DOMINIONRESOURCES, INC. 2008PERFORMANCE GRANT PLAN

1.           Purpose.   The purpose of this Plan is to set forth the terms of 2008 Performance Grants awarded pursuant to the Dominion Resources, Inc. 2005 Incentive Compensation Plan. This Plan contains the Performance Goals for the awards, the Performance Criteria, the target and maximum amounts payable, and other applicable terms and conditions.

2.           Definitions.  Capitalized terms used in this Plan not defined in this Section 2 will have the meaning assigned to such terms in the Dominion Resources, Inc. 2005 Incentive Compensation Plan.

a.           Cause.   For purposes of this Plan, the term “Cause” will have the meaning assigned to that term under a Participant’s Employment Continuity Agreement with the Company, as such Agreement may be amended from time to time.

b.           Date of Grant.  April 1, 2008.

c.           Disability or Disabled.  The Committee will determine whether or not a Disability exists and its determination will be conclusive and binding on the Participant. To the extent a Performance Grant is subject to Code Section 409A, the Committee’s determination will be made in accordance with the requirements of Treasury Regulation Section 1.409A-3(i)(4).

d.           Participant.  An officer of the Company or a Dominion Company who receives a Performance Grant on the Date of Grant.

e.           Performance Period.  The 24-month period beginning on January 1, 2008 and ending on December 31, 2009.

f.           Retire or Retirement.    For purposes of this Plan, the term Retire or Retirement means termination of employment on a date when the Participant is eligible for early or normal retirement benefits under the terms of the Dominion Pension Plan, or would be eligible if any crediting of deemed additional years of age or service applicable to the Participant under the Company’s Benefit Restoration Plan or New Benefit Restoration Plan was applied under the Dominion Pension Plan, as in effect at the time of the determination.  Notwithstanding the foregoing, a Participant will not be treated as eligible for retirement benefits for purposes of this Plan if the Chief Executive Officer of the Company determines, in his sole discretion, that the Participant’s retirement is detrimental to the Company.

h.           Target Amount.  The dollar amount designated on the Participant’s Performance Grant.

3.           Performance Grants.  A Participant will receive a written notice of the amount designated as the Participant’s Target Amount for the Performance Grant payable under the terms of this Plan.  The actual payout may be from 0% to 200% of the Target Amount, depending on the achievement of the Performance Goals.

4.           Performance Achievement and Time of Payment.  Upon the completion of the Performance Period, the Committee will determine the Performance Goal achievement of the Performance Criteria described in Section 6.  The Company will then calculate the amount of each Participant’s Performance Grant based on such Performance Goal achievement.  Except as provided in Sections 7(b) or 8, payout of Performance Grants will be made as soon as administratively feasible after the end of the Performance Period.  In no event will payment be made later than March 15, 2010.

5.           Forfeiture.  Except as provided in Sections 7(b) or 8, a Participant's right to payout of a Performance Grant will be forfeited if the Participant’s employment with the Company or a Dominion Company terminates before the end of the Performance Period.

6.           Performance Goals.  Payout of Performance Grants will be based on the Performance Goal achievement described in this Section 6 of the three Performance Criteria defined in Exhibit A.

a.           TSR Performance.  Total Shareholder Return Performance (“TSR Performance”) will determine fifty percent (50%) of the Target Amount (“TSR Percentage”).  TSR Performance is defined in Exhibit A.  The TSR Percentage of the Target Amount that will be paid out, if any, is based on the following table:

To the extent that the Company’s TSR Performance ranks in a percentile within the Top, 2nd or 3rd Quartiles of Relative TSR Performance, then the TSR Percentage Payout will be interpolated between the top and bottom of the Percentage Payout of TSR Percentage range for that Quartile.  No payment will be made if the TSR Performance is in the 4th Quartile, except that a payment of 25% of the TSR Percentage will be made if the Company’s TSR Performance was at least 10% on a compounded annual basis for the Performance Period.

b.           ROIC Performance.  Return on Invested Capital Performance (“ROIC Performance”) will determine forty percent (40%) of the Target Amount (“ROIC Percentage”).  ROIC Performance is defined in Exhibit A.  The ROIC Percentage of the Target Amount that will be paid out, if any, is based on the following table:

To the extent that the Company’s ROIC Performance is greater than 8.60% and less than 8.90%, then the ROIC Percentage payout will be interpolated between the top and bottom of the applicable Percentage Payout of ROIC Percentage range set forth above.

c.           Book Value per Share Performance.  Book Value per Share Performance (“Book Value Performance”) will determine ten percent (10%) of the Target Amount (“Book Value Percentage”).  Book Value Performance is defined in Exhibit A. The Book Value Percentage of the Target Amount that will be paid out, if any, is based on the following table:

