REQUEST FOR QUALIFICATIONS (RFQ)

FOR

COMPETITIVE BID SUPPLY SERVICE PILOT PROGRAM

(“CBS PILOT”)

[PART 1 of 2]

DOMINION VIRGINIA POWER
SOLICITATION
FOR COMPETITIVE SERVICE PROVIDERS
TO PROVIDE
ELECTRICITY SUPPLY SERVICE

TO BLOCKS OF RETAIL CUSTOMERS

BEGINNING ON OR AFTER

JANUARY 10, 2005

INSTRUCTIONS TO POTENTIAL BIDDERS

1.0 Introduction

Dominion Virginia Power (hereinafter referred to as "Company" or "DVP") is conducting a retail access pilot program for competitive bid supply service (“CBS Pilot”). The CBS Pilot, along with two other retail access pilot programs, was approved by the Virginia State Corporation Commission on September 10, 2003. Revisions to the CBS Pilot were approved on January 9, 2004 and May 25, 2004. This Request for Qualifications (RFQ) applies to the CBS Pilot only.

The CBS Pilot involves a competitive bidding process to provide Electricity Supply Service to serve sub-blocks of retail customers based on geographic areas in the Company’s Virginia jurisdiction service territory. Electricity supply in the Pilot will begin on or after January 4, 2005 and continue until the expiration or termination of the Company’s capped rates according to Section 56-582 of the Code of Virginia.

Currently, pursuant to this section, the Company’s capped rates will expire on December 31, 2010. To encourage participation by Competitive Service Providers and customers in the CBS Pilot (as well as the other approved pilot programs), a reduction in wires charges equal to 100% of the wires charges approved by the State Corporation Commission for 2004 for each rate schedule will be applied to participating customers through a tariff rider. The reduction is subject to the limitation that the reduction will not exceed the total wires charge established by the State Corporation Commission for each rate class for each year the pilot programs are in effect.

The Company is hereby initiating a two-part process to determine the entities that will provide Electricity Supply Service to sub-blocks of retail customers in the CBS Pilot. The first part of the process will determine whether potential bidders are qualified to provide Electricity Supply Service to a sub-block of retail customers in Virginia. DVP will administer the Request for Qualifications with oversight provided by the Staff of the Virginia State Corporation Commission (“Staff”). The second part of the process will determine which qualified bidders will serve the sub-blocks. DVP will administer the Request for Bids with oversight provided by the Staff. The final selection of bidders to serve the geographic sub-blocks will be determined by the Staff.

With this RFQ dated October 21, 2004, Dominion Virginia Power is soliciting Qualification Packages from potential bidders interested in providing Electricity Supply Service in the CBS Pilot to serve sub-blocks of eligible customers. (Note, previously qualified bidders do not need to respond to this request.) There are two sub-blocks from each of the three geographic areas. One sub-block consists of customers from the Residential Service and Worship Site Service rate classes and/or equivalent rate schedules. A second sub-block consists of customers from the GS-1 Small General Service and GS-2 Intermediate General Service rate classes and/or equivalent rate schedules.

The Schedule for submitting Qualification Packages, issuing the request for bids, evaluation and award is shown below:

Part 1

DVP Issue Request for Qualifications October 21, 2004

Qualification Packages Due No later than November 9, 2004

Part 2

DVP Issue Request for Bids (“RFB”) Upon Receipt of RFQ

Bids Due November 15, 2004

Award Blocks Ten Days After Bids Due

2.0 Description

2.1 DVP is seeking Bids from pre-qualified bidders to provide Electricity Supply Service for customers in the CBS Pilot with the following target level of customers:

2.1.1  The Residential and Worship Site Service Sub-blocks

The Residential Service target level of customers for each sub-block shall be 13,005.

The Worship Site Service target level of customers for each sub-block shall be 20.

2.1.2 The Non-residential Service sub-blocks

The GS-1 – Small General Service target level of customers for each sub-block shall be 1,124

The GS-2 – Intermediate General Service target level of customers for each sub-block shall be 229.

2.2 Each block shall consist of customers from one of three geographic areas within DVP’s Virginia jurisdiction service territory.

2.2.1  Block 1 shall be based on the geographic area of Northern Virginia and encompasses the following counties: Arlington, Clarke, Culpeper, Fairfax, Fauquier, King George, Loudoun, Page, Prince William, Rappahannock, Shenandoah, Spotsylvania, Stafford, Warren, and Westmoreland. The following major cities and towns are included: Alexandria, Fairfax, Falls Church, Fredericksburg, and Manassas.

2.2.2 Block 2 shall be based on the geographic area of Central/Western Virginia and encompasses the following counties: Albemarle, Alleghany, Amelia, Amherst, Appomattox, Augusta, Botetourt, Brunswick, Buckingham, Campbell, Caroline, Charles City, Charlotte, Chesterfield, Craig, Cumberland, Dinwiddie, Essex, Fluvanna, Goochland, Greene, Greensville, Halifax, Hanover, Henrico, King and Queen, King William, Lancaster, Louisa, Lunenburg, Madison, Mecklenburg, Nelson, New Kent, Northumberland, Nottoway, Orange, Pittsylvania, Powhatan, Prince Edward, Prince George, Richmond, Rockbridge, and Rockingham. The following major cities and towns are included: Buena Vista, Charlottesville, Clifton Forge, Colonial Heights, Covington, Emporia, Hopewell, Lexington, Petersburg, Richmond, Staunton, and Waynesboro.

