What the fate of one solar bill reveals about politics in Virginia

 

Want an extra solar panel on your roof, just in case? Too bad, chump. Better luck next year. Maybe.

While Dominion’s latest effort to legislate profits into perpetuity got all the press attention this winter, another story went largely ignored. A whole raft of bills that would have opened more opportunities for customer-owned and third-party owned renewable energy died in committee. So did bills supporting energy choice and an energy efficiency mandate.

These bills generally had one thing in common: they were opposed by the same utility that was touting its own clean energy investments as a reason to vote for the Ratepayer Rip-Off.

Most of the rejected bills would have promoted customer investments in solar, a segment of the market that Dominion’s legislation won’t help. These bills included:

  • HB 54 (Sullivan) state tax credit of 35% on renewable energy property
  • SB 313 (Edwards) and SB 311 (Edwards) community solar
  • HB 393 (Keam) remove the 1% cap on net metered projects and provide for an SCC study of the impact of net metering
  • HB 1060 (Tran) remove the 1% cap on net metered projects
  • HB 1253 (Tran) expand net metering by local governments
  • HB 421 (Sullivan) allow owners of multifamily residential buildings to install renewable energy facilities and sell output to occupants
  • HB 930 (Lopez) allow net metering program for multifamily customer-generators
  • HB 978 (Guzman) require utilities to justify standby charges with a value of solar study (withdrawn by the patron, reportedly at the request of utilities)
  • SB 82 (Edwards) expand agricultural net metering program
  • HB 1155 (Simon) affirm legality of third-party power purchase agreements (PPAs) for customer solar.
  • SB 83 (Edwards) expand availability of PPAs statewide
  • HB 1252 (Kilgore) allow PPAs for non-profits in APCo territory (passed the House with support of APCo but withdrawn by the patron before a Senate hearing when the utility decided that it didn’t like the bill it had negotiated with advocates in Southwest Virginia after all)

It’s tempting to focus blame on the utilities for the demise of these bills, but the fate of one additional bill reminds us where accountability properly lies. SB 191 (Favola) would have allowed net metering customers to install enough solar to meet up to 125% of their previous 12 months’ electric demand, up from 100% currently. As under current law, they still could not sell any surplus electricity at retail. This last point is key: it means customers have no financial incentive to install more solar than they will actually use, and if they do, it’s the utilities that come out ahead.

APCo and the Coops said they were opposed to it anyway, and were written out of the bill to save it. But Dominion agreed to the bill, with the addition of an amendment it wanted. The bill passed the Senate, and a lobbyist for Dominion joined a representative of the Sierra Club (yours truly) to speak in its favor in the House Commerce and Labor subcommittee. Lobbyists for APCo and the Coops also spoke in its favor, just to be nice. No one rose in opposition.

But the subcommittee killed it anyway on a party-line vote.* One of the Republican committee members offered an excuse about “sending it” to the Rubin Group—which, however, they did not do. Discussions with observers later suggested that the vote was a petty, partisan act of retribution against the patron for something entirely unrelated to the legislation.

So while the utilities’ desire to protect their monopoly makes them oppose customer solar, and utility campaign donations persuade legislators to vote accordingly, ultimately voters have only the legislators themselves to blame for the barriers holding back solar in Virginia.

Elections have consequences, as the saying goes, and the fact that Republicans managed to retain a majority in the House by the slimmest of margins this past November was enough for them to be able to continue their long practice of killing popular solar initiatives in subcommittee. The election that was decided by drawing a name from a hat also determined that rooftop solar bills would not advance out of subcommittee, even when they are small, relatively inconsequential, and completely unopposed.

Advocates had hoped the close election would influence Republicans to moderate their trigger-happy approach to clean energy bills. No part of Republican ideology says customers should not install their own solar. Indeed, in past years Republicans have sometimes been leading advocates for rooftop solar.

Maybe Republicans will do better next year, especially if grassroots anger continues to strengthen the Democrats, and Republicans feel the heat. Otherwise, solar advocates will be highly motivated to support Democrats in the 2019 election.

Of course there are plenty of Democrats in the pockets of the utilities, too. That makes it especially important that a growing number of legislators have pledged to refuse campaign contributions from public utilities and their parent corporations. Delegate Mark Keam (D-Vienna) is the latest to “break up” with Dominion over its undue influence on the legislative process.