To the extent that the Company’s Book Value Performance is greater than $20.50 and less than $20.80, then the Book Value Percentage payout will be interpolated between the top and bottom of the applicable Percentage Payout of Book Value Percentage range set forth above.

a.           Retirement or Involuntary Termination without Cause.  If a Participant Retires during the Performance Period or if a Participant’s employment is involuntarily  terminated by the Company or a Dominion Company without Cause during the Performance Period and the Participant would have been eligible for a payment if the Participant had remained employed until the end of the Performance Period, the Participant will receive a pro-rated payout of the Participant’s Performance Grant multiplied by a fraction, the numerator of which is the number of complete calendar months from the Date of Grant to the Participant’s termination of employment, and the denominator of which is the number of complete calendar months between the Date of Grant and December 31, 2009.  Payment will be made after the end of the Performance Period at the time provided in Section 4 based on the Performance Goal achievement approved by the Committee.  If the Participant Retires, however, payment will be conditioned on a determination by the Company’s Chief Executive Officer, in his sole discretion, that the Participant’s Retirement is not detrimental to the Company.

b.           Death or Disability.  If a Participant dies or becomes Disabled during the Performance Period, the Participant or the Participant’s successor will receive a lump sum cash payment equal to the product of (i) and (ii) where

(i)

is the predicted performance used for determining the compensation cost recognized by the Company for the Participant’s Performance Grant for the latest financial statement filed with the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q immediately prior to the event, and

(ii)

is the fraction, the numerator of which is the number of complete calendar months from the Date of Grant to the first day of the calendar month coinciding with or immediately following the Participant’s date of death or termination of employment due to Disability, and the denominator of which is the number of complete calendar months between the Date of Grant and December 31, 2009.

Payment under this paragraph 7(b) will be made as soon as administratively feasible after the date of the Participant’s death or termination of employment due to Disability; provided, however, that payment will be made no earlier than six months after the Participant’s termination other than for death if the Performance Grant is subject to Code Section 409A and the Participant is a Specified Employee (within the meaning of Code Section 409A(a)(2)(B)(i)).

8.           Change of Control.  Upon a Change of Control, the Participant will receive a lump sum cash payment equal to the greater of (i) the Target Amount or (ii) the total payout that would be made at the end of the Performance Period if the predicted performance used for determining the compensation cost recognized by the Company for the Participant’s Performance Grant for the latest financial statement filed with the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q immediately prior to the Change of Control was the actual performance for the Performance Period.  Payment will be made as soon as administratively feasible following the Change of Control date.

9.           Termination for Cause.  Notwithstanding any provision of this Plan to the contrary, if the Participant’s employment with the Company is terminated for Cause, the Participant will forfeit all rights to his or her Performance Grant.

The TSR Performance will be measured based on where the Company’s total shareholder return during the Performance Period ranks in relation to the total shareholder returns of the Comparison Companies during such period.  In general, Total Shareholder Return consists of the difference between the value of a share of common stock at the beginning and end of the Performance Period, plus the value of dividends paid as if reinvested in stock and other appropriate adjustments for such events as stock splits.  For purposes of TSR Performance, the total shareholder return of the Company and the Comparison Companies will be the total shareholder return as calculated by Bloomberg L.P.  As soon as practicable after the completion of the Performance Period, the total shareholder returns of the Comparison Companies will be obtained from Bloomberg L.P. and ranked from highest to lowest.  The Company’s total shareholder return will then be ranked in terms of which percentile it would have placed in among the Comparison Companies.

The Comparison Companies are:

Ameren Corporation	FirstEnergy Corporation
American Electric Power Company, Inc.	FPL Group, Inc.
Constellation Energy Group, Inc.	Nisource Inc.
DTE Energy	PPL Corporation
Duke Energy Corporation	Progress Energy, Inc.
Entergy Corporation	Public Service Enterprise Group Incorporated
Exelon Corporation	Southern Company

If a Comparison Company ceases to be a publicly traded entity, is acquired by another entity, or is merged out of existence during the Performance Period, the Comparison Company will removed from the list of Comparison Companies.

The following terms are used to calculate ROIC for purposes of the 2008 Performance Grants:

ROIC means Total Return divided by Average Invested Capital.  Performance will be calculated for the two successive fiscal years within the Performance Period, added together and then divided by two to arrive at an annual average ROIC for the Performance Period.

Total Return means Operating Earnings plus After-tax Interest & Related Charges, all determined for the two successive calendar years within the Performance Period.

