive application 

of the 10.9% ROE authorized in the Final Order is 

consistent with its March 11, 2010 Order Approving 

Stipulation and Addendum in Case No. PUE-2009-00019, 

and that the parties to the Stipulation and 

Addendum, including the Company, agreed that the 

Company's 11.9% ROE authorized thereunder would not 

apply to earnings for the period January 1, 2011 

through the effective date of the Commission's Final 

Order in the 2011 biennial review.

VEPCO and the appellees2 agree as to the standard of 

review we are to apply, each having cited Appalachian Voices 

v. State Corporation Commission, 277 Va. 509, 515-16, 675 

S.E.2d 458, 460-61 (2009), in which we quoted the following 

passage from Northern Virginia Electric Cooperative v. 

 2 In addition to the Commission, represented by its staff 

counsel, the Office of the Attorney General Division of 

Consumer Counsel, the Virginia Committee for Fair Utility 

Rates, and the Fairfax County Board of Supervisors have 

appeared in these appeals as appellees in support of the 

Commission's ruling. With respect to the dispositive issues 

of these appeals, the appellees are mostly in accord in their 

positions supporting the Commission's decision. Accordingly, 

we will summarize their arguments jointly.
10

Virginia Electric & Power Co., 265 Va. 363, 368, 576 S.E.2d 

741, 743-44 (2003):

It is firmly established that a decision by the 

Commission 

comes to this court with a presumption of 

correctness. The Constitution of Virginia and 

statutes enacted by the General Assembly 

thereunder give the Commission broad, general 

and extensive powers in the control and 

regulation of a public service corporation. 

The Commission is charged with the 

responsibility of finding the facts and making 

a judgment. This court is neither at liberty 

to substitute its judgment in matters within 

the province of the Commission nor to overrule 

the Commission's finding of fact unless we can 

say its determination is contrary to the 

evidence or without evidence to support it.

Campbell County v. Appalachian Pow. Co., 216 Va. 93, 

105, 215 S.E.2d 918, 927 (1975). Additionally, the 

Commission's decision "is entitled to the respect 

due judgments of a tribunal informed by experience," 

and we will not disturb the Commission's analysis 

when it is " 'based upon the application of correct 

principles of law.' " Lawyers Title Insurance Corp. 

v. Norwest Corp., 254 Va. 388, 390-91, 493 S.E.2d 

114, 115 (1997) (quoting Swiss Re Life Co. Am. v. 

Gross, 253 Va. 139, 144, 479 S.E.2d 857, 860 

(1997)). However, the Commission's decision, if 

based upon a mistake of law, will be reversed. 

First Virginia Bank v. Commonwealth, 213 Va. 349, 

351, 193 S.E.2d 4, 5 (1972).

At the outset of our discussion, it is important to make 

clear, as did the Commission, the distinction between the 

"rates" which are allowed to be charged by an electric utility 

as determined by the Commission for a biennial period, and the 

"ROE" set in the same biennial review process. As the 
11

Commission explained in its March 29, 2012 order, the setting 

of the ROE does not "result in a rate change and is not the 

same as setting rates" for the biennial period in which the 

review is conducted. Rather, the ROE is used as a benchmark 

in the next biennial review for determining whether the 

utility has received a fair rate of return during the 

preceding biennium, neither reaping a windfall if market 

conditions, such as cost of fuel, consumer demand, and other 

variables, are more favorable than anticipated, nor suffering 

an undue loss if these variables are less favorable than the 

projections used to set the rates in the preceding biennial 

review.3

During VEPCO's 2011 biennial review the determination 

whether VEPCO's revenues from 2009 through 2010 had allowed it 

an appropriate rate of return was controlled by the 11.9% ROE 

established in the Commission's March 11, 2010 order. The 

10.9% ROE established in the 2011 review process will be used 

in the 2013 biennial review to determine what adjustment may 

be necessary for VEPCO's revenue from 2011 through 2012. In 

this sense, an ROE is "prospective" at the time it is 

established in one biennial review, and it is not utilized by 

 3 The ROE is used by the Commission in setting rates when 

circumstances require rate adjustments under Code § 56-

585.1(A)(8). This aspect of that statutory provision is not 

at issue in these appeals.
12

the Commission until the Commission conducts its retrospective 

review of prior earnings in the next biennial review. VEPCO 

does not challenge the Commission's 10.9% ROE determination. 