The pledge isn’t a guarantee of how a legislator will vote, but for frustrated clean energy advocates it offers a simple litmus test that proved out well this year, as pledge-takers overwhelmingly voted against Dominion’s bill. Solar advocates who found this past legislative session more frustrating than ever may find some satisfaction in persuading their own legislators to follow Keam’s example (and get some press attention for it, too).


* The six Republicans voting to table (kill) SB 191 were O’Quinn, Byron, Hugo, Marshall, Habeeb, and Ransone. The four Democrats supporting the bill were Ward, Kory, Heretick, and Bourne.

Virginia buys Dominion’s pig in a poke

How Dominion sees the bill.

A pig in a poke is defined as “an object offered in a manner that conceals its true value, especially its lack of value.” The expression is said to go back about five hundred years to English marketplaces. A poke was a sort of sack, but why 16th century people bought pigs in sacks, and why they would have bought a sack without looking inside, is not at all clear. I’m guessing the seller was the local pig monopoly, and the buyers were timid leaders who meekly paid their farthings and hoped for the best. After all, that is how we do it in the marketplace of Virginia’s General Assembly when Dominion Energy Virginia comes peddling legislation.

And indeed, the true value (or lack of value) of this year’s boondoggle bill (HB 1558/SB 966) will probably not be understood for months or even years to come. The General Assembly passed this legislation that will govern billions of dollars of new spending paid for by Virginia customers after just a handful of hearings over a few weeks, and with no study or input from outside experts. If you will excuse the expression, this is a lousy way to make sausage.

Arguably, the only thing worse than this bill is the law it seeks to fix, the infamous “rate freeze” legislation of 2015 that simply let Dominion keep a billion dollars of customer money to line its own pockets. You’d think legislators would have learned something about legislating in haste and repenting at leisure.

But the legislation could have been worse. We know this because it was worse; the bills Dominion originally put forward returned even less money to consumers, gave the utilities even more leeway on spending, and included the infamous “double dip” that the SCC said would let Dominion charge customers twice for the same projects. The bills improved over the next few weeks under pressure from progressive Democrats, conservative Republicans, the SCC, the Attorney General’s office, the Governor, and consumer and environmental groups.

Whether it is good enough now remains a matter of debate. Conservatives for Clean Energy and the League of Conservation Voters support the bill, especially the provisions relating to investments in energy efficiency and renewable energy. The Sierra Club, an early opponent, used what leverage it had to get the worst provisions changed before removing its opposition late in the game (while still not supporting the bill). The AG’s Office of Consumer Counsel and Appalachian Voices never dropped their opposition.

Nevertheless, the poke has been bought, so you should definitely take a look at the pig. The Virginia Poverty Law Center and the Southern Environmental Law Center produced a handy summary of the bill’s final provisions compared to both the original bill and the status quo under the 2015 law (and sometimes also to the pre-2015 law).

The summary describes the categories of new spending authorized by the law, but a lot is left to interpretation—Dominion’s interpretation, mostly. Customers don’t seem to have any say in how their money gets spent. They are just supposed to feel happy with the provisions granting them some initial refunds reflecting a portion of the overearnings from past years, plus the utility’s savings from the federal tax cut. Going forward, though, the likelihood of further refunds or rate cuts seems remote. The whole point of the bill is to allow utilities to spend overearnings and avoid refunds. And as always, rates can continue to go up through “rate adjustment clauses” (RACs) like the ones that tacked new charges onto electricity bills even when base rates were frozen.

Moreover, what VPLC’s summary (understandably) lacks is a comparison to what ought to be in there: full refunds based on a review of past earnings rather than legislative guesstimates; mandatory—and much higher—levels of energy efficiency, wind and solar; proper regulatory oversight of rates and spending; and an independent assessment of grid modernization needs rather than blanket permission for a utility to indulge in projects that benefit itself most.

We’ll have to wait until next year for any new legislation, but it is not too early to start laying the groundwork. Governor Northam should direct his administration to begin working with national experts on a comprehensive grid modernization study. The goal should not be to tinker around the edges of current law and policy, but to draft a new and better approach from the ground up. (For a great discussion of why we need this study and what it should look like, see Tom Hadwin’s blogpost from last week.)

