Electric Bluebird school bus. Photo by University Railroad via Wikimedia Commons
Transportation electrification is the focus of several bills moving through the General Assembly this winter. Environmental advocates support legislation providing rebates for purchases of electric vehicles and making EVs more readily available, both of which will help develop a market for electric cars. But buses present an even stronger case for electrification because they serve more people of all income levels, and are mostly diesel now. Switching to electric buses, especially school buses, would save money on fuel and improve air quality, especially for children riding them.
Yet the only electric school bus bill that would have much immediate impact is so deeply flawed and counterproductive that the environmental community is largely united in opposition. SB1380 has passed the Senate and reached the House floor, where it is now encountering headwinds. That opposition contrasts with the broad support offered for HB2118 (Keam), now in Senate Finance, which establishes a public funding mechanism for electric school buses, but unfortunately so far no funds have been appropriated.
I asked Gary Greenwood, the EV Issues Chair for the Sierra Club’s legislative committee, to explain the problems with SB1380 and what amendments it would need to have before Sierra Club could support it. Below is Gary’s response.
Last week, the House Labor and Commerce committee approved a bill that allows Dominion to deploy an unproven technology, electric school bus batteries used to support the electric grid, and collect the costs from ratepayers. The bill, SB1380 (Lucas), specifies that these school buses connected to the grid are in the public interest, and therefore ratepayers must pay for them, including the guaranteed profit for the utility. Also of concern is that the bill does not ensure that the buses will always be available when the schools need them for transporting kids.
While vehicle-to-grid technology is not new, it has never been deployed at this scale to support a utility’s electric grid. SB1380 will allow Dominion to charge ratepayers hundreds of millions of dollars for this unproven technology, without a thorough SCC evaluation.
Yes, the environmental community wants to reduce and ultimately eliminate greenhouse gas emissions. And switching from diesel school buses zero-emission electric school buses is an important part of this effort. We also know that electric school buses will be much healthier for the children that ride them. “Do it for the kids” is a great sentiment, but a poor excuse to declare unproven technology in the public interest. Note that Mothers Out Front, a champion of electric school buses in Virginia, also spoke against this bill.
The environmental community supports battery storage as a key part of the transition to renewable energy, and adding battery storage to the grid is needed for utilities to meet VCEA’s storage targets of 250MW by 2025 and 1200MW by 2030. However, the vehicle-to-grid technology that enables electric buses to support the electrical grid has not been implemented at this scale. Dominion has begun a pilot program, but it is in its infancy.
We don’t believe that the General Assembly should declare the deployment of this technology in the public interest. Rather, an analysis evaluating the benefits and reliability of using school bus batteries to support the grid should be presented in an SCC filing, comparing the costs of bus batteries to dedicated batteries for grid support.
We do need to convert our school bus fleets to electric buses. SB1380 could move us in the right direction if it is amended to guarantee that the buses are always available for transporting students, and to allow for unfettered SCC oversight of costs.
Virginia is, famously, a state that prides itself on being business-friendly. That makes it all the more interesting that a number of bills favoring consumers have made it through the House. Democrats have led the charge, but several of the bills earned bipartisan support even in the face of utility opposition.
This doesn’t guarantee their luck will hold. Democrats aren’t just more numerous in the House, they are also younger and more independent-minded than the old guard Democrats in control of the Senate. The second half of the session is going to be a lot more challenging for pro-consumer legislation.
The action will be especially hot in the coming days around five bills dealing with utility reform and a customer’s “right to shop” for renewable energy (HB2048). All these bills passed the House with at least some Republican support. But they are headed to Senate Commerce and Labor, which, though dominated by Democrats, has a long history of protecting utilities.
The Clean Car Standard (HB1965), which would make electric cars more readily available in Virginia, and the EV rebate bill (HB1979), which would make them more affordable, seem to be on stronger ground as far as Democratic support goes — and they will need all the Democrats because Republicans are united in opposition. But rebates require money, and that is always a challenge.
Below is the status of the bills I’ve been following. Since we have passed “crossover,” House bills will be heard in the Senate and vice-versa. At the end I’ve collected the bills that died along the way.
BILLS ALIVE AT HALFTIME
Bills are arranged by category, and then by number, with House bills first.
A worker installs solar panels at Washington & Lee University. Photo courtesy of Secure Futures LLC.
Renewable energy and storage
• HB1925 (Kilgore) establishes, but does not fund, the Virginia Brownfield and Coal Mine Renewable Energy Grant Fund and Program. Passed the House unanimously, expected to pass in the Senate.
• HB1994 (Murphy) and HB2215 (Runion) expands the definition of small agriculture generators to include certain small manufacturing businesses such as breweries, distilleries and wineries for the purposes of the law allowing these businesses to aggregate meters and sell renewable energy to a utility. HB2215 was incorporated into HB1994, which passed the House 93-6. I expect it to pass the Senate.
• HB2006 (Heretick) and SB1201 (Petersen) change the definition of an “electric supplier” to include the operator of a storage facility of at least 25 MW, exempting them from state and local taxation but allowing a revenue share assessment. This is a priority bill for renewable energy industry associations. HB2006 passed the House 11-8 with one abstention. SB1201 passed the Senate 38-0-1. Looks like this one is a done deal.
• HB2034 (Hurst) clarifies that the program allowing third-party power purchase agreements (PPAs) applies to nonjurisdictional customers (i.e., local government and schools) as well as jurisdictional customers (most other customers). Passed the House 99-0. Senate companion billSB1420(Edwards) also passed unanimously, so this is another done deal.
• HB2048 (Bourne) restores the right of customers to buy renewable energy from any supplier even once their own utility offers a renewable energy purchase option. In addition, third party suppliers of renewable energy are required to offer a discounted renewable energy product to low-income customers, saving them at least 10% off the cost of regular utility service. Passed the House 67-32, which is darned good for a pro-consumer, pro renewable energy bill. But a similar bill ran into trouble in Senate Commerce and Labor in past years due to utility opposition.
• HB2148 (Willett) provides for energy storage facilities below 150 MW to be subject to the DEQ permit by rule process as “small renewable energy projects.” This is a priority bill for renewable energy industry associations. Passed the House 89-9.
• HB2201 (Jones) and SB1207 (Barker) expands provisions related to siting agreements for solar projects located in an opportunity zone to include energy storage projects; however, according to existing language, the provision only takes effect if the GA also passes legislation authorizing localities to adopt an ordinance providing for the tax treatment of energy storage projects. (Why doesn’t the bill just go ahead and include that authorization? Don’t ask me.) This is another renewable energy industry bill. HB2201 passed the House 71-29. SB1207passed the Senate 37-0. Another done deal.
• HB2269 (Heretick) provides for increases in the revenue share localities can require for solar projects based on changes in the Consumer Price Index. Passed the House 91-8.
• SB1258 (Marsden) requires the State Water Control Board to administer a Virginia Erosion and Sediment Control Program (VESCP) on behalf of any locality that notifies the Department of Environmental Quality that it has chosen not to administer a VESCP for any solar photovoltaic (electric energy) project with a rated electrical generation capacity exceeding five megawatts. The provisions become effective only if the program is funded; Marsden has submitted a budget amendment. This is also a priority bill for renewable energy industry associations. Passed the Senate 39-0.
• SB1295 (DeSteph) requires utilities to use Virginia-made or U.S.-made products in constructing renewable energy and storage facilities “if available.” After much criticism it was amended to read that the products must be “reasonably available and competitively priced,” after which the now-happily-pointless bill passed the Senate 37-0-2.
Energy efficiency and buildings
• HB1811 (Helmer) adds a preference for energy efficient products in public procurement. Passed the House 55-44 along party lines. Someone will have to explain to me why wasting taxpayer dollars on products that cost more to operate is a conservative value.
• HB1859 (Guy) amends last year’s legislation on Commercial Property Assessed Clean Energy (C-PACE) loans to allow these loans to be extended to projects completed in the previous two years; it also expressly excludes residential buildings of less than five units and residential condominiums. Passed House 61-38; passed Senate 26-12-1. A done deal.
• HB2001 (Helmer) requires state and local government buildings to be constructed or renovated to include electric vehicle charging infrastructure and the capability of tracking energy efficiency and carbon emissions. Local governments are authorized to adopt even more stringent requirements. Passed the House 53-45.
• HB2227 (Kory) and SB1224 (Boysko) originally required the Board of Housing and Community Development to adopt amendments to the Uniform Statewide Building Code within one year of publication of a new version of the International Code Council’s International Energy Conservation Code (IECC) to address changes related to energy efficiency and conservation. The bill would have required the Board to adopt Building Code standards that are at least as stringent as those contained in the new version of the IECC. It turns out the homebuilders who oppose higher efficiency standards have more clout with committee chairs David Bulova in the House and George Barker in the Senate than consumer and environmental advocates do. The Senate bill never even got a hearing in committee. After much negotiation, the amended House bill now merely requires the Housing Board to “consider” adopting amendments “at least as stringent as those contained” in the latest IECC, and must “assess the public health, safety, and welfare benefits” involved, “including potential energy savings and air quality benefits over time compared to the cost of initial construction.” Republicans still wouldn’t vote for it, so it passed the House only on a party-line vote of 55-45.
Financing
• HB1919 (Kory) authorizes a locality to establish a green bank to finance clean energy investments. Fairfax County has requested this authority. Passed the House 55-43 on another party-line vote.
Fossil fuels
• HB1834 (Subramanyam) and SB1247 (Deeds) originally required owners of carbon-emitting power plants to conduct a study at least every 18 months to determine whether the facility should be retired; and to give notice of any decision to retire a facility to state and local leaders within 14 days. Both bills were amended so that the retirement analysis is now just a part of the integrated resource planning process of investor-owned utilities, currently every three years, leaving out other plant owners like ODEC. The amended bills both passed their chambers unanimously.
• HB1899 (Hudson) and SB1252 (McPike) sunset the coal tax credits, because it is absolutely crazy that Virginia continues to subsidize coal mining. Amended to give the coal companies one more year of subsidies before the program ends Jan. 1, 2022. Passed the House 54-45 and Senate 22-17.