2.2.3 Block 3 shall be based on the geographic area of Eastern Virginia and encompasses the following counties: Gloucester, Isle of Wight, James City, Mathews, Middlesex, Southampton, Surry, Sussex, and York. The following major cities are included: Chesapeake, Franklin, Hampton, Newport News, Norfolk, Poquoson, Portsmouth, Suffolk, Virginia Beach, and Williamsburg.

2.3 The target level of customers in each sub-block shall be maintained by Dominion Virginia Power according to its filed Terms and Conditions, Section XXIV Attachment B under the following schedule:

2.3.1  Following the awarding of a sub-block, for the first three months, the Company shall replace Customers in that sub-block, by rate class and from the geographic area, where there has been a reduction from the target level at the end of each month.

2.3.2  Following the awarding of a sub-block, after the first three months and until six months before the scheduled end of the Pilot, the Company shall replace Customers in each sub-block, by rate class and from the geographic area, where there has been a reduction from the target level at the end of each three-month period.

2.3.3  In the event that no remaining customers in a rate class or classes are available for assignment in that geographic area, the target level of customers in that sub-block shall not be maintained.

2.4  The approximate peak load for each Residential and Worship Site Service sub-block based on the Company’s load research data for Virginia jurisdiction customer classes from 2002 is 50 MW. The approximate peak load for each Non-residential Service sub-block based on the Company’s load research data for Virginia jurisdiction customer classes from 2002 is 17 MW. (Note, each sub-block is designed to achieve a target level of customers and not a target load.)

2.5  Bidders are awarded sub-blocks according to Section IX (D) of the Company’s filed Terms and Conditions in Section XXIV Attachment B.

2.6  A bid must provide for service to Customers in the applicable geographic block(s) through the January 2006 meter reading date for each Customer.

2.7 Load profile information can be found on the DVP website, www.dom.com, on the Energy Choice Supplier webpage. DVP reserves the right to update profiles as it deems appropriate.

3.0 Submission of Qualification Package

The potential bidder’s Qualification Package shall include executing the attached

Certification Form attesting to the following:

3.1.1 Possession of a valid license to operate as a Competitive Service Provider (“CSP”) per 20 VAC 5-312-40 of the Rules Governing Retail Access to Competitive Energy Service (20 VAC 5-312-10 et seq.) (“Rules”) or proof of a waiver from the State Corporation Commission (“Commission”) of this requirement due to an application for a license pending before the Commission.

3.1.2 Certification that registration with Dominion Virginia Power is in process in compliance with 20 VAC 5-312-50 of the Rules.

3.1.3 Certification that EDI testing with Dominion Virginia Power is underway in accordance with VAEDT EDI test plan found in 20 VAC 5-312-20.L of the Rules.

3.1.4  Bidders agree to conform to 20 VAC 5-312-70 in communications and handling of customers.

3.1.5  Certification that Dominion Virginia Power's creditworthiness review is in process for the scale of service to be provided by the CSP prior to submission of any bid proposals.

3.1.6  Certification that bidders (CSPs) will provide monthly billing amounts netting non-tariff items, such as rebates and credits, and excluding additional items, such as late payment charges, for each randomly selected customer as notified by Dominion Virginia Power.

3.2 The submission of a Qualification Package to DVP shall constitute the potential bidder's acknowledgment and acceptance of all the terms, conditions and requirements of this RFQ.

3.2.1 All proposals submitted to DVP pursuant to this RFQ shall become the exclusive property of DVP and may be used for any reasonable purpose related to the Company’s responsibilities in administering the Competitive Bid Supply Service Pilot program.

3.2.2  DVP shall consider materials provided by potential bidders in response to this RFQ to be confidential only if such materials are clearly marked as "Confidential." Potential bidders should be aware that such materials, even if marked "Confidential," might be subject to discovery and disclosure in regulatory or judicial proceedings

that may or may not be initiated by DVP. Potential bidders may be required to justify the requested confidential treatment under the provisions of a protective order issued in such proceedings. If required by an order of an agency or court of competent jurisdiction, DVP may produce the material in response to such order without prior consultation with the potential Bidder.

3.2.3 Bidder shall be responsible for all of its costs associated with the qualification package.

3.2.4 Failure to submit a complete Qualification Package or to provide complete information may be cause for the Company to find a submitted package non-responsive and could result in disqualification of the potential bidder.

3.2.5  Nothing contained in this RFQ shall be construed to require or obligate the Company to select any particular proposal.

3.3  Submittal Procedure

3.3.1  The Qualification Package must be submitted with the complete name of the party expected to submit a bid and must be executed by a person who is duly authorized to act on behalf of the potential bidder.

3.3.2  The Qualification Package must be submitted either by Email or by U. S. Mail per the instructions below and must be received by DVP no later than close of business (5:00 PM Eastern Time) on November 9, 2004. A copy must also be provided to the Staff by e-mail or by U.S. Mail at the Staff’s address below.

A. Qualification Package submitted by Email to DVP must be sent to the following address:

E-mail submissions must be followed by an original and two (2) copies to be received by the Company at the mailing address below, not later than 5:00 p.m. on November 9, 2004,

OR

Qualification Package submitted by U.S. Mail, must be sent in original and two (2) copies to DVP at the following address:

Dominion Virginia Power

Supplier Relations, OJRP 14th Floor

701 East Cary Street

Richmond, VA 23219

B. A copy of the Qualification Package also must be sent simultaneously to the Staff either by e-mail at the following address: or by U.S. Mail (one copy) to the following address:

Mr. Timothy R. Faherty

Division of Energy Regulation

State Corporation Commission

P. O. Box 1197

Richmond, VA 23218

3.3.3 Questions may be directed to:

Dominion Virginia Power Supplier Relations

(804) 771-3585

October 21, 2004 Page 2 of 1