Solar schools, climate resiliency, energy efficiency: Local governments are now involved in energy planning – whether they feel ready for it or not. Some localities have adopted climate goals that require them to look for ways to lower carbon emissions; others just want to save money on high energy bills.
Virginia has chipped away at the barriers to renewable energy and started putting hundreds of millions of dollars into energy efficiency programs, thanks to laws like Solar Freedom, the Virginia Clean Economy Act (VCEA) and the Clean Energy and Community Flood Preparedness Act, which made Virginia part of the Regional Greenhouse Gas Initiative (RGGI).
But even a positive policy environment doesn’t flatten all barriers. At all levels of government — and for that matter, in homes and businesses — energy-saving projects get stalled by confusing information, lack of money or financing, layers of opaque bureaucracy or fear of uncertain outcomes.
Attacks on Virginia’s clean energy transition framework and utility reform get most of the ink during this legislative session, but some less-noticed bills are focused on moving ahead by removing stumbling blocks to clean energy and identifying funding.
I made a brief mention of some of these in my bill round-up last week, including House Joint Resolution 545 from Briana Sewell, D-Prince William, asking the Department of Energy to recommend ways to overcome barriers that keep local governments and their constituents from purchasing clean energy. There is also Senate Bill 1333 from Ghazala Hashmi, D-Richmond, to facilitate local clean energy projects for low- and moderate-income residents. Senate Bill 1419 from David Suetterlein, R-Roanoke, would allow retail choice in renewable energy purchasing, and Senate Bill 949 from Chap Petersen, D-Fairfax, would allow residents to access low-cost public financing of clean energy.
The shared solar bills I covered last week also allow local governments to participate. And although I’m not tracking them myself, there are other bills that encourage local resiliency planning, give localities authority to require electric vehicle charging infrastructure or support transit solutions.
Overwhelmingly — but not exclusively! — the bills this year that try to move the ball forward on clean energy come from Democrats, a bad sign when the House and governor are Republican. I have seen many bills die in committee for reasons that have little to do with the bill, and Gov. Youngkin notoriously vetoed bills last year seemingly as a “personal and political move” against the bills’ patron senator. It’s also a short session this year, so if a bill is complicated or has opposition from favored industries, it goes into committee with a strike against it.
But many of these bills support private investments or save money for taxpayers, which are thankfully still bipartisan priorities. And some energy innovations are now mainstream across Virginia, in red counties as well as blue. Among these are solar schools.
So let’s take a deeper look at one piece of legislation, the solar school roofs study at the center of Senate Bill 848 from Barbara Favola, D-Arlington, and House Bill 1852 from Suhas Subramanyam, D-Loudoun.
Wilson Middle School, Augusta County. Photo courtesy of Secure Futures.
I wish they all could be solar schools
In the summer of 2021, I was dismayed to learn that the school board for the city of Norfolk had been told none of their brand-new schools could be outfitted with solar panels because the roofs weren’t designed to take the extra weight. As a result, Norfolk could not do what dozens of school districts across Virginia have been doing: installing solar arrays to provide some or all of the energy the school consumed, saving money for taxpayers and giving students hands-on exposure to a fast-growing technology with terrific career potential.
What a missed opportunity, and yet, Norfolk wasn’t alone. I soon learned about a new school in Richmond where educators were eager for solar, but the steep pitch of the roof on the main part of the building wasn’t suitable. That left only a flat-roofed side wing that couldn’t hold enough panels to meet more than a fraction of the school’s needs.
From conversations with architects and solar developers, I know that building a school with a roof that can hold solar panels doesn’t have to be an added expense; mainly, you just have to plan for it. Wyck Knox, the architect who designed Arlington’s two net-zero energy schools (among others), says even building a school that can produce as much energy as it uses doesn’t have to cost more, if you simply approach the design process with that goal.
Designing a school with a solar-ready roof pays off when the school district enters a power purchase agreement (PPA) with a solar company that installs and owns the solar array. The school pays just for the electricity it produces, typically at a rate lower than what the utility charges.
As of this year, the financing options have expanded. The Inflation Reduction Act allows tax-exempt entities like local governments and schools to claim federal tax credits for renewable energy and batteries directly.
So why aren’t all schools solar schools? The answers might differ from one school district to the next, but generally it’s because nobody thought of it at the right time, or they don’t know how to go about it, or the right people aren’t on board. One stubborn facilities manager can stall a project indefinitely.