• SB1265 (Deeds) makes it easier for DEQ to inspect and issue stop-work orders during gas pipeline construction. An amendment slightly weakened the bill before it passed the Senate 38-0.
• SB1311 (McClellan) originally required DEQ to revise erosion and sediment control plans or stormwater management plans when a stop work order has been issued for violations related to pipeline construction. The bill has been amended significantly and the stop-work language removed. It does require pipeline applicants to submit detailed erosion and sediment control plans, and expands the applicability of the requirement to areas with slopes with a grade above 10 percent, a number that is currently 15 percent. Passed the Senate 20-17.
Climate bills
• HB2330 (Kory) is the legislation the SCC asked for to provide guidance on the Percentage of Income Payment Program under the Virginia Clean Economy Act. This turned out to be harder than one would have thought for a bill that was just supposed to help implement a section of a previous year’s bill, and it may still be subject to further changes.Passed the House 54-46, the usual party-line split.
• SB1282 (Morrissey) directs DEQ to conduct a statewide greenhouse gas inventory, to be updated and published every four years. Passed the Senate 22-16. (It picked up one Republican vote: Jill Vogel.)
• SB1284 (Favola) changes the name of the Commonwealth Energy Policy to the Commonwealth Clean Energy Policy, and streamlines the language without making major changes to the policies set out last year in Favola’s successful SB94. That bill overhauled the CEP, which until then had been a jumble of competing priorities, and established new targets for Virginia to achieve 100 percent carbon-free electricity by 2040 and net-zero carbon economy-wide by 2045. This year’s bill shows the Northam administration is now fully on board, and the result is a policy statement that is more concise and coherent. Amendments make the bill slightly more friendly to biomass and natural gas than the introduced bill had been, but it remains an improvement on existing law. Senator Norment, who opposed last year’s bill as well as this year’s, tried to run out the clock on it by getting it referred to Finance after it was reported from Commerce and Labor, but Finance promptly reported it, and it passed the Senate 21-18. It should have no trouble in the House.
• SB1374 (Lewis) would set up a Carbon Sequestration Task Force to consider methods of increasing carbon sequestration in the natural environment, establish benchmarks and identify carbon markets. Passed the Senate 38-0.
Photo credit McKay Savage
Utility reform
The House bills are doing great, but the one Senate bill (SB1292, see “Dead and buried”) went down in flames in Commerce and Labor with only three yea votes from Senators Deeds, Mason and Bell. The five House bills are now headed to that same tough committee. If any survive, it is likely to be the Hudson and/or Helmer bills, which are the least prescriptive. Judging from the comments made during the debate of the one Senate bill, I don’t see how the other three make it through the committee.
• HB1914 (Helmer) changes “shall” to “may” in a number of places, giving the SCC discretion over when to count utility costs against revenues. HB1835 (Subramanyam) was incorporated into this bill. Passed the House 60-39.
• HB1984 (Hudson) gives the SCC added discretion to determine a utility’s fair rate of return and to order rate increases or decreases accordingly. Passed the House 64-35.
• HB2049 (Bourne) would prevent utilities from using overearnings for new projects instead of issuing refunds. Passed the House 56-44.
• HB2160 (Tran) gives the SCC greater authority to determine when a utility has overearned and gives the Commission greater discretion in determining whether to raise or lower rates and order refunds. It also requires 100 percent of overearnings to be credited to customers’ bills, instead of 70 percent, as is the case today. Passed the House 62-38.
• HB2200 (Jones) makes a number of changes to SCC rate review proceedings, including setting a fair rate of return, requiring 100 percent of overearnings to be credited to customers’ bills, and eliminating the $50 million limit on refunds to Dominion customers in the next rate review proceeding. HB2057 (Ware) was incorporated into this bill, and it passed the House 63-37.
EVs and transportation energy
• HB1850 (Reid) increases the roadway weight limit for electric and natural gas-fueled trucks to accommodate the extra weight of batteries or natural gas fuel systems. Passed the House 98-0.
• HB1965 (Bagby) is the Clean Car Standard bill, which would require manufacturers to deliver more electric vehicles to Virginia dealers beginning in 2025. To get agreement from the dealers, this bill has been “packaged” with HB1979 (rebates for EVs), which dealers wanted to ensure the customers would be there. Republicans still don’t like it. Passed the House 55-44.
• HB1979 (Reid) creates a rebate program for new and used electric vehicles. Passed the House 55-45.
• HB2118 (Keam) establishes an Electric Vehicle Grant Fund and Program to assist school boards in replacing diesel buses with electric, installing charging infrastructure, and developing workforce education to support the electric buses. It seems to be an empty fund.Passed the House 55-44-1.
• HB2282 (Sullivan) directs the SCC to develop and report on policy proposals to accelerate transportation electrification in the Commonwealth. The bill also limits how utilities get reimbursed for investments in transportation electrification: they must recover costs through normal rates for generation and distribution, and not through rate adjustment clauses or customer credit reinvestment offsets. Passed the House 76-23.
• HJ542 (McQuinn) requests a statewide study of transit equity and modernization. Passed the House 77-19.
• SB1223 (Boysko) adds a requirement to the Virginia Energy Plan to include an analysis of electric vehicle charging infrastructure and other infrastructure needed to support the 2045 net-zero carbon target in the transportation sector. Passed the Senate 22-15.
• SB1380 (Lucas) authorizes electric utilities to partner with school districts on electric school buses. The utility can own the batteries and the charging infrastructure and use the batteries for grid services and peak shaving. Passed the Senate 33-4.
Code update
• SB1453 (Edwards) revises Titles 45.1 and 67 of the Virginia Code. “The bill organizes the laws in a more logical manner, removes obsolete and duplicative provisions, and improves the structure and clarity of statutes pertaining to” mining and energy. The bill is a recommendation of the Virginia Code Commission. Passed the House 39-0.
DEAD AND BURIED
In numerical order, House bills first
• HB1934 (Simon) requires local approval for construction of any gas pipeline over 12 inches in diameter in a residential subdivision. Killed in committee.
• HB1937 (Rasoul) was this year’s version of the Green New Deal Act. But like last year, it never even got a hearing, in part because it rocked too many boats, and in part because it was a lousy bill.
• HB2067 (Webert) lowers from 150 MW to 50 MW the maximum size of a solar facility that can use the Permit by Rule process. Tabled in committee.
• HB2265 (Freitas) would repeal provisions of the VCEA phasing out carbon emissions from power plants, repeal the restrictions on SCC approval of new carbon-emitting facilities, and nix the provisions declaring wind, solar, offshore wind and energy storage to be in the public interest; however it also would declare that planning and development of new nuclear generation is in the public interest. Killed in subcommittee.
• HB2281 (Ware) would exempt certain companies that use a lot of energy from paying for their share of the costs of Virginia’s energy transition under the VCEA, driving up costs for all other ratepayers. Killed in subcommittee.
• HB2292 (Cole) was labeled the fossil fuel moratorium bill but included many other parts of the Green New Deal as well. It suffered the same fate, and for the same reasons.
• SB1292 (McClellan) was the only utility reform bill to begin in the Senate instead of the friendlier House. It would require 100% of utility overearnings to be credited to customers’ bills, instead of 70 percent, as is the case today. Killed in committee.
• SB1463 (Cosgrove) would create a loophole to let HOAs to ban solar once again. It turned out even the HOA lobby didn’t like the bill. It was stricken by the patron in committee.
This post was originally published in the Virginia Mercury on February 8, 2021.
[This post was updated January 22 to include two bills filed just ahead of the deadline. See SB1463 under Renewable Energy, and HB2330 under Climate.]
The 2021 General Session is in full swing, with bills being heard at all hours of the day, every day of the week. We’re now told the session will be extended to 45 days as it normally is in odd years, buying a little time for committees to act before the new “crossover” date of February 6.
Meanwhile, the list of bills I’ve corralled over the past week has grown to nearly 50. I’ve included the updated list here—scroll down.
Unless you’re paid to lobby, you may have only a few minutes at a time to contact legislators about the bills you want to see passed (or in some cases, defeated). So how do you set priorities?
Let me propose three criteria for you to lobby for a bill:
If enacted, the legislation would achieve progress on the issue you care about, in a way you approve of;
The legislation has a shot at passage; and
Your lobbying could make a difference
Do you like the bill? You might think this one is easy, but I recommend reading the whole bill before you decide to support one, and not just the summary. In my experience, the summaries are often misleading or incomplete. And even if you agree with the apparent goal of a bill, you might conclude the specifics are unwise or could lead to unintended consequences. But don’t dismiss a bill because it doesn’t go far enough or have everything you want. They seldom do.
Can it pass? This largely depends on who is against it, and how much influence they have. It used to be that if the utilities opposed a bill, it would die. Last year we saw a rebellion against that norm, but utilities are still formidable foes—and there are plenty of other powerful interests who can sink a bill.
There is a second reason some bills don’t have a chance: they cost money. If legislation requires public spending and the patron hasn’t got that figured out, the committee that hears the bill is likely to send it to the Appropriations Committee to die.
Can you make a difference? It’s a waste of your time to lobby for a bill that can’t pass, unless your game plan is to build momentum for future years. On the other end of the scale, sometimes a bill has been negotiated before it is even introduced, or it makes technical amendments that no one opposes; those bills don’t need your help. Focus on the bills where you believe public support matters. (And then get your friends involved, too.)
Three bills to consider for your priority list. These bills pass all three tests. They would make a difference on climate and they all have a shot, but they need public pressure to win votes.
Right to shop for renewable energy, HB2048. Consumers of all kinds want the right to buy renewable energy from suppliers other than their utility, and the provision for low-income residents to receive a discount is a clear winner. Dominion is fighting this threat to its monopoly, but it’s on the wrong side of history. It has been referred to the House Labor and Commerce committee, subcommittee 3 (members: Sullivan (Chair),Keam,Lopez,Bagby,Heretick,Ayala,Kilgore,Ware,Marshall,O’Quinn,Ward
If you have time to adopt additional bills, you might consider adding one or more of the utility reform measures. I’m also partial to HB1925 to bring renewable energy to the Coalfields, which would pair nicely with HB1899/SB1252, sunsetting the coal tax credits. I could go on, but you’ve heard enough.
