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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



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FORM 10-Q



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(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended March 31, 2007

or



| ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ----------------------------------------------------------------------------------------

For the transition period from  to

Commission file number 000-50039



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OLD DOMINION ELECTRIC
COOPERATIVE

(Exact Name of Registrant as Specified in Its Charter)



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|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|VIRGINIA                                                       |  | 23-7048405                          
|(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification No.)
|                                                               | 
|4201 Dominion Boulevard, Glen Allen, Virginia                  |  | 23060                               
|(Address of Principal Executive Offices)                       |  | (Zip Code)                          

(804) 747-0592

(Registrants Telephone Number, Including Area Code)



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Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No ̈

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer and large accelerated filer in Rule 12b-2
of the Exchange Act.

Larger accelerated filer ̈Accelerated filer ̈Non-accelerated
filer  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).    Yes ̈No  x

The Registrant is a membership corporation and has no authorized or outstanding equity securities.



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##### Table of Contents

OLD DOMINION ELECTRIC COOPERATIVE

INDEX



|                                                                                                                                       |  |           
|-------------------------------------------------------------------------------------------------------------------------------------- |  | ----------
|                                                                                                                                       |  | PageNumber
|PART I. Financial Information                                                                                                          |  |           
|                                                                                                                                       | 
|Item 1. Financial Statements                                                                                                           |  |           
|                                                                                                                                       | 
|Condensed Consolidated Balance Sheets  March 31, 2007 (Unaudited) and December 31, 2006                                               |  | 3         
|                                                                                                                                       | 
|Condensed Consolidated Statements of Revenues, Expenses and Patronage Capital (Unaudited)  Three months ended March 31, 2007 and 2006 |  | 4         
|                                                                                                                                       | 
|Condensed Consolidated Statements of Comprehensive Income (Unaudited) - Three months ended March 31, 2007 and 2006                     |  | 4         
|                                                                                                                                       | 
|Condensed Consolidated Statements of Cash Flows (Unaudited)  Three Months Ended March 31, 2007 and 2006                               |  | 5         
|                                                                                                                                       | 
|Notes to Condensed Consolidated Financial Statements                                                                                   |  | 6         
|                                                                                                                                       | 
|Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations                                          |  | 10        
|                                                                                                                                       | 
|Item 3. Quantitative and Qualitative Disclosures About Market Risk                                                                     |  | 17        
|                                                                                                                                       | 
|Item 4. Controls and Procedures                                                                                                        |  | 17        
|                                                                                                                                       | 
|PART II. Other Information                                                                                                             |  |           
|                                                                                                                                       | 
|Item 1. Legal Proceedings                                                                                                              |  | 18        
|                                                                                                                                       | 
|Item 1A. Risk Factors                                                                                                                  |  | 18        
|                                                                                                                                       | 
|Item 5. Other Information                                                                                                              |  | 18        
|                                                                                                                                       | 
|Item 6. Exhibits                                                                                                                       |  | 20        



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OLD DOMINION ELECTRIC COOPERATIVE

PART 1. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS



|                                             |  |                |           |   |                  |   |           |  
|-------------------------------------------- |  | -------------- | --------- | - | ---------------- | - | --------- | -
|                                             |  | March 31,2007  |           |   | December 31,2006 |  
|                                             |  | (in thousands) |          
|                                             |  | (unaudited)    |           |   |                  |  
|ASSETS:                                      |  |                |           |   |                  |   |           |  
|Electric Plant:                              |  |                |           |   |                  |   |           |  
|In service                                   |  | $              | 1,527,774 |   |                  | $ | 1,527,672 |  
|Less accumulated depreciation                |  |                | (519,067  | ) |                  |   | (509,306  | )
|                                             |  |                |           |   |                  |   |           |  
|                                             |  |                | 1,008,707 |   |                  |   | 1,018,366 |  
|Nuclear fuel, at amortized cost              |  |                | 7,043     |   |                  |   | 8,381     |  
|Construction work in progress                |  |                | 24,402    |   |                  |   | 20,342    |  
|                                             |  |                |           |   |                  |   |           |  
|Net Electric Plant                           |  |                | 1,040,152 |   |                  |   | 1,047,089 |  
|                                             |  |                |           |   |                  |   |           |  
|Investments:                                 |  |                |           |   |                  |   |           |  
|Nuclear decommissioning trust                |  |                | 92,607    |   |                  |   | 91,050    |  
|Lease deposits                               |  |                | 172,681   |   |                  |   | 171,585   |  
|Other                                        |  |                | 74,179    |   |                  |   | 24,321    |  
|                                             |  |                |           |   |                  |   |           |  
|Total Investments                            |  |                | 339,467   |   |                  |   | 286,956   |  
|                                             |  |                |           |   |                  |   |           |  
|Current Assets:                              |  |                |           |   |                  |   |           |  
|Cash and cash equivalents                    |  |                | 42,433    |   |                  |   | 52,018    |  
|Accounts receivable                          |  |                | 3,199     |   |                  |   | 4,071     |  
|Accounts receivable - deposits               |  |                |          |   |                  |   | 23,600    |  
|Accounts receivable - members                |  |                | 92,976    |   |                  |   | 94,136    |  
|Fuel, materials and supplies                 |  |                | 31,546    |   |                  |   | 30,585    |  
|Deferred energy                              |  |                | 31,033    |   |                  |   | 14,914    |  
|Prepayments                                  |  |                | 4,631     |   |                  |   | 4,035     |  
|                                             |  |                |           |   |                  |   |           |  
|Total Current Assets                         |  |                | 205,818   |   |                  |   | 223,359   |  
|                                             |  |                |           |   |                  |   |           |  
|Deferred Charges:                            |  |                |           |   |                  |   |           |  
|Regulatory assets                            |  |                | 34,083    |   |                  |   | 49,738    |  
|Other                                        |  |                | 20,535    |   |                  |   | 20,267    |  
|                                             |  |                |           |   |                  |   |           |  
|Total Deferred Charges                       |  |                | 54,618    |   |                  |   | 70,005    |  
|                                             |  |                |           |   |                  |   |           |  
|Total Assets                                 |  | $              | 1,640,055 |   |                  | $ | 1,627,409 |  
|                                             |  |                |           |   |                  |   |           |  
|                                             |  |               
|CAPITALIZATION AND LIABILITIES:              |  |                |           |   |                  |   |           |  
|Capitalization:                              |  |                |           |   |                  |   |           |  
|Patronage capital                            |  | $              | 296,110   |   |                  | $ | 293,077   |  
|Non-controlling interest                     |  |                | 10,588    |   |                  |   | 10,993    |  
|Long-term debt                               |  |                | 814,120   |   |                  |   | 813,264   |  
|                                             |  |                |           |   |                  |   |           |  
|Total Capitalization                         |  |                | 1,120,818 |   |                  |   | 1,117,334 |  
|                                             |  |                |           |   |                  |   |           |  
|Current Liabilities                          |  |                |           |   |                  |   |           |  
|Long-term debt due within one year           |  |                | 22,917    |   |                  |   | 22,917    |  
|Accounts payable                             |  |                | 68,911    |   |                  |   | 87,844    |  
|Accounts payable-members                     |  |                | 56,433    |   |                  |   | 48,220    |  
|Accrued expenses                             |  |                | 51,432    |   |                  |   | 35,767    |  
|                                             |  |                |           |   |                  |   |           |  
|Total Current Liabilities                    |  |                | 199,693   |   |                  |   | 194,748   |  
|                                             |  |                |           |   |                  |   |           |  
|Deferred Credits and Other Liabilities       |  |                |           |   |                  |   |           |  
|Asset retirement obligation                  |  |                | 56,545    |   |                  |   | 55,812    |  
|Obligations under long-term leases           |  |                | 175,103   |   |                  |   | 174,205   |  
|Regulatory liabilities                       |  |                | 54,824    |   |                  |   | 51,497    |  
|Other                                        |  |                | 33,072    |   |                  |   | 33,813    |  
|                                             |  |                |           |   |                  |   |           |  
|Total Deferred Credits and Other Liabilities |  |                | 319,544   |   |                  |   | 315,327   |  
|                                             |  |                |           |   |                  |   |           |  
|Commitments and Contingencies                |  |                |          |   |                  |   |          |  
|                                             |  |                |           |   |                  |   |           |  
|Total Capitalization and Liabilities         |  | $              | 1,640,055 |   |                  | $ | 1,627,409 |  
|                                             |  |                |           |   |                  |   |           |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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OLD DOMINION ELECTRIC COOPERATIVE