Meanwhile, legislators should promise their constituents that they will never again allow a public utility to write our energy laws and force through massive and complex changes over the course of a few weeks of the legislative session. Next time Dominion offers a pig in a poke, the answer should be no.

After losing a vote on the double dip, is Dominion losing Power?

An earthquake shook Richmond, Virginia on the afternoon of Monday, February 12, rocking the House of Delegates just as it was supposed to be passing HB 1558, Dominion Energy’s Ratepayer Rip-Off Act of 2018. The bill was intended to help the utility lock in stupendous unearned profits for its parent company, courtesy of the monopoly’s captive customers, under the guise of supporting clean energy and grid investments.

And the bill did pass the House, but only after delegates adopted an amendment offered by Minority Leader David Toscano stripping away a lucrative provision that Dominion both desperately wanted and swore didn’t exist: the infamous “double dip” that the SCC has said would allow Dominion to charge customers more than twice over for a large portfolio of infrastructure projects. With billions of dollars worth of projects on the drawing board, the double dip meant serious money.

Anyone who didn’t believe the double dip was real only needed to listen to Dominion lobbyist Jack Rust respond to repeated questions about it during a Senate Commerce and Labor Committee hearing two weeks earlier. It was a “yes or no” question that Rust wouldn’t answer with a yes or a no.

Obfuscation, however, was good enough for the Senate, which passed SB 966 last week by a bi-partisan vote of 26-13. It was good enough for Governor Northam, too, who had already pledged to sign the bill. A few environmental groups broke ranks to support the bill, too, cheering the provisions for energy efficiency and the promise of more renewables.

Admittedly, the Attorney General’s Office of Consumer Counsel remained opposed. So did other environmental and consumer groups, complaining not just about the double dip, but about ceding control over the future of Virginia’s electric grid to a profit-driven monopoly. But when has the General Assembly ever cared what environmental and consumer groups thought? So passing the bill through the House should have been easy.

And then Toscano called Dominion’s bluff. If the double dip is real, said Toscano, his amendment would fix it. If the bill doesn’t already allow for double-dipping, then making doubly sure of that does no harm.

The logic was unassailable, though bill patron and Friend of Dominion Terry Kilgore assailed it anyway. As the Associated Press reported, Kilgore tried to persuade legislators to reject Toscano’s amendment. Yet even some fellow Republicans deserted him on the vote, helping Democrats pass it 55-41. A quick-thinking Delegate Habeeb, apparently recognizing bad optics for the Republicans, called for a second vote, and this time the amendment passed 96-1, with even Kilgore supporting it.

By all accounts, the vote was unprecedented. Dominion does not lose floor votes. The vote rocked the House.

In hindsight, perhaps Dominion should have known a fault line had formed. Grassroots groups were agitating against the power of monopoly. A new group called Clean Virginia was agitating against the bill. Almost all the freshmen Democrats had pledged not to accept Dominion money—and there were a lot of them, thanks to last fall’s “blue wave” election. But the Republicans had already scuttled most of their bills; surely they had learned humility? They had not. They all supported Toscano’s amendment, and all but one followed him in opposing final passage of the bill, which passed 63-35.

The earthquake could be felt over at Dominion headquarters, where reporters could be seen inspecting the foundation for damage. CEO Tom Farrell called in his damage control specialists, heavy-hitting lobbyists Eva Teig Hardy and Bill Thomas, to persuade legislators to support the Senate version of the bill over the House version—or failing that, to lard it up with new favors to the utilities.

According to the AP, Kilgore continued to maintain after the vote that the double dip was “more perception than reality.” But he also said, “Toscano’s amendment takes ‘a lot of stuff out that needs to stay in’ the legislation. ‘I’m going to have to fix it.’”

One might think Dominion and its allies would be embarrassed to defend a provision they say doesn’t exist. Reportedly they have pivoted to a different argument, that the company would have no incentive to invest in renewable energy if it isn’t allowed to rip off ratepayers in the process. Accordingly, they are holding solar investments hostage, knowing how much Democrats want them.