Here is the whole list, updated this morning, and hopefully now comprehensive:
Renewable energy and storage
HB1925 (Kilgore) Establishes, but does not fund, the Virginia Brownfield and Coal Mine Renewable Energy Grant Fund and Program. Kilgore put in a similar bill last year, which unfortunately did not pass. With no budget impact, this ought to pass easily. But I said that last year, too.
HB1937 (Rasoul) is this year’s version of the Green New Deal Act. It contains policy initiatives to prioritize jobs and benefits for EJ populations and displaced fossil fuel workers and requires a transition to renewable energy by 2035, though these latter provisions are poorly integrated into the VCEA.
HB1994 (Murphy) and HB2215 (Runion) expands the definition of small agriculture generators to include certain small manufacturing businesses such as breweries, distilleries and wineries for the purposes of the law allowing these businesses to aggregate meters and sell renewable energy to a utility.
HB2006 (Heretick) exempts energy storage systems from state and local taxation but allows a revenue share assessment. This is a priority bill for renewable energy industry associations.
HB2034 (Hurst) clarifies that the program allowing third-party power purchase agreements (PPAs) applies to nonjurisdictional customers (i.e., local government and schools) as well as jurisdictional customers (most other customers). Currently, PPA projects with local governments in APCo territory have been held up due to a contract provision between the localities and APCo, and it is hoped this legislation will break the logjam. [Passed House, now in Senate Commerce & Labor.]
HB2048 (Bourne) restores the right of customers to buy renewable energy from any supplier even once their own utility offers a renewable energy purchase option. In addition, third party suppliers of renewable energy are required to offer a discounted renewable energy product to low-income customers, saving them at least 10% off the cost of regular utility service.
HB2067 (Webert) lowers from 150 MW to 50 MW the maximum size of a solar facility that can use the Permit by Rule process. [Killed in committee.]
HB2148 (Willett) provides for energy storage facilities below 150 MW to be subject to the DEQ permit by rule process as “small renewable energy projects.” Although 150 MW is not “small,” the permit by rule process has worked pretty well, so this should be acceptable. This is a priority bill for renewable energy industry associations.
HB2201 (Jones) expands provisions related to siting agreements for solar projects located in an opportunity zone to include energy storage projects; however, according to existing language, the provision only takes effect if the GA also passes legislation authorizing localities to adopt an ordinance providing for the tax treatment of energy storage projects. (Why doesn’t the bill just go ahead and include that authorization? Don’t ask me.) This is another renewable energy industry bill.
HB2269 (Heretick) provides for increases in the revenue share localities can require for solar projects based on changes in the Consumer Price Index.
SB1201 (Petersen) changes the definition of an “electric supplier” to include the operator of a storage facility of at least 25 MW, and subjects them to the same reporting obligations as other suppliers.
SB1258 (Marsden) requires the State Water Control Board to administer a Virginia Erosion and Sediment Control Program (VESCP) on behalf of any locality that notifies the Department of Environmental Quality that it has chosen not to administer a VESCP for any solar photovoltaic (electric energy) project with a rated electrical generation capacity exceeding five megawatts. The provisions become effective only if the program is funded; Marsden has submitted a budget amendment. This is also a priority bill for renewable energy industry associations.
SB1295 (DeSteph) requires utilities to use Virginia-made or US-made products in constructing renewable energy and storage facilities “if available,” but it does not require any added cost to be reasonable. [Amended to resolve the reasonable cost issue.]
SB1420 (Edwards) is a companion bill to HB2034, clarifying PPA language for Appalachian Power territory.
SB1463 (Cosgrove) would reverse the progress made last year in preventing homeowner associations from unreasonably restricting rooftop solar. It would create a loophole to let HOAs ban solar once again. [Withdrawn by patron.]
Energy efficiency and buildings
HB1811 (Helmer) adds a preference for energy efficient products in public procurement.
HB1859 (Guy) amends last year’s legislation on Commercial Property Assessed Clean Energy (C-PACE) loans to allow these loans to be extended to projects completed in the previous 2 years; it also expressly excludes residential buildings of less than 5 units and residential condominiums. [Passed House with a substitute, now in Senate.]
HB2001 (Helmer) requires state and local government buildings to be constructed or renovated to include electric vehicle charging infrastructure and the capability of tracking energy efficiency and carbon emissions.
SB1224 (Boysko) requires the Board of Housing and Community Development to adopt amendments to the Uniform Statewide Building Code within one year of publication of a new version of the International Code Council’s International Energy Conservation Code (IECC) to address changes related to energy efficiency and conservation. The bill requires the Board to adopt Building Code standards that are at least as stringent as those contained in the new version of the IECC. This is one of the important bills I wrote about last week.
Financing
HB1919 (Kory) authorizes a locality to establish a green bank to finance clean energy investments. Fairfax County has requested this authority.
Fossil fuels
HB1834 (Subramanyam) requires owner of carbon-emitting power plants to conduct a study at least every 18 months to determine whether the facility should be retired. It also requires notice of any decision to retire a facility to be submitted to state and local leaders within 14 days, a step that allows transition planning.
HB1899 (Hudson) sunsets coal tax credits, because it is absolutely crazy that Virginia continues to subsidize coal mining while we’ve committed to close coal plants.
HB1934 (Simon) requires local approval for construction of any gas pipeline over 12 inches in diameter in a residential subdivision. The genesis of this bill is a particular project in Simon’s district, but I was surprised this isn’t a requirement already.
HB2292 (Cole) is similar to the Green New Deal bill but without the speeded-up RPS timeline. It contains a moratorium on permits for new fossil fuel infrastructure and requires programs for transitioning fossil fuel workers that guarantees them jobs at the same income they had before and provides early retirement benefits and pension guarantees. It also requires development of new job training programs; requires that 40% of energy efficiency and clean energy funding go to EJ communities; and mandates that 50 percent of the clean energy workforce come from EJ communities.
SB1265 (Deeds) makes it easier for DEQ to inspect and issue stop-work orders during gas pipeline construction.
SB1311 (McClellan) requires DEQ to revise erosion and sediment control plans or stormwater management plans when a stop work order has been issued for violations related to pipeline construction.
Climate bills
HB2281 (Ware) would exempt certain companies that use a lot of energy from paying for their share of the costs of Virginia’s energy transition under the VCEA, driving up costs for all other ratepayers. And thus the slow chipping away at the VCEA begins. Everybody’s got a reason they’re special. [Killed in subcommittee.]
HB2330 (Kory) is the legislation the SCC asked for to provide guidance on the Percentage of Income Payment Program under the Virginia Clean Economy Act.
SB1282 (Morrissey) directs DEQ to conduct a statewide greenhouse gas inventory, to be updated and published every four years.
SB1284 (Favola) changes the name of the Commonwealth Energy Policy to the Commonwealth Clean Energy Policy, and streamlines the language without making major changes to the policies set out last year in Favola’s successful SB94. That bill overhauled the CEP, which until then had been a jumble of competing priorities, and established new targets for Virginia to achieve 100% carbon-free electricity by 2040 and net-zero carbon economy-wide by 2045. This year’s bill shows the Northam Administration is now fully on board, and the result is a policy statement that is more concise and coherent.
SB1374 (Lewis) would set up a Carbon Sequestration Task Force to consider methods of increasing carbon sequestration in the natural environment, establish benchmarks, and identify carbon markets.
And because this category would not be complete without a bill from a legislator who thinks climate action is a bunch of hooey, we have HB2265 (Freitas), which would repeal provisions of the VCEA phasing out carbon emissions from power plants, repeal the restrictions on SCC approval of new carbon-emitting facilities, and nix the provisions declaring wind, solar, offshore wind and energy storage to be in the public interest. Oh, but in case you thought Freitas was just a free market believer, or cared about cost, the bill provides that planning and development of new nuclear generation is in the public interest.
Utility reform
Clean Virginia developed a full slate of bills, each a little different, that all restore SCC oversight over utilities and/or benefit customers with refunds.
HB1835 (Subramanyam) eliminates provisions that limit rate reductions to $50 million in the next SCC review of Dominion’s rates.
HB1914 (Helmer) changes “shall” to “may” in a number of places, giving the SCC discretion over when to count utility costs against revenues.
HB1984 (Hudson) gives the SCC added discretion to determine a utility’s fair rate of return and to order rate increases or decreases accordingly.
HB2049 (Bourne) would prevent utilities from using overearnings for new projects instead of issuing refunds.
HB2057 (Ware) changes how the SCC determines a fair rate of return for utilities and gives the SCC discretion in the treatment of certain utility generation and distribution costs, as well as in determining when a rate increase is appropriate. It also provides that when a utility has earnings above the authorized level, 100% of the overearnings must be returned to customers, up from 70% today. The SCC is also given authority to determine when a utility’s capital investments should offset overearnings.
HB2160 (Tran) gives the SCC greater authority to determine when a utility has overearned and gives the Commission greater discretion in determining whether to raise or lower rates and order refunds. It also requires 100% of overearnings to be credited to customers’ bills, instead of 70%, as is the case today.
HB2200 (Jones) makes a number of changes to SCC rate review proceedings, including setting a fair rate of return, requiring 100% of overearnings to be credited to customers’ bills, and eliminating the $50 million limit on refunds to Dominion customers in the next rate review proceeding.
SB1292 (McClellan) requires 100% of overearnings to be credited to customers’ bills, instead of 70%, as is the case today.
EVs and Transportation energy
The Virginia Mercury ran a good article this week that covered most of these bills.
HB1850 (Reid) increases the roadway weight limit for electric and natural gas-fueled trucks to accommodate the extra weight of batteries or natural gas fuel systems.
HB1965 (Bagby) is the Clean Car Standard bill, which would require manufacturers to deliver more electric vehicles to Virginia dealers beginning in 2025.
HB1979 (Reid) creates a rebate program for new and used electric vehicles.
HB2118 (Keam) establishes an Electric Vehicle Grant Fund and Program to assist school boards in replacing diesel buses with electric, installing charging infrastructure, and developing workforce education to support the electric buses.
