Of synagogues and subsidies

A while back I was engaged in an online discussion with other solar advocates about renewable energy — specifically, how to get more of it built. Some of the participants I knew, others I did not. The conversation was lively, ranging from the need for better education to public policy and incentives.

But then one of the participants threw in an unexpected comment. His email read, “Aren’t we all tired of synagogues?”

The question stopped me cold. I had never heard anyone express weariness of synagogues, much less understood that to be a consensus sentiment. However, I’m not Jewish, so if it were something my Jewish friends grumbled about among themselves but did not share more widely, then I wouldn’t necessarily know about it.

But our discussion was about renewable energy, so surely the comment could not really be about a physical house of worship. “Synagogue” had to be shorthand for something else. If someone said “aren’t we all tired of church,” it might be understood to refer to doctrinal thinking, or more likely, to preaching. You could see how someone would be tired of renewable energy advocates preaching about the benefits of wind turbines and solar panels. Could “synagogue” be meant as a sort of metaphor for haranguing people?

It seemed like a stretch, even assuming the person who had made the comment was Jewish, which I didn’t know. I looked back at the email to see if the name might give me a clue. At that moment, another email came through from him: “Sorry about that autocorrect, it was supposed to be ‘subsidies.’”

Ah.

I was relieved that synagogue fatigue was off the table, but now I had a new question to ponder: Are we, in fact, all tired of subsidies?

Opposition to subsidies is one of the touchstones of free-market capitalism, and even within the wind and solar industries you will find believers in the proposition that if a technology can’t attract enough customers on its own merits, it deserves to remain niche, and the government ought not to put its fat thumb on the scale.

Republican attacks on the Virginia Clean Economy Act, passed last year by the Democrat-controlled General Assembly, are often framed as opposition to the government “picking winners and losers.” The law certainly does that, by directing utilities to close coal plants and incorporate an increasing percentage of electricity from wind and solar.

Some Republicans are raising the same objection in response to the Biden administration’s plans for addressing the climate crisis. Technological advances and market forces are already moving us inexorably towards a clean energy economy—but not fast enough. So Biden’s initiatives rely on the full range of government powers, subsidies among them, to drive down greenhouse gas emissions nationwide in an effort to avoid a worldwide climate catastrophe.

But here’s the thing: to the extent the U.S. has anything resembling an energy policy, subsidies have always been a tool of first resort. Indeed, this has been the case literally since the nation’s founding. Often the difference between Republicans and Democrats is not in whether they embrace subsidies, but which ones they favor.

Cash grants, tax credits, loan guarantees, low-cost access to public land, public purchasing requirements, protective tariffs and federal R&D funding all shape the way energy is produced, delivered and consumed, and they are responsible for the fossil-fuel heavy energy economy we have today. Even U.S. foreign policy and our military have been deployed for the benefit of extractive industries. A century ago, the National Guard came to the aid of the coal barons against striking miners. More recently, a think tank crunched numbers to estimate the U.S. spends $81 billion per year to  protect global oil supplies. That figure rises to over $3 trillion when you count the Iraq war.

Externalities matter, too. If an industry is allowed to inflict damage to a community’s air and water, that is a form of subsidy that can be partly measured in dollars spent on health care and clean-up. Regulations requiring expensive pollution controls can lessen the economic advantages of offloading costs onto the public, but any remaining costs shouldered by the public are a subsidy to the polluter.

Conversely, by displacing fossil fuels, a clean energy facility may confer a public benefit far exceeding the cost of any government subsidy it receives. When we’re dealing with climate change, the public benefit of carbon-free energy is immense.

None of this is an argument against the merits of free market competition, which remains the economy’s most important driver of innovation leading to better and cleaner energy technologies. Well-designed subsidies should work with the market, not against it, to speed the energy transition towards a net-zero future.

And to that we should all say, Amen.

This article originally appeared in the Virginia Mercury on September 14, 2021.

You call that democracy? How Virginia’s electric co-ops fail their member-owners.

Virginia’s thirteen electric cooperatives were exempted from most provisions of the 2020 Virginia Clean Economy Act, which caps carbon pollution from power plants and requires investor-owned utilities to meet renewable-energy and energy-efficiency targets. In lobbying for the VCEA exemption, cooperatives no doubt touted their claimed status as member-owned and democratically governed. In theory that means co-op members can direct their co-ops to adopt programs friendly to consumers and the environment. But events last month showed again that some of the commonwealth’s electric co-ops are not as democratic as they claim. 

Summer is annual-meeting time for electric co-ops. Like all consumer cooperatives, electric co-ops are owned by their customers (called “member-owners”). Democratic control of the cooperative is one of seven “cooperative principles” that all electric cooperatives claim to adhere to. The key to genuine democratic control is board-of-director elections, which happen at each co-op’s annual meeting, where member-owners vote for board candidates. 

Two examples from Virginia electric co-op annual meetings last month demonstrate ways large and small in which incumbent co-op boards game the election process to help their favored board candidates. The most egregious case occurred at Rappahannock Electric Cooperative (REC), which serves rural and suburban Virginians in 22 counties. In a five-way race in REC’s August board election there was a clear winner among co-op member-owners who selected a candidate. Hanover County businessman Roddy Mitchell got more than twice as many member-owner votes as any of the four other candidates. You might call that a landslide win.