Where the parties differ is whether the Commission has the 

discretion to apply that ROE to revenue that was earned before 

that ROE was established by the Commission's order of November 

30, 2011. Thus, the crux of these appeals is whether during 

the 2013 biennial review VEPCO's revenues will be subject to 

an 11.9% ROE for the first 11 months of 2011, and a 10.9% ROE 

thereafter, as it maintains, or whether the Commission 

correctly determined that it has the discretion to apply the 

10.9% ROE to the entire 2011-2012 biennium.

VEPCO first contends that the Commission erred in holding 

that it would apply the 10.9% ROE "retroactively" to January 

1, 2011 in the 2013 biennial review because, in VEPCO's view, 

the plain language of Code § 56-585.1 mandates prospective 

application of a newly determined ROE. To support this 

assertion, VEPCO relies on four selected statements gleaned 

from the statute.

First, VEPCO notes that with regard to the initial 

"going-in" review, Code § 56-585.1(A) provides that "the 

Commission shall determine the rates that the utility may 

charge until such rates are adjusted." (Emphasis added.) 

VEPCO contends that this language shows that the legislature 
13

intended for the rates set initially to continue, and be 

subject to the ROE set for that period, until the rates were 

adjusted in the first biennial review. In this regard, VEPCO 

maintains that because it was required to charge the base 

rates set by the "going-in" review and authorized to collect 

the revenues generated thereby into the next biennium while 

the 2011 review was taking place, it should be allowed "to 

retain those revenues based on the 11.9% rate of return," 

subject to any adjustment in the next, that is the 2013, 

biennial review.

VEPCO further notes that a similar provision is found in 

Code § 56-585.1(A)(8), which provides that in subsequent 

biennial reviews after the "going-in" review, "any revisions 

in rates or credits . . . shall take effect not more than 60 

days after the date of the order." (Emphasis added.) VEPCO 

contends that this language shows that the legislature 

intended for the effect of all actions taken by the Commission 

in a biennial review to be prospective only, limiting its 

discretion to when during the 60 day period the Commission's 

order will take effect.

The appellees respond that when Code § 56-585.1 is read 

as a whole, it is clear that the General Assembly understood 

the distinction between "rates," any change in which must be 

approved by the Commission, and the ROE, which is a benchmark 
14

used to determine at a future date whether the approved rates 

have provided the utility with a fair rate of return on 

equity. Thus, they contend that VEPCO's reliance on these two 

provisions within the statute is misplaced, as they clearly 

speak to when a change may be affected in "rates," and have no 

application to the ROE that is to be applied to revenue 

derived from those rates at a future date. We agree.

When construing a statute, our " 'primary objective . . .

is to ascertain and give effect to legislative intent.' "

Conger v. Barrett, 280 Va. 627, 630, 702 S.E.2d 117, 118 

(2010) (quoting Turner v. Commonwealth, 226 Va. 456, 459, 309 

S.E.2d 337, 338 (1983)). "When the language of a statute is 

unambiguous, we are bound by the plain meaning of that 

language." Conyers v. Martial Arts World of Richmond, Inc., 

273 Va. 96, 104, 639 S.E.2d 174, 178 (2007). And if the 

language of the statute "is subject to more than one 

interpretation, we must apply the interpretation that will 

carry out the legislative intent behind the statute." Id.

Moreover, in evaluating a statute in this way, we have said 

that "consideration of the entire statute . . . to place its 

terms in context to ascertain their plain meaning does not 

offend the rule because 'it is our duty to interpret the 

several parts of a statute as a consistent and harmonious 

whole so as to effectuate the legislative goal.'" Eberhardt 
15

v. Fairfax Cnty. Emps. Ret. Sys. Bd. of Trs., 283 Va. 190, 

194-95, 721 S.E.2d 524, 526 (2012) (quoting VEPCO v. Board of 

Cnty. Supervisors, 226 Va. 382, 387-88, 309 S.E.2d 308, 311 

(1983)). Thus, "[a] statute is not to be construed by 

singling out a particular phrase." VEPCO, 226 Va. at 388, 309 

S.E.2d at 311.

