Amazon will need even more energy in Virginia. Will they make it clean?

Entrance to Crystal City Metro Station in Arlington, Virginia

Crystal City in Arlington will be the heart of Amazon’s new Virginia headquarters. Renewable energy options on site are limited. Photo credit Woogers via Wikimedia Commons.

Amazon Web Services jump-started the utility solar industry in Virginia in 2015, when it announced plans for its first solar farm in Accomack County. Three years later, Amazon remains the biggest purchaser of solar in the commonwealth, allowing it to offset some of the enormous amount of energy used by its data centers.

Yet the company’s energy footprint in Virginia far exceeds the energy output of its solar projects. The addition of a new headquarters in Arlington will further increase its need for electricity, and will attract new residents who will also use electricity. All this demand poses a problem for the company and the climate: Dominion Virginia Power will burn more coal and fracked gas to meet Amazon’s energy need, unless Amazon acts to ensure the power comes from renewable sources.

Like many big tech companies, Amazon has adopted aggressive sustainability goals, including a “long-term commitment to achieve 100% renewable energy usage” for its data centers. But the details of its commitment are fuzzy, and the qualifier “long-term” makes the commitment meaningless.

Earth to Jeff Bezos: in the “long term” climate change will put HQ2 under water.

If Amazon still wants a habitable planet to compete in, it should consider the entire energy footprint of its operations, and make sure it is meeting these needs 24/7 with clean, renewable energy. Solar should be a big part of the plan, but so should land-based wind and offshore wind, which complement solar by providing power in the evening and at night. An investment in battery storage would round out the package nicely.

Virginia officials made a perfunctory mention of renewable energy availability to Amazon in the state’s bid package (see page 184). This was accompanied by a quote from Bob Blue of Dominion Energy, promising to sell the company renewable energy. (Be pleased, Mr. Bezos; that’s not a promise he’s made to the rest of us.)

Arlington County has reportedly discussed with Amazon how to make its new campus as environmentally-friendly as possible. Arlington is considering making a commitment to 100 percent renewable energy by 2035, so it has a real incentive to ensure that newcomers are part of the solution, not part of the problem.

Given today’s building technology, there is no reason the National Landing campus should not set a new standard for energy-efficient design. Ideally that will include on-site solar as well. Local officials also want to see enough improvements to transit, pedestrian and biking routes to keep 25,000 new commuters from spewing air pollution while they sit in traffic.

Even if Amazon and Arlington do everything right, though, the campus will need to purchase electricity from off-site generation—and there is still the matter of those power-hungry data centers.

Amazon can take Bob Blue up on his offer and let Dominion supply the company with all the renewable energy it needs. Caveat emptor, though: Dominion’s idea of renewable energy includes resources of dubious value to the climate, like the burning of trash and woody biomass.

And, thanks largely to Dominion’s clout in the General Assembly, Virginia has many barriers to on-site solar, which limit customers’ ability to supply their own renewable energy. We also boast a renewable portfolio standard that works approximately opposite to that of every other state, by ensuring wind and solar will never be part of our resource mix.

Come to think of it, we could really use Amazon’s negotiating chops with our legislators.

In any case, with or without Dominion’s help, Amazon will find plenty of opportunities to procure wind as well as more solar in Virginia. Apex Clean Energy’s Rocky Forge wind farm near Roanoke is already permitted and ready for construction as soon as a customer shows up. Apex now has two additional wind farms in development in southwest Virginia—a nice way to support areas of the state outside of Northern Virginia.

Offshore wind is another opportunity to deliver energy at scale while supporting jobs in the Hampton Roads region. Although offshore wind is poised to become a huge industry in the U.S. within the next ten years, right now only the northeastern states are moving forward with offshore wind farms in the near term. Amazon could make it happen here, too.

Dominion Energy has secured approval for two test turbines off the Virginia coast, but the utility has been slow-walking plans to develop hundreds more turbines in the commercial lease area it owns the rights to. In part that’s because Dominion doesn’t see how to get the State Corporation Commission (SCC) to approve the cost to ratepayers.

That wouldn’t be an issue if Amazon were the buyer, but nor is Amazon limited to Dominion as a supplier of offshore wind. Amazon could let Dominion and its developer, Ørsted, compete against Avangrid, the developer that holds the lease on the Kitty Hawk offshore wind area just over the border in North Carolina. The power from both areas has to come to shore at the same point in Virginia Beach, where a high-voltage transmission line is available. Avangrid has already announced that it is speeding up its development work in hopes of appealing to Virginia customers.