Dominion’s new argument is simply posturing. Its 2017 Integrated Resource Plan declared solar to be the cheapest form of energy in Virginia, and it had signaled via the Rubin Group its plan to build at least 3,000 MW of solar in the coming years. Saying now that it might take its ball and go home is a sign its lobbyists are out of good arguments.

In the past, good arguments were not a requirement for Dominion to get what it wants; political power has always been enough. It will be interesting to see now whether Dominion emerges with some semblance of its omnipotence intact, or whether this earthquake presages new shocks that could crack the fortress.

 

General Assembly chews on, spits out healthy legislation, while still trying to digest a huge hunk of pork

They just keep getting fatter.

If you were bewildered by the sheer volume of bills addressing solar, efficiency, storage, and other energy topics that I outlined last month, take heart: clean energy advocates don’t have nearly as many bills to keep track of now. So few bills survived the Finance and Commerce and Labor Committees that it will be easier to talk about what is left than what got killed.

The bigger story, of course, is the Dominion Ratepayer Rip-Off Act of 2018, which the utility would dearly love you to think of as the “grid modernization bill,” but which might be better imagined as an oozing pork barrel. Recent amendments do make it less obnoxious than it was last week (begging the question of why it wasn’t introduced that way in the first place). The Governor now says he supports the bill, the Attorney General continues to oppose it, and the SCC keeps issuing poisonous analyses.

But right now let’s just run down the fate of the other bills we’ve been following. For explanations of these bills, see previous posts on solar; efficiency, storage and EVs; and energy choice, carbon and coal.

Of the bills affecting customer-sited solar, only a handful remain:

  • HB 1252 (Kilgore), expanding the pilot program for third-party PPAs in APCo territory to cover all nonprofits and local government: amendment ensures current Dominion pilot is unchanged, passes the House, goes to the Senate
  • HB 1451 (Sullivan), allowing a school district to attribute surplus electricity from a solar array on one school to other schools in the district: amendment turns it into a pilot program, passes House C&L
  • SB 191 (Favola), allowing customers to install solar arrays large enough to meet 125% of previous demand (up from 100% today): amended to exclude customers in coop territory*, passes Senate C&L

Delegate Toscano’s bills promoting energy storage remain alive. HB 1018, offering a tax credit for energy storage devices, passed a House Finance subcommittee last week with an amendment to delay its start date to 2020. HJ 101, calling for a study, passed Rules but then was sent to Appropriations, where it was to be heard yesterday. (The Legislative Information Service does not yet show its fate.)

HB 922 (Bulova), allowing localities to install EV charging stations, has been reported from General Laws with amendments. The companion bill, SB 908 (McClellan) passed the Senate.

The Rubin Group’s land use bills passed their respective houses with amendments. The bills are SB 429 (Stanley), its companion bill HB 508 (Hodges), SB 179 (Stanley) and companion bill HB 509 (Hodges).

All other customer-focused solar bills died. So did energy efficiency goals, the mandatory renewable portfolio standard, LED light bulb requirements, and tax credits for EVs and renewable energy. Direct Energy’s energy choice legislation died in both House and Senate in the face of Dominion’s opposition, in spite of an astonishingly diverse array of business supporters; even the support of Conservatives for Clean Energy was not enough to garner any Republican votes in the House C&L subcommittee.

Republicans also killed the Governor’s RGGI bills while passing Delegate Poindexter’s anti-RGGI bill, HB 1270, in the House. Delegate Yancey’s anti-regulation HB 1082, appears to be alive in a subcommittee, though Delegate Freitas’ anti-regulation bill died, and Senator Vogel’s effort to change the constitution to allow legislative vetoes of regulations died in committee.

Delegate Kilgore’s HB 665, restoring tax subsidies to coal companies to facilitate destroying Virginia mountains, passed House Finance on a party-line vote. Shockingly, Senator Chafin’s similar bill, SB 378, passed the Senate with support from Democrats Marsden, Petersen, Edwards, Dance, Lewis, Mason and Saslaw.

So once again, in spite of a remarkable election that swept progressive Democrats into the House and nearly upended Republican rule, clean energy advocates have done poorly this year. Some of their priorities are now part of the Dominion pork barrel legislation, to be sure. But that legislation enables utility solar and utility spending; it does nothing for customer-owned renewable energy, market competition, climate action, or consumer choice.