Code § 56-585.1 is a comprehensive statute detailing a 

complex and cohesive regulatory scheme. The two phrases that 

VEPCO has singled out plainly do not support the proposition 

being advanced because, as the appellees observe, these 

provisions apply to rates not rate of return, which under the 

statute are distinct, separate concepts.

VEPCO, however, points to two additional provisions in 

Code § 56-585.1 to support its contention that all decisions

made by the Commission in a biennial review are to be 

prospectively applied. First, VEPCO notes that in subsection 

(A)(2), the statute provides that an ROE "shall be determined 

by the Commission during each such biennial review." VEPCO 

reasons that it would be harmonious to interpret this 

provision as meaning that an ROE should be applied 

prospectively in the same way as the rates, as both are 

determined in the biennial review.

VEPCO asserts that there is further support for this view 

in subsection (A)(2)(c), which provides that if the Commission 
16

adopts a "Performance Incentive" increasing a utility's base 

ROE, the incentive "shall remain in effect without change 

until the next biennial review for such utility is concluded." 

VEPCO contends that this language plainly evinces a 

legislative intent that both the incentive and the ROE to 

which it is added can only be changed prospectively.4

According to VEPCO, these provisions demonstrate that 

"[i]f the General Assembly had intended the [ROE] to apply 

retroactively . . . then the 2007 Act would have said so. In 

fact, it explicitly provides to the contrary."

The appellees respond that VEPCO's assertion in this 

regard is contrary to the overall scheme of the statute. They 

contend, as did the Commission in its March 29, 2012 opinion, 

that when read as a whole it is clear that where the General 

Assembly wished to limit the discretion of the Commission, it 

did so expressly. See, e.g., Code §§ 56-585.1(A)(2)(a) 

(requiring a set floor and ceiling for the ROE); -585.1(A)(10) 

(prescribing what capital structure and cost to use in 

measuring return on equity); -585.1(A)(6) (prescribing 

additional ROE for different generation technology). By 

contrast, the legislature did not dictate that a new ROE would

 4 Whether a performance incentive can only be changed 

prospectively is not before us in these appeals. Accordingly, 

we express no opinion on that issue.
17

serve as the fair rate of return for the entire biennium

because the ROE would not be utilized until the next biennial 

review in any case. Thus, the absence of such language, far 

from indicating an intent that the ROE not be applicable to 

the entire biennium, must be interpreted as a recognition that 

the General Assembly did not wish to alter the manner in which 

an ROE would be utilized, leaving it to the Commission to make 

such adjustments in its discretion if it deemed proper and 

necessary.

We agree with the Commission's observation in its March 

29, 2012 opinion that the directive that the ROE for a 

biennium "shall be determined by the Commission during each 

such biennial review" means exactly what it says and nothing 

more. That is, this language directs that a new ROE is to be 

determined by the Commission during the biennial review based 

on the most recently available criteria, but it says nothing 

about limiting the application of an ROE to less than the full 

biennium in the subsequent review. It plainly does not 

mandate that an ROE must be applied to less than the full 

biennium.

In short, the better reading of VEPCO's four selections 

from Code § 56-585.1 is to place them in context within the 

entire statute. In doing so, it is entirely consistent with 

the overall legislative intent expressed therein that the 
18

General Assembly would expressly dictate that the "rates" 

which already have been assessed while a biennial review was 

pending could only be modified prospectively, but would make 

no such provision for an ROE, which is used as a benchmark to 

evaluate performance after the biennium which is under review

has ended. Accordingly, we hold that the Commission did not 

err in concluding that Code § 56-585.1 does not mandate 

prospective application of an ROE from the date it is set by 

the Commission's final order at the conclusion of a biennial 

review.

VEPCO next contends that even if Code § 56-585.1 does not 

expressly mandate that the Commission must apply the ROE 

determined in a biennial review prospectively from the date of 

its final order, the Commission nonetheless erred in 

concluding that it had the discretion to utilize the ROE for 

the entire 2011-2012 biennium because of statutory, 

procedural, and due process constraints as well as policy 

considerations.5

 We will address each aspect of VEPCO's 

contentions in turn.