It will take several years for Amazon to build out HQ2, but given how much electricity the company already uses in Virginia, there is no reason to wait on making new investments in renewable energy. Virginians, and the planet, will thank you.

This post first appeared in the Virginia Mercury on November 26, 2018. 

SCC rips into Dominion’s offshore wind pilot, approves it anyway

Photo credit: Phil Holman

The Virginia State Corporation Commission (SCC) approved Dominion Energy Virginia’s proposed Coastal Virginia Offshore Wind (CVOW) project on Friday, but not happily. A press releasefrom the SCC complains about the project’s “excessive costs” and the way it is structured to make customers, rather than the developer, shoulder risks:

The offshore wind project consists of two wind turbines to be built by Dominion that would begin operating in December 2020. In its factual findings, the Commission determined that the company’s proposal puts “essentially all” of the risk of the project, including cost overruns, production and performance failures, on Dominion’s customers. Currently, the estimated cost of the project is at least $300 million, excluding financing costs.

The Commission found that the offshore wind project was not the result of a competitive bidding process to purchase power from third-party developers of offshore wind. Doing so would likely have put all or some of the risks on developers as has been done with other offshore wind projects along the East Coast of the United States. The Commission also found that any “economic benefits specific to [the project] are speculative, whereas the risks and excessive costs are definite and will be borne by Dominion’s customers.”

In spite of these harsh words, the SCC goes on to conclude that the language of the giant energy bill passed by the General Assembly last winter, SB 966, leaves regulators no choice but to approve CVOW:

The Commission concluded that the offshore wind project “would not be deemed prudent [under this Commission’s] long history of utility regulation or under any common application of the term.” However, the Commission ruled, as a matter of law, that 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.

Obviously, the SCC has a point about the high cost of CVOW. Even Dominion agreed that if you just want 12 megawatts (MW) of power, you can get it a lot more cheaply than $300 million. The SCC’s Final Orderis even harsher on this topic. Moreover, the SCC doesn’t see any future for offshore wind as a matter of pure economics.

Nor is it all that reassuring that Dominion has said the price tag won’t have any impact on rates. What Dominion means is that we ratepayers have already paid for it, and as we aren’t going to get our money back anyway, we may as well enjoy seeing it put to use in building an offshore wind industry.

That’s where Dominion is (sort of) right, and the SCC (sort of) wrong. CVOW is the first step in the Northam administration’s plan to build an offshore wind industry in Virginia and install at least 2,000 MW of offshore wind turbines in the coming decade, a goal shared by many members of the General Assembly.

Northam says CVOW will lead to the commercial projects. Dominion says maybe, maybe not (“It’s too soon to have that conversation,” in the words of Dominion’s Katharine Bond). At any rate, it sure won’t happen without CVOW first.

Critics have said it’s silly to insist on a pilot project when other states are going forward with full-scale wind farms. That’s not entirely fair. As the first project in federal waters, the first in the Mid-Atlantic, and the first to be located 27 miles out to sea, CVOW’s two turbines will have much to teach the industry about offshore wind installation and performance in this part of the world. The whole U.S. offshore wind industry stands to benefit.

And also, Dominion has us over a barrel. Dominion holds the lease for the 2,000 MW; nobody else can come in and build it. So if Northam wants an offshore wind industry with thousands of new jobs, he has to do it Dominion’s way or not at all.

Clearly the SCC would choose not to do it at all. But then, the SCC has never shown any understanding of the climate crisis and the pressing need for Virginia to respond by developing as much wind and solar as possible, as rapidly as possible.

In the long term, we have to build out much more than 2,000 MW of offshore wind. As we do, and as costs decline in response to increasing economies of scale and technological improvements, the price tag of one pilot project will shrink in proportion to the billions of dollars flowing into the offshore wind industry and decarbonizing our electricity supply.

If it’s Dominion’s way or the highway, we have to do it Dominion’s way—for now—and then make sure it gets done.

No doubt the SCC would disagree. Yet to its credit, on Friday the SCC also approved Dominion’s purchase of power from a proposed 80-megawatt solar facility dubbed the “Water Strider” project. Unlike the offshore wind project, the solar project met the Commission’s prudency test because it involves a purchase from a private developer and followed a competitive bidding process. This resulted in a price to customers that the SCC felt is “in line with market rates.”