HB2282 (Sullivan) directs the SCC to develop and report on policy proposals to accelerate transportation electrification in the Commonwealth. The bill also limits how utilities get reimbursed for investments in transportation electrification: they must recover costs through normal rates for generation and distribution, and not through rate adjustment clauses or customer credit reinvestment offsets.
HJ542 (McQuinn) requests a statewide study of transit equity and modernization.
SB1223 (Boysko) adds a requirement to the Virginia Energy Plan to include an analysis of electric vehicle charging infrastructure and other infrastructure needed to support the 2045 net-zero carbon target in the transportation sector.
SB1380 (Lucas) authorizes electric utilities to partner with school districts on electric school buses. The utility can own the batteries and the charging infrastructure and use the batteries for grid services and peak shaving.
Code update
SB1453 (Edwards) revises Titles 45.1 and 67 of the Virginia Code. “The bill organizes the laws in a more logical manner, removes obsolete and duplicative provisions, and improves the structure and clarity of statutes pertaining to” mining and energy. The bill is a recommendation of the Virginia Code Commission.
Clean energy advocates expected this legislative session to feature fewer initiatives of interest, in part because of the shorter session and bill limits for legislators. Good news (I guess): the number of bills we are following is growing longer by the hour.
Below are a number of bills of interest, organized by category, and then with House bills first, Senate bills second, in ascending order. I will update this post as I learn of other bills.
If you are interested in supporting or opposing any of these, you will want to act fast, since committees are hearing bills already. In Virginia, if a subcommittee or a committee votes against a bill, it is usually gone for good.
Renewable energy and storage
HB1925 (Kilgore) Establishes, but does not fund, the Virginia Brownfield and Coal Mine Renewable Energy Grant Fund and Program. Kilgore put in a similar bill last year, which unfortunately did not pass. With no budget impact, this ought to pass easily. But I said that last year, too.
HB1937 (Rasoul) is this year’s version of the Green New Deal Act. It contains policy initiatives to prioritize jobs and benefits for EJ populations and displaced fossil fuel workers and requires a transition to renewable energy by 2035, though these latter provisions are poorly integrated into the VCEA.
HB1994 (Murphy) and HB2215 (Runion) expands the definition of small agriculture generators to include certain small manufacturing businesses such as breweries, distilleries and wineries for the purposes of the law allowing these businesses to aggregate meters and sell renewable energy to a utility.
HB2006 (Heretick) exempts energy storage systems from state and local taxation but allows a revenue share assessment. This is a priority bill for renewable energy industry associations.
HB2034 (Hurst) and SB1420 (Edwards) clarifies that the program allowing third-party power purchase agreements (PPAs) applies to nonjurisdictional customers (i.e., local government and schools) as well as jurisdictional customers (most other customers). Currently, PPA projects with local governments in APCo territory have been held up due to a contract provision between the localities and APCo, and it is hoped this legislation will break the logjam.
HB2048 (Bourne) restores the right of customers to buy renewable energy from any supplier even once their own utility offers a renewable energy purchase option. In addition, third party suppliers of renewable energy are required to offer a discounted renewable energy product to low-income customers, saving them at least 10% off the cost of regular utility service.
HB2067 (Webert) lowers from 150 MW to 50 MW the maximum size of a solar facility that can use the Permit by Rule process.
HB2148 (Willett) provides for energy storage facilities below 150 MW to be subject to the DEQ permit by rule process as “small renewable energy projects.” Although 150 MW is not “small,” the permit by rule process has worked pretty well, so this should be acceptable. This is a priority bill for renewable energy industry associations.
HB2201 (Jones) expands provisions related to siting agreements for solar projects located in an opportunity zone to include energy storage projects; however, according to existing language, the provision only takes effect if the GA also passes legislation authorizing localities to adopt an ordinance providing for the tax treatment of energy storage projects. (Why doesn’t the bill just go ahead and include that authorization? Don’t ask me.) This is another renewable energy industry bill.
HB2269 (Heretick) provides for increases in the revenue share localities can require for solar projects based on changes in the Consumer Price Index.
SB1201 (Petersen) changes the definition of an “electric supplier” to include the operator of a storage facility of at least 25 MW, and subjects them to the same reporting obligations as other suppliers.
SB1258 (Marsden) requires the State Water Control Board to administer a Virginia Erosion and Sediment Control Program (VESCP) on behalf of any locality that notifies the Department of Environmental Quality that it has chosen not to administer a VESCP for any solar photovoltaic (electric energy) project with a rated electrical generation capacity exceeding five megawatts. The provisions become effective only if the program is funded; Marsden has submitted a budget amendment. This is also a priority bill for renewable energy industry associations.
SB1295 (DeSteph) requires utilities to use Virginia-made or US-made products in constructing renewable energy and storage facilities “if available,” but it does not require any added cost to be reasonable.
SB1420 (Edwards) is a companion bill to HB2034, clarifying PPA language for Appalachian Power territory.
Energy efficiency and buildings
HB1811 (Helmer) adds a preference for energy efficient products in public procurement.
HB1859 (Guy) amends last year’s legislation on Commercial Property Assessed Clean Energy (C-PACE) loans to allow these loans to be extended to projects completed in the previous 2 years; it also expressly excludes residential buildings of less than 5 units and residential condominiums.
HB2001 (Helmer) requires state and local government buildings to be constructed or renovated to include electric vehicle charging infrastructure and the capability of tracking energy efficiency and carbon emissions.
SB1224 (Boysko) requires the Board of Housing and Community Development to adopt amendments to the Uniform Statewide Building Code within one year of publication of a new version of the International Code Council’s International Energy Conservation Code (IECC) to address changes related to energy efficiency and conservation. The bill requires the Board to adopt Building Code standards that are at least as stringent as those contained in the new version of the IECC. This is one of the important bills I wrote about last week.
Financing
HB1919 (Kory) authorizes a locality to establish a green bank to finance clean energy investments. Fairfax County has requested this authority.
Fossil fuels
HB1834 (Subramanyam) requires owner of carbon-emitting power plants to conduct a study at least every 18 months to determine whether the facility should be retired. It also requires notice of any decision to retire a facility to be submitted to state and local leaders within 14 days, a step that allows transition planning.
HB1899 (Hudson) sunsets coal tax credits, because it is absolutely crazy that Virginia continues to subsidize coal mining while we’ve committed to close coal plants.
HB1934 (Simon) requires local approval for construction of any gas pipeline over 12 inches in diameter in a residential subdivision. The genesis of this bill is a particular project in Simon’s district, but I was surprised this isn’t a requirement already.
HB2292 (Cole) is similar to Rasoul’s Green New Deal bill but without the speeded-up RPS timeline. It contains a moratorium on permits for new fossil fuel infrastructure and requires programs for transitioning fossil fuel workers that guarantees them jobs at the same income they had before, and with early retirement benefits and pension guarantees. It also requires development of new job training programs; requires that 40% of energy efficiency and clean energy funding go to EJ communities; and mandates that 50 percent of the clean energy workforce come from EJ communities.
SB1265 (Deeds) makes it easier for DEQ to inspect and issue stop-work orders during gas pipeline construction.
SB1311 (McClellan) requires DEQ to revise erosion and sediment control plans or stormwater management plans when a stop work order has been issued for violations related to pipeline construction.
Climate bills
HB2281 (Ware) would exempt certain companies that use a lot of energy from paying for their share of the costs of Virginia’s energy transition under the VCEA, driving up costs for all other ratepayers. And thus the slow chipping away at the VCEA begins. Everybody’s got a reason they’re special.
SB1282 (Morrissey) directs DEQ to conduct a statewide greenhouse gas inventory, to be updated and published every four years.
SB1284 (Favola) changes the name of the Commonwealth Energy Policy to the Commonwealth Clean Energy Policy, and streamlines the language without making major changes to the policies set out last year in Favola’s successful SB94. That bill overhauled the CEP, which until then had been a jumble of competing priorities, and established new targets for Virginia to achieve 100% carbon-free electricity by 2040 and net-zero carbon economy-wide by 2045. This year’s bill shows the Northam Administration is now fully on board, and the result is a policy statement that is more concise and coherent.
SB1374 (Lewis) would set up a Carbon Sequestration Task Force to consider methods of increasing carbon sequestration in the natural environment, establish benchmarks, and identify carbon markets.
And because this category would not be complete without a bill from a legislator who thinks climate action is a bunch of hooey, we have HB2265 (Freitas), which would repeal provisions of the VCEA phasing out carbon emissions from power plants, repeal the restrictions on SCC approval of new carbon-emitting facilities, and nix the provisions declaring wind, solar, offshore wind and energy storage to be in the public interest. Oh, but in case you thought Freitas was just a free market believer, or cared about cost, the bill provides that planning and development of new nuclear generation is in the public interest.
Utility reform
Advocacy groups worked with legislators to develop a slate of bills, each a little different, that restore SCC oversight over utilities and/or benefit customers with refunds. More information about these bills is available on the Clean Virginia website.
HB1835 (Subramanyam) eliminates provisions that limit rate reductions to $50 million in the next SCC review of Dominion’s rates.
HB1914 (Helmer) changes “shall” to “may” in a number of places, giving the SCC discretion over when to count utility costs against revenues.
HB1984 (Hudson) gives the SCC added discretion to determine a utility’s fair rate of return and to order rate increases or decreases accordingly.
HB2049 (Bourne) would prevent utilities from using overearnings for new projects instead of issuing refunds.
HB2057 (Ware) changes how the SCC determines a fair rate of return for utilities and gives the SCC discretion in the treatment of certain utility generation and distribution costs, as well as in determining when a rate increase is appropriate. It also provides that when a utility has earnings above the authorized level, 100% of the overearnings must be returned to customers, up from 70% today. The SCC is also given authority to determine when a utility’s capital investments should offset overearnings.
HB2160 (Tran) gives the SCC greater authority to determine when a utility has overearned and gives the Commission greater discretion in determining whether to raise or lower rates and order refunds. It also requires 100% of overearnings to be credited to customers’ bills, instead of 70%, as is the case today.
HB2200 (Jones) makes a number of changes to SCC rate review proceedings, including setting a fair rate of return, requiring 100% of overearnings to be credited to customers’ bills, and eliminating the $50 million limit on refunds to Dominion customers in the next rate review proceeding.