Dominion still rules the General Assembly, though the legislators who voted in line with the utility’s wishes won’t admit it—or give any other explanation. The Republican members of the House Commerce and Labor subcommittee slashed their way through the pro-consumer bills with ruthless efficiency, and did not bother explaining their votes. (A special shout-out goes to Democratic delegates Kory, Ward, Heretick and Bourne for just as stubbornly voting in support of the good bills.)

But over in Senate C&L, chairman Frank Wagner tried to maintain the pretense that he was merely “referring” his colleagues’ bills to the Rubin Group instead of actually killing them.

The closed-door, private, invitation-only, utility-centric Rubin Group has no legislators among its members and proposes only changes to the law that all its members like, so “sending” a bill there that the utilities oppose is pure farce. Yet that was the fate of Senator Edwards’ bills on third party PPAs, agricultural net metering, and community solar, and Senator Wexton’s community solar bill. Wagner instructed these Senators to “work with” the Rubin Group on their bills. None of the other committee members objected.

But it’s not like the Rubin Group achieved much, either. Its hallmark legislation putting 4,000 MW of utility solar in the public interest got thrown into the Dominion pork barrel (and was later upped to 5,000 MW), along with energy efficiency bills designed to eliminate the SCC’s over-reliance on the RIM test, requirements for utility spending on energy efficiency, and Delegate Habeeb’s nice battery storage pilot program. They all became tasty morsels designed to offset legislators’ queasiness over the ratepayer rip-off and, not incidentally, to maneuver advocates and bill patrons into supporting Dominion’s bill as the only way to get their own legislation passed into law.

 

 

Think I was being harsh about the Dominion bill? Read what the SCC had to say.

Last week I called it a pig of a bill, because calling it a dog was too nice. The SCC must agree, because they just gave us the dirt.

The State Corporation Commission just weighed in on this year’s boondoggle legislation Dominion Energy concocted with Senators Dick Saslaw and Frank Wagner, and they are not happy.

Recall that when last we looked, eleven senators had sent a letter over to the SCC asking about effects of the legislation on ratepayers. The SCC responded with the kind of alacrity we do not customarily see from them, for example when we have to wait a year to get a decision on a case, and then get an order that avoids answering the important questions. This time it appears they were just waiting for the chance to make it very, very clear, they do not like this legislation.

Here is how the SCC answered the opening question:

Q: In general, how can the likely effect of SB 966 and SB 967 on ratepayers be summarized?

A: As explained in greater detail within this document, the key impacts on ratepayers can be summarized as follows:

  1. There will be no opportunity to consider base-rate reductions or refunds to customers for at least six years, and then only if the utility over-earns for two consecutive three-year periods effectively extending the current base-rate freeze further into the future.
  2. There may be only a partial return of the reduction in federal income taxes currently being collected in base rates.
  3. The provision in current law that allows utilities to keep more than 30% of their excess earnings is continued.
  4. The legislation allows the utilities to keep future excess earnings (i.e. customer overpayments) and, rather than return them to customers, use them for capital projects chosen by the utility. In addition, the utilities can charge customers for these same projects in base rates.
  5. The legislation deems certain capital projects to be “in the public interest,” thus impacting the SCC’s authority to evaluate whether such projects are cost-effective or whether there are alternatives available at lower costs to customers. This provision could potentially result in billions of dollars of additional costs that will be charged to customers in higher rates.
  6. An amount that appears to represent the customers’ portion of prior period excess earnings is returned to customers, but the amount has not been examined in a formal proceeding to determine its accuracy.

Answers to other questions mostly reiterate what a great deal this is for the utilities and what a terrible deal it is for ratepayers. Liberal use of underlining prevails throughout. But there is one answer I just have to reproduce here because it shows how truly ingenious the rip-off is:

Q: If customers’ refund money is reduced by distribution grid transformation and renewable generation projects (“Projects”), are the Projects considered paid in full?

A: No, under the legislation if the utility has spent money on Projects, customer refunds will be reduced by that amount and base rates will recover the same amount with interest and profit margin.