CONDENSED CONSOLIDATED STATEMENTS OF REVENUES,

EXPENSES AND PATRONAGE CAPITAL (UNAUDITED)



|                                                            |  |                             |         |   |      |   |         |  
|----------------------------------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------- | -
|                                                            |  | Three Months EndedMarch 31, |        
|                                                            |  | 2007                        |         |   | 2006 |  
|                                                            |  | (in thousands)              |        
|Operating Revenues                                          |  | $                           | 228,710 |   |      | $ | 203,461 |  
|                                                            |  |                            
|Operating Expenses:                                         |  |                             |         |   |      |   |         |  
|Fuel                                                        |  |                             | 33,093  |   |      |   | 24,465  |  
|Purchased power                                             |  |                             | 166,316 |   |      |   | 161,364 |  
|Deferred energy                                             |  |                             | (16,119 | ) |      |   | (27,682 | )
|Operations and maintenance                                  |  |                             | 9,976   |   |      |   | 8,060   |  
|Administrative and general                                  |  |                             | 8,092   |   |      |   | 8,287   |  
|Depreciation, amortization and decommissioning              |  |                             | 9,417   |   |      |   | 9,660   |  
|Amortization of regulatory asset/(liability), net           |  |                             | 181     |   |      |   | 195     |  
|Accretion of asset retirement obligations                   |  |                             | 732     |   |      |   | 651     |  
|Taxes other than income taxes                               |  |                             | 1,830   |   |      |   | 1,560   |  
|                                                            |  |                             |         |   |      |   |         |  
|Total Operating Expenses                                    |  |                             | 213,518 |   |      |   | 186,560 |  
|                                                            |  |                             |         |   |      |   |         |  
|Operating Margin                                            |  |                             | 15,192  |   |      |   | 16,901  |  
|                                                            |  |                             |         |   |      |   |         |  
|Other Expense, net                                          |  |                             | (43     | ) |      |   | (100    | )
|Investment Income                                           |  |                             | 3,008   |   |      |   | 2,075   |  
|Interest Charges, net                                       |  |                             | (15,086 | ) |      |   | (14,922 | )
|                                                            |  |                             |         |   |      |   |         |  
|Net Margin Before Income Taxes and Non-Controlling Interest |  |                             | 3,071   |   |      |   | 3,954   |  
|                                                            |  |                             |         |   |      |   |         |  
|Income Taxes                                                |  |                             | (8      | ) |      |   | (385    | )
|Non-Controlling Interest                                    |  |                             | (30     | ) |      |   | (579    | )
|                                                            |  |                             |         |   |      |   |         |  
|Net Margin                                                  |  |                             | 3,033   |   |      |   | 2,990   |  
|                                                            |  |                             |         |   |      |   |         |  
|Patronage Capital - Beginning of Period                     |  |                             | 293,077 |   |      |   | 271,833 |  
|                                                            |  |                             |         |   |      |   |         |  
|Patronage Capital - End of Period                           |  | $                           | 296,110 |   |      | $ | 274,823 |  
|                                                            |  |                             |         |   |      |   |         |  

OLD DOMINION ELECTRIC COOPERATIVE

CONDENSED CONSOLIDATED STATEMENTS

OF COMPREHENSIVE INCOME (UNAUDITED)



|                                                                  |  |                             |       |   |      |   |         |  
|----------------------------------------------------------------- |  | --------------------------- | ----- | - | ---- | - | ------- | -
|                                                                  |  | Three Months EndedMarch 31, |      
|                                                                  |  | 2007                        |       |   | 2006 |  
|                                                                  |  | (in thousands)              |      
|Net Margin                                                        |  | $                           | 3,033 |   |      | $ | 2,990   |  
|                                                                  |  |                             |       |   |      |   |         |  
|Other Comprehensive Income:                                       |  |                             |       |   |      |   |         |  
|Unrealized loss on derivative contracts(1)                        |  |                             | (435  | ) |      |   | (12,504 | )
|                                                                  |  |                             |       |   |      |   |         |  
|Other Comprehensive Income (Loss) before Non-controlling interest |  |                             | 2,598 |   |      |   | (9,514  | )
|Less: Non-controlling interest in comprehensive income            |  |                             | 435   |   |      |   | 12,504  |  
|                                                                  |  |                             |       |   |      |   |         |  
|Comprehensive Income                                              |  | $                           | 3,033 |   |      | $ | 2,990   |  
|                                                                  |  |                             |       |   |      |   |         |  

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|(1) | Unrealized loss on derivative contracts net of taxes of $0.3 and $8.0 million for the three months ended
March 31, 2007 and March 31, 2006, respectively.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------

The accompanying notes are an integral part of the condensed consolidated
financial statements.



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OLD DOMINION ELECTRIC COOPERATIVE

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)



|                                                                                              |  |                             |          |   |      |   |         |  
|--------------------------------------------------------------------------------------------- |  | --------------------------- | -------- | - | ---- | - | ------- | -
|                                                                                              |  | Three Months EndedMarch 31, |         
|                                                                                              |  | 2007                        |          |   | 2006 |  
|                                                                                              |  | (in thousands)              |         
|Operating Activities:                                                                         |  |                             |          |   |      |   |         |  
|Net Margin                                                                                    |  | $                           | 3,033    |   |      | $ | 2,990   |  
|Adjustments to reconcile net margins to net cash provided by (used for) operating activities: |  |                             |          |   |      |   |         |  
|Depreciation, amortization and decommissioning                                                |  |                             | 9,417    |   |      |   | 9,660   |  
|Other non-cash charges                                                                        |  |                             | 3,038    |   |      |   | 2,795   |  
|Non-controlling interest                                                                      |  |                             | 30       |   |      |   | 579     |  
|Amortization of lease obligations                                                             |  |                             | 2,886    |   |      |   | 2,718   |  
|Interest on lease deposits                                                                    |  |                             | (2,810   | ) |      |   | (2,616  | )
|Change in current assets                                                                      |  |                             | 24,075   |   |      |   | 55,968  |  
|Change in deferred energy                                                                     |  |                             | (16,119  | ) |      |   | (27,682 | )
|Change in current liabilities                                                                 |  |                             | 5,222    |   |      |   | (56,179 | )
|Change in regulatory assets and liabilities                                                   |  |                             | 18,342   |   |      |   | (32,069 | )
|Deferred charges and credits                                                                  |  |                             | (1,031   | ) |      |   | (1,710  | )
|                                                                                              |  |                             |          |   |      |   |         |  
|Net Cash Provided by (Used for) Operating Activities                                          |  |                             | 46,083   |   |      |   | (45,546 | )
|                                                                                              |  |                             |          |   |      |   |         |  
|Financing Activities:                                                                         |  |                             |          |   |      |   |         |  
|Obligations under long-term leases                                                            |  |                             | (274     | ) |      |   | (503    | )
|                                                                                              |  |                             |          |   |      |   |         |  
|Net Cash (Used for) Financing Activities                                                      |  |                             | (274     | ) |      |   | (503    | )
|                                                                                              |  |                             |          |   |      |   |         |  
|Investing Activities:                                                                         |  |                             |          |   |      |   |         |  
|Purchases of available for sale securities                                                    |  |                             | (117,449 | ) |      |   | (7,675  | )
|Proceeds from sale of available for sale securities                                           |  |                             | 57,629   |   |      |   | 15,350  |  
|Increase in other investments                                                                 |  |                             | 9,045    |   |      |   | (869    | )
|Electric plant additions                                                                      |  |                             | (4,619   | ) |      |   | (3,282  | )
|                                                                                              |  |                             |          |   |      |   |         |  
|Net Cash (Used for) Provided by Investing Activities                                          |  |                             | (55,394  | ) |      |   | 3,524   |  
|                                                                                              |  |                             |          |   |      |   |         |  
|Net Change in Cash and Cash Equivalents                                                       |  |                             | (9,585   | ) |      |   | (42,525 | )
|Cash and Cash Equivalents - Beginning of Period                                               |  |                             | 52,018   |   |      |   | 98,633  |  
|                                                                                              |  |                             |          |   |      |   |         |  
|Cash and Cash Equivalents - End of Period                                                     |  | $                           | 42,433   |   |      | $ | 56,108  |  
|                                                                                              |  |                             |          |   |      |   |         |  