But through REC’s needlessly arcane and confusing proxy-voting process, REC’s board was able to allocate some 6,000 additional votes to the board-favored candidate, thereby swinging the election win to him. That board-favored candidate came in fourth out of five when looking at votes that member-owners cast for candidates.

When a board controls 40 to 60 percent or more of all votes, as REC’s board generally does, the board effectively controls the election outcome and “democracy” is an empty label.  

REC’s board controls huge numbers of votes each year because proxy ballots left blank are deemed by REC’s board as a delegation of the member-owner’s vote to the incumbent board to decide whom to cast them for. Moreover, REC offers those who send in a proxy, even a blank one, a chance to win cash prizes. That encourages member-owners to submit blank proxies, even if they have no interest in the election or makeup of the board. REC election tally forms going back over a decade show that every year REC’s incumbent board controls enough proxies to control election outcomes. For at least the past twelve years no candidate has won a race without getting the board-controlled votes. 

So the way to win an REC board election is to please incumbent board members, not to get the most votes from member-owners. That isn’t fair and it isn’t democratic. It leads to board groupthink, insulates boards from the concerns of member-owners, and discourages well-informed, knowledgeable co-op members from running for board.

A National Rural Electric Cooperative Association governance task force report recommended against using board-controlled proxies to swing election results. But REC’s board continues to ignore that recommendation years after it was made.  

Meanwhile, neighboring Shenandoah Valley Electric Cooperative’s (SVEC) board changed the co-op’s bylaws at a closed board meeting in June to help out an incumbent board member facing a strong challenge from another candidate in the August election. The board added a bylaw provision saying that in the case of a tie between an incumbent and non-incumbent candidate the incumbent would be deemed the winner of a one-year board term! 

As if that isn’t bad enough, REC board chair Chris Shipe said publicly a few weeks ago that SVEC’s board is considering changing its (fair) direct election process next year to a proxy system like REC’s. If SVEC follows through on that, then its board, like REC’s, will be able to determine election outcomes. That would make SVEC’s new tie-vote bylaw unnecessary. There are no ties when incumbent board members control election outcomes. 

SVEC’s board would then be fully insulated from member-owner concerns. That would greatly help incumbent board members, who recently approved major fixed-monthly-charge increases that disproportionately affect the co-op’s low-income member-owners and those who’ve invested in rooftop solar or energy efficiency.

There is currently no government oversight of Virginia electric co-op elections, and no law to ensure fair board-election procedures, prohibit abusive proxy practices, or prohibit using board-imposed bylaw changes to favor incumbents. This is important because electric cooperatives are essential service providers that operate as monopolies. Monopoly utilities seldom act in the best interest of their customers unless subjected to meaningful scrutiny, accountability, and independent oversight. Such oversight is lacking when entrenched co-op boards have ironclad control of board-election outcomes. It’s time for the General Assembly to step in and ensure basic, fair election practices to give Virginia electric cooperative member-owners a true say in the governance of the utilities they own.

Seth Heald is a retired U.S. Justice Department lawyer and has a master of science degree in energy policy and climate. He is a member-owner of Rappahannock Electric Cooperative and co-founder of Repower REC, a campaign to bring genuine democracy to Virginia’s electric co-ops. More information at RepowerREC.com

What do we owe to each other?

Americans’ commitment to a shared sense of purpose has hit a low point with our response to COVID-19. Photo credit Noah Wulf via Wikimedia Commons.


The politicization of coronavirus vaccines and mask-wearing has been a depressing reminder of the downside of American individualism. The successful functioning of a free republic depends on people taking personal responsibility for their actions. Too often now that translates into a disregard for the rights of others, coupled with an insistence that our own opinions, even if they are founded on the shifting sands of rumor, must be given as much respect as any expert’s.  

In the case of COVID-19, the results have been catastrophic: the loss of hundreds of thousands of American lives, hospital stays for millions more, and lingering disability for a number we can’t yet calculate. They are as much victims of the ideology of personal freedom as of the virus itself. 

Anti-maskers and anti-vaxxers (usually but not always the same people) could choose to stay home so as not to endanger others by their choices, and perhaps some do. But many claim a right to go where they please, be served in whatever businesses they wish to frequent and send their children unmasked to schools that they insist must be open. Confronted with some version of the maxim that your right to swing your arm ends where the other guy’s nose begins, they insist the other guy ought to swing his arm, too, because bloody noses aren’t real. 

COVID-19 is not the only example of the damage that ensues when a large segment of society elevates the rights of individuals over obligations to society. Second Amendment absolutism has led to the peculiar result that the right to own a gun is valued more highly in law than the right not to be killed by one. 

I would argue that the refusal on the part of a vocal minority to even acknowledge climate change and the role of humans in causing it similarly has its roots in American individualism. To concede we are in a crisis is to accept the need for action to counter the rise in atmospheric CO2. Though the collective benefits of action are enormous (extending even to the ability of our civilization to endure), some individual sacrifice has to happen in the short term. Yet for some people, individual sacrifice in the service of the greater good is unthinkable. What’s in it for them?

That’s why climate activists (myself included) so often emphasize the benefits to individuals of the energy transition: cleaner air, the superior comfort of energy-efficient homes, lower electricity bills from cheap wind and solar. Even the appeal to parental love — Save the planet for your children! — assumes the primacy of self-interest. But that avoids the more difficult question of what my obligation is to my neighbor’s children, or for that matter, children elsewhere in the world. What do human beings owe to each other?