Initially, VEPCO maintains that the same statutory 

provisions that it relied upon in asserting that prospective 

application of an ROE is mandatory also in this case limit the 

 5 On brief, VEPCO combined the issues of its second and 

third assignments of error in this argument.
19

Commission's discretion to apply the 10.9% ROE to the entire 

2011-2012 biennium. VEPCO notes that the Commission itself 

recognized that many of the provisions of Code § 56-585.1 

place express limits on the Commission's discretion as to the 

determination of an ROE. VEPCO contends that if the 

Commission were also not limited in its discretion as to when 

an ROE would be applied, this would "swallow up or 'end-run' 

many of the stated limitations on its authority."

The appellees respond that the General Assembly expressly

set specific limitations on the Commission's authority to 

determine the ROE, but was silent as to when the ROE should be 

applied. They contend that because the nature of the biennial 

review process makes it self-evident that the ROE would not be 

determined until sometime during the first year of the 

biennium to which it would apply, the legislature must have 

been aware that the Commission would have been required to 

determine when the ROE was to be applied. Having given no 

express direction on this matter, they assert that the 

legislative intent was to leave the matter to the Commission's 

sound discretion. We agree.

"The Commission is a specialized body with broad 

discretion in regulating public utilities." Level 3 Commcn's 

of Virginia v. State Corp. Comm'n, 268 Va. 471, 474, 604 

S.E.2d 71, 72 (2004); Central Tel. Co. of Va. v. State Corp.
20

Comm'n, 219 Va. 863, 874, 252 S.E.2d 575, 581 (1979). 

Moreover, when the Commission is conducting a ratemaking 

procedure, it is exercising a legislative function delegated 

to it by the General Assembly. Potomac Edison Co. v. State

Corp. Comm'n, 276 Va. 577, 587, 667 S.E.2d 772, 777 (2008). 

Thus, when a statute delegates such authority to the 

Commission, we presume that any limitation on the Commission's 

discretionary authority by the General Assembly will be 

clearly expressed in the language of the statute. In the 

absence of an express limitation, we will not add language to 

the statute by inference. See Jackson v. Fidelity & Deposit 

Co., 269 Va. 303, 313, 608 S.E.2d 901, 906 (2005) ("Courts 

cannot 'add language to the statute the General Assembly has 

not seen fit to include.' ") (quoting Holsapple v. 

Commonwealth, 266 Va. 593, 599, 587 S.E.2d 561, 564-65 

(2003)). Rather, we presume that where the General Assembly 

has not placed an express limitation in a statutory grant of 

authority, it intended for the Commission, as an expert body, 

to exercise sound discretion. Accordingly, we hold that there 

is no statutory prohibition of the Commission's exercising its 

discretion to determine when an ROE for a given biennium will 

be applied.

VEPCO next contends that permitting the Commission to 

utilize the newly set ROE for the entire 2011-2012 biennium
21

violates Rule 1:1 because this would permit the Commission to 

modify its March 11, 2010 order "authorizing the 11.9% rate of 

return that was in effect during" the period of January 1, 

2011 to November 30, 2011. However, the Commission made an 

express finding in the March 29, 2012 order that the 

stipulation adopted in the March 11, 2010 order "does not 

apply the 11.9% ROE determined therein to the second biennial 

review." VEPCO has not assigned error to this finding by the 

Commission. Therefore, under the facts as determined by the 

Commission, the 11.9% ROE never applied to the 2011-2012 

biennial period, and, accordingly, the November 30, 2011 order 

did not modify the March 11, 2010 order.

VEPCO next contends that by applying the 10.9% ROE to the 

entire 2011-2012 biennium, the Commission has effectively 

instituted a retroactive rate change for the period of January 

1, 2011 to November 30, 2011 in violation of due process 

guarantees of the Virginia and federal constitutions. This 

argument is premised on VEPCO's assertion that the March 11, 

2010 order "authorized the Company to charge rates designed to 

provide it with the opportunity to earn an 11.9% rate of 

return." However, as the Commission expressly found that the 

11.9% rate did not apply after December 31, 2010, VEPCO's 

assertion must fail.
22

Moreover, as appellees note in responding to this issue, 

and as we have already explained in addressing VEPCO's first 

assignment of error, the term "rates" as used in this statute 

refers to the rates that a utility is authorized to charge. 

