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Acquisitions and Dispositions | 6 Months Ended
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Jun. 30, 2022
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Acquisitions and Dispositions | Note 3. Acquisitions and Dispositions Disposition of Gas Transmission & Storage Operations In December 2021, Dominion Energy completed the sale of the Q-Pipe Group to Southwest Gas, as discussed in Note 3 to the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. In the first quarter of 2022, Dominion Energy recognized a gain of $27 million ($20 million after-tax) in discontinued operations in its Consolidated Statements of Income associated with finalization of working capital adjustments. In connection with the closing of the sale of the Q-Pipe Group, Dominion Energy and Southwest Gas entered into a transition services agreement under which Dominion Energy will continue to provide specified administrative services to support the operations of the disposed businesses for up to 12 months after closing, subject to extension. Dominion Energy recorded $2 million and $3 million associated with the transition services agreement in operating revenue in the Consolidated Statements of Income for the three and six months ended June 30, 2022, respectively. The following table represents selected information regarding the results of operations, which were reported within discontinued operations in Dominion Energy’s Consolidated Statements of Income:
|  | Three Months Ended June 30, 2021 |  |  | Six Months Ended June 30, 2021 |
|  | Q-Pipe Group |  |  | Q-Pipe Group |
(millions) |  |  |  |  |  |  |  |
Operating revenue |  | $ | 59 |  |  | $ | 126 |
Operating expense |  |  | 9 |  |  |  | 28 |
Other income |  |  | 1 |  |  |  | 1 |
Interest and related charges |  |  | 5 |  |  |  | 10 |
Income before income taxes |  |  | 46 |  |  |  | 89 |
Income tax expense |  |  | 9 |  |  |  | 17 |
Net income attributable to Dominion Energy |  | $ | 37 |  |  | $ | 72 |
Capital expenditures and significant noncash items relating to the Q-Pipe Group included the following:
|  | Six Months Ended June 30, 2021 |
(millions) |  |  |  |
Capital expenditures |  | $ | 15 |
Significant noncash items: |  |  |  |
Accrued capital expenditures |  |  | 4 |
Sale of Hope In February 2022, Dominion Energy entered into an agreement to sell 100% of the equity interests in Hope to Ullico for $690 million of cash consideration, subject to customary closing adjustments. The sale will be treated as a stock sale for tax purposes and is expected to close by the end of 2022, contingent on clearance or approval under the Hart-Scott-Rodino Act and from the West Virginia Commission, and other customary closing and regulatory conditions. In March 2022, the waiting period under the Hart-Scott-Rodino Act expired. Also in March 2022, Dominion Energy filed for review and approval with the West Virginia Commission. In August 2022, Dominion Energy, the West Virginia Commission staff and other parties filed a comprehensive settlement agreement recommending approval of the sale with the West Virginia Commission. In the first quarter of 2022, Dominion Energy recorded a charge of $87 million in income tax expense in its Consolidated Statements of Income to reflect the recognition of deferred taxes on the outside basis of Hope’s stock upon meeting the classification as held for sale. These deferred taxes will reverse upon closing of the sale. See Note 5 for additional information. Following closing of the sale, Dominion Energy expects to recognize a pre-tax gain of approximately $40 million, subject to customary closing adjustments, (net of $110 million write-off of goodwill which is not deductible for tax purposes) and an after-tax loss of approximately $65 million. At June 30, 2022, the assets and liabilities of Hope, included in Gas Distribution, are classified as held for sale and reflected in current assets held for sale and current liabilities held for sale, respectively, in Dominion Energy’s Consolidated Balance Sheets. The carrying amounts of major classes of assets and liabilities classified as held for sale in Dominion Energy’s Consolidated Balance Sheets are as follows:
| June 30, 2022 |
(millions) |  |  |
Current assets |  | 71 |
Property, plant and equipment, net |  | 499 |
Other deferred charges and other assets, including goodwill(1) and intangible assets |  | 313 |
Current liabilities |  | 44 |
Long-term debt |  | 1 |
Deferred credits and other liabilities |  | 176 |
(1) | Includes goodwill of $110 million.
Sale of Kewaunee In May 2021, Dominion Energy entered into an agreement to sell 100% of the equity interests in Dominion Energy Kewaunee, Inc. to EnergySolutions, including the transfer of all decommissioning obligations associated with Kewaunee, which ceased operations in 2013. The sale closed in June 2022 following approval from the Wisconsin Commission in May 2022 and NRC approval of a requested license transfer in March 2022. The sale is treated as an asset sale for tax purposes and Dominion Energy retained the assets and obligations of the pension and other postretirement employee benefit plans. EnergySolutions is subject to the Wisconsin regulatory conditions agreed to by Dominion Energy upon its acquisition of Kewaunee, including the return of any excess decommissioning funds to WPSC and WP&L customers following completion of all decommissioning activities. In the second quarter of 2022, Dominion Energy recorded a loss of $649 million ($513 million after-tax), recorded in losses (gains) on sales of assets in its Consolidated Statements of Income, primarily related to the difference between the nuclear decommissioning trust and AROs. Prior to its receipt, there had been uncertainty as to the timing of or ability to obtain approval from the Wisconsin Commission. Prior to closing, Dominion Energy withdrew $80 million from the nuclear decommissioning trust to recover certain spent nuclear fuel and other permitted costs. All activity related to Kewaunee prior to closing is included in Contracted Assets.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=2122178 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI https://asc.fasb.org/topic&trid=2303972 + Details
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