(Reuters) -U.S. utility Dominion Energy reported first-quarter revenue and profit above Wall Street expectations on Thursday, helped by lower interest costs and strong demand from Virginia and South Carolina.
Power demand in the U.S. is expected to hit record highs in 2025 and 2026, driven by demand from data centers for artificial intelligence and cryptocurrency technologies and from homes and businesses for heat and transportation, according to the U.S. Energy Information Administration.
Adjusted operating earnings from Dominion’s Virginia segment rose 32.3% to $561 million in the first quarter, and that from the South Carolina segment rose 90% to $152 million.
Dominion’s Virginia utility services the world’s largest cluster of data centers, which has a bigger capacity than the next four largest global data center clusters combined, according to the company.
Dominion Energy also said its interest expenses fell 16.4% to $480 million in the first-quarter.
Lower interest rates reduce borrowing costs for power companies, which usually need higher capital to maintain and upgrade grid infrastructure.
Dominion’s electric and gas service areas saw a 25.6% rise in actual heating degree days – a measure of energy demand for space heating – in the quarter.
Quarterly revenue was $4.08 billion, up from $3.63 billion a year ago, beating analysts’ estimate of $3.97 billion, according to data compiled by LSEG.
The company reaffirmed its annual adjusted operating earnings forecast of between $3.28 per share and $3.52 per share; analysts have estimated $3.39 per share.
The utility’s adjusted operating earnings was 93 cents per share for the three months ended March 31, compared with analysts’ average estimate of 75 cents per share, according to data compiled by LSEG.
(Reporting by Pooja Menon in Bengaluru; Editing by Sahal Muhammed)
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