It may feel impossible to have a serious conversation about rights and responsibilities when our public sphere is so contaminated by falsehoods, mistrust and conspiracy theories. But we still have to try, because the ability of our society to navigate the many challenges ahead of us depends on a consensus about what we owe to one another. 

Successfully tackling the big issues – both familiar ones like the economy, racial and wealth inequality, and threats from abroad, and emerging threats like cyberterrorism, climate chaos, plastic pollution and looming ecological collapse — requires collective action. A nation of individuals all fiercely guarding their individual rights and recognizing no responsibilities towards others is on its way to collapse.

This column appeared first in the Virginia Mercury on August 28, 2021.

Everybody talks about bringing solar to low-income households. This guy is doing it (and you can, too).

Photo credit Don Crawford for GiveSolar

Regular readers of this blog know I discourage Virginians from spending their money on so-called green energy offerings from Dominion Energy, Appalachian Power, or REC sellers like Arcadia. They might make you feel better about the electricity you use, but the best products do little to put new solar projects on the grid, and the worst are actually counter-productive

There is a better way to put solar on the grid and salve your conscience, while also cutting out the middleman. Take the money you were going to pay to Dominion Energy for its Green Power Program (or are already paying, if I didn’t warn you off soon enough), and give it to someone who will put actual solar panels on actual houses in Virginia.

That someone might be Jeff Heie, whose non-profit, GiveSolar, works with low-income home-builder Habitat for Humanity in Rockingham County, Virginia to outfit Habitat homes with rooftop solar. The homeowner gets a 4-kilowatt system that cuts their electricity bill by $40; they commit to sending half that amount back to GiveSolar to help pay for the cost of solar on future Habitat homes. 

GiveSolar keeps installation costs down by holding solar “barn-raisings” using volunteers from the community and a solar company, Green Hill Solar, that is willing to install at cost. As a result, a 4-kW system can be installed for $5,000, about half price. 

Eventually GiveSolar expects its Solar Seed Fund to be self-funding as owners of Habitat homes send in their $20 per month repayments, but meanwhile the organization needs donations to get the program up and running. Heie hopes to raise $100,000 to put solar on 20 homes.

It sounds like a lot of money, until you consider that Dominion reports it has 30,000 Virginia customers enrolled in its Green Power Program. If all those customers are currently spending an average of just $5 per month on pointless RECs, and if they sent that money to GiveSolar instead, Heie would raise 150% of his goal every month

Indeed, Heie has plans to take his model to other Habitat for Humanity affiliates around Virginia; he told me he has already heard from five that are interested in installing solar. His approach has also won him the support of other nonprofits, including Solar United Neighbors of Virginia, which is helping to raise $20,000 for the first four projects in Rockingham County and has secured a $10,000 matching grant.

There is a huge need for projects like these. Many low-income Virginia residents spend more than 6 percent of their income on electricity and home heating. Legislators have responded with programs providing funding for low-income energy efficiency programs; capping energy costs for customers who qualify under a percentage-of-income calculation; authorizing Dominion to install solar on some low-income homes (with the utility’s usual profit-margin, and without the barn-raising); and establishing a shared solar program that, if successful, will give some low-income residents the ability to buy electricity from community solar facilities. 

But the potential for rooftop solar to lower energy costs and displace fossil fuels is so huge, and these government programs so limited, that there’s still plenty of room for GiveSolar’s inexpensive, hands-on, and self-sustaining approach. The Habitat homeowners who benefit pay the money back over time, creating a virtuous cycle. Donors don’t have to guess whether their money is building solar projects; they can see it happen, and even take part. Neighbors help neighbors, and by doing so, help the planet.

Legislators built a solar program for apartment dwellers. The SCC gutted it.

Photo by Pixabay on Pexels.com

The State Corporation Commission recently finalized regulations for the Multifamily Shared Solar Program, created by the General Assembly to give residents of apartment buildings and condominiums the ability to use solar energy from panels installed on their buildings. But in implementing the program, the SCC also made sure it can never be used.  

Dominion Energy is largely to blame here, as it so often is whenever customer-sited solar encounters barriers. The utility proposed to lard up the program with fees, none of them allowed by the law. But it’s the SCC’s agreement with Dominion that’s the problem—and not just for people in apartment buildings who want solar, but for the future of any solar in Virginia that isn’t utility-owned. 

2020’s Solar Freedom law set out to make it easier for residents and businesses to install solar onsite. At the heart of the law is net metering, the program that credits solar owners for excess electricity fed back into the grid. Net metering makes solar affordable for customers, so giving more people access to net metering means more private investment dollars, more jobs and a more resilient power grid. 

The multifamily shared solar provision is meant to extend net metering-like benefits to residents of apartment buildings and condominiums, who don’t own their building and its roof themselves. The law allows the building owner—a landlord or condo association—to have solar panels installed on the property, and let residents buy the electricity produced.  Residents who sign up for solar are to be credited for the solar electricity at the utility’s retail rate, giving the residents a benefit equivalent to net metering. The only added cost the utility is allowed to impose is an administrative fee.

“Administrative fee.” You probably think you know what that term means: a fee to cover the cost of administering the program because, duh, what else could it mean? It would pay for someone to do paperwork, or to tweak the billing software. It couldn’t amount to more than a buck or two for a customer in the program.