SB1292 (McClellan) requires 100% of overearnings to be credited to customers’ bills, instead of 70%, as is the case today.
EVs and Transportation energy
The Virginia Mercury ran a good article this week that covered most of these bills.
HB1850 (Reid) increases the roadway weight limit for electric and natural gas-fueled trucks to accommodate the extra weight of batteries or natural gas fuel systems.
HB1965 (Bagby) is the Clean Car Standard bill, which would require manufacturers to deliver more electric vehicles to Virginia dealers beginning in 2025.
HB1979 (Reid) creates a rebate program for new and used electric vehicles.
HB2118 (Keam) establishes an Electric Vehicle Grant Fund and Program to assist school boards in replacing diesel buses with electric, installing charging infrastructure, and developing workforce education to support the electric buses.
HB2282 (Sullivan) directs the SCC to develop and report on policy proposals to accelerate transportation electrification in the Commonwealth. The bill also limits how utilities get reimbursed for investments in transportation electrification: they must recover costs through normal rates for generation and distribution, and not through rate adjustment clauses or customer credit reinvestment offsets.
HJ542 (McQuinn) requests a statewide study of transit equity and modernization.
SB1223 (Boysko) adds a requirement to the Virginia Energy Plan to include an analysis of electric vehicle charging infrastructure and other infrastructure needed to support the 2045 net-zero carbon target in the transportation sector.
SB1380 (Lucas) authorizes electric utilities to partner with school districts on electric school buses. The utility can own the batteries and the charging infrastructure and use the batteries for grid services and peak shaving.
Code update
SB1453 (Edwards) revises Titles 45.1 and 67 of the Virginia Code. “The bill organizes the laws in a more logical manner, removes obsolete and duplicative provisions, and improves the structure and clarity of statutes pertaining to” mining and energy. The bill is a recommendation of the Virginia Code Commission.
This post has been updated to add bills and correct a misstatement about the development of the utility reform agenda.
Last year Virginia’s General Assembly passed more than 30 separate clean energy bills, which together put Virginia on a path to zero-carbon electricity by 2050, enabled massive investments in renewable energy, storage and energy efficiency and eased restrictions on distributed solar.
But many of the bills that passed were not perfect, and most of the new mandates affect only the electric sector. Only about a quarter of Virginia’s greenhouse gas emissions comes from power plants, so getting serious about a zero carbon economy means finding ways to reduce emissions from transportation, buildings, industry and agriculture.
Unfortunately, building on last year’s progress will be hard this winter, not because there aren’t plenty of opportunities, but because the legislative session that starts Jan. 13 is likely to be exceptionally short and tightly-controlled. If, as expected, Republicans force a 30-day session limit(including weekends and holidays), that means each chamber must dispose of its own bills even faster than that to meet the crossover deadline (around Jan. 28, I’m told), when bills that have passed one chamber “cross over” to be considered in the other. Leadership has responded by strictly limiting the number of bills a legislator can carry, hoping not to overwhelm the committees that have to vet the bills.
One result is that complex bills haven’t got a prayer. Climate advocates and their legislative champions will be focused on bills that are narrowly-crafted (or at least short) and easy to explain.
Adding to the challenge, for those who want to weigh in with their legislators, is the fact that very few bills appear in the Legislative Information System yet, in another departure from prior years.
And then of course, there’s COVID-19, disrupting normal procedures and making it harder than ever for citizens to make their voices heard.
So yeah, ain’t we got fun?
What follows is a list of bills that are far along in the drafting process, have a patron, and are likely to be filed this year. I’m omitting other initiatives that don’t seem likely to make it into legislation this year or that I don’t have enough information to go on. I have not seen the language for any of these bills, so descriptions are based on previous years’ legislation, information from legislators and advocates, or both.
Building codes
One of the most cost-effective ways to lower carbon emissions from buildings is by constructing them with an eye to saving energy right from the start. If the builder puts more insulation in the walls and attic, reduces draftiness and installs better windows, buyers will save money and future residents will have lower heating and cooling costs for decades. Any small increases in a buyer’s mortgage costs are recouped many times over in utility bill savings.
A national standard for energy efficiency in residential buildings even takes the guesswork out. The standard, known as the International Energy Efficiency Code (IECC), is updated every three years by a national organization referenced in the law setting out procedures for adopting Virginia’s residential building code. Unfortunately, the Board of Housing and Community Development (BHCD) has long ignored its statutory obligation to keep Virginia’s building code at least consistent with these nationally recognized standards.
As a result of that, and BHCD’s slow review process, Virginia’s building code is still behind the 2012-2018 IECC’s consumer protections. Unless BHCD is compelled to protect residents consistent with national standards, sub-standard housing will continue to be built for years into the future.
Ideally, the attorney general or the governor would direct BHCD to correct its latest decision to extend substandard code protections. Regardless, this long history of our building code underperforming national standards calls for legislative action. Sen. Jennifer Boysko, D-Fairfax, is expected to introduce legislation that would require the BHCD to adopt the latest IECC within 12 months.
[Update: Boysko’s bill is SB1224. Delegate Kory has also introduced HB2227.]
Right to buy
It’s a strange paradox. The Virginia Clean Economy Act is one of the most ambitious clean energy laws in the U.S., calling on our utilities to add thousands of megawatts of solar and wind energy in the coming years. And yet most Virginia customers still can’t buy solar energy unless they install it on their own property.
This is an absurd position for Virginia to be in today, insisting on an energy transition but not allowing customers to actually go buy electricity from solar. Indeed, this restriction threatens Virginia’s ability to meet its carbon reduction goals, for one reason in particular: data centers.
Data centers are energy hogs, and this sector has grown so fast in Virginia it now makes up 12 percent of Dominion Energy’s total electric demand in the state. Most data center operators say they want to run on renewable energy, and we need them to make good on that. Otherwise, cutting carbon will be harder and more expensive for the rest of us.
But we have to make it possible for them to do so. Right now, only the really big companies, like Microsoft or Facebook, can get Dominion to come to the table on solar deals. The rest don’t have that kind of market power. Neither, of course, do residential customers and small businesses.
The irony is that customers actually had the right to go outside their utility to buy 100% renewable energy until just recently. The Virginia Code gives customers that right so long as their own utility wasn’t offering a 100% renewable energy product. But first Appalachian Power, and then Dominion Energy Virginia, triggered a “kill switch” by offering their own products. The trouble is, these products cost more, use existing facilities instead of adding new renewable energy to the grid, and in Dominion’s case, include the poison pill of dirty biomass energy.
Last year saw the passage of a bill patroned by Del. Jeffrey Bourne, D-Richmond, that would return to customers their right to go outside their utility to buy renewable energy from sellers who qualify as competitive service providers. But there was a catch: an amendment tacked on at the last moment made the bill effective only if passed again in 2021.
Delegate Bourne is bringing the bill back this year, with added language that would require competitive service providers who sell renewable energy in Virginia to offer a discount to low and moderate income consumers. The providers would have to offer 100% renewable energy at a 10% discount off the cost of the utility’s standard residential rate. [Update: the bill is HB2048.]
Workers install solar panels at Huguenot High School in Richmond. (Sun Tribe Solar)
Solar for public schools and other government buildings
Last year the VCEA and Solar Freedom legislation expanded the ability of customers to finance onsite solar projects by raising the cap on third-party power purchase agreements (PPAs) and making the program available to a wider range of customers in Appalachian Power territory, where it had previously been restricted. The new limits in Dominion territory are 500 MW for “non-jurisdictional” customers like local governments and schools and 500 MW for “jurisdictional” customers like residents and businesses; in Appalachian Power territory the new limit is 40 MW for all customers. This year a bill from Sen. John Edwards, D-Roanoke, clarifies that the program in Appalachian Power territory applies to non-jurisdictional customers as well as jurisdictional customers.
The bill also expands a pilot program for municipal net metering established in 2019 that allowed a local government to use surplus electricity generated by solar panels on one building for another building also owned by the locality. As originally enacted, however, the pilot program did not allow the locality to use PPA financing for its solar panels, a restriction that prevents budget-conscious local governments from using the program. Senator Edwards’ bill will let local governments of both Dominion and APCo use PPAs for solar projects installed under the pilot program. In addition, the previous caps on the municipal net metering pilot program are removed in favor of the general PPA program caps.
[Update: Delegate Hurst introduced HB2049, which just addresses PPAs in APCo territory.]
Transportation
What RGGI does for the electric sector, the Transportation Climate Initiative (TCI) is supposed to do for transportation. As Sarah Vogelsong reported last week, Virginia is participating in the development of the multistate compact designed to lower carbon emissions from the transportation sector 30 percent by 2032, but it hasn’t yet pledged to join the compact. There may be some details to work out before that happens, including resolving concerns from environmental justice leaders who believe more of the revenues should go to historically underserved communities. So whether we will see a TCI bill this year is anyone’s guess, but I’ve included it here because of the impact it would have if it does show up.
Three other transportation bills are more certain. One, called the Clean Car Standard, simply requires manufacturers of electric vehicles to send some of their vehicles to Virginia dealers, so consumers can actually buy them. (Weirdly, many dealers are opposed.) Del. Lamont Bagby, D-Henrico, is expected to carry the bill; its passage is a priority for a long list of environmental and grassroots groups. [The bill is HB1965.]
A bill from Del. David Reid, D-Loudoun, would have Virginia offer incentives for the purchase of electric vehicles, following recommendations from a 2019 study. I’m told we should also expect at least one bill from Del. Mark Keam, D-Fairfax, and one from Sen. Louise Lucas, D-Portsmouth, to get more electric school buses on the road. [Reid’s bill is HB1979. Keam’s is HB2118.]
Another bill would require a Transit Modernization Study, which would gather information about how the public is currently being served by the existing transit system, including details as specific as which bus stops in which communities have benches and covered facilities. The study will determine which transit systems have infrastructure needs related to safety, reliability and environmental impact, such that when funding is available, the results of the study can ensure that funding is allocated equitably and to be used to make non-car options more appealing. A patron will be announced soon. [The patron is McQuinn, and the bill is HJ542.]