The accompanying notes are an integral part of the condensed consolidated financial statements.



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OLD DOMINION ELECTRIC COOPERATIVE

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



|1. | In the opinion of our management, the accompanying unaudited condensed consolidated financial statements contain all adjustments, which include only normal recurring adjustments,
necessary for a fair statement of our consolidated financial position as of March 31, 2007, and our consolidated results of operations, comprehensive income, and cash flows for the three months ended March 31, 2007 and 2006. The
consolidated results of operations for the three months ended March 31, 2007 are not necessarily indicative of the results to be expected for the entire year. These financial statements should be read in conjunction with the financial
statements and notes thereto included in our 2006 Annual Report on Form 10-K filed with the Securities and Exchange Commission.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|2. | Presentation. The accompanying financial statements reflect the consolidated accounts of Old Dominion Electric Cooperative (ODEC or we or
our) and TEC Trading, Inc. (TEC). We are a not-for-profit wholesale power supply cooperative, incorporated under the laws of the Commonwealth of Virginia in 1948. We have two classes of members. Our Class A members are
twelve customer-owned electric distribution cooperatives engaged in the retail sale of power to member consumers located in Virginia, Delaware, Maryland, and parts of West Virginia. Our sole Class B member is TEC, a taxable corporation owned by
our member distribution cooperatives. Our board of directors is composed of two representatives from each of the member distribution cooperatives and one representative from TEC.
|-- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

In accordance with Financial Accounting Standards Board (FASB) Interpretation No. 46R, Consolidation of Variable Interest
Entities, an Interpretation of Accounting Research Bulletin No. 51 (the Interpretation), TEC is considered a variable interest entity for which we are the primary beneficiary. We became the primary beneficiary of TEC in 2001.
We first consolidated TECs financial position as of December 31, 2004, and beginning January 1, 2005, TECs operations were also consolidated as a result of our adoption of the Interpretation. We have eliminated all intercompany
balances and transactions in consolidation. The assets and liabilities and non-controlling interest of TEC are recorded at carrying value and the net assets consolidated were $10.6 million and $11.0 million at March 31, 2007, and
December 31, 2006, respectively. As TEC is 100% owned by our twelve member distribution cooperatives, its equity is presented as a non-controlling interest in our consolidated financial statements. Our non-controlling, 50% or less, ownership
interest in other entities is recorded using the equity method of accounting.

Our rates are not regulated by the respective states
public service commissions, but are set periodically by a formula that was accepted for filing by the Federal Energy Regulatory Commission (FERC) on December 23, 2003. An amendment to the formula was accepted for filing by FERC
on February 19, 2005, subject to the outcome of our other pending FERC proceedings.

We comply with the Uniform System of Accounts as
prescribed by FERC. In conformity with accounting principles generally accepted in the United States (GAAP), the accounting policies and practices applied by us in the determination of rates are also employed for financial reporting
purposes.

The preparation of our consolidated financial statements in conformity with GAAP requires management to make estimates and
assumptions that affect the amounts reported therein. Actual results could differ from those estimates.



|3. | Financial Instruments (including Derivatives). Financial instruments included in the decommissioning fund are classified as available for sale, and accordingly, are carried
at fair value. Unrealized gains and losses on investments held in the decommissioning fund are deferred as a regulatory liability and a regulatory asset until realized.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Our investments in marketable securities, which are actively managed, are classified as available for sale and are recorded at fair value. Unrealized
gains or losses on these investments, if material, are reflected as a component of capitalization. Investments in debt securities that we have the positive intent and ability to hold to maturity are classified as held to maturity and are recorded at
amortized cost. Other investments are recorded at cost, which approximates market value.

We primarily purchase power under both long-term
and short-term forward physical delivery contracts to supply power to our member distribution cooperatives under all requirements wholesale power contracts. These forward purchase contracts meet the accounting definition of a derivative;
however, a majority of the forward purchase derivative contracts qualify for the normal purchases/normal sales exception under Statement of Financial Accounting Standards (SFAS) No. 133 Accounting for Derivative Instruments
and Hedging Activities. As a result, these contracts are not recorded at fair value. We record a liability and purchased power expense when the power under the forward physical delivery contract is delivered. We also purchase



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natural gas futures generally for three years or less to hedge the price of natural gas for the operation of our combustion turbine facilities and to hedge
certain forward power purchase agreements that use natural gas as a basis for determining the price of power. These derivatives do not qualify for the normal purchase/normal sales exception.

For all derivative contracts that do not qualify for the normal purchases/normal sales accounting exception, we may elect cash flow hedge accounting in
accordance with SFAS No. 133. Accordingly, gains and losses on derivative contracts are deferred into Other Comprehensive Income until the hedged underlying transaction occurs or is no longer likely to occur. For derivative contracts where
hedge accounting is not utilized, or for which ineffectiveness exists, we defer all remaining gains and losses on a net basis as a regulatory asset or liability in accordance with SFAS No. 71 Accounting for the Effects of Certain Types of
Regulation. These amounts are subsequently reclassified as purchased power or fuel expense in our Consolidated Statements of Revenues, Expenses, and Patronage Capital as the power or fuel is delivered and/or the contract settles.

Generally, derivatives are reported on the Consolidated Balance Sheet at fair value. The measurement of fair value is based on actively quoted market
prices, if available. Otherwise, we seek indicative price information from external sources, including broker quotes and industry publications. For individual contracts, the use of differing assumptions could have a material effect on the
contracts estimated fair value. There was no hedge ineffectiveness for the three months ended March 31, 2007 and hedge ineffectiveness was immaterial for the three months ended March 31, 2006.