You think that way because you are not a Dominion lawyer. With no definition of “administrative fee” in the law, and no dollar limit, Dominion’s lawyers went to work shoveling every conceivable expense they could come up with into the humble little fee until it resembles one of those memes of a kitten the size of Godzilla. Now the administrative fee includes the utility’s transmission and distribution costs; standby generation; balancing costs; “nonbypassable charges”; even “banking, balancing and storing fees related to the utility’s processing and handling of the excess bill credits.” 

Then the SCC, faced with this long list of fees that have nothing to do with program administration and aren’t authorized in the law, closed its eyes and signed on. 

However, the regulations don’t tell us what all the kitten-stuffing charges add up to. To determine the dollar amounts, the SCC references “parallel rate proceedings,” by which it means regulations being written to implement a different law, also passed in 2020, creating a much larger program under the name of Shared Solar. And right now, in those parallel rate proceedings, Dominion is insisting that those various fees should add up to nearly $75 per customer per month. Mind you, that amount does not include the cost of the electricity from the solar panels. Adding $75 to the price of electricity makes the cost of buying solar energy through the program far more than the cost of buying electricity from Dominion. 

Carrying those charges over to the multifamily program instantly kills it. No landlord would install solar expecting residents to pay an extra $75 per month for their electricity. The result makes a mockery of Solar Freedom’s intent for “robust project development and shared solar program access for all customer classes.” Indeed, the law expressly requires the utility to credit customers at the retail rate, which is to be “inclusive of all supply charges, delivery charges, demand charges, fixed charges, and any applicable riders or other charges to the customer.” The whole point is to block the utility from piling on costs, excepting only that little kitten of an administrative fee

At this point the only way to salvage the multifamily program is for the General Assembly to amend the law. With the SCC refusing to understand the meaning of “administrative,” the only thing legislators can do is put a dollar limit on the kitten. Indeed, a dollar seems like the right amount. 

That would resurrect the multifamily solar program. As for the shared solar program, where Dominion first came up with the idea of penalizing customers $75 a month for buying solar energy from someone else, the SCC is still working on regulations. 

The two programs are based on very different laws. Where Solar Freedom’s multifamily solar provision mimics net metering, and therefore allows the utility to charge only an administrative fee, the shared solar law explicitly contemplates customers paying a “minimum bill” that will include transmission and distribution, standby charges, and so on, in addition to a (presumably for-real) administrative fee. All those bloated charges that Dominion shoehorned into the administrative fee for apartments and condos in clear violation of the legislative mandate, are expressly allowed by the shared solar law.

Except, of course, no one said anything about $75.  If customers have to pay Dominion $75 in addition to whatever they have to pay to the solar provider, no one will sign up, and there will not be a program. 

The implications are not confined to shared solar laws. Dominion is laying a foundation to set a high floor for customer billings that will be independent of how much electricity residents use, where it comes from, whether their use of renewable energy provides a public benefit, or even whether customer-generated solar reduces other utility costs.  

The solar industry and other parties have strenuously objected to Dominion’s calculations. They have also asked the SCC to hold an evidentiary hearing on the amount of the minimum bill to be charged to shared solar customers (and by extension, to multifamily solar customers via kitten-stuffing). The request gives the SCC a chance to weigh benefits as well as costs, and produce an outcome that will ensure a future for shared solar in Virginia. 

This column originally appeared in the Virginia Mercury on July 15, 2021.

Legislative Scorecard Shows Continued Action on Climate, Environment, and Justice From Lawmakers

The Virginia Chapter of the Sierra Club released its 2021 Climate, Energy and Justice Scorecard today, grading state legislators on their votes on key issues during the last General Assembly session. Votes scored include energy policies, climate solutions, voting rights and environmental justice. Sixty-three out of one hundred forty legislators scored an “A.”

The organization’s press release highlights the adoption of the Clean Car Standards as the standout win for the environment. The scorecard also notes progress on other transportation bills, residential building codes, pipelines, plastic waste and energy equity. 

A lot of utility reform bills that Sierra Club supported went down to defeat, and votes against those bills pulled down the grades of several Senate Democrats who sit on the Commerce and Labor Committee. Senators Barker, Saslaw, Lewis and Lucas were especially notable for their alignment with utility interests. 

With a federal windfall incoming, Virginia should require school districts to build to green standards

The solar panels powering Arlington, Virginia’s Discovery Elementary School, seen through the windows of a science classroom. Photo by Ivy Main

More than $4.3 billion in federal stimulus dollars will be flowing to Virginia this year as part of the American Rescue Plan, with cities and counties in line for another $2.7 billion. In a joint statement in May, Governor Northam and Democratic leaders laid out spending priorities that included rehabilitating and upgrading the infrastructure in public schools. The General Assembly plans to meet for a special legislative session in August to allocate the funds. In addition to the federal money, Virginia also finds itself in the happy position of having surplus funds of its own to spend.

As it stands now, the federal funds cannot be used for new school construction, a restriction that upsets school officials in areas with aging schools and no budget to replace them. But whether some money is spent on new schools or not, the General Assembly should not just throw dollars out the door and hope for the best. Virginia has an enormous opportunity to improve student health and learning, correct historic injustices, and meet the demands of the climate crisis, but only if the right standards are in place from the outset.