It does not refer to the ROE which is used to measure whether 

the rates allowed the utility a fair rate of return. While 

VEPCO was required to continue charging the rates set in 2010 

until the 2011 biennial review was complete, it is simply not 

correct to say that those "rates [were] designed to provide it 

with the opportunity to earn an 11.9% rate of return" in the 

2011-2012 biennium. The 11.9% ROE was "designed" in the 

"going-in" review process that was limited to the time period

applicable to that review process. Likewise, it was the 2011 

biennial review that would determine the appropriate ROE for 

the 2011-2012 biennium. Accordingly, we hold that there has 

been no due process violation of VEPCO's rights under the 

facts of this case.

VEPCO next contends that the General Assembly could not 

have intended for the Commission to have discretion to set an

ROE during the period to which it will be applied because this 

would create "significant operational concerns and risks 

. . . . with respect to the ability of the Company to manage 

its business and comply with its financial reporting 

obligations, as well the ability for investors to evaluate 
23

their investment options in the Company." VEPCO contends that 

such uncertainty "would run directly contrary to the goals of 

promoting healthy and stable electric utility returns and 

investor perceptions that are an evident purpose of the 2007 

Act." 

Even if we assume that VEPCO's contentions accurately

reflect public policy concerns that the Act is intended to 

facilitate, this Court is not the appropriate forum for 

addressing VEPCO's asserted deficiencies of the Act regarding

those concerns. The legislature is the "author of public 

policy." Campbell v. Commonwealth, 246 Va. 174, 184 n.8, 431 

S.E.2d 648, 654 n.8 (1993). The courts "can only administer 

the law as it is written." Coalter v. Bargamin, 99 Va. 65, 

71, 37 S.E. 779, 781 (1901). For the courts, then, the "best 

indications of public policy are to be found in the enactments 

of the Legislature." City of Charlottesville v. DeHaan, 228 

Va. 578, 583, 323 S.E.2d 131, 133 (1984) (quoting City of 

Danville v. Hatcher, 101 Va. 523, 532, 44 S.E. 723, 726 

(1903)).

Having found that Code § 56-585.1 does not expressly 

limit the discretion of the Commission to set an ROE during 

the biennium to which it will apply, we must presume that the 

General Assembly found such discretion to be consistent with 

the policy objectives of the statute. Accordingly, we will 
24

not consider VEPCO's policy-based arguments, but presume that 

if they have merit they will find redress in the appropriate 

forum of the legislature.

Finally, VEPCO contends that the Commission erred in 

relying on the stipulation agreed to by VEPCO and adopted by 

the Commission in the March 11, 2010 order as demonstrating 

that VEPCO had effectively agreed that utilization of the ROE 

determined during the "going-in" review was appropriate, and, 

thus, that utilization of the ROE determined in the 2011 

biennial review was permissible. Appellees Fairfax County and 

the Virginia Committee for Fair Utility Rates respond that the 

Commission's prior action is merely consistent with and

provides a rational basis for its action in the present case.

Because we have already determined that the Commission 

has the discretion to utilize the 10.9% ROE for the entire 

2011-2012 biennium, any reliance that the Commission may have 

placed on VEPCO's prior stipulation to the retrospective

application of the ROE from the "going-in" review, even if 

misplaced, would not impugn the Commission's action in this 

case. Moreover, the March 29, 2012 order is clear that the 

Commission principally relied upon its interpretation of Code 

§ 56-585.1 as the basis for finding that it could apply the 

10.9% ROE to the entire 2011-2012 biennium. The references to 

the 2010 stipulation in the order relied upon by VEPCO to 
25

support its argument principally set the background of the 

case, and to the extent they may be viewed as justification 

for the Commission's action, this would only serve as an 

alternative basis for a ruling that was, in any case, correct.

CONCLUSION

In summary, we find no merit to VEPCO's contentions that 

the Commission is not permitted to utilize the 10.9% ROE set 

in the November 30, 2011 order for the entire 2011-2012 

biennial period in the 2013 biennial review of the rates, 

terms, and conditions for the provision of generation, 

distribution, and transmission services by VEPCO. The 

Commission's construction of Code § 56-585.1 was based upon 

the proper application of legal principles, and we hold that 

the Commission did not abuse the discretion afforded to it 

under that statute. For these reasons, the judgment of the 

Commission will be affirmed.

Affirmed.