We are exposed to credit risk in our business operations. We have a Credit Risk Policy that establishes the basis for determining counterparty credit
standards and processes to determine credit limits. Our risk management committee monitors credit exposure on a regular basis. Formal counterparty credit reviews are performed at least annually and informal reviews are performed on an ongoing basis.



|4. | Commitments and Contingencies.
|-- | ------------------------------

Norfolk Southern

In April 1989, we entered into a coal transportation agreement with Norfolk Southern for delivery of coal to Clover. The agreement, which
was later assigned to Virginia Power as operator of Clover, had an initial 20-year term and provides that the amounts payable for coal transportation services are subject to adjustment based on a reference index. In October 2003, Norfolk Southern
claimed that it had been using an incorrect reference index to calculate amounts due to it since the inception of the agreement, and that it would begin to escalate prices for these services in the future based on an alternate reference index. On
November 26, 2003, together with Virginia Power, we filed suit against Norfolk Southern in the Circuit Court of Halifax County, Virginia, seeking an order to clarify the price escalation provisions in the coal transportation agreement. In its
reply to our suit, Norfolk Southern filed a counter-claim and sought (1) recovery from Virginia Power and us for additional amounts resulting from its use of the alternate reference index since December 1, 2003, and (2) an order
requiring the parties to calculate the amounts Norfolk Southern claims it was underpaid since the inception of the agreement by using the alternate reference index.

On December 22, 2004, the court found in favor of Norfolk Southern on the issue of ambiguity and held that the price escalation provisions in the agreement were clear and unambiguous. The court later denied
Virginia Powers and our motion to file an amended complaint based on additional evidence that was not considered by the court in the original proceedings. The court permitted Virginia Power and us to file an amended answer to Norfolk
Southerns counter-claims and our amended answer was filed on March 4, 2005.

On September 1, 2006, the court granted
Norfolk Southerns request to substantially dispose of the issues in the case. On September 23, 2006, we, along with Virginia Power, appealed the courts order to the Supreme Court of Virginia. On December 13, 2006, Norfolk
Southern filed a motion to dismiss for lack of jurisdiction, contending that we and Virginia Power failed to timely appeal. On April 4, 2007, we along with Virginia Power, presented our arguments to a panel of three justices as to why the
petition for appeal should be granted and we are currently awaiting the decision. If any one of the three justices supports granting the petition for appeal, we along with Virginia Power, intend to vigorously prosecute the appeal.

We recorded a liability related to the Norfolk Southern dispute and created the related regulatory asset for prior charges. The regulatory asset was
amortized over 21 months (April 1, 2005 through December 31, 2006) and was fully amortized and collected through rates as of December 31, 2006. The current period charges are being collected through rates. If it is ultimately determined
that we owe any such amounts to Norfolk Southern, the amounts are not expected to have a material impact on our financial position or results of operations due to our ability to collect such amounts through rates charged to our member distribution
cooperatives.



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Ragnar Benson

In December 2002, we entered into a contract with RBI for engineering, procurement and construction services relating to the construction of our Marsh Run combustion turbine facility. Construction of the facility
began in April 2003 and the facility was required to be substantially complete in the second quarter of 2004. The facility ultimately became available for commercial operation on September 15, 2004, but is still not substantially complete
according to the terms of the contract. On December 23, 2004, we terminated the contract with RBI for default and filed suit in the U.S. District Court for the Eastern District of Virginia, Richmond Division, against RBI seeking liquidated
damages for delay in completion of the project up to $15.0 million and damages for breach of contract up to $5.0 million. RBI counterclaimed for damages exceeding $15.0 million related to conditions they claim to have encountered during
construction. We filed an answer to RBIs counterclaim denying any liability to RBI. During the discovery phase of the legal proceeding, RBI revised its claim from $15.0 million to $33.0 million.

On September 27, 2005, the U.S. District Court for the Eastern District of Virginia, Richmond Division, ruled on motions for partial summary
judgment in our claims against RBI. Specifically, the court granted our motion for partial summary judgment pertaining to claims of entitlement to a change order and fraud allegations, it dismissed six of RBIs counterclaims, including all
counterclaims pertaining to fraud, and it limited our possible recovery of liquidated damages to the liquidated damages cap of approximately $4.7 million. The trial began October 11, 2005 and concluded October 26, 2005. During the trial,
RBI revised its claim from $33.0 million to $36.0 million.

RBI and its parent companies, The Austin Company and Austin Holdings, Inc.,
filed for bankruptcy under Chapter 11 of the bankruptcy code on October 14, 2005. The automatic litigation stay was lifted for our litigation with RBI.

On June 13, 2005, we executed an agreement with RBIs surety, Seaboard Surety Company (Seaboard), under which it assumed all responsibilities for the final completion of the Marsh Run facility in
accordance with the terms of the original agreement with RBI. Because RBI declared bankruptcy during the legal proceeding, we served a lawsuit against Seaboard on February 10, 2006, in order to enforce the eventual outcome of the suit with RBI.

On August 4, 2006, the court ruled in our favor on all remaining issues in the case and awarded us damages of $5.2 million plus
expenses. On January 22, 2007, the court entered its order awarding us an additional $2.5 million for attorneys fees and certain other costs and expenses. On February 1, 2007, we filed a motion to amend the January 22, 2007
order to address our claim for expert witness fees and interest from the date of the trial, totaling approximately $0.8 million. On April 12, 2007, the court entered its final order awarding us a total of $7.6 million plus interest on the
principal judgment from October 25, 2005, and interest on attorneys fees from September 15, 2006. The appeals process began with the April 12, 2007 order and RBI will have 30 days to appeal any of the courts rulings. On
April 23, 2007, we filed an amended complaint against Seaboard Surety Company (Seaboard) to take into consideration the final order entered by the court on April 12, 2007. We intend to enforce the courts rulings against
RBI, to the extent permitted by its bankruptcy proceeding, and against Seaboard.

Tax Increase Prevention and Reconciliation Act of 2005

On May 17, 2006, President Bush signed into law an act entitled the Tax Increase Prevention and Reconciliation Act of 2005
(the 2005 Tax Act). Among other provisions, the 2005 Tax Act imposes an excise tax on certain types of leasing transactions entered into by tax-exempt entities. At this time, it is not clear whether the excise tax imposed by
the 2005 Tax Act is applicable to our lease transactions. We are continuing to evaluate this legislation and the impact on us; however, specific guidance has not yet been made available. We have revised our estimate of the potential impact and
have determined that we do not need to record a liability based upon the currently available information. We have determined that our potential liability for 2006 could range from zero to approximately $1.2 million and that zero represents our best
estimate at this time. However, once further guidance is issued, our potential liability under the 2005 Tax Act may change.



|5. | New Accounting Pronouncements.
|-- | ------------------------------

We adopted the
provisions of the Financial Accounting Standards Board (FASB) Interpretation No. 48, Accounting for Uncertainty in Income Taxesan Interpretation of FASB Statement No. 109 (FIN 48) on
January 1, 2007. This



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interpretation requires that income tax positions recognized in an entitys tax returns have a more-likely-than-not chance of being sustained prior to
recording the related tax benefit in the financial statements. There was no impact on our financial statements as a result of the adoption of FIN 48.



|6. | Subsequent Event.On April 10, 2007, our Board of Directors approved an increase to our fuel factor adjustment rate, resulting in an increase to our total energy rate of
approximately 7.2%, effective April 1, 2007. This increase was implemented due to our continued rising energy costs and difference between actual costs incurred and anticipated costs upon which our rates were based.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



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OLD DOMINION ELECTRIC COOPERATIVE

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Caution Regarding Forward-Looking Statements

Managements Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements regarding matters that could have an impact on our business, financial condition, and
future operations. These statements, based on our expectations and estimates, are not guarantees of future performance and are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those
expressed in the forward-looking statements. These risks, uncertainties, and other factors include, but are not limited to, general business conditions, increased competition in the electric utility industry, demand for energy, federal and state
legislative and regulatory actions and legal and administrative proceedings, changes in and compliance with environmental laws and policies, weather conditions, the cost of commodities used in our industry, and unanticipated changes in operating
expenses and capital expenditures. Our actual results may vary materially from those discussed in the forward-looking statements as a result of these and other factors. Any forward looking statement speaks only as of the date on which the statement
is made, and we undertake no obligation to update any forward looking statement or statements to reflect events or circumstances after the date on which the statement is made even if new information becomes available or other events occur in the
future.