Operating Earnings means operating earnings (as disclosed on the Company’s earnings report furnished on Form 8-K for the applicable fiscal year) without taking into account the impact of potential outcomes that could be prescribed by regulation under Virginia law that are different than the assumptions included in the Company’s actual 2008 budget and the projected 2009 budget calculations in effect immediately prior to the Date of Grant (as described in A and B below).

Average Invested Capital means the Average Balances for Long & Short-term Debt plus Preferred Equity plus Common Shareholders’ Equity (as calculated based on the exclusion of the items described below).  The Average Balances for a year are calculated by performing the calculation at the end of each month during the fiscal year plus the last month of the prior fiscal year and then averaging those amounts over 13 months.

Common Shareholders’ Equity will be calculated by excluding (i) accumulated other comprehensive income (as shown on the Company’s financial statements during the Performance Period): (ii) impacts from changes in accounting principles that were not prescribed as of the Date of Grant; and (iii) the impact of potential outcomes that could be prescribed by regulation under Virginia law that are different than the assumptions included in the Company’s actual 2008 budget and the projected 2009 budget calculations in effect immediately prior to the Date of Grant (as described in A and B below).

Actual 2008 budget and Projected 2009 budget assumptions:

A.        Virginia law provides for the Virginia State Corporation Commission (the SCC) to initiate a base rate case during the first six months of 2009.  As a result, the SCC may reduce rates or, alternatively, order a credit to customers if Virginia Electric and Power Company is found to have earnings more than 50 basis points above the established return on equity.  Because the Company cannot predict the outcome of future rate action taken by the SCC, the actual 2008 budget and projected 2009 budget calculations in effect immediately prior to the date of grant exclude the impact of (1) any changes in base rates other than from qualified construction riders and (2) potential credits to customers.

B.        The actual 2008 budget and projected 2009 budget calculations in effect immediately prior to the date of grant assume that Virginia jurisdictional fuel rates will be reset effective July 1, 2008 based on (1) a forecast of commodity prices, electric sales and electric generation fuel consumption for the following 12 months, (2) an initial recovery, subject to a 4% increase in residential rates, of the statutory “deferral portion” arising from a similar 4% limitation in the July 1, 2007 fuel case, and (3) the inclusion of any over- or under-recovery of fuel expenses during the July 1, 2007 through June 30, 2008 fuel year unrelated to the statutory “deferral portion.”    If the Virginia jurisdictional fuel rates are reset on a different basis than the assumptions in (1)-(3), the effect of the difference in the Virginia jurisdictional fuel rates from the rates in the actual 2008 budget and projected 2009 budget calculations will be excluded.

Book Value per Share Performance will be calculated as Common Shareholders’ Equity (as calculated based on the exclusion of the items described below), divided by the number of outstanding, unrestricted shares at December 31, 2009.

Common Shareholders’ Equity will be calculated by excluding (i) accumulated other comprehensive income (as shown on the Company’s financial statements during the Performance Period): (ii) impacts from changes in accounting principles that were not prescribed as of the Date of Grant; and (iii) the impact of potential outcomes that could be prescribed by regulation under Virginia law that are different than the assumptions included in the Company’s actual 2008 budget and the projected 2009 budget calculations in effect immediately prior to the Date of Grant (as described in A and B below).

Actual 2008 budget and Projected 2009 budget assumptions:

A.        Virginia law provides for the Virginia State Corporation Commission (the SCC) to initiate a base rate case during the first six months of 2009.  As a result, the SCC may reduce rates or, alternatively, order a credit to customers if Virginia Electric and Power Company is found to have earnings more than 50 basis points above the established return on equity.  Because the Company cannot predict the outcome of future rate action taken by the SCC, the actual 2008 budget and projected 2009 budget calculations in effect immediately prior to the date of grant exclude the impact of (1) any changes in base rates other than from qualified construction riders and (2) potential credits to customers.

B.        The actual 2008 budget and projected 2009 budget calculations in effect immediately prior to the date of grant assume that Virginia jurisdictional fuel rates will be reset effective July 1, 2008 based on (1) a forecast of commodity prices, electric sales and electric generation fuel consumption for the following 12 months, (2) an initial recovery, subject to a 4% increase in residential rates, of the statutory “deferral portion” arising from a similar 4% limitation in the July 1, 2007 fuel case, and (3) the inclusion of any over- or under-recovery of fuel expenses during the July 1, 2007 through June 30, 2008 fuel year unrelated to the statutory “deferral portion.”  If the Virginia jurisdictional fuel rates are reset on a different basis than the assumptions in (1)-(3), the effect of the difference in the Virginia jurisdictional fuel rates from the rates in the actual 2008 budget and projected 2009 budget calculations will be excluded.