For example, suppose the SCC determines after two Triennial Reviews that customers are owed a refund of $100 million. Assume further, that during the six year period of the Triennial Review, an electric utility spends $100 million on distribution grid transformation investment. As a result, customer refunds are offset by this utility spending (customers would not receive any refunds). Then, customers will pay the full $100 million for these distribution grid transformation projects, plus interest and a profit margin, through base rates. Effectively, customers are more than $200 million out of pocket ($100 million lost refund + $100 million paid through base rates + interest/profit margin) for these $100 million of new distribution grid transformation projects.

Wow, get that? Dominion can charge customers for a project in order to spend enough money that it avoids having over-earnings. Having done that, it can then charge the customers for the same project all over again, and this time add a percentage for profit and another percentage for interest.

Come on, that’s impressive. I could never have come up with anything so devious and underhanded. I can’t even follow the money. Heck, I bet there isn’t a legislator in the General Assembly who could have figured out the tricks in this legislation!

We can only assume that was exactly the point. But now that the SCC has uncovered the tricks and laid it out for all to read how extraordinarily bad this bill is for consumers, Dominion, we hear, is making some concessions. Saslaw promises a new version next week.

My advice? Read the fine print.

When a billion dollars is not enough: Dominion tries a hostile takeover of the SCC

I’d call this a dog of a bill, but this is my dog, and she’s pretty darned cute.

For this bill, we really need a different animal altogether. Photo credit bmani/Creative Commons.

 

We have seen the future, and it looks suspiciously like the past.

I’m referring, of course, to the much-anticipated legislation Dominion Energy Virginia’s friends are peddling in the Virginia legislature to replace the infamous rate rip-off of 2015 with a brand new way for utilities to skip regulatory oversight and avoid giving refunds.

Personally, I have to hand it to Dominion on this one. Its lobbyists spent the fall trying to convince legislators not to reverse the brilliantly—though falsely—named “rate freeze.” Dominion hoped legislators would ignore estimates that the utility would keep northwards of a billion dollars in unearned profit from it, not to mention the barrage of newspaper articles connecting Dominion’s campaign contributions to the votes of legislators in support of the law. Apparently, a lot of legislators made it clear they were done being snookered, because by December, Dominion had publicly announced that it, too, believed it was time to change the law.

So Dominion had a PR disaster on its hands, and what did it do? Offer massive refunds and a return to regulatory oversight? Heck, no. The new bill allows Dominion to avoid regulatory oversight pretty much forever, while rebating just a fraction of the loot. Awesome head fake, guys!

Mind you, there are a lot of great buzzwords in the bill. If you didn’t know any better—if you happen to be one of this year’s snookerees, as the rank-and-file legislators are meant to be—you might think this bill is intended to transform the grid and add massive amounts of solar energy and energy efficiency. It could have been written to do that, but it wasn’t.

For a fuller explanation of this legislation and how it fits into the long pattern of Virginia legislators giving away the store to Dominion, see this terrific analysis from Dan Casey of the Roanoke Times. As he demonstrates, this is not legislation aimed at transforming the business of energy in Virginia. It’s aimed at ensuring Dominion gains unfettered control.

If legislative leaders are serious about transforming our energy economy, they could amend the bill now to give the State Corporation Commission back its role in protecting consumers from unwise spending and by ordering refunds and rate reductions when utilities collect more than permitted by law. The current draft of the bill throws a small fraction of past overearnings back to customers, ignores 2017 overearnings altogether, and allows utilities to game the system so rates can only go up hereafter.

Grid transformation is indeed important—so important that it shouldn’t be left to profit-seeking utilities to decide what grid investments are in the public interest. This issue needs an independent study with in-depth analysis and extensive public input– the sensible approach that has been taken by numerous states across the country. Letting Dominion decide what investments to make guarantees we’ll see only the ones that allow Dominion to tighten its control over Virginia’s power supply.

The bill also tries to buy off environmentalists with a promise of up to 4,000 MW of solar by 2028, a figure that was already in play (and appears in other bills this year) as a result of negotiations between utilities and the solar industry. To put that in context, recall that The Solar Foundation analysis showed Virginia needs 15,000 MW of solar to equal just 10% of our electricity supply. Do the math: 4,000 MW is well under 5% under the best of circumstances. When a bunch of other states are getting 20% of their electricity from wind and solar resources today, the promise of less than 5% over ten years is not only grossly inadequate, it’s insulting. Perhaps we environmentalists can be bought, but not that cheaply.