Critical Accounting Policies

As of March 31, 2007, there have been no significant changes in our critical accounting policies as disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2006. These policies include the accounting for
rate regulation, deferred energy, margin stabilization plan, asset retirement obligations, and derivative contracts.

Basis of Presentation

The accompanying financial statements reflect the consolidated accounts of Old Dominion Electric Cooperative (ODEC or
we or our) and TEC Trading, Inc. (TEC) effective December 31, 2006. See Note 2Notes to Condensed Consolidated Financial Statements in Part 1, Item 1.

Overview

ODEC is a not-for-profit power supply
cooperative owned entirely by its twelve member distribution cooperatives and a thirteenth member, TEC. We supply our member distribution cooperatives power requirements, consisting of capacity requirements and energy requirements through a
portfolio of resources including generating facilities, long-term and short-term physically-delivered forward power purchase contracts, and spot market purchases.

Our financial results for the three months ended March 31, 2007, were impacted by higher energy rates, weather, operation of our combustion turbine facilities, and changes in the fair value of our derivative
contracts. Revenues were higher due to higher energy rates which were implemented in April and October of 2006 to collect previously incurred but not collected costs and to provide for the collection of future anticipated costs. We experienced
significantly colder weather in February 2007 resulting in increased sales volume. Our combustion turbine facilities were dispatched more in accordance with the requirements of PJM Interconnection, LLC (PJM) resulting in increased fuel
costs. Due to changing conditions in the power markets, the fair value of our forward purchase power contracts and natural gas futures increased resulting in changes to our regulatory assets and liabilities which increased cash provided by operating
activities.

Results of Operations

Operating
Revenues

Our power sales are comprised of two power products  energy and capacity (also referred to as demand). Energy is the
physical electricity delivered through transmission and distribution facilities to customers. We must have sufficient committed energy available to us for delivery to our member distribution cooperatives to meet their maximum energy needs at any
time, with limited exceptions. This committed available energy at any time is referred to as capacity.



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##### Table of Contents

The rates we charge our member distribution cooperatives for sales of energy and capacity are determined
by a formulary rate accepted by the Federal Energy Regulatory Commission (FERC), which is intended to permit collection of revenues which will equal the sum of:



| |  |  | all of our costs and expenses;
| | - |  | ------------------------------



| |  |  | 20% of our total interest charges; and
| | - |  | --------------------------------------



| |  |  | additional equity contributions approved by our board of directors.
| | - |  | -------------------------------------------------------------------

The formulary rate has three main components: a demand rate, a base energy rate and a fuel factor adjustment rate. The formulary rate identifies the cost components that we can collect through rates, but not the
actual amounts to be collected. With limited minor exceptions, we can change our rates periodically to match the costs we have incurred and we expect to incur without seeking FERC approval.

Energy costs, which are primarily variable costs, such as nuclear, coal and natural gas fuel costs and the energy costs under our power purchase
contracts with third parties, are recovered through two separate energy rates, the base energy rate and the fuel factor adjustment rate. The base energy rate is a fixed rate that requires FERC approval prior to adjustment. However, to the extent the
base energy rate over- or under-collects all of our energy costs, we refund or collect the difference through a fuel factor adjustment rate. We review our energy costs at least every six months to determine whether the base energy rate and the
current fuel factor adjustment rate together are adequately recovering our actual and anticipated energy costs, and revise the fuel factor adjustment rate accordingly. Since the fuel factor adjustment rate can be revised without FERC approval, we
can effectively change our total energy rate to recover all of our energy costs without seeking FERC approval.

Capacity costs, which are
primarily fixed costs, such as depreciation expense, interest expense, administrative and general expenses, capacity costs under our power purchase contracts with third parties, transmission costs, and our margin requirements and additional amounts
approved by our board of directors are recovered through our demand rate. The formulary rate allows us to change the actual demand rate we charge as our capacity-related costs change, without seeking FERC approval, with the exception of
decommissioning cost, which is a fixed number in the formulary rate that requires FERC approval prior to any adjustment. FERC approval is also needed to change account classifications currently in the formula or to add accounts not otherwise
included in the current formula. Additionally, future depreciation studies are to be filed with FERC for their approval if they would result in a change in our deprecation rates. Our demand rate is revised automatically to recover the costs
contained in our budget and any revisions made by our board of directors to our budget.

Our operating revenues are derived from power
sales to our member distribution cooperatives and non-members. Our operating revenues by type of purchaser for the three months ended March 31, 2007 and 2006, were as follows:



|                                 |  |                             |         |      |   |        
|-------------------------------- |  | --------------------------- | ------- | ---- | - | -------
|                                 |  | Three Months EndedMarch 31,
|                                 |  | 2007                        |         | 2006
|                                 |  | (in thousands)             
|Revenue from sales to:           |  |                             |         |      |   |        
|Member distribution cooperatives |  | $                           | 208,619 |      | $ | 176,815
|Non-members                      |  |                             | 20,091  |      |   | 26,646 
|                                 |  |                             |         |      |   |        
|Total revenues                   |  | $                           | 228,710 |      | $ | 203,461
|                                 |  |                             |         |      |   |        



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Our energy sales in megawatt hours (MWh) to our member distribution cooperatives and
non-members for the three months ended March 31, 2007 and 2006, were as follows:



|                                 |  |                             |  |          
|-------------------------------- |  | --------------------------- |  | ---------
|                                 |  | Three Months EndedMarch 31,
|                                 |  | 2007                        |  | 2006     
|                                 |  | (in MWh)                   
|Energy sales to:                 |  |                             |  |          
|Member distribution cooperatives |  | 3,088,879                   |  | 2,793,266
|Non-members                      |  | 416,191                     |  | 476,586  
|                                 |  |                             |  |          
|Total energy sales               |  | 3,505,070                   |  | 3,269,852
|                                 |  |                             |  |          

Sales to Member Distribution Cooperatives. Revenues from sales to our member
distribution cooperatives are a function of our formulary rate for sales of power to our member distribution cooperatives and our member distribution cooperatives consumers requirements for power. Operating revenues on our Condensed
Consolidated Statements of Revenues, Expenses and Patronage Capital reflect the actual capacity-related costs we incurred plus the energy costs that we collected during the quarter. Estimated capacity-related costs are collected during the period
through the demand component of our formulary rate. Under our formulary rate, we make adjustments for the refund or recovery of amounts under our Margin Stabilization Plan. We adjust demand revenues and accounts payablemembers or accounts
receivablemembers each quarter to reflect these adjustments. See Critical Accounting PoliciesMargin Stabilization Plan in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31,
2006, for a discussion of our Margin Stabilization Plan.