The U.S. Department of Energy says energy is the second largest expensefor schools, after teacher salaries. Taxpayers should be able to expect their school districts will pursue strategies like onsite solar that reduce energy costs.
Personally, I support requiring school districts to, at the very least, analyze whether they could save money with solar roofs before they lock in designs that don’t include them. However, House Republicans killed an effort last year to impose such a requirement. And some school officials say it isn’t needed because they want to do solar; they just need help with the process.
The commission itself recommended several pieces of legislation that are now before the General Assembly, including some around construction funding. That should make it easier to integrate solar recommendations into their other work.
Favola said, “I am extraordinarily excited about the possibility of providing school systems with technical assistance on how to incorporate solar and other renewable energy components in their renovations and new buildings.”
You and me both, Senator. You and me both.
This article was originally published in the Virginia Mercury on January 26, 2023.
Update January 27: I may have given Republicans too much credit, at least those in the House. Although Senator Favola’s bill sailed through a Senate committee and is headed for a floor vote, a House subcommittee killed Delegate Subramanyam’s companion bill–in spite of a long line of speakers in support and no opposition.It was a bad meeting for Subramanyam; his shared solar bill also died in that committee.Senator Sutterlein’s retail competition bill has also been killed in a bipartisan vote in Senate Commerce and Labor, a Dominion-friendly committee.
Climate advocates gathered at the Virginia Capitol on Friday to defend Virginia’s clean energy laws. Speakers included Senators Creigh Deeds, Ghazala Hashmi, David Marsden and Scott Surovell, and Delegates Rip Sullivan, Nadarius Clark, Rodney Willett and Alfonso Lopez. Photo courtesy of Mary-Stuart Torbeck, Virginia Sierra Club.
Every year I do a round-up of climate and energy bills at the start of the General Assembly session. This year, as expected, Republicans continue their assault on the hallmark legislation passed in 2020 and 2021 committing Virginia to a zero-carbon economy by 2050. In addition, this year features the usual assortment of bills doing favors for special interests, efforts to help residents and local governments go solar and a brand-new money and power grab by Dominion Energy.
Republicans are not down with the energy transition
Dominion Energy may have baked the transition to renewables into its planning, but unsurprisingly, the Virginia Republican Party thinks the fight to preserve fossil fuel dependence is a winning issue. The three foundational bills of Virginia’s energy transition — the Regional Greenhouse Gas Initiative (RGGI), the Virginia Clean Economy Act (VCEA) and Clean Cars — all come in for attack, either by outright repeal or death-by-a-thousand-cuts.
Senate Bill 1001 (Richard Stuart, R-Westmoreland) would repeal the Clean Energy and Community Flood Preparedness Act, the statute that propelled Virginia into the Regional Greenhouse Gas Initiative. Participation in RGGI is the vehicle by which utilities buy allowances to emit carbon pollution. Under RGGI, the number of allowances available declines every year, and Virginia’s power sector would reduce CO2 emissions 30% by 2030. The allowance auctions have already raised hundreds of millions of dollars that by law must be used for low-income energy efficiency programs and flood resilience projects. A similar bill failed last year, and Senate Democrats have pledged to block the effort again. Meanwhile, Gov. Glenn Youngkin is trying to withdraw Virginia from RGGI administratively, a move that former Attorney General Mark Herring ruled wasn’t legal.
Carbon allowance auctions are a foundational piece of the VCEA as well, but it is a much bigger law that touches on too many aspects of energy regulation for repeal of the whole thing. This isn’t stopping Republicans from trying to undermine key provisions. House Bill 2130 (Tony Wilt, R-Rockingham) and Senate Bill 1125 (Travis Hackworth, R-Tazewell) would give the State Corporation Commission more authority over closures of fossil fuel plants and require it to conduct annual reviews aimed at second-guessing the VCEA’s framework for lowering emissions and building renewable energy. Achieving the VCEA’s climate goals is decidedly not the purpose; meanwhile, the legislation would remove business certainty and undercut utility planning.
Other attacks on the VCEA take the form of favors for specific industries, but would effectively make the VCEA’s goal of reaching 100% carbon-free electricity by 2050 at the least cost to consumers impossible. I’ve dealt separately with small modular reactors, hydrogen and coal mine methane below.