First, funding should be prioritized to Title 1 schools, which are those with at least 40 percent of children from low-income families. Given Virginia’s history of segregation and racism, a high number of Title 1 schools are in Black communities, while others are in parts of rural Virginia that have been left behind economically.  Title 1 schools on average are older and in worse condition than schools in more affluent areas, and the students are more likely to suffer from asthma and other health problems that are exacerbated by mold and poor indoor air quality. Improving indoor air quality and student well-being should be the primary goals for all new or renovated facilities, and it makes sense to start with the students most in need.

Second, while many localities are attracted to the idea of shiny new schools, in most cases it takes less time and costs less to retrofit an old school that is structurally sound than to tear it down and build new. It’s also better for the environment, even if the new school would be built to a “green” standard. Children don’t need new buildings; they need healthy, high-performing buildings. A beautiful remodel of the historic school their parents and grandparents attended could be just what the doctor ordered.

Third, new or renovated schools should be required to meet the highest standards for energy efficiency, including windows, insulation and HVAC. New construction should also be all-electric, as should most renovated buildings. This maximizes taxpayer savings on energy costs over the lifetime of the building, supports the goal of healthy indoor air, and is consistent with Virginia’s commitment to phase out fossil fuels.

Fourth, if the roof will be new or upgraded, it should be made solar-ready, allowing the school to take advantage of third-party power purchase agreements (PPAs) or solar services agreements to install solar panels. Leveraging private capital to pay for the school’s primary energy source stretches construction dollars. These agreements provide financing for solar facilities at no upfront cost and typically save money for schools from the outset. Once the solar panels are paid off, energy bills plummet and savings pile up.

New schools and deep retrofits can even achieve net-zero status affordably, and ought to be required to do so in most cases. Net-zero schools become a source of community pride and offer educational benefits as students learn about energy and how solar panels work. According to a study conducted for Fairfax County Public Schools, the additional upfront cost of building a net-zero-ready school (one that will produce as much energy as it uses once solar panels are added) is only about 5 percent more than standard construction, and the additional cost is recovered through energy savings in under 10 years. Renovating older schools to net-zero costs 11 percent more, but still pays off in 15 years.

Even if we weren’t worried about climate, these standards would make sense for student health and taxpayer savings. Yet today, school districts are not required to build high performance schools, and most don’t. The result is higher operating costs, and in some cases school boards being told that their brand-new schools won’t support solar. Solar companies say it’s probable that solar would be just fine, but this shouldn’t even be an issue. Yet it will continue to be cited as an obstacle if solar-readiness is not made standard.

Our children deserve better. Virginia should seize this year’s historic opportunity to invest in healthy, high-performing schools that are free of fossil fuels and will deliver long-term benefits for taxpayers and the climate.

Dominion-funded group adds more fuel to its campaign against utility reform, and a legislator responds

Four things happened after I wrote last week about Power for Tomorrow’s strange advertising campaign attacking Clean Virginia: the Fredericksburg Freelance-Star ran an op-ed from Power for Tomorrow’s executive director, Gary C. Meltz, opposing deregulation in the electric sector; the Virginia Mercury ran a response to my article from Mr. Meltz; another mailer arrived from Power for Tomorrow, even more unhinged about Clean Virginia and what it calls “their Texas-style policies”; and the Roanoke Times ran an op-ed from Republican Senator David Sutterlein in favor of electricity choice. 

Mr. Meltz’ Freelance-Star op-ed argues that regulated monopolies produce lower cost power for consumers than competitive markets. Instead of developing the argument, however, most of the op-ed is devoted to horror stories about Texas and Maryland.

In both states, poor regulation unquestionably led to high bills, in Texas because customers were allowed to choose “low-cost” billing options that charged them astronomical real-time power costs during the winter freeze, and in Maryland because unscrupulous power providers lured low-income customers into overpriced contracts with up-front goodies like gift cards. Power for Tomorrow would like you to think these abuses are the inevitable result of deregulated markets, but it doesn’t follow.

Coming from the opposite direction, Senator Sutterlein’s op-ed argues that Dominion has abused its political power for private gain. He cites legislation like the notorious 2015 “rate freeze” bill that allowed the company to hang on to over-earnings it would otherwise have had to refund to customers. His cure for these abuses is deregulation, allowing customers to choose other electricity providers. But again, it’s not obvious that curbing Dominion’s excessive profits requires deregulation, rather than better regulation by the General Assembly and the SCC.

Personally, I’m agnostic on this issue. I would welcome a data-driven discussion of whether carefully-designed free markets deliver more for the public than a well-regulated monopoly system coupled with a ban on campaign contributions from public utilities. 

But if Power for Tomorrow is really interested in consumer protection, it’s just plain weird that its ads are so squarely focused on trying to take down Clean Virginia, an organization whose entire purpose is to secure lower costs for consumers. It’s hard not to suspect that the real point of the attack ads is to protect the high profits of Power for Tomorrow’s utility funders. 

According to Mr. Meltz, those over- the-top mailers are indeed getting results for Power for Tomorrow. In his Virginia Mercury letter, Meltz says his organization’s “education campaign” has produced 4,324 letters to elected officials and 1,607 petition signatures. Meltz also says Power for Tomorrow’s funding (and spending) will become a public record when they submit paperwork to the IRS. He doesn’t say when that will be; and he isn’t telling us the answers now.

What’s with the scary ads about threats to your power service?

A mailer sent out to Virginia residents from “Power for Tomorrow”

It’s campaign season in Virginia, with primary elections coming up on June 8. But in addition to all the candidate flyers arriving in mailboxes, Virginia residents have been receiving another kind of mailer with a message unrelated to the election.