Revenues from sales to our member distribution cooperatives by formulary rate
component and our average costs to our member distribution cooperatives in MWh for the three months ended March 31, 2007 and 2006, were as follows:



|                                                              |  |                             |         |      |   |        
|------------------------------------------------------------- |  | --------------------------- | ------- | ---- | - | -------
|                                                              |  | Three Months EndedMarch 31,
|                                                              |  | 2007                        |         | 2006
|                                                              |  | (in thousands)             
|Revenues from sales to member distribution cooperatives:      |  |                             |         |      |   |        
|Base energy revenues                                          |  | $                           | 55,625  |      | $ | 50,229 
|Fuel factor adjustment revenues                               |  |                             | 98,681  |      |   | 68,336 
|                                                              |  |                             |         |      |   |        
|Total energy revenues                                         |  |                             | 154,306 |      |   | 118,565
|Demand (capacity) revenues                                    |  |                             | 54,313  |      |   | 58,250 
|                                                              |  |                             |         |      |   |        
|Total revenues from sales to member distribution cooperatives |  | $                           | 208,619 |      | $ | 176,815
|                                                              |  |                             |         |      |   |        
|                                                              |  |                            
|Average costs to member distribution cooperatives (per MWh)   |  | $                           | 67.54   |      | $ | 63.30  

Growth in the number of consumers and growth in consumers requirements for power
significantly affect our member distribution cooperatives requirements for power. Factors affecting our member distribution cooperatives consumers requirements for power include the amount, size, and usage of electronics and
machinery and the expansion of operations among their commercial and industrial customers. Weather also affects the requirement for electricity. Relatively higher or lower temperatures tend to increase the requirement for energy to use air
conditioning or heating systems, respectively. Mild weather generally reduces the requirement because air conditioning and heating systems are operated less.

Three Months Ended March 31, 2007 compared to Three Months ended March 31, 2006

Total
revenues from sales to our member distribution cooperatives for the three months ended March 31, 2007, increased $31.8 million, or 18.0%, over the same period in 2006, primarily as a result of higher energy rates and higher sales volumes
slightly offset by lower incurred capacity costs (which are reflected in revenues in the period in which they are expensed).

Our total
energy rate (including our base energy rate and our fuel factor adjustment rate) was 17.7% higher during the three months ended March 31, 2007, as compared to the same period in 2006. We increased our fuel factor adjustment rate effective
April 1, 2006, and October 1, 2006, resulting in an increase to our total energy rate of approximately 11.9% and 5.2%, respectively. These increases were implemented due to our continued rising fuel and purchased power costs and
differences between actual costs incurred and anticipated costs upon which our rates were based.



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The capacity costs we incurred, and thus the capacity-related revenues we reflected pursuant to the
formulary rate, for the three months ended March 31, 2007, as compared to the same period in 2006, decreased $3.9 million, or 6.8%, primarily related to decreased transmission charges. Additionally, effective April 1, 2006, we decreased
the demand component of our rate approximately 1.8% in accordance with the budget that our board of directors approved in December 2005. Increases or decreases in our budget automatically amend the demand component of our formulary rate.

Our average costs to member distribution cooperatives per MWh increased $4.24 per MWh, or 6.7%, for the three months ended March 31, 2007, as
compared to the same period in 2006, primarily as a result of the increase in our total energy rates related to increased fuel and purchased power costs.

Sales to Non-Members.Sales to non-members consist of sales of excess purchased energy and sales of excess generated energy. We primarily sell excess purchased energy to PJM under its rates for providing
energy imbalance services. Excess energy is sold at the prevailing market price at the time of sale and is the result of changes in our purchased power portfolio, differences between actual and forecasted needs, as well as changes in market
conditions. Non-member revenue decreased by $6.6 million, or 24.6%, in the three months ended March 31, 2007, and non-member energy sales in MWh decreased 60,395 MWh, or 12.7%, as compared to the same period in 2006. The decrease in non-member
revenue for the three months ended March 31, 2007, is due to a decrease in the prices at which we sold excess energy to non-members and a decrease in the volume of excess energy sales.

Operating Expenses

We supply our member
distribution cooperatives power requirements, consisting of capacity requirements and energy requirements, through (i) our interests in electric generating facilities which consist of a 50% interest in the Clover Power Station
(Clover), an 11.6% interest in the North Anna Nuclear Power Station (North Anna), our Louisa combustion turbine facility (Louisa), our Marsh Run combustion turbine facility (Marsh Run), our Rock
Springs combustion turbine facility (Rock Springs), and our distributed generation facilities, and (ii) long-term and short-term physically-delivered forward power purchase contracts and spot purchases of power in the open market.
Our energy supply for the three months ended March 31, 2007 and 2006, was as follows:



|                       |  |                              |  |       |      |  |           |  |       |  
|---------------------- |  | ---------------------------- |  | ----- | ---- |  | --------- |  | ----- | -
|                       |  | Three Months Ended March 31, | 
|                       |  | 2007                         |  |       | 2006 | 
|                       |  | (in MWh and percentages)     | 
|Generated:             |  |                              |  |       |      |  |           |  |       |  
|Clover                 |  | 883,720                      |  | 24.5  | %    |  | 906,808   |  | 27.1  | %
|North Anna             |  | 420,019                      |  | 11.7  |      |  | 388,494   |  | 11.6  |  
|Louisa                 |  | 13,236                       |  | 0.4   |      |  | 775       |  |      |  
|Marsh Run              |  | 32,304                       |  | 0.9   |      |  | 1,550     |  | 0.1   |  
|Rock Springs           |  | 809                          |  |      |      |  |          |  |      |  
|Distributed generation |  | 113                          |  |      |      |  |          |  |      |  
|                       |  |                              |  |       |      |  |           |  |       |  
|Total Generated        |  | 1,350,201                    |  | 37.5  |      |  | 1,297,627 |  | 38.8  |  
|                       |  |                              |  |       |      |  |           |  |       |  
|Purchased:             |  |                              |  |       |      |  |           |  |       |  
|Total Purchased        |  | 2,246,498                    |  | 62.5  |      |  | 2,045,939 |  | 61.2  |  
|                       |  |                              |  |       |      |  |           |  |       |  
|Total Available Energy |  | 3,596,699                    |  | 100.0 | %    |  | 3,343,566 |  | 100.0 | %
|                       |  |                              |  |       |      |  |           |  |       |  

We satisfy the majority of our member distribution cooperatives capacity requirements and
less than half of their energy requirements through our ownership interests in Clover, North Anna, Louisa, Marsh Run, and Rock Springs. We purchase capacity and energy from the market to supply the remaining needs of our member distribution
cooperatives.

Our operating expenses are significantly affected by the extent to which we purchase power and, relatedly, the availability
of our base load generating facilities, Clover and North Anna. Base load generating facilities, particularly nuclear power plants such as North Anna, generally have relatively high fixed costs. Nuclear facilities operate with relatively low variable
costs due to lower fuel costs and technological efficiencies. In addition, coal-fired facilities also have relatively low variable costs, as compared to combustion turbine facilities such as Louisa, Marsh Run and Rock Springs. Owners of power plants
incur the fixed costs of these facilities whether or not the units operate. When either Clover or North Anna is off-line, we must purchase replacement energy from either Virginia Electric & Power Company (Virginia Power) or from
the market. As a result, our operating expenses, and



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consequently our rates to our member distribution cooperatives, are more significantly affected by the operations of Clover and North Anna than by our
combustion turbine facilities. Our combustion turbine facilities have relatively low fixed costs and greater operational flexibility; however, they are more expensive to operate; and as a result we will operate them only when the market price of
energy makes their operation economical or when their operation is required by PJM for system reliability purposes. The output of Clover and North Anna for the three months ended March 31, 2007 and 2006, as a percentage of the maximum net
dependable capacity rating of the facilities was as follows:



|         |  |                              |   |  |                              |   |  |      |   |  |       |  
|-------- |  | ---------------------------- | - |  | ---------------------------- | - |  | ---- | - |  | ----- | -
|         |  | Clover                       |   |  | North Anna                   |  
|         |  | Three Months Ended March 31, |   |  | Three Months Ended March 31, |  
|         |  |                             
|         |  | 2007                         |   |  | 2006                         |   |  | 2007 |   |  | 2006  |  
|Unit 1   |  | 94.4                         | % |  | 96.5                         | % |  | 99.1 | % |  | 68.8  | %
|Unit 2   |  | 93.6                         |   |  | 96.0                         |   |  | 83.6 |   |  | 100.6 |  
|Combined |  | 94.0                         |   |  | 96.3                         |   |  | 91.4 |   |  | 84.7  |  

Clover.During the three months ended March 31, 2007, both Clover Units
1 and 2 were available for dispatch. Clover Unit 2 experienced minor unscheduled outages during the three months ended March 31, 2007 and 2006. On March 31, 2007, Clover Unit 1 was taken off-line for a scheduled maintenance outage and was
returned to service on April 14, 2007.