In addition, House Bill 1430 and House Bill 1480 (Lee Ware, R-Powhatan) exempt certain industrial customers categorized as “energy-intensive trade-exposed industries” from paying costs that the VCEA makes all customers pay. The exemption would last four years. The result would be nice for those industries but would shift costs onto everyone else. The bill seems likely to pass the House, but the same bill last year died in the Senate. However, Senate Bill 1454 (Jeremy McPike, D-Prince William) proposes the SCC put together a group of experts to study the issue and make recommendations.
In the transportation sector, no fewer than seven bills sought to repeal the Air Pollution Control Board’s authority to implement the Advanced Clean Car Standard: House Bill 1372 (Buddy Fowler, R-Hanover), House Bill 1378 (Wilt), Senate Bill 778 (Stuart), Senate Bill 779 (Stephen Newman, R-Bedford), Senate Bill 781 (Bill DeSteph, R-Virginia Beach), Senate Bill 782 (Bryce Reeves, R-Fredericksburg) and Senate Bill 785 (Ryan McDougle, R-Hanover). The Senate bills were killed in committee on Tuesday. The House bills are likely to pass that Republican-led chamber, but it appears clear that Senate Democrats intend to hang fast to Clean Cars.
Although so many identical bills might look like a failure of legislators to coordinate efforts, in fact the senators all signed on as co-patrons to each other’s bills, along with a dozen House Republicans. Republicans think they have a winning issue for the November election, and lots of them want to claim they filed “the” legislation attempting to repeal Clean Cars.
Raiding the store for polluter interests
If the VCEA is here to stay, there are some decidedly non-green industries that want to claim the green mantle to get in on the action. It’s not about making themselves feel better about their high greenhouse gas emissions. It’s about getting a piece of the market for renewable energy certificates and undermining the integrity of the renewable energy label.
House Bill 1643 (Terry Kilgore, R-Scott) and Senate Bill 1121 (Hackworth) proclaim coal mine methane a renewable energy. House Bill 2178 (James Morefield, R-Tazewell) makes coal mine methane a qualifying industry for Virginia’s green job creation tax credit.
Burning wood for electricity produces as much CO2 as coal, at a cost much higher than solar energy today. Yet House Bill 2026 (Israel O’Quinn, R-Bristol) and Senate Bill 1231 (Lynwood Lewis, D-Accomack) remove the requirement in the VCEA for the retirement of Dominion’s generating facilities that burn wood for electricity and allow these generating plants to qualify as renewable energy sources.
SMRs and hydrogen
Speaking of raiding the store, House Bill 2197 (Kathy Byron, R-Bedford) allows “advanced nuclear technology” to qualify for Virginia’s renewable portfolio standard (RPS). The bill defines the term as “a small modular reactor or other technology for generating nuclear energy,” which looks like an opening for existing nuclear plants as well. Even if it isn’t, treating any kind of nuclear technology as a renewable resource upsets the VCEA’s calibrated approach to nuclear as a zero-carbon technology alongside renewable energy, not in place of it.
House Bill 2311 (Kilgore) goes a step further, declaring both nuclear and hydrogen to be renewable energy sources and making them eligible for the RPS. Hydrogen, of course, is a fuel made from other sources of energy, which can be renewable but are more typically fossil fuels currently. Given Youngkin’s interest in seeing hydrogen made from coal mine methane, you can see where this is headed.
House Bill 2333 (Danny Marshall, R-Danville) calls on the SCC to develop a pilot program to support building small modular nuclear reactors, with a goal of having the first one operational by 2032. In spite of the word “pilot,” the bill is ambitious. It contemplates four sites, each of which can have multiple reactors of up to 400 megawatts each.
Utility reform
Some of these bills are reform bills; some are “reform” bills. To recognize the difference, it helps to know whether the proponent is a public interest organization or the utility itself. When Dominion tells you it has a bill you’re going to love, you can be pretty sure the result will be bad for ratepayers.
Senate Bill 1321 (Jennifer McClellan, D-Richmond, and Creigh Deeds, D-Charlottesville) and House Bill 1604 (Ware), billed as the Affordable Energy Act, is real reform legislation that gives the SCC authority to lower a utility’s base rates if it determines that existing rates produce “unreasonable revenues in excess of the utility’s authorized rate of return.”