Oversized, campaign-style postcards from an entity calling itself Power for Tomorrow warn, “Clean Virginia wants to end customer protections on electricity — leaving Virginians stuck with #BigBills like Texas!” Quotes from headlines about last winter’s disastrous power outage in Texas sprinkle the page to drive home the message that “It happened in Texas. Don’t let it happen in Virginia.” 

The flip side of the postcard reads, “We can’t allow so-called ‘Clean Virginia’ to spend millions to influence Richmond politicians and make hardworking Virginians pay more for electricity.” The cards then urge people to join a texting campaign targeting legislators. 

What’s going on here? According to the nonprofit Energy and Policy Institute, Power for Tomorrow is a utility front group that is “Virginia-based and Dominion Energy-connected.” Power for Tomorrow “opposes efforts to introduce greater competition to monopoly utilities and provides a platform for former regulators to advocate for utility interests.” Its directors and experts are mostly lawyers and lobbyists who represent utility interests. Its website claims the Texas power outage “catalyzed the launch” of the group, but Energy and Policy Institute notes that the website first launched in 2019, and only re-launched this year following the Texas debacle. 

In addition to the postcard mailer, Power for Tomorrow has also run television and Facebook ads. According to Virginia Public Media, as of May 14 the organization had spent at least $220,000 on TV ads and at least another $90,000 on Facebook ads. Dominion Energy spokesperson Rayhan Daudani told Virginia Public Media that Dominion is “proud to support Power for Tomorrow and its efforts to educate people about the dangers of electric deregulation.” He also asserted Dominion’s political contributions, including those to Power for Tomorrow, were “bipartisan and transparent.” 

The bipartisan part is true; Virginia Public Access Project records show Dominion gives money to both Democrats and Republicans. Doing so ensures the company has influence no matter which party holds power. Dominion’s political donations to Virginia elected leaders add up to over $3 million in just the last year and a half (making its criticism of Clean Virginia’s spending more than a little hypocritical). “Transparent” is another matter, however; neither VPAP nor any other source I could find reveals how much money Dominion has provided to Power for Tomorrow.  

As for the claims about customer protections, the mailer’s message stands Clean Virginia’s purpose on its head. Clean Virginia advocates for decreasing the influence of utilities on the General Assembly and increasing regulatory oversight by the State Corporation Commission. The legislation it supported in 2021 uniformly would have returned more money to customers.  The reason Clean Virginia “spends millions to influence Richmond politicians” is to counter Dominion Energy’s spending and political influence in Richmond. There would be no need for Clean Virginia if the General Assembly weren’t already under the utility’s thumb. 

According to Clean Virginia’s website, the five energy reform bills the group supported in 2021 were:

  • HB2200, restoring SCC discretion over Dominion rate-setting and accounting practices
  • HB1984, allowing the SCC to set future rates to reflect the true cost of service
  • HB1914, giving the SCC the ability to set the time period for utilities to recover large one-time expenses, eliminating an accounting gimmick that benefited utilities at the expense of customers
  • HB2160, requiring utilities to return 100% of overcharges to customers, instead of being allowed to keep 30 percent
  • HB2049, also aimed at supporting rate reductions or refunds

All of these bills passed the House with bipartisan support but failed in the Senate, where the Commerce and Labor committee remains Dominion-friendly. 

The Power for Tomorrow ads don’t try to defend Dominion’s opposition to customer-friendly legislation. Instead, they reference a broader effort by Clean Virginia and an unusual alliance of several progressive and conservative free-market groups to restructure Virginia’s utilities. Calling themselves the Virginia Energy Reform Coalition, the allies supported legislation in 2020 that would have separated the generation and transmission functions of Dominion and Appalachian Power and introduced competition in the sale of electricity. 

Whether the long-term effects of this kind of energy deregulation would be good or bad for Virginia residents is a matter of furious debate, but clearly the legislation would have hurt Dominion’s profits. In any event, the bill never even got a vote last year, and was not brought back in 2021. 

The Power for Tomorrow campaign deliberately muddies the water. While mentioning only the stillborn deregulation effort, its attacks on Clean Virginia are meant to undercut support for other legislation that increases utility regulation. 

So what about the threat of Texas-style power outages? Where is the connection? Power for Tomorrow would like you to believe that competition leads to disaster. But the mailer is vague about how what happened in Texas might happen here, and for good reason: It won’t. 

What happened in Texas was due to generating facilities (mostly natural gas) freezing up and failing to deliver electricity to the state’s isolated power grid. With too much demand and not enough supply, short-term power costs soared, and people who’d opted for electricity plans that tracked real-time prices received astronomical bills. Simple regulatory fixes could have avoided both the blackouts and the sky-high bills, but Texas politicians and grid operators shied away from imposing those requirements. Failure to regulate, not deregulation, was to blame. 

When the lights go out in Virginia, by contrast, downed power lines and blown transformers are typically to blame. In other words, the problem is in the delivery, not the generation. Our electricity supply is more secure than Texas’ because Virginia is part of the larger PJM transmission grid that covers all or parts of 13 states from the East to the Midwest. Not only does PJM have a huge excess of generating capacity, but generators have to guarantee they will deliver electricity when called on, and would be penalized by failure to winterize their facilities. Those guarantees are absent in Texas.