North Anna.North Anna Unit 1 experienced minor unscheduled outages
during the three months ended March 31, 2007 and 2006. On March 18, 2007, North Anna Unit 2 was taken off-line for a scheduled refueling and maintenance outage and was returned to service on April 22, 2007.

Combustion turbine facilities.During the three months ended March 31, 2007 and 2006, the operational availability of our Louisa,
Marsh Run and Rock Springs combustion turbine facilities was as follows:



|             |  |                              |   |  |      |  
|------------ |  | ---------------------------- | - |  | ---- | -
|             |  | Three Months Ended March 31, |  
|             | 
|             |  | 2007                         |   |  | 2006 |  
|Louisa       |  | 98.8                         | % |  | 99.5 | %
|Marsh Run    |  | 99.7                         |   |  | 99.2 |  
|Rock Springs |  | 99.7                         |   |  | 92.2 |  

The components of our operating expenses for the three months ended March 31, 2007 and 2006,
were as follows:



|                                                  |  |                             |         |   |      |   |         |  
|------------------------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------- | -
|                                                  |  | Three Months EndedMarch 31, |        
|                                                  |  | 2007                        |         |   | 2006 |  
|                                                  |  | (in thousands)              |        
|Fuel                                              |  | $                           | 33,093  |   |      | $ | 24,465  |  
|Purchased power                                   |  |                             | 166,316 |   |      |   | 161,364 |  
|Deferred energy                                   |  |                             | (16,119 | ) |      |   | (27,682 | )
|Operations and maintenance                        |  |                             | 9,976   |   |      |   | 8,060   |  
|Administrative and general                        |  |                             | 8,092   |   |      |   | 8,287   |  
|Depreciation, amortization and decommissioning    |  |                             | 9,417   |   |      |   | 9,660   |  
|Amortization of regulatory asset/(liability), net |  |                             | 181     |   |      |   | 195     |  
|Accretion of asset retirement obligations         |  |                             | 732     |   |      |   | 651     |  
|Taxes other than income taxes                     |  |                             | 1,830   |   |      |   | 1,560   |  
|                                                  |  |                             |         |   |      |   |         |  
|Total Operating Expenses                          |  | $                           | 213,518 |   |      | $ | 186,560 |  
|                                                  |  |                             |         |   |      |   |         |  



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Three Months Ended March 31, 2007 compared to Three Months ended March 31, 2006:

Aggregate operating expenses increased $27.0 million, or 14.5%, for the three months ended March 31, 2007, as compared to the same
period in 2006, primarily due to the change in deferred energy expense and the increase in fuel expense.

Deferred energy expense changed
$11.6 million, or 41.8%, for the three months ended March 31, 2007, as compared to the same period in 2006. During the three months ended March 31, 2007, we under-collected $16.1 million in energy costs; whereas in the three months ended
March 31, 2006, we under-collected $27.7 million in energy costs. At March 31, 2007, we had an under-collected deferred energy balance of $31.0 million.

Fuel expense increased $8.6 million, or 35.3%, for the three months ended March 31, 2007, as compared to the same period in 2006, primarily due to the increased operation of our combustion turbine facilities.

On April 10, 2007, our Board of Directors approved an increase to our fuel factor adjustment rate, resulting in an increase to our
total energy rate of approximately 7.2% effective April 1, 2007, due to our continued rising energy costs and differences between our actual and anticipated costs upon which our rates were based.

Other Items

Investment
Income.Investment income increased $0.9 million, or 45.0%, for the three months ended March 31, 2007, as compared to the same period in 2006, primarily due to income earned on our increased average balance in cash and temporary
investments as a result of higher member prepayments and higher interest rates.

Interest Charges, net. The primary
factors affecting our interest expense are scheduled payments of principal on our indebtedness, interest related to our potential liability associated with our dispute with Norfolk Southern, and capitalized interest.

The major components of interest charges, net for the three months ended March 31, 2007 and 2006, were as follows:



|                                                      |  |                             |         |   |      |   |         |  
|----------------------------------------------------- |  | --------------------------- | ------- | - | ---- | - | ------- | -
|                                                      |  | Three Months EndedMarch 31, |        
|                                                      |  | 2007                        |         |   | 2006 |  
|                                                      |  | (in thousands)              |        
|Interest expense on long-term debt                    |  | $                           | (13,613 | ) |      | $ | (13,895 | )
|Other                                                 |  |                             | (1,553  | ) |      |   | (1,056  | )
|                                                      |  |                             |         |   |      |   |         |  
|Total Interest Charges                                |  |                             | (15,166 | ) |      |   | (14,951 | )
|Allowance for borrowed funds used during construction |  |                             | 80      |   |      |   | 29      |  
|                                                      |  |                             |         |   |      |   |         |  
|Interest Charges, net                                 |  | $                           | (15,086 | ) |      | $ | (14,922 | )
|                                                      |  |                             |         |   |      |   |         |  

Interest charges, net remained relatively flat for the three months ended March 31, 2007, as
compared to the same period in 2006. Other interest increased $0.5 million, or 47.1% for the three months ended March 31, 2007 as compared to the same period in 2006, primarily as a result of accrued interest related to our dispute with Norfolk
Southern.

Net Margin.Our net margin, which is a function of our total interest charges, remained relatively flat for
the three months ended March 31, 2007, as compared to the same period in 2006.

Financial Condition

The principal changes in our financial condition from December 31, 2006 to March 31, 2007, were caused by increases in investmentsother,
accrued expenses and the change in deferred energy partially offset by decreases in accounts receivabledeposits, accounts payable and regulatory assets. Investmentsother increased $49.9 million related to the return of $23.6 in
collateral we were required to post with our counterparties at December 31, 2006. Also, we had additional cash to invest due to higher member prepayment balances. Due to changes in energy prices, at March 31, 2007, we were not required to
post any deposits. Accrued expenses increased $15.7 million related primarily to accrued interest. Our deferred energy balance represents the net under-



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or over-collection of energy costs as of the end of the reporting period. These amounts are recovered from or refunded to our member distribution
cooperatives in subsequent periods. At December 31, 2006, we had an under-collected deferred energy balance of $14.9 million as compared to an under-collected deferred energy balance of $31.0 million at March 31, 2007. Accounts
receivabledeposits decreased by $23.6 million related to the return of collateral posted due to changes in energy prices. Accounts payable decreased $18.9 million primarily as a result of decreased purchased power in March 2007 as compared to
December 2006. Regulatory assets decreased $15.7 million primarily due to the change in the fair value of our derivatives.