Other straightforward measures include House Bill 2267 (Wilt) and Senate Bill 1417 (David Suetterlein, R-Roanoke), which allow the SCC to decide to add the cost of a new utility generation project into base rates instead of granting a rate adjustment clause (RAC), and House Bill 1670 (Marshall), which returns rate reviews to every two years instead of the current three years.
Dominion, however, has its own “reform” bill, introduced by its favorite Democratic Senate and Republican House leaders. As is typical for Dominion, Senate Bill 1265 (Dick Saslaw, D-Fairfax) and House Bill 1770 (Kilgore) is long, dense and deadly effective in crushing competition and protecting profits. The bitter pill is sugarcoated with short-term rebates and concessions to minor reform proposals, such as biennial rate reviews in place of triennial reviews and consolidating many RACs into base rates. A somewhat less objectionable substitute moved forward in Senate subcommittee this week, but further negotiations are expected to produce yet more changes.
The warring factions may be able to find common ground in House Bill 2275 (Kilgore) and Senate Bill 1166 (Scott Surovell, D-Fairfax), legislation creating a structure for state energy planning.
House Bill 1777 (O’Quinn) and Senate Bill 1075 (Frank Ruff, R-Mecklenburg) change how the SCC regulates rates of Appalachian Power – but not Dominion. They require the SCC to conduct “annual rate true-up reviews (ART reviews) of the rates, terms and conditions for generation and distribution services” by March 31, 2025 and annually after. They also remove the requirement for an integrated resource plan.
Retail choice
Past years have seen efforts to restore the ability of customers to buy renewable energy from providers other than their own utilities, an important option for a resident or business that wants to buy renewable energy at a competitive rate. Senate Bill 1419 (Suetterlein) marks at least the fourth year in a row for this effort. A Senate subcommittee voted against it this week.
Dominion’s “reform” bill, on the other hand, clamps down further on retail choice. In light of Youngkin’s support for retail choice in his energy plan, it is interesting to see Republicans like Kilgore instead enabling Dominion’s anticompetitive efforts.
Wilson Middle School, Augusta County. Photo courtesy of Secure Futures.
Goosing investments in solar and efficiency
With the passage of the federal Inflation Reduction Act last summer, renewable energy and energy efficiency tax credits are more generous and easier to access than ever before. Senate Bill 848 (Barbara Favola, D-Arlington) and House Bill 1852 (Suhas Subramanyam, D-Loudoun) direct the Commission on School Construction and Modernization to figure out how to help schools take full advantage of onsite solar.
House Joint Resolution 545 (Briana Sewell, D-Prince William) directs the Department of Energy to study barriers to clean energy investments by localities and their residents and issue recommendations to help.
Senate Bill 1333 (Ghazala Hashmi, D-Richmond) creates a program within the Department of Energy to be known as the Commonwealth Solar and Economic Development Program. The program will implement solar, energy efficiency and other economic development projects in specified census tracts.
Senate Bill 1323 (McClellan) requires the SCC to establish for Dominion Energy Virginia annual energy efficiency savings targets for customers who are low-income, elderly, disabled or veterans of military service.
Senate Bill 984 (Monty Mason, D-Williamsburg) clarifies that lease arrangements for onsite solar are legal, whether or not they’re net metered, including when battery storage is part of the project. (For context: Leasing has always been an option for onsite solar, but the IRA has increased interest in this approach. It is considered especially attractive for residential projects that, except when the customer is low-income, are barred by Virginia law from using third-party power purchase agreements.) The bill also ensures owners can be paid for grid services using the facilities. Another welcome provision of the bill is removing standby charges for residential customers who have batteries along with their solar panels. Currently, residents with systems over 15 kW must pay hefty standby charges.
House Joint Resolution 487 (Marshall) directs the Department of Transportation to study the idea of putting solar panels in highway medians.
Meanwhile, House Bill 2355 (Jackie Glass, D-Norfolk) is a consumer-protection effort for buyers of rooftop solar and other small arrays, who have sometimes been the victims of unscrupulous companies that overcharge and under-deliver.
Shared solar
Virginia has been wading into community solar like a child at the seashore, dipping a toe in and then running away again and again, without ever truly entering the water. A 2020 law establishing a “shared solar” program in Dominion territory was supposed to get us swimming. At the SCC, however, Dominion won the right to impose such a high minimum bill as to make the program unworkable for any but low-income customers, who are exempt from the minimum bill.