Introducing competition to the Virginia utility market would not change any of this. Some states within PJM have deregulated utilities, others have vertically-integrated utilities like Virginia’s. The Texas blackouts were scary; they are also a red herring.  Apparently the cynics at Power for Tomorrow think there is nothing wrong with a non sequitur if it gets people’s attention. 

But is it getting their attention? I checked with a couple of legislators, neither of whom had received any texts or emails from constituents generated by the advertising. Either the campaign isn’t working, or Power for Tomorrow is just building out a mailing list to deploy later, perhaps in the next legislative session when regulatory reform bills come up again.  

At that point we may find out whether Dominion has built an anti-reform constituency with these misleading ads, or just added fuel to the fire. 

This article originally ran in the Virginia Mercury on June 2, 2021. It has been updated to correct the day of the June primary. It is June 8, not June 6.

Why most ‘renewable energy’ options don’t add new wind and solar to the grid

bucket of green paint with spill
Photo credit: Neep at the English Language Wikipedia.

Virginia residents who want to do right by the planet are confronted with a bewildering array of renewable energy and “green power” options. Unfortunately, few of these programs actually deliver renewable energy. People who want the gold standard — electricity from new wind and solar projects — are completely out of luck if their utility is Dominion Energy Virginia or Appalachian Power. 

To understand how there can be so many options and none of them good, we first have to talk about renewable energy certificates.  RECs are a topic that is way more interesting than it sounds because — well, it would have to be, wouldn’t it? RECs are how we know that some electricity can be attributed to a renewable source. If you want to know what kind of renewable energy your utility is buying, or if you yourself want to buy renewable energy, RECs matter.

RECs are not electricity; they aren’t even real certificates. They were conceived of as an accounting tool enabling a utility to show it is in compliance with a state mandate to include a percentage of renewable energy in its mix. A utility amasses RECs associated with its own renewable generating sources, or buys them from renewable sources it doesn’t own, and then “retires” them to show compliance with the law. Since RECs are separate from the electricity itself, they can be bought and sold independently. There is even an online marketplace for your REC shopping convenience. 

RECs are also how voluntary buyers of renewable energy, like customers of Arcadia or Dominion’s Green Power Program, know they’re actually getting what they pay for —assuming they understand that what they pay for is not actually energy, and may have no relationship to the electricity powering their home or business. If you buy RECs, you are still using whatever electricity your utility provides, but you are also paying a premium on top of your regular bill. 

There is no nationwide, generally accepted definition of “renewable energy,” just as there is no definition of “natural” in food labeling. In Virginia, there is a state law defining what counts as renewable, and it includes not just solar, wind and hydro, but also a range of burnable fuels like biomass and municipal solid waste that foul the air and contribute to climate change. Buyer beware!  

The Virginia Clean Economy Act narrowed the list of sources that Dominion and APCo can use to meet the law’s new renewable portfolio standard, and also limited the locations of qualifying facilities. After 2025, happily, most of the RECs retired by Dominion and APCo under the VCEA will come from Virginia wind and solar facilities. 

But crucially, the VCEA didn’t change the definition of renewable energy in the code. Dominion won’t be able to use RECs from its biomass plants to meet the VCEA, but it can still sell them to anyone else and label the product “renewable” without falling afoul of the law. Anyone buying a renewable energy product from Dominion had better check the list of ingredients. 

It’s not just Dominion. Anyone buying RECs from Arcadia or anywhere else should take a good look at what they are getting, and ask themselves if the money they spend means new renewable energy will be added to the grid. 

The answer is probably no. If the RECs come from a wind farm in Texas or Iowa, the electricity from those turbines doesn’t feed into the grid that serves Virginia, so you can’t even pretend it is powering your house. It also doesn’t mean anyone built a wind farm because of REC buyers like you. Wind energy is already the cheapest form of new energy in the central part of the U.S. People build wind farms because they are profitable, not because they can sell RECs. In fact, those wind farms are swimming in surplus RECs, because states in the center of the country don’t have renewable energy mandates to make their own utilities buy them.  

For that matter, a lot of RECs come from facilities that were built before the idea of RECs even existed. Hundred-year-old hydroelectric dams can sell RECs; so can fifty-year-old paper mills that sell biomass RECs from burning wood. 

With this background, let’s look at the offerings available in Virginia and see which are worth paying more for. 

Dominion Energy Virginia

In theory, Dominion customers will have the ability to buy real solar energy directly from independent providers beginning as early as 2023, thanks to shared solar legislation sponsored by Sen. Scott Surovell and Del. Jay Jones and passed in 2020. The law envisions independent solar developers building solar facilities in Virginia and selling the electricity (and the RECs) to subscribers who are Dominion customers. But the SCC opened a Pandora’s box last fall by allowing Dominion to propose the rules, and in an act of classic Dominion overreach, the utility has now proposed to collect an average of $75 a month as a “minimum bill” from every customer who buys solar energy from someone else. A fee like that would end the program before it ever started.

 The matter is hardly settled. The solar industry has asked for an evidentiary hearing and suggested that the minimum bill should be set at a single dollar. If all else fails, the program may go forward serving only low-income customers, whom the legislation exempts from the minimum bill. 

Dominion customers can hope for the best, but any shared solar option is still at least two years away. 

In the meantime, the utility’s website lists four renewable energy options: two that sell RECs, one that sells actual energy (and retires the RECs for you) and one that doesn’t exist. 