Liquidity and Capital
Resources

Operations. Historically, our operating cash flows have been sufficient to meet our short-term and long-term
capital expenditures related to our existing generating facilities, our debt service requirements, and our ordinary business operations. During the first three months of 2007, our operating activities provided cash flow of $46.1 million. During the
first three months of 2006, our cash needs exceeded our cash inflows from operating activities by $45.5 million. Operating activities in the first three months of 2007 were primarily impacted by the change in current assets and regulatory assets and
liabilities partially offset by the change in deferred energy. Current assets changed $24.1 million primarily related to the return of $23.6 million in deposits we were required to post as of December 31, 2006. As of March 31, 2007, due to
market changes in energy prices, we were not required to post any deposits. Regulatory assets and liabilities changed $18.3 primarily due to the change in the fair value of our derivatives. At March 31, 2007, we had an under-collected deferred
energy balance of $31.0 million as compared to an under-collected deferred energy balance of $14.9 million at December 31, 2006, which resulted in a cash outflow of $16.1 million.

Financing Activities.In addition to liquidity from our operating activities, we maintain committed lines of credit and revolving credit
facilities to cover short-term and medium-term funding needs. As of March 31, 2007, we had short-term committed variable rate lines of credit in an aggregate amount of $180.0 million. Additionally, we had two committed three-year revolving
credit facilities, $50.0 million each.

At March 31, 2007 and 2006, we had no short-term borrowings or letters of credit outstanding
under any of these arrangements. We expect the working capital lines of credit and revolving credit facilities to be renewed as they expire.

Investing Activities.Investing activities in the first three months of 2007 were primarily impacted by activity related to available for sale securities, interest earned on investmentsother and cash and cash
equivalents, as well as electric plant additions for our generating facilities.



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OLD DOMINION ELECTRIC COOPERATIVE

ITEM 3. QUANTITATIVE AND QUALITATIVE

DISCLOSURES ABOUT MARKET RISK

No material changes occurred in our exposure to market risk during the first quarter of 2007.

ITEM 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, our management,
including the President and Chief Executive Officer and Senior Vice President and Chief Financial Officer conducted an evaluation of the effectiveness of our disclosure controls and procedures. Based upon that evaluation, the President and Chief
Executive Officer, and Senior Vice President and Chief Financial Officer concluded that our disclosure controls and procedures are effective in ensuring that all material information required to be filed in this report has been made known to them in
a timely matter. We have established a Disclosure Assessment Committee comprised of members from senior and middle management to assist in this evaluation. There have been no significant changes in our internal controls over financial reporting or
in other factors that could significantly affect such controls during the past fiscal quarter.



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OLD DOMINION ELECTRIC COOPERATIVE

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

NOVEC

On May 7, 2007, Northern Virginia Electric Cooperative (NOVEC) filed a brief in accordance with the procedural schedule issued on March 5, 2007, by the United States Court of Appeals for the District of
Columbia. For further description of our legal proceedings related to NOVEC, see Part 1, Item 3 of our 2006 Annual Report on Form 10-K.

Norfolk
Southern

In our legal proceedings against Norfolk Southern Railway Company (Norfolk Southern), on April 4, 2007, we
along with Virginia Power, presented our arguments to a panel of three justices as to why the petition for appeal should be granted. We are currently awaiting the decision. If any one of the three justices supports granting the petition for appeal,
we, along with Virginia Power, intend to vigorously prosecute the appeal. For further description of our legal proceedings for Norfolk Southern, see Part 1, Item 3 of our 2006 Annual Report on Form 10-K.

Ragnar Benson

In our legal proceedings against
Ragnar Benson, Inc. (RBI), on April 12, 2007, the court entered its final order awarding us a total of $7.6 million plus interest on the principal judgment from October 25, 2005, and interest on attorneys fees from
September 15, 2006. On April 23, 2007, we filed an amended complaint against Seaboard Surety Company (Seaboard) to take into consideration the final order entered by the court on April 12, 2007. For further description of
our legal proceedings for RBI, see Part 1, Item 3 of our 2006 Annual Report on Form 10-K.

FERC Proceedings Related to Potential Reorganization

On March 27, 2007, we filed our response to the March 7, 2007, Northern Virginia Electric Cooperative (NOVEC) and
FERC staff exceptions to the February 5, 2007, initial decision wherein the judge ruled in our favor on all material matters. For further description of our legal proceedings for the FERC Proceedings Related to Potential Reorganization, See
Part 1, Item 3 of our 2006 Annual Report on Form 10-K.

Other Matters

Other than legal proceedings arising out of the ordinary course of business, which management believes will not have a material adverse impact on our results of operations or financial condition, there is no other
litigation pending or threatened against us.

ITEM 1A. RISK FACTORS

In addition to the other information set forth in this report, you should
carefully consider the factors discussed in Risk Factors in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2006, which could affect our business, financial condition or future results. The
risks described in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial
condition and/or operating results.

ITEM 5. OTHER INFORMATION

On April 4, 2007, legislation was passed in Virginia that changed the
electricity restructuring in Virginia. The legislation, effective July 1, 2007, changed the termination date for the capped rates our Virginia member distribution cooperatives charge their customers from December 31, 2010 to
December 31, 2008. After the end of capped rates, retail choice is eliminated for all customers except those that consume at least five megawatts of power individually or in the aggregate (with aggregation subject to the approval of the
Virginia State Corporation Commission (VSCC)), but do not account for more than 1% of the incumbent utilitys peak load during the past year. Also, retail choice will continue to be available for customers that desire to select a
supplier that provides 100% green or renewable power and for any cooperative customer whose 2006, or any subsequent years, noncoincident peak demand exceeded 90 megawatts. Currently, we do not anticipate that these conditions related to retail
choice will have a material impact on



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our financial results. Also, beginning January 1, 2009, this legislation allows our Virginia member distribution cooperatives to adjust their rates by a
maximum net increase or decrease of 5%, on a cumulative basis, in any three year period without filing a rate case with the VSCC. Additionally, our Virginia member distribution cooperatives may make changes to their terms and conditions of
distribution service without VSCC approval, provided the changes do not affect their revenues. This new legislation does not affect our Virginia member distribution cooperatives ability to pass through changes in energy costs to their
customers. For further description see Competition in Part 1, Item 1 of our 2006 Annual Report on Form 10-K.



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ITEM 6. EXHIBITS



|     |  |                                                                          
|---- |  | -------------------------------------------------------------------------
|31.1 |  | Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)  
|     | 
|31.2 |  | Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)  
|     | 
|32.1 |  | Certification of the Chief Executive Officer pursuant to 18 U.S.C. § 1350
|     | 
|32.2 |  | Certification of the Chief Financial Officer pursuant to 18 U.S.C. § 1350



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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



|                   |  |  |  |                                                  
|------------------ |  |  |  | -------------------------------------------------
|                   |  |  |  | OLD DOMINION ELECTRIC COOPERATIVE                
|                   |  |  |  | Registrant                                       
|                   |  | 
|Date: May 14, 2007 |  |  |  | /s/ Robert L. Kees                               
|                   |  |  |  | Robert L. Kees                                   
|                   |  |  |  | Senior Vice President and Chief Financial Officer
|                   |  |  |  | (Principal Financial and Accounting Officer)     



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EXHIBIT INDEX



|              |  |                                                                          
|------------- |  | -------------------------------------------------------------------------
|ExhibitNumber |  | Description of Exhibit                                                   
|31.1          |  | Certification of the Chief Executive Officer pursuant to Rule 13a-14(a)  
|              | 
|31.2          |  | Certification of the Chief Financial Officer pursuant to Rule 13a-14(a)  
|              | 
|32.1          |  | Certification of the Chief Executive Officer pursuant to 18 U.S.C. § 1350
|              | 
|32.2          |  | Certification of the Chief Financial Officer pursuant to 18 U.S.C. § 1350



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