Senate Bill 1266 (Surovell) attempts to address the problems with the shared solar program in Dominion territory. Surovell was the author of the 2020 law and criticized the SCC’s action for making shared solar unavailable to anyone other than low-income residents. His approach would limit the minimum bill to more than twice the basic customer charge, while also increasing the size of the program to at least 10% of the utility’s peak load and allowing non-jurisdictional customers like local governments to participate.
Senate Bill 1083 (Edwards and Surovell) creates a shared solar program in Appalachian Power territory. It builds on the framework of the existing program in Dominion territory, but the minimum bill is limited to $20. It also seeks to prevent the interconnection problems that industry members have complained about by limiting costs and requirements to those “consistent with generally accepted industry practices in markets with significant penetration levels of distributed generation.”
On the House side, House Bill 1853 (Suhas Subramanyam, D-Loudoun) combines both Senate bills into one bill that addresses both Dominion and Appalachian Power. For both, it limits the minimum bill to two times the basic customer charge, and it includes the interconnection language.
Offshore wind
Senate Bill 1441 (Mamie Locke, D-Hampton) moves up the VCEA’s deadline for offshore wind farm construction from 2034 to 2024, a change I don’t understand at all, given that the current timeline calls for completion of the Coastal Virginia Offshore Wind Project (CVOW) in 2026. The bill also requires that when Dominion seeks cost recovery, the SCC must give preference “for generating facilities utilizing energy derived from offshore wind that maximize economic benefits to the Commonwealth, such as benefits arising from the construction and operation of such facilities and the manufacture of wind turbine generator components.” I look forward to learning what’s behind that, too.
Senate Bill 1854 (Subramanyam) seeks annual reports from the SCC on the progress of CVOW, including “the status and the anticipated environmental impacts and benefits of such projects” that “analyze the current and projected capital costs and consumer rate impacts associated with such projects.” It also wants “an analysis of the ownership structure chosen by an electric utility for previously approved wind energy projects and the costs, benefits, and risks for consumers associated with utility-owned and third-party-owned projects.” This analysis would compare the Virginia project with other U.S. projects, potentially a useful analytical tool for the next offshore wind project that comes along.
House Bill 1797 (Nick Freitas, R-Culpeper) declares that ratepayers will be held harmless if CVOW’s annual net capacity factor falls below 42% as measured on a three-year rolling average. The capacity factor is the average output of the wind turbines as a percentage of their full potential. In its filing with the SCC, Dominion projected CVOW would hit that 42% mark. If wind speeds turn out to be stronger than projected, the turbines will produce more energy at a lower cost. If the wind (or the machinery) doesn’t meet expectations, the capacity factor will be lower and costs will be higher. The bill would make Dominion absorb the loss in that event. However, the SCC did just resolve this issue in a way that takes account of both ratepayer interests and the newness of the technology, making it unlikely that many legislators will want to revisit this topic.
Senate Bill 1477 (Lewis) allows Dominion, subject to SCC approval, to create an affiliated company to build some or all of its offshore wind project, with the purpose of having the affiliate secure equity financing.
House Bill 2444 (Bloxom) moves up the timeline for Virginia offshore wind projects under the VCEA from 2034 to 2032 (I wonder if this is what Senator Locke’s bill was supposed to say). It also requires the SCC to give preference to requests for cost recovery by Dominion for “generating facilities utilizing energy derived from offshore wind that maximize economic benefits to the Commonwealth.” I don’t understand if this is intended to discourage Dominion from pursuing projects off the shores of other states, or if it is a poorly-worded way to support in-state manufacturing of components.
Residential PACE
Senate Bill 949 (Petersen) makes homeowners eligible for property-assessed clean energy (PACE) programs, which provide low-cost financing for energy efficiency and renewable energy upgrades. Currently PACE loans are only available to commercial customers.
Data centers
Virginia has a data center problem. Northern Virginia hosts the largest concentration of data centers in the world, and the energy they consume now amounts to 21% of Dominion’s load. This growth has happened with no state oversight; indeed, it’s been goosed by a billion dollars’ worth of state tax incentives over the past decade. Meeting the energy demand of data centers requires more generation and more transmission lines, usually paid for by all utility customers.
