Dominion’s plan to hijack community net metering

Want to quadruple the potential market for solar in Virginia? The answer is to open up the benefits of solar ownership to renters, people with shaded roofs, and others who can’t install solar panels on their own property. Several legislators have been working with the solar industry to take a step in that direction this year. Senator Edwards (SB 350) and Delegates Krupicka (HB 906) and Yost (HB 879) introduced bills that would allow residents of multi-family housing communities like condominiums to band together to purchase a solar system, with all the participants able to claim a credit on their utility bills for their share of the energy generated.

Virginia’s utilities don’t want to see this happen. When people install solar systems, they buy less power from their utility, which otherwise has a monopoly on the generation and sale of electricity.

Now Dominion Virginia Power thinks it has figured out a way to hijack the bills. It proposes to scrap the community net metering language that’s in there now and substitute language that would give the utility the exclusive right to build and own community systems and sell the power to the customers.

Is this still progress? Regrettably, no, and for three reasons:

monopolistIt’s anticompetitive and anti-free market. With a monopoly on the systems, Dominion will also control price. Customers won’t be able to go elsewhere to get a better deal. If Dominion sets the price unacceptably high or imposes terms that turn off customers, we may see no community systems installed at all.

The original proposal for multi-family net metering provides customer choice and allows market forces to determine prices. It’s a better deal for customers.

Virginia solar companies will be left out in the cold. Virginia solar companies tell me the utility hired out-of-state companies for the few solar projects it has installed so far under its Solar Partnership Program. (This is hard to verify because Dominion won’t share the information.)

The original bill language would create new opportunities for Virginia solar companies. It’s a better deal for business.

The changes suggested by Dominion would allow it to engage in self-dealing at the expense of Green Power Program customers. Dominion could set the price of solar at whatever it wants, but that wouldn’t be its only income stream. It would also generate renewable energy certificates (RECs), which it would own and could sell for additional revenue. (The customers would just be buying electricity from Dominion, not the “attributes” that allow them to say they are using solar energy. For that, they would have to also buy the RECs.)

Dominion could sell these RECs to a utility in a state like Pennsylvania, which has a mandatory renewable portfolio system that creates a market for RECs. But that market has been pretty weak lately. So more likely, Dominion’s plan is to sell the RECs to the chumps over at the voluntary Green Power Program, at a higher-than-market price. After all, Dominion operates the Green Power Program, and the State Corporation Commission has already blessed this self-dealing once.

By contrast, under the original bill language, the customers would be the owners of their solar system and thus the owners of the RECs. They could sell the RECs to reduce their costs, or retire (keep) them so they are truly running their homes on solar power.

To protect both the system owners and the Green Power customers, any bill allowing Dominion to own a community solar system would have to require the RECs to be applied to the utility’s goals under Virginia’s RPS, and not sold on the voluntary market. Yet I predict this protection would provoke howls of protest from Dominion.

Is there anything to be done? Well, legislators shouldn’t let Dominion hijack community net metering. But that doesn’t mean there’s no role in this market for the utility, if it’s willing to play fair. That means competing with Virginia solar companies, not shutting them out.

Heck, customers have been clamoring for years for Dominion to sell us solar power. It could do that so easily by building a utility-scale project on a brownfield somewhere and offering customers a straightforward solar tariff. When we see that happen, we will know the company is serious about solar. Its attempt to hijack these net metering bills just proves it’s not.

7 thoughts on “Dominion’s plan to hijack community net metering

    • The House bills are on the docket of the House Commerce and Labor Subcommittee on Energy tomorrow (January 30) starting mid-afternoon. (The time is half an hour after the conclusion of the meeting of the full committee, not a fixed time.)

  1. So should I be calling my representative and say this is destroying a free market and we as consumers have a right to decide from whom and with what we will power our homes. Virginia Power is a legalized monopoly interfering in my right to choose.

    • The good news is that the bill patrons rejected Dominion’s attempt to hijack their bills; the bad news is that Dominion then succeeded in killing the bills. More on that soon. But this battle will likely go on, so solar advocates should certainly contact their legislators to express their views.

  2. Did you know that Amibt Energy is opening in VA in March? I don’t know how solar works with this kind of company, but if you are flat out mad at Dominion, it might be worth looking into a different company to get your electricity form. Dominion’s days as a monopoly are just about over, deregulation is finally happening and soon people will have a choice. I’m an Ambit rep if you have any questions, I can try to get the info you need. My website is http://www.savewithambitnow.com. We save the average user money, I am not sure about solar. Best regards!

  3. Pingback: Dominion Virginia Power Blocks Net Metering Bill

  4. Reduced energy consumption since 2007 has probably left old VEPCO with excess generating capacity (I have not verified this statement for Dominion) that the company would like to see sold. Any non-company energy project reduces load factor on company generation plants. Essentially, DOM would like to sell every bit of electricity it can produce every second of the day because they have already paid for the plants that produce it (with rate base adjustments to cover those plants). I have no doubt that the company would undercut prices by any publicly or privately financed production facility (of any type of generation be it solar, hydro, nuclear or fossil fuel) simply because it might be financially reasonable to allow a slight operating loss to cover the sunk capital costs of existing company projects. That is to say, if the company can get 90 cents on my dollar, and that pays their costs, that’s better than getting no cents when I buy energy elsewhere. I know it’s not that simple, but the basic principle applies.

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