Environmental Justice
Del. Shelly Simonds, D-Newport News, and Keam are expected to introduce a bill that will expand last year’s Environmental Justice Act to change how the state forms and carries out environmental justice policies within agencies, and to ensure greater public involvement in the permitting process at DEQ. Among other issues, residents often learn too late that Virginia’s Department of Environmental Quality has finalized a permit for a facility that will add to the pollution in their community. The legislation would also require DEQ to consider the cumulative impact of polluting facilities — that is, to take into account whether the community is already overburdened.
Low-income ratepayer protections
The State Corporation Commission has been busy writing implementing regulations for many of the programs established by 2020 legislation. Some of the rules that have come out of the SCC are disappointing enough that I wouldn’t be surprised to see corrective legislation, but probably not until next year. One exception, where legislation is needed right away, concerns the Percentage of Income Payment Program.
The PIPP is an important feature of the Virginia Clean Economy Act that caps utility bills for qualifying low-income customers. The SCC convened a stakeholder group to hammer out the details, but concluded the statute did not provide enough information to go on. An SCC order issued Dec. 23 left open critical elements of the program, and urged the General Assembly to provide additional legislative guidance. It is very late in the year to craft a response and secure a patron, but the administration and advocates are trying.
Pipelines
A bill from Sen. Jennifer McClellan, D-Richmond, adds specificity to the currently vague process that governs small to medium changes in pipeline routes and may impact permit conditions like erosion control measures. Currently it is unclear under what conditions DEQ must re-examine plans it has previously approved. The legislation will bring clarity and explicit direction to all parties involved. [The bill is SB1311.]
At least one and possibly two other bills that would affect pipeline construction are also said to be in the works, but I have no details. [See SB1265, from Senator Deeds.]
Fossil fuel moratorium
Last year’s Virginia Clean Economy Act contains a two-year moratorium on new fossil fuel electric generating plants. Del. Joshua Cole, D-Fredericksburg, is expected to introduce legislation expanding this into a permanent moratorium on all new fossil fuel infrastructure, to take effect in 2022. The bill would exempt retail projects like local gas hook-ups but would otherwise affect not just electric generation, but pipelines, fracking infrastructure, refineries and processing facilities.
Utility reform
Last year saw a number of bills that would affect how our utilities do business. These issues have not gone away, so we should expect to see legislation to strengthen SCC oversight and pare back the ability of utilities to pocket overearnings. [Clean Virginia produced a whole slew of bills. These include HB1835, HB1914, HB1984, HB2049, HB2160, and HB2200.]
Will there be bad bills?
Yes, we should expect to see a few bills from Republicans attempting to roll back parts (or all) of the Virginia Clean Economy Act, or trying to block Virginia’s participation in the Regional Greenhouse Gas Initiative. These aren’t expected to get far in the Democratically-controlled General Assembly. [So far the worst of the bunch is HB2265.]
This post originally appeared in the Virginia Mercury on January 4, 2021. It has been updated to reflect additional bill information.
Everybody has a favorite topic to bring up at parties when someone who knows them only vaguely and can’t remember what line of work they’re in seeks clues by asking, “So what have you been up to lately?”
“Advocating for offshore wind!” I used to respond brightly, which is why I wasn’t that popular at parties even before the pandemic.
But I got my longed-for turbines when Virginia Governor Ralph Northam and Dominion Energy committed to developing 2,600 megawatts of offshore wind by the middle of this decade.
So now I’m campaigning for another cutting-edge technology, or rather, for a cutting-edge combination of otherwise familiar technologies. I’m talking about agrivoltaics. For those of you not in the know, agrivoltaics refers to using land for solar panels and farming purposes at the same time. The “construction footprint” of solar—that is, the amount of land at a solar facility that is taken up by infrastructure and can’t be used for anything else—is less than 2%. The rest is up for grabs.
Consider one approach. At most utility-scale solar facilities, the ground under and between the rows of solar panels is planted in grass, which has to be mowed periodically. Instead of paying a maintenance crew to come through with lawn mowers, why not hire sheep to do the lawn care? The sheep do a better job at less cost, the shepherds get fresh pasture for their flock, and the soil gets nicely fertilized.
(Sheep, it turns out, are the grazers of preference. Cattle like to rub up against things that ought not to have 1200-pound animals rubbing against them, and goats—well, they’re goats: they eat the wiring.)
Photo credit Furman University.
I admit I have no personal knowledge of this, since I live in wooded suburbs with neither solar panels nor sheep. The closest I get to country life is owning a dog of the farm collie variety. And she shows no talent for herding, though it’s possible she is just not in her element. Five years after arriving here from rural South Carolina, Ellie has still not gotten over her indignation at having been “rescued” by a family without a farm.
Actually, I recently toyed with the fantasy of moving to a farm, which is such a COVID cliché that I apologize for mentioning it. But if my fellow residents of Northern Virginia haven’t done this yourselves, you will cry in your morning latte to learn that for the price of the average home in the D.C. area, you can buy hundreds of acres of open space elsewhere in Virginia, typically with a house thrown in. Alas, not a single listing mentioned suitability for solar, with or without sheep, and when I caught on that they didn’t mention internet access either, my enthusiasm waned.
So what I know about solar sheep comes mostly from the American Solar Grazing Association, which I urge you to check out because it is by far the cutest professional organization I have ever belonged to. Most of the projects it highlights are small in scale, given that the partnership between solar developers and shepherds is a new one. Still, the partnerships work because they save money for solar project owners and earn money for graziers.
A few Virginia farmers and developers have shown it works. The 3-megawatt Bedford Solar Farm has used sheep as the primary means of vegetation management since beginning operations in January 2018. Sheep are also on the job at the 1.3-megawatt solar facility at Carilion New River Valley Medical Center near Roanoke. The project owner, Secure Futures LLC, argues for the economic and environmental benefits in an enthusiastic blogpost (but beware of the b-a-a-a-d puns).
For others, the bigger benefit comes in community acceptance. The more a solar facility looks and operates like an agricultural use, the easier it will be to integrate it into the rural landscape. If we want Virginia to succeed in its quest to decarbonize our electricity supply, we need more solar. We need much more of it on rooftops and parking lots and closed landfills, but we also need the big projects. The carbon math just doesn’t work otherwise.
Virginia’s solar industry is young, but developers already report difficulty in securing permits for projects that require hundreds or even thousands of acres. The industry sweetened the pot this year by supporting laws that provide extra revenue to counties in exchange for hosting projects. But solar was already a good deal for county government and landowners, producing more revenue for both than farming alone. The people putting up a fuss are the neighbors.
Sheep graze under a solar array. (Photo courtesy Solar Power World and Nexamp)
I’m not terribly sympathetic to these folks. Virginia has lost way more farmland and forests to subdivisions than it ever will to solar projects, including the subdivisions many of those complaining neighbors live in (looking at you, Fawn Lake!). Land that is carved up and paved over never becomes a field or forest again, but solar is a temporary use; when the lease is up, the panels and their supports are taken away, and an open meadow remains.
As for concerns about losing land that was growing food, we need to keep in mind that more than 30 million acres of U.S. farmland is largely wasted today growing the 40 percent of U.S. corn production that gets processed into ethanol for mixing with gasoline. Solar is not competing with food.
But it isn’t me who has to be persuaded, it’s the people who show up at public hearings to oppose what they regard as some kind of industrial eyesore. They don’t care that leasing land for solar may be what lets a family hold onto their farm. They don’t want to look at it.
So developers, and the utilities who buy the projects from them, have to do more to make themselves welcome by offering other benefits. It doesn’t have to be sheep. Some developers offer wildlife-friendly fencing and set aside land for walking trails. Another especially welcome trend is for facility owners to plant native wildflowers in place of grass to support bees and other pollinators.
If sheep don’t move you, pollinators should. We are in a biodiversity crisis as well as a climate crisis, and populations of native bees critical to pollination of many food crops are in steep decline. So why not make use of the space under solar panels to strike a blow for bees? Neighboring farmers also benefit, because studies show that attracting insect pollinators increases yields of food crops grown nearby. A study from Yale University found additional benefits, including the cooling effect of native plantings that increase solar production.
Minnesota and Maryland are leading the way in formalizing programs with guidelines and incentives for pollinator-friendly solar facilities, but Virginia is also out front on this topic. The Departments of Conservation and Recreation (DCR), Mines, Minerals and Energy (DMME), and Environmental Quality (DEQ) created the Virginia Pollinator-Smart Solar Program and developed a scorecard to help local governments and solar developers understand how to achieve pollinator-friendly status. (Check out the terrific webinar from last April.)
Photo credit Center for Pollinators in Energy, fresh-energy.org
Solar developer Sun Tribe announced it achieved the state’s first Gold Certified solar site under the program at Cople Elementary School in Westmoreland County, where the solar array sits on 4.3 acres. Small projects like this should be simple to replicate, but scaling up may be harder.
For one thing, the only large supplier of native plant seeds in our region, Ernst Conservation Seeds in Pennsylvania, projects that it would take up to ten years to build up enough stock to supply a robust utility-scale solar market. (Ernst also has a seed mix designed for those who want both pollinator plants and sheep among their solar panels; of course it’s called “Fuzz and Buzz.”)
The solar companies I’ve spoken with are enthusiastic, but they cite one other challenge: persuading their customers, including utilities, to accept sheep or pollinator plantings on site. So we may have to look to other kinds of customers for leadership: institutional buyers, corporations and government buyers — the kind of customers for whom social and environmental benefits add value beyond the cheap electricity they can get from solar.
I don’t imagine I will ever be able to give my dog a farm, with or without solar sheep, but I take comfort in the certainty that grazing, native plantings and other co-benefits will eventually become standard practice, simply because they’ll have to.
Meeting our energy needs sustainably means solar is going to become a visible part of our landscape. The job of the solar industry, its allies and its customers is to make that not just tolerable, but welcome. And for that, solar projects must offer more than energy.
This article originally appeared in the Virginia Mercury on December 11, 2020.
Immediately following the 2016 election of Donald Trump, I wrote a column titled “Why Trump won’t stop the clean energy revolution.”