Senate Joint Resolution 240 (Chap Petersen, D-Fairfax), and House Joint Resolution 522 (Danica Roem, D-Manassas) task the Department of Energy with studying data centers’ impact on Virginia’s environment, energy supply, electricity rates and ability to meet climate targets. The bills also ask for recommendations on whether tax incentives should be conditioned on use of renewable energy or on meeting siting criteria.
Both Roem and Petersen also have bills that deal with specific siting issues, mostly unrelated to energy. Senate Bill 1078 (Petersen) limits areas where data centers can be sited (e.g., not near parks and battlefields, a barb likely aimed at the Prince William Gateway project). However, it also requires localities to conduct site assessments for impacts on carbon emissions as well as water resources and agriculture.
Meanwhile, though, legislators seem determined to increase taxpayer handouts to data centers. Following Governor Youngkin’s announcement about Amazon’s plans to invest billions of dollars in new data centers in Virginia, Delegate Barry Knight (R-Virginia Beach) filed House Bill 2479, creating the Cloud Computing Cluster Infrastructure Grant Fund to throw more money at a corporation that seems likely to have more money already than Virginia does.
Return of the gas ban ban
Last year the natural gas industry tried to get a law passed to ban localities from prohibiting gas connections in new buildings. Some cities in other states have done that to protect the health and safety of residents and protect the climate; meanwhile, about 20 red states have passed laws to prevent their local governments from doing it. But no Virginia locality has attempted to ban gas connections, in part because as a Dillon Rule state, our local governments don’t appear to have that authority. That isn’t stopping the gas industry from seeking to ban bans here; House Bill 1783 (O’Quinn) and Senate Bill 1485 (Morrissey) would do just that. Obnoxiously, it calls the right to use gas “energy justice,” which is surely the best reason to oppose it.
A version of this article appeared in the Virginia Mercury on January 18, 2023.
Update January 19: Two new bills have been added since yesterday. Senator Morrissey filed SB1485 (gas ban ban), and Senator Lewis filed SB1477 (Dominion offshore wind affiliate).
Update January 23: Delegate Bloxom filed HB2444, added to the offshore wind section above. Delegate Knight filed HB2479, a bill to enrich Amazon; see data centers.
When the Virginia General Assembly convenes this week for the 2023 session, Republicans will once again try to undo the commonwealth’s framework for a transition to renewable energy. Led by Gov. Glenn Youngkin, they will attack Virginia’s participation in the Regional Greenhouse Gas Initiative and the Virginia Clean Economy Act (VCEA) and continue seeking ways to keep a money-losing coal plant in Wise County in operation.
Meanwhile, Virginia’s largest utility has already decided that renewable energy, especially solar, is the future. Dominion Energy’s just-released Climate Report 2022 projects that under every set of assumptions modeled, solar energy will become the mainstay of its electricity generation fleet no later than 2040.
As for coal, it disappears from the energy mix by 2030 even in a scenario that assumes no change from present policy, in spite of the fact that the VCEA allows the Wise County coal plant to operate until 2045. As for fracked gas, it hangs on longer but in ever-smaller amounts, mostly to help meet winter peak demand.
Dominion modeled three scenarios for this report. The “current policy” scenario assumes the policy landscape and technology options stay the same as they are presently, and that Dominion does its part in driving a global temperature increase of 2.1°C by 2050. That’s in keeping with Virginia’s climate law, and also with Dominion’s internal commitment to achieve net-zero emissions by 2050.
That much warming is not a good outcome, considering the climate chaos the planet is experiencing today with barely over 1 degree of warming. Yet even under a 2.1°C scenario, Dominion’s model predicts solar energy will provide 40% of the electricity supply by 2040, followed by nuclear at 30% and (offshore) wind at 19%.
The “emerging technologies” scenario also assumes a temperature increase of 2.1°C by 2050, but adjusts for the likelihood that technological change will lead to “advanced dispatchable zero-carbon technology” options that could displace much of the need for energy storage. These might include hydrogen, carbon sequestration and storage, and methane gas produced as the result of poor animal waste disposal practices at factory farms — what Dominion calls renewable natural gas, or RNG.
Small modular reactors, SMRs, are not included in this scenario (and are hardly mentioned at all in the report), perhaps because operating them as peaker plants would be crazy expensive. Even without SMRs, though, the report says overall cost savings would be slight for this scenario, and solar would still be the leading source of electricity by 2040.