But will legislators wise up in time? Senate Minority Leader Dick Saslaw’s version of the legislation (there are several), SB 967, runs for 22 pages of mind-numbing detail that can’t be fully understood by anyone but a lawyer specializing in electric utility regulation. I’m not one, and I’m grateful for the help of people who are. Saslaw’s bill was introduced Friday—the last possible day to file legislation—and did not appear online until Tuesday. The Senate legislation may come before the Commerce and Labor committee as soon as Monday, and House versions may be in subcommittee on Tuesday.

Not everyone is being snookered, to be sure. Senator Chap Petersen has renewed his earlier effort for a more straightforward repeal of the “rate freeze,” and a bipartisan group of 11 senators have fired off a letter to the SCC asking for a report on what effect the various bills will have “on refunds owed to rate payers for past payments” and “the effects on future rates.” Six House members have done the same.

Finally, this afternoon Governor Northam weighed in, saying he has “significant concerns about the bill that is on the table.” An email from the Governor’s office laid out goals that echo what critics have been saying. First, more money should be refunded to ratepayers. Grid modernization should be defined, the focus on clean energy increased, and the SCC should be involved to make sure Virginians “are getting the best bang for the buck.” And perhaps most critically, the legislation should “restore the SCC’s authority to ensure that Virginia families and businesses do not pay more for power than they should under state law.”

Perhaps having the Governor weigh in will put a stop to the plan to turn electric utility regulation over to the monopolies themselves. Associated Press reporter Alan Suderman quotes Dominion spokesman David Botkins as saying by way of response that the legislation is a “work in progress.”

But why is this up for negotiation? Legislators should insist on a return to regular order, put an independent agency in charge of grid transformation, and set mandatory targets for decarbonizing our electricity supply. It’s time for the snookering to stop.

The remaining energy bills: energy choice, carbon trading, the SCC, and coal. Plus, will Dominion be forced to give up its ill-gotten gains?

This is the last of my three-part review of energy legislation introduced in Virginia’s 2018 session. The first post covered solar bills; the second focused on energy efficiency, storage, and electric vehicles. I’m concluding with bills from the miscellaneous file–some of which, however, will likely be among the most significant energy bills addressed this year.

Energy Choice

Readers will recall the ruckus at the SCC that ensued when third-party electricity provider Direct Energy proposed to offer renewable energy to current Dominion customers. The SCC confirmed last spring that this is allowed under the Virginia Code, but only until Dominion wins approval for its own renewable energy tariff. Dominion immediately filed a tariff, though eight months later, the SCC has yet to rule on it. Irked by the delay, Dominion has gotten two of its best friends to introduce bills forcing the SCC to act faster when Dominion wants something. The bills are SB 285 (Saslaw) and HB 1228 (Hugo).

Meanwhile, Senator Sutterlein has introduced SB 837, allowing customers of Dominion and APCo to purchase electricity generated 100% from renewable energy from any supplier licensed to do business in the state, and eliminating the condition that permits such purchases only if the utility itself does not offer a tariff for 100 percent renewable energy. This would resolve Direct Energy’s conundrum, since the approval of a similar Dominion tariff would not nullify an existing—or future—renewable energy offering from Direct Energy or anyone else. HB 1528 (Mullin) is the companion bill in the House.

Carbon trading

Last May, Governor McAuliffe announced Executive Directive 11, which started the process for drafting regulations that would have Virginia participate in a carbon emissions trading program known as the Regional Greenhouse Gas Initiative (RGGI). Electric utilities would be allotted, or would buy, carbon emission allowances. This makes non-carbon-emitting sources and energy efficiency more attractive to utilities than fossil fuel generation. Draft regulations were released in late December, and a comment period runs until April 9, 2018. Governor Northam has pledged to follow through on the program.

As part of this effort, the Administration’s bills include SB 696 (Lewis) and HB 1273 (Bulova), which provide for the state to join RGGI. The legislation is not necessary for Virginia to trade with RGGI, but there is an advantage to the state in doing so: RGGI member states auction off carbon allowances to polluters, rather than giving them away. That provides a significant source of income to the state that can be used to support clean energy, climate adaptation, or other priorities. Accordingly, HB 1273 spells out how the auction revenues would be spent. Energy efficiency and renewable energy would both get pieces of the pie.