If you were to read it now, you would yawn. What seemed bold back then now feels like forecasting the inevitable. Of course coal has not come back. Of course wind and solar are cheaper now than fossil fuels. Of course people agree a zero-carbon future is achievable.
Still, few of us could have predicted how far off course Trump would try to take us. Withdrawing from the Paris climate accord was the least of it. The Washington Post tallied more than 125 rollbacks of environmental regulations and policies over the past four years. Trump’s more flamboyant acts of perfidy distracted attention away from his sustained attack, not just on climate science, but on the laws protecting America’s lands, air and water.
Really, we should be grateful Trump staffed his administration with grifters and sycophants who repeatedly bungled the details and opened their decisions to legal challenge. Incompetence is underrated. Skilled managers would have done much more damage.
Yet the past four years have also pushed us closer to the brink of climate chaos and the collapse of ecosystems. We wasted time we did not have.
As president, Joe Biden will be able to undo most of the environmental rollbacks with new executive orders and agency actions. Biden has also promised a long list of new initiatives, though many of them would require Democratic control of the Senate.
Virginia and other states partially filled the four-year void with commitments to decarbonize our electricity supply and build renewable energy. But even for Virginia the path to zero-carbon would be a lot easier with federal action. Public support for climate action is strong even from Republicans, though it’s hard to imagine a really aggressive climate bill getting a floor vote in the Senate while Mitch McConnell is in charge. (In my dreams, Maine Senator Susan Collins announces she is changing her party affiliation to Independent and will caucus with Democrats to get a climate bill passed. I have really great dreams.)
Let’s assume for now, though, that Joe is on his own. What can he do through executive orders and agency actions? A lot, it turns out, so I’ll just focus on a few high-profile moves and how they might affect the energy transition here in Virginia.
Carbon emissions: a new Clean Power Plan? Recall that back in 2016, the EPA finalized regulations under the Clean Air Act designed to reduce carbon emissions from power plants with state-by-state targets. Lawsuits and backpedaling by the Trump EPA prevented the Clean Power Plan from ever taking effect, and the replacement plan was derided for its weakness.
Four years later, a Biden EPA could use the same Clean Air Act authority to write new regulations. The thing is, though, the Clean Power Plan put the squeeze on coal-dependent states but would have had virtually no effect on Virginia. And that was before the Virginia Clean Economy Act set us on a path to decarbonization, putting Virginia ahead of any revamped rule that might come out of the EPA now.
A better scenario for us would be if the threat of new climate action from EPA brought Republican senators to the table for a climate bill that would, say, impose a carbon tax (or fee-and-dividend) in return for stripping EPA of its authority to regulate carbon emissions.
But I promised to focus on what Biden can do without Congress, so let’s get back to that.
Coal. Among the protections Trump tried to roll back are EPA regulations like the Mercury and Air Toxics Standard and the Coal Ash Rule, both of which limit pollution caused by coal plants. While both are in litigation (see “bungling,” above), we can expect the EPA under Biden to reverse course and, if anything, tighten these protections. Virginia has already committed to closing most of its coal plants, a decision that will prove even wiser when coal plants have to meet stricter standards.
Of course, these Trump regulatory rollbacks didn’t do the coal industry any good. Nationally, coal plants have continued to close at an even faster rate than they did during Obama’s second term. The false hopes Trump offered for a coal renaissance forestalled real efforts to help communities in Appalachia transition.
Here in Virginia, even coalfields legislators understand the need to diversify the economy of Southwest Virginia. Biden’s election is their wake-up call to stop trying to revive a past that was never a golden era for workers anyway, however enriching it was for the coal bosses.
Fracked gas. Biden made it clear he would not ban fracking other than on federal lands, but we can expect stronger regulations to limit the leakage of methane from wellheads, pipelines and storage infrastructure. That’s a Virginia priority, too.
Energy efficiency. Federal efficiency requirements for products including appliances and HVAC systems have proven to be low-cost and consumer-friendly. A renewed focus on strong national standards will help reduce per-capita energy consumption and help Virginia meet its carbon reduction goals at less cost to consumers.
Wind and solar. It would take legislation to extend federal tax credits for renewable energy, but there are other actions the Biden administration can take to support wind and solar. These include increased funding of R&D through the Department of Energy (a program that already has support in Congress), and removing tariffs on imported solar panels.
The Federal Energy Regulatory Commission can also help wind and solar. FERC has caused its share of climate damage, most memorably for Virginians by approving the Atlantic Coast and Mountain Valley pipelines. FERC’s decisions also control the playing field for the electricity sector, including rules that currently disadvantage wind and solar in the wholesale markets. These rules could just as easily be rewritten. Although FERC is an independent agency, Biden will have an opportunity to appoint climate-friendly FERC commissioners as vacancies occur and terms expire.
And indeed, FERC is already starting to come around. Chairman Neil Chatterjee recently hosted a technical conference and issued a proposed policy statement on carbon pricing in regional markets, an act that may have led Trump to demote him this month.
Offshore wind. Within the Department of Interior, the Bureau of Ocean Energy Management (BOEM) issues offshore energy leases and oversees development of offshore projects, including wind farms. More than a year ago offshore wind activity at BOEM ground almost to a halt, setting back one project after another. Congress isn’t happy, and it may direct more funding to BOEM to help re-start the process.
Biden will also direct BOEM to get out of the way of current projects and begin the process of designating new offshore lease areas for development. Both of these are critical to Virginia’s clean energy plans. (Of course, an investment tax credit for offshore wind would help, too — but there I go again, looking for legislation.)
Transportation. Until Trump came in, the auto industry was gradually improving fuel economy standards in new cars and light trucks. Biden will put that program back in place, and likely impose more stringent tailpipe emission standards. These moves will boost the transition to electric and hybrid vehicles and lead to lower carbon emissions from the transportation sector, another Virginia priority.
Declaring a national climate emergency. It’s a long shot, but Biden could use his executive authority to declare a climate emergency the way Trump declared a national emergency to redirect funds from national defense to his border fence. There are many ways this could help the Virginia transition if Biden were to go this route.
But of course he won’t. Biden is no Trump. And for that, we should all be grateful.
This article was originally published in the Virginia Mercury on November 12, 2020.
Photo courtesy of Department of Energy, via Wikimedia Commons.
With Virginia fully committed to the clean energy transition, you would think that by now, residents would be able to check a box on their utility bill to buy solar energy, or at least be able to call up a third-party solar provider to sell them electricity from solar.
Not so. Sure, if you’re fortunate enough to own your own house or commercial building, and it’s in a sunny location and the roof is sound, you can install solar panels for your own use. Renters, though, are completely out of luck, which means almost all lower and moderate-income people are shut out of the solar market.
Actually, we were all supposed to be able to buy solar by now. A 2017 law required utilities to offer a “community solar” program. Utilities would buy electricity from solar facilities and sell it to customers. At least one electric cooperative followed through, but although Dominion Energy, Virginia’s biggest utility, created a program and had it approved by the SCC in 2018, the company has never offered it.
So this year the General Assembly passed two bills that would finally bring the benefits of solar energy to a broader range of customers. One would be community solar but under a different name. It would let anyone buy electricity from a “shared solar” facility, with at least 30 percent of the output reserved for low-income customers.
The other, the leadoff section of the Solar Freedom legislation, would let residents of apartment buildings and condominiums share the output of a solar array located on the premises or next door.
The bills were narrowed in committee to apply only in Dominion Energy territory (and for the multifamily program, to a part of Southwest Virginia served by Kentucky Utilities). Dominion also lobbied successfully for changes to the shared solar bill that raised red flags with solar industry members and advocates. Dominion has a long history of putting barriers in the way of customers who want solar, and the final language of the shared solar legislation pretty much invited that sort of mischief.
Still, it was left to the State Corporation Commission to write rules implementing the programs, so customers had reason to hope Dominion would not be allowed to make the programs unwieldy and expensive.
Ha. What has emerged from the SCC in the form of proposed rules manages to be both incoherent and everything Dominion wants. The reason for that is clear: most of the rules are copied and pasted from proposals Dominion submitted in August.
Adopting the recommendations of a company that failed to follow through on its own program seems like a bad idea. Hasn’t Dominion abdicated its right to tell other companies how to execute community solar?
And of course, with Dominion writing the rules, the programs won’t work. The shared solar option doesn’t kick in until at least 2023, and customers won’t be told what it will cost them. The SCC proposes to hold an “annual proceeding” to decide each year how much subscribers will have to pay in the form of a minimum bill, an amount that can then change from year to year.
This minimum bill is not the eight or nine dollar fixed charge that all customers pay today; it’s a whole new charge representing various of Dominion’s real or imagined costs of doing business, which Dominion says it needs to recover from the subscribers to compensate it for the fact that some other company is now selling them electricity.
How much might this be? No one knows. And because no one knows, it’s also impossible for solar companies or other third-party providers to offer the program. They can’t sell a product whose price is unknown, and banks aren’t going to loan them money to build a solar facility with no assurance that there will be customers.
There are really only two ways to save this program. The SCC could hold an evidentiary hearing upfront to examine the costs Dominion claims it needs to recover and then decide what the minimum bill ought to be. If that number is so high that the program can’t work, the SCC gets the privilege of telling the General Assembly there won’t be a shared solar program after all.
Alternatively, the SCC can follow the lead of states that already have successful programs and set the minimum bill (upfront) at a level that still saves customers money, so projects have a fighting chance of getting off the ground. If Dominion thinks it is losing money on the deal, that’s a claim it can pursue in its next rate case — which is where the dispute belongs.
Either way, the industry needs clarity, and it needs it now.
Multifamily solar: from straightforward to hopeless
The drafters of Solar Freedom thought they’d avoided the mess that threatens to tank the shared solar program. The multifamily provision of Solar Freedom is simply a way to let residents of apartment buildings and other multifamily units enjoy the same benefits available to homeowners who install solar under the net metering program. Instead of putting solar on a roof they own, they can buy the output of solar panels on the roof of the building where they live. It’s not net metering, but that’s the model.
Since the solar is onsite, none of these projects will be big. Keeping it simple and inexpensive is important. The law provides that utilities will credit participating customers for their share of solar at a rate “set such that the shared solar program results in robust project development and shared solar program access for all customer classes.” More specifically, the commission “shall annually calculate the applicable bill credit rate as the effective retail rate of the customer’s rate class, which shall be inclusive of all supply charges, delivery charges, demand charges, fixed charges and any applicable riders or other charges to the customer.”