Finally, the report models an “accelerated transition” scenario that reduces emissions more aggressively, in line with an effort to keep the global temperature increase to 1.5°C by 2050. This is the upper bound of warming considered tolerable by many climate scientists, but it would require Dominion’s electricity business to reach net zero by 2035. Dominion’s model shows solar would make up nearly two-thirds of the electric supply in that scenario. Offshore wind would be held to just 17%, apparently because at that point more wouldn’t be needed.
I’d argue that offshore wind should carry more of the load to create a more balanced portfolio, but it’s a moot point: The report writers clearly think this scenario is just a thought exercise. The scenario consistent with keeping global warming to 1.5°C is described in a way that seems intended to discourage anyone from pursuing the matter.
“The heavier reliance on renewable capacity in this scenario,” it warns, “would require significantly greater capital investment at a much more rapid pace in preparation for a net zero mix by 2035. … Achieving such a rapid pace of emissions reductions would require predictable, dependable, and rapid wholesale shifts in public policy and technology advancements capable of maintaining system reliability and customer affordability. Also necessary would be supportive regulatory treatment and timely permitting for significant near-term zero-carbon infrastructure development and transmission system enhancements.”
In other words, the report seems to say, fuggedaboutit. It’s just too hard.
If that feels defeatist, it’s worth remembering how far Dominion has come to reach a point where it is even writing climate reports, not to mention declaring on page 1 that “climate change presents one of the greatest challenges of our time, and we take seriously our leadership role in helping to mitigate it.”
This is new, and you have to look back only a decade to appreciate how radical this declaration is. When 2013 opened, Dominion had just completed construction of that regrettable coal plant in Wise County and had begun a fracked gas plant building spree that would continue even after solar emerged as the cheapest source of new electricity in Virginia. Climate activists like myself were dismissed when we warned that new gas plants would be reduced to giant concrete paperweights well before the end of their design life, leaving ratepayers paying off stranded assets.
Even in 2016, when now-CEO Bob Blue was president of Dominion Virginia Power, Blue was proclaiming natural gas “the new default fuel” for electric generation. As late as the spring of 2020, the company’s integrated resource plan still called for building more gas plants. That plan acknowledged the strategy would violate Virginia’s new climate law, so it argued against the law.
Yet I suspect Blue may deserve credit for the remarkable about-face at Dominion beginning in 2020. That summer Dominion Energy began significantly reducing its investments in fossil gas outside of the electric sector, scrapping plans for the Atlantic Coast Pipeline and selling off its gas transmission and storage assets. That year it also sold half of its interest in the Cove Point liquified natural gas export facility. It is reportedly considering selling the other half now as part of what Blue called in November “a ‘top-to-bottom’ business review aimed at ensuring that it is best positioned to generate substantial long-term value for shareholders.”
Maybe Blue got religion on climate, maybe he’s just a savvy businessman. It’s a really good sign of the times that you can’t always tell the difference.
But of course, Dominion is stuck with a heck of a lot of gas generating plants that it has to justify post hoc, which helps to explain its lack of enthusiasm for the 1.5°C scenario. Another part of the explanation lies in Dominion’s remaining gas investments outside the electric sector. Although Dominion Energy Virginia is solely an electric utility and does not supply gas to retail customers in Virginia, a separate Dominion Energy subsidiary sells gas in other states. So far these assets don’t seem to be going the way of the gas transmission business and Cove Point.
Dominion’s climate report tries valiantly to justify holding onto its retail gas business. The report declares, “Natural gas is also part of our long-term vision and consistent with our Net Zero commitment.”
Sure, and the Tooth Fairy is real. Of the greenhouse gas reduction approaches cited — fixing leaks, making “renewable” methane from waste products, blending hydrogen into pipelines, and using creative carbon accounting with “offsets” — none make sense either economically or from a climate standpoint.
Maybe he cares about climate, but apparently Blue doesn’t want to give up yet on a profitable business. Fortunately, at least for the planet, the retail gas business is about to enter a terminal decline as homes and businesses electrify. Getting out now would be the smart move from both the business and climate perspective.
Because what will eventually power all these homes, no matter which scenario you choose? Renewable energy, and especially solar.
This article was originally published in the Virginia Mercury on January 6, 2023.
Power for the People VA 