Does the SCC finally see the light on customer-owned solar?

two men installing solar panels on a roof

Photo credit NREL.

Almost four years ago, Virginia’s State Corporation Commission (SCC) approved a request from Appalachian Power to impose “standby charges” on grid-connected homeowners who installed solar arrays between 10 and 20 kilowatts (kW). The approval came not long after the SCC had given the same authority to Dominion Power (now Dominion Energy Virginia).

The standby charges, dubbed a “tax on the sun,” effectively shut down the market for these larger home systems. Since then, Virginia utilities have made no bones about their desire to dismantle the rest of the Virginia law that has enabled the growth of the private solar market.

The law permits solar owners to “net meter,” giving them credit at the retail rate for the electricity they feed onto the grid on sunny days, and letting them use that credit when they draw electricity from the grid at other times.

Utilities say net metering customers don’t pay their fair share of grid costs. Solar advocates say the subsidy runs the other way: both the utility and society at large benefit when more customers install solar. Independent studies find the “value of solar” to be above the retail rate; utility-funded studies find much lower values. In Virginia, the debate continues to rage, but in 2014, at least, the SCC came down squarely on the utility’s side.

Fast forward to 2018. This year the General Assembly passed a law called the Grid Transformation and Security Act that, among other things, envisions an electric grid of the future that incorporates distributed generation like rooftop solar. And suddenly the staff of the SCC sees customer-owned solar in a new light.

Members of the Commission staff filed testimony last month in response to Dominion’s 2018 Integrated Resource Plan, which proposes large amounts of utility-built and owned solar. Associate Deputy Director Gregory Abbott devoted much of his testimony to bashing Dominion’s solar plans.

But just when a reader might have concluded that Abbott hates solar, he pivoted to the suggestion that Dominion should consider offering rebates for customers who install their own rooftop solar:

Given that the Company is developing a Grid Transformation Plan that is designed specifically to integrate customer-level DERs [distributed energy resources], and given the Company’s peak load forecast, Staff believes the Company should explore developing a rebate program to incent customer-owned rooftop solar systems. Staff believes that it is logical to incent these DERs particularly since the Company’s Grid Transformation Plan pursuant to the GTSA is designed specifically to handle these DERs. Staff also notes that such a program could be considered to be a peak shaving program and eligible for cost recovery through Rider CIA. To the extent that the program passed the economic tests, it may obviate the need for some of the more expensive capacity resources as described in the Company’s proposed build plan. Such a program would be more environmentally benign as it would take advantage of
existing brownfield sites rather than the greenfield sites required for utility-scale
 solar.

These are, of course, precisely the arguments made by advocates for distributed solar.

The support from SCC staff comes at an opportune moment, as the Northam Administration considers making distributed solar a centerpiece of its new Energy Plan. It could also complicate Dominion’s efforts to limit and penalize customer investments in solar. Last year Dominion’s opposition doomed a raft of bills intended to make it easier for customers to use Virginia’s net metering law. When solar advocates try again in the 2019 session, having the support of the SCC could change the minds of legislators who, until now, have been happy to accept Dominion’s arguments.

All this assumes the SCC commissioners agree with their staff on the value of customer-owned solar to the grid. If they do, it could signal a new day in Virginia for customer-owned solar.

This article originally appeared in the Virginia Mercury, the new, non-profit on-line news source founded by Robert Zullo, formerly a reporter for the Richmond Times-Dispatch. 

8 thoughts on “Does the SCC finally see the light on customer-owned solar?

  1. Abbott said, “Such a program would be more environmentally benign as it would take advantage of
existing brownfield sites rather than the greenfield sites required for utility-scale
 solar.” By “brownfield” did he just mean already-developed land, i.e. rooftops?

    • Kimberly, I also thought that was an interesting use of the word “brownfield,” which we tend to think of as meaning decommissioned industrial sites. From the context he was using it in its broader sense to mean any site that is already developed, which would include rooftops, don’t you think?

  2. I hope Virginians get out to see the annual Solar & Green Home tour, Oct. 6-7 in the D.C. metro area (may differ in other locations across the Commonwealth) to see for themselves how it works, saves money (mine is even running in this rainy cloudy weather!). Check it out: http://solartour.org/

    • Yes – I think it’s best to reserve the term “brownfield” for its EPA use – not just decommissioned industrial sites, but those with significant residual toxic contamination that makes subsequent land use challenging. It’s helpful to recognize the excellent compatibility of solar ground-mounts with true brownfields, because it means minimal human contact.

      I would just use the term “developed land” to contrast it with greenfield solar “farms”….However, while I see that pro-rooftop strategy from an advocacy standpoint, I don’t like to perpetuate the myth that greenfield solar has much wrong with it, either! 😉 The permanent impact is negligible to the extent of being de minimus.

  3. Remove that ridiculous ‘stand-by’ charge and many of us could economically add more capacity. It also arbitrarily penalizes people with larger homes and or electric vehicles, who could utilize larger arrays.

    If they are worried about grid stability, they should just call PG&E and see how its done with much larger solar penetration. Or maybe offer to install batteries in people’s homes for grid balance.

  4. Actually the Concept of an availability fee is logical but it depends on how much. Likewise the concept of the residential owner receiving a credit supplying solar is logical also but what is the actual “value” of it?

    At peak hour the value would be higher than typical retail as Dominion would pay 3-5 times as much for peakers as combined cycle generation. But at other times when the grid is awash in power and that solar is just not needed..then what? Should Dominion still have to pay for it if they cannot use it?

    This scenario could actually happen if some day – SOLAR is so widespread that it is excess to the grid needs at times.

    A FAIR compromise might be to allow a REASONABLE “availability” fee, AND dynamic value-based payments for residential-generated solar.

    If/when batteries become truly cost-effective and becomes a standard installation on new homes – the “profit” in grid electricity is going to be affected. If Dominion in the future sells much less electricity than now but what it does sell is super critical – to those who need it – what is the “value” of it then? Dominion has to make a reasonable profit or else it will become like any service that is not adequately funded…

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