• The REC-based Green Power Program has been around for a decade, and as of 2019 it had more than 31,000 subscribers. Dominion’s “product content label” projected that for 2020 the program would likely consist of 56 percent wind RECs, 34 percent biomass RECs, and 10 percent solar RECs. Facilities are advertised as being “in Virginia and the surrounding region,” but the fine print reveals sources as far away as Mississippi, Georgia, Missouri and Alabama, none of which are part of the PJM transmission grid that serves Virginia.  (Side note: the biomass icon is a cow, not a tree, which is misleading but charming, unless they might be burning cows, in which case it is deeply disturbing.) With the website out of date, I contacted Dominion for current content information: solar is now up to 13 percent, but, sadly, biomass still makes up 35 percent of the mix (but now it has a leaf icon!).

• REC Select. When I say “buyer beware,” I have this offering in mind. Dominion has been authorized to go Dumpster diving to buy the cheapest RECs from around the country and from any facility that meets Virginia’s overly-expansive definition of renewable energy. The website implies that so far the company is only buying wind RECs from Oklahoma and Nebraska, an indication of just how cheap those are. But under the terms of the program, the RECs could come from 50-year-old paper mills in Ohio or hundred-year-old hydroelectric dams. No educated consumer would buy this product, and both Dominion and the SCC should be ashamed of themselves for putting it out there.

• The 100% Renewable Energy Program delivers actual energy from Virginia, and retires RECs on your behalf. That’s the good news. But only a few of the solar farms are new; the rest of the energy comes from old hydro plants and, worse, from biomass plants that are so highly polluting that they don’t qualify for Virginia’s renewable energy mandate under the VCEA. The inclusion of biomass makes the program more expensive than it would be otherwise. So why include biomass when no one wants it? Because Dominion doesn’t really care if you sign up for this program. The company only offers it to close off a provision in the law that allowed customers to buy renewable energy from competitors if their own utility doesn’t offer it.

• Dominion’s website does list one attractive program under the name “community solar.” Like the shared solar program already discussed, it would deliver actual solar energy from new facilities to be built in Virginia, while retiring the RECs on your behalf. This would pass all our tests, except that it doesn’t exist. The SCC gave Dominion the green light to offer the program more than two years ago, and we’ve heard nothing since, even though the enabling legislation appears to make it mandatoryfor both Dominion and APCo. 

Appalachian Power

APCo never developed a community solar program either, and the shared solar program discussed earlier would not be available to APCO customers even if it gets off the ground. But APCo does have two renewable energy offerings. 

• For its Virginia Green Pricing program, APCo put together wind and hydro from its own facilities. That means it’s actual energy and reasonably priced, at less than half a cent per kWh. But these are existing facilities that all its customers had been paying for until APCo figured out how to segment the market and make more money, and the hydro is old. (As with Dominion’s renewable energy program, the real purpose of the new product was to close off competition.) 

• Even cheaper is Alternative Option-REC, the RECs for which “may come from a variety of resources but will likely be associated with energy from waste, solid waste and hydro facilities.” No biomass, anyway, but I still have trouble imagining who would pay extra for (literally) garbage. 

Virginia electric coops

Some electric cooperatives offer real renewable energy to customers, and a couple have community solar programs that are quite attractive.  

• Central Virginia Electric Cooperative and BARC Electric Cooperativeoffer community solar programs that not only deliver actual solar energy, but also let customers lock in a fixed price for 20-25 years. Four other coops also offer a solar energy option, and at least one other is working on it.

• Many coops also sell RECs, of mixed quality. Shenandoah Valley Electric Cooperative offers RECs generated by wind farms owned or contracted byOld Dominion Electric Cooperative, the generation cooperative that supplies power to most Virginia coops. Rappahannock Electric Cooperative, however, sells only biomass RECs.

• Bottom line: if you are a member of an electric cooperative, you may have better options than either Dominion or APCo is offering — and if you don’t, hey, you’re an owner of the coop, so make some noise!

Arcadia

 If you like RECs, you don’t have to buy them from your own utility. The folks at Arcadia have struggled for years to offer products that put new renewable energy on the grid. In states that allow community solar, Arcadia now offers wind and solar from projects in those states. Everywhere else, they just sell RECs. The website provides no information indicating where the facilities are, meaning they could be out in the same central plains states that are awash in surplus wind RECs. Their game plan appears to be for all the nice liberals with climate guilt to throw enough money at red state RECs that eventually the day will come when demand exceeds supply and drives the price up enough to incentivize new projects. The plan sounds self-defeating to me, but in any case, buyers should keep in mind that the RECs bought before that glorious date will have incentivized precisely nothing. 

Other options

Obviously, if you have a sunny roof, you can install solar onsite and net-meter. Of all the programs available today, that’s the one that will save you money instead of making you spend more. 

If you don’t have a sunny roof, but you’d still like to see your money put solar onto the grid, consider contributing to a church, school or non-profit that is going solar, or to an organization that puts solar on low-income homes. Two that operate in Virginia are Give Solar, which puts solar on Habitat for Humanity houses, and GRID Alternatives, which trains workers to install solar on low-income homes here and abroad. If everyone in Virginia who is currently buying RECs were to choose this alternative instead, it would put millions of dollars to work building new solar in Virginia, and lowering the energy bills of people who most need the help.

And that might make it the best option of all.

A version of this article first appeared in the Virginia Mercury on May 21, 2021.