The law couldn’t be clearer: there is to be no minimum bill, and the utility cannot load up a customer’s bill with lots of miscellaneous extra charges. All those charges that the SCC loads into the shared solar program’s minimum bill are, for the multifamily program, already included in the retail rate.
End of discussion? Not hardly. The SCC’s implementing rules — which are Dominion’s rules — get around this problem by dumping all the minimum bill elements from the shared solar rules onto the program provider instead (that is, the company that owns the solar panels).
Solar Freedom doesn’t actually allow that, either, so the SCC has decided these costs should be part of the one fee the utility is allowed to collect, for “reasonable costs of administering the program.” Never mind that items like “standby generation and balancing costs” have nothing to do with administering the program.
Oh, and the SCC won’t decide what the administrative charge will be until it holds an annual proceeding. And the amount can change every year. So once again, the SCC has designed a program that no solar company will be able to offer.
The SCC rules are so blatantly contrary to the program mandate set out in Solar Freedom that one can’t help but wonder whose side the SCC is on.
It is certainly not the customers’. We want solar.
The SCC is accepting comments on the proposed rules for both the shared solar and multifamily programs through Monday.
This article originally appeared in the Virginia Mercury on October 30, 2020.
Back in 2017, two Republican legislators from Southwest Virginia helped Dominion Energy Virginia secure legislation allowing the utility to charge ratepayers for a new pumped hydro storage facility to be built in the coalfields region.
Dominion Energy’s new headquarters building in Richmond, Virginia
The law even deemed the project “in the public interest.” Three years later, Dominion included a new pumped hydro project in its 2020 Integrated Resource Plan. The 300-megawatt facility would be built in Tazewell County and come online in 2030.
But — surprise, surprise — details in the IRP reveal the project to be unneeded and its price exorbitant. That leaves just one question: Will the State Corporation Commission approve the IRP anyway?
Pumped hydro stores surplus energy using two reservoirs, one at the top of a hill and one at the bottom. When you need energy, you release water from the upper reservoir and let it flow down through a hydroelectric turbine to the lower reservoir. When you have a surplus of energy, you use it to pump water uphill to fill the upper reservoir. Repeat as needed. It’s not high-tech, but it gets the job done.
Today pumped storage is used mostly to store surplus energy at night from baseload fossil fuel and nuclear plants that run 24/7, then use the energy to meet the surge in demand during daylight and early evening hours. As wind and solar become bigger players, pumped storage can also help integrate these variable resources in much the same way that batteries can.
But pumped storage is land-intensive, and each project has to be designed for its own particular site, making it expensive to develop. Or in this case, very expensive. In its 2017 Annual Report, Dominion said its project would cost up to $2 billion and provide up to 1,000 MW of storage capacity ($2 million per megawatt, not terrible for this kind of storage). Three years later the size has shrunk by 70 percent but the cost has actually gone up and now stands at $2.3 billion ($7.7 million per megawatt, genuinely terrible).
That didn’t stop Dominion from including the 300 MW of new pumped storage hydro in every scenario of its IRP, not allowing its modeling software the option of rejecting it as unneeded or as more expensive than other options.
What was once an interesting project idea now looks a heck of a lot like another Dominion boondoggle.
As Virginia embarks on a transition to 100 percent carbon-free electricity, the ability to store energy has become a hot topic of discussion. How much do we need, and can batteries do it all? The one advantage that pumped storage has over batteries is that a pumped storage facility can supply energy over a longer duration: 10 hours as opposed to the four hours typical of most batteries. For the rare occasions when you really need those extra hours, pumped hydro can be a solution.
As it happens, though, Dominion is already the majority owner of the world’s largest pumped hydro project. The 3,000 MW facility in Bath County, Virginia, has been in operation since 1985. Dominion earns money by selling its energy storage service to the operator of the regional transmission grid, PJM Interconnection.
Three thousand megawatts is a lot of storage; the Bath County facility is even nicknamed “the world’s largest battery.” So building more pumped storage would only be reasonable if the Bath County facility were already being used to its maximum capacity (or was projected to max out in the future), and if a new facility could meet a need that can’t be met by alternatives like batteries. Unfortunately for Dominion, neither of those is true. Tazewell is a solution in search of a problem.
Consumers smell a rat. Dominion customer Glen Besa intervened in the IRP case this summer to challenge the inclusion of the Tazewell project. Besa retired a few years ago as director of the Virginia Chapter of the Sierra Club; he is acting on his own behalf in this case, represented by attorney William Reisinger of the firm ReisingerGooch.
The firm hired energy storage expert Kerinia Cusick. Her testimony points out that the IRP shows the Bath County facility is expected to be used lessover the coming years, not more. The IRP projects capacity factors for the facility will decline steadily from 10.7 percent in 2021 to 7.5 percent in 2035. If an existing facility has spare capacity, there is no good case for building another facility like it.
Cusick also compared the $2.3 billion cost of the Tazewell project to an equivalent amount of battery storage. Not surprisingly, the battery storage won hands down. Indeed, Cusick noted, the cost of battery storage has fallen over the years and is projected to continue doing so. By contrast, she found Dominion had understated the costs of the pumped storage project by excluding items like land costs and taxes. (The real number she calculated, unfortunately, is not available to us. It has been redacted from the public version of Cusick’s testimony.)
In sum, there is no need for the Tazewell project, and no economic case to support it. Adding billions of dollars in unneeded infrastructure to Dominion’s rate base will add profit for Dominion shareholders but drive up electricity bills for consumers.
There’s no way the SCC would let Dominion get away with this if legislators hadn’t used the magic words “in the public interest.” Now the question is whether those magic words are all it takes to ram a project through.
The SCC takes its job of protecting ratepayers seriously; it does not welcome legislative interference. Only grudgingly did the SCC allow itself to be coerced into approving Dominion’s offshore wind pilot when the legislature proclaimed the pilot project in the public interest. In that case, after pointing out the high cost and risks borne by ratepayers, the SCC order concluded by grumbling, “Recent amendments to Virginia laws that mandate that such a project be found to be ‘in the public interest’ make it clear that certain factual findings must be subordinated to the clear legislative intent expressed in the laws governing the petition.”
But the offshore wind pilot was just that, a pilot, and its $300 million price tag represented an investment in a new industry that is expected to become a mainstay of Virginia’s future energy supply. Legislators knew the costs, and judged them acceptable.
Pumped hydro, on the other hand, is a mature technology. The proposed Tazewell project won’t lead to bigger and better things, driving costs down along the way. Legislators deemed it “in the public interest” for Dominion to locate a pumped storage project in the coalfields because they are desperate for jobs there. But they were misled about the actual cost. That ought to matter.
If it doesn’t matter — if the SCC decides “in the public interest” always means a blank check to Dominion, written by the General Assembly but charged to the account of customers — then legislators need to change the law. We can’t afford another boondoggle.
This article originally appeared in the Virginia Mercury on October 7, 2020.
Last winter, during the fight to pass the Virginia Clean Economy Act, Dominion Energy lobbyists went out of their way to save the company’s youngest coal plant in Wise County. It worked. Legislators exempted the Virginia City Hybrid Energy Center from closure until 2045, when Dominion has to shutter all its fossil fuel generation.
VCHEC was approved in 2008 and built in 2013 as a boondoggle for Dominion, earning the company an enhanced rate of return. It was also intended as an expensive gift from then-Gov. Tim Kaine to coalfield Democrats, who went on to lose their seats anyway. Even then, it was a terrible deal for Dominion’s customers and the climate, with all the carbon pollution you expect from coal and a cost that was twice that of cleaner alternatives.
No wonder it proved to be one of the last coal plants ever built in the U.S.
Knowing this, and knowing the determination of this year’s General Assembly to turn the commonwealth in the direction of clean energy, you might not have expected VCHEC to have a lot of friends left in Richmond. But Dominion never told legislators what it would cost consumers to keep its coal plants running. Among all the criticism of the price tag associated with Virginia’s energy transition — much of that criticism coming from Dominion itself — one crucial fact gets lost: It’s coal that is hitting consumers the hardest.
An analysis Dominion reluctantly made public last month as part of its Integrated Resource Planning case shows that VCHEC is far and away the worst performing economically of all the utility’s fossil fuel-burning plants. This one coal plant carries a 10-year net present value of negative $472 million. (The analysts didn’t extend their calculations out to 2045, where it would certainly cross a billion dollars; maybe they were running low on red ink.)
VCHEC isn’t the only coal plant in Dominion’s fleet with a negative valuation, just the worst. In fact, all the Virginia coal plants have negative values.
These are Dominion’s numbers, not those of the Sierra Club or the other environmental and consumer groups challenging Dominion’s plans. The Sierra Club hired a consulting company to run its own analysis, using a standard utility model. That analysis concluded it would be cheaper for customers to build more solar now and speed up the closure not just of VCHEC but of all Dominion’s coal plants. This includes even the company’s Mount Storm coal plant in West Virginia, the only one assigned a positive economic value in Dominion’s analysis. From a customer standpoint, all of them should go.
Maybe that’s not too surprising. We already knew coal was dead. But how many of us knew we were paying to prop up the corpse?
Dominion’s lawyers tried to keep the terrible cost numbers out of the public’s hands, contending it was “confidential commercial and financial information that other entities could use to their competitive advantage in future negotiations.” I can imagine these future meetings: the other entities would be so busy mocking Dominion that, indeed, negotiations might stall permanently.
Fortunately for all of us, the Attorney General’s Office of Consumer Counsel persuaded the SCC the information should be public. Some information truly is confidential; this is merely embarrassing. Dominion’s customers—and the General Assembly—should know what it’s costing us to prop up coal.
This article originally appeared in the Virginia Mercury on September 24, 2020.
The analysis Dominion ultimately produced, showing 10-year Net Present Values for certain of its generating units, under various scenarios. Notice biomass doesn’t do too well either. The analysis omits some additional units, apparently because they are already scheduled for retirement.
Power for the People VA 