Republican critics have counter-attacked. HB 1270 (Poindexter) would prohibit Virginia from joining RGGI or implementing carbon rules. Delegate Yancey, whose lucky win following a tied election barely returned him to office, is affirming his Tea Party credentials with HB 1082, prohibiting state agencies from adopting any rules more stringent than what is required by federal law. And then there is HB 549 (Freitas), which tries to hobble the General Assembly itself, prohibiting any future laws that would direct state agencies to adopt regulations that “are likely to have a significant economic impact” (defined as anything over $500!) unless they pass the bill twice to prove they really, truly mean it.

None of these bills pose a real threat to the Administration’s carbon initiative; the Governor will veto any that pass. A more serious challenge takes the form of a constitutional amendment, because it would not be subject to the Governor’s veto. Last year, Republicans pushed through a bill approving a constitutional amendment that would allow the General Assembly (read: the Republican majority) to nullify any existing regulations enacted by any Virginia state agency on any topic at any time. Since constitutional amendments have to be passed two years in a row before going to the voters for ratification, the same language (which Senator Vogel has reintroduced via SB 826 and SJ69) has to pass again this year.

Bills aimed at the SCC

Our investor-owned utilities are not the only barrier to cleaner energy in Virginia; often the SCC does us no favors either. Some of the energy efficiency bills discussed in my last post would force the SCC to evaluate utility efficiency programs differently. Two other bills are also worth noting:

HB 33 (Kory) repeals a provision prohibiting the SCC from imposing environmental conditions that go beyond what is in a permit, and expressly permits (though it does not require) the SCC to consider environmental effects, including carbon impacts, when evaluating new generating sources.

HB 975 (Guzman) would prohibit the SCC from approving new fossil fuel generating plants unless at least 20% of the generating capacity approved that year uses renewable energy. Too bad we didn’t have a rule like this a few years ago, when Dominion sought (and got) approval for the last of its giant combined-cycle gas plants. Today, however, this could be moot. No utility has proposed a new fossil fuel plant other than relatively small gas combustion turbines (peaker plants), which could meet the 20% rule when paired with even the modest levels of solar generation Dominion contemplates.

Coal subsidies

You think you killed the zombie, but it pops right back up. HB 665 (Kilgore) and SB 378 (Chafin) would reinstate the expired tax subsidies for the mining companies who despoil Virginia mountains. There is little risk of this corporate welfare becoming law again, because the governor would surely veto the legislation if it passes. The more interesting question is whether it gets through this year’s more closely divided General Assembly.

Undoing the Dominion handouts

The boondoggle Dominion won in 2015—the now infamous SB 1349, which allowed the utility to keep overearnings and avoid SCC rate reviews until into the next decade—has been in the news a lot lately. Under pressure from legislators and the media, Dominion has agreed to revisit the so-called “rate freeze.” That doesn’t mean it wants to give the money back. We hear the company is working on a deal with House and Senate leaders that lets it spend its ill-gotten gains on things it wants to do anyway: some for renewables, some for grid upgrades, anything but refunds.

So far, Dominion’s friends in the Senate have its back. Under the guidance of Frank Wagner, the original SB 1349 patron, and Dick Saslaw, Dominion’s top ally among the Democrats, the Commerce and Labor Committee today killed Chap Petersen’s SB 9, which would have restored the SCC’s ability to review utility spending and order refunds. The House companion bill, HB 96 (Rasoul) has not yet been taken up. Currently, no other bills are on file addressing the overearnings, but both Saslaw and Republican Tommy Norment have promised they have excellent bills in the works.

UPDATE January 23: On the last day to file legislation, Terry Kilgore presented us with the first of the new utility boondoggle bills. HB 1558 calls for a small portion of the overcharges to be rebated to customers, after which overcharging would go back to being the normal course of business. Wagner, Saslaw and Newman filed their own bills, supposedly on January 19, though these evaded posting on the website until today. I hear they are similar but haven’t ha time to read them. Petersen, meanwhile, played a new card, introducing SB 955, which would empower the SCC to review the overearnings and order refunds as appropriate.