Though the Water Strider project looks like a clear winner for ratepayers, its approval wasn’t a foregone conclusion either. After a long history of approving one fossil fuel project after another, the SCC has belatedly begun to question Dominion’s projections about its need for more generation, at precisely the time when the new generation happens to be solar and wind.

For now, the SCC believes it must bow to the will of the General Assembly. For these two projects, that’s a good thing, but ratepayers will be in trouble if the SCC declines to assert its oversight authority in other filings under SB 966. Dominion wants to spend billions of dollars over the coming years on smart meters, software, burying power lines and other grid projects. Customers still need the SCC to make sure we get our money’s worth.

This article originally appeared in the Virginia Mercury

There’s a lot to like in Northam’s energy plan, but missed opportunities abound

electric vehicle plugged in

Vehicle electrification gets a boost under the energy plan.

There is a lot to like in the Northam Administration’s new Virginia Energy Plan, starting with what is not in it. The plan doesn’t throw so much as a bone to the coal industry, and the only plug for fracked gas comes in the discussion of alternatives to petroleum in transportation.

The 2018 Energy Plan is all about energy efficiency, solar, onshore wind, offshore wind, clean transportation, and reducing carbon emissions. That’s a refreshing break from the “all of the above” trope that got us into the climate pickle we’re in today. Welcome to the 21stcentury, Virginia.

But speaking of climate, the Intergovernmental Panel on Climate Change (IPCC) just released a special report that makes it clear we need “rapid, far-reaching and unprecedented changes in all aspects of society” to keep warming below 1.5 degrees Celsius. That’s only half again the amount of warming that has already brought us melting glaciers, a navigable Arctic Ocean, larger and more destructive hurricanes, and here in Virginia, the swampiest summer in memory. The fact that things are guaranteed to get worse before they get better (if they get better) is not a happy thought.

Perhaps no Virginia politician today has the courage to rise to the challenge the IPCC describes. Certainly, Governor Northam shows no signs of transforming into a rapid-change kind of leader. But as we celebrate the proposals in his Energy Plan that would begin moving us away from our fossil fuel past, we also have to recognize that none of them go nearly far enough, and missed opportunities abound.

Let’s start with the high points, though. One of the plan’s strongest sections champions offshore wind energy. It calls for 2,000 megawatts (MW) of offshore wind by 2028, fulfilling the potential of the area of ocean 27 miles off Virginia Beach that the federal government leased to Dominion Energy. In the short term, the Plan pledges support for Dominion’s 12-MW pilot project slated for completion in 2020.

Other East Coast states like Massachusetts and New York have adopted more ambitious timelines for commercial-scale projects, but the economics of offshore wind favor the Northeast over the Southeast, and they aren’t saddled with a powerful gas-bloated monopoly utility.  For Virginia, a full build-out by 2028 would be a strong showing, and better by far than Dominion has actually committed to.

Another strong point is the Administration’s commitment to electric vehicles. The transportation sector is responsible for more carbon emissions even than the electric sector, and vehicle electrification is one key response.

Even better would have been a commitment to smart growth strategies to help Virginians get out of their cars. Overlooking this opportunity is a costly mistake, and not just from a climate standpoint. Today’s popular neighborhoods are the ones that are walkable and bikeable, not the ones centered on automobiles. If we want to create thriving communities that attract young workers, we need to put smart growth front and center in urban planning—and stop making suburban sprawl the cheap option for developers.

Speaking of developers, how about beefing up our substandard residential building code? Lowering energy costs and preparing for hotter summers requires better construction standards. Houses can be built today that produce as much energy as they consume, saving money over the life of a mortgage and making homes more comfortable. The only reason Virginia and other states don’t require all new homes to be built this way is that the powerful home builders’ lobby sees higher standards as a threat to profits.

The Energy Plan mentions that updated building codes were among the recommendations in the Virginia Energy Efficiency Roadmap that was developed with funding from the U.S. Department of Energy and published last spring. I hope the only reason the Energy Plan doesn’t include them among its recommendations is that the Administration is already quietly taking action.

Meanwhile, it is not reassuring to see that the section of the plan devoted to attaining Virginia’s ten percent energy efficiency goal simply describes how our utilities will be proposing more efficiency programs as a result of this year’s SB 966 (the “grid mod” bill).

States that are serious about energy efficiency don’t leave it up to companies whose profits depend on a lack of efficiency. They take the job away from the sellers of electricity and give it to people more motivated. So if the Governor’s plan is merely to leave it up to Dominion and APCo without changing their incentives, we should abandon all hope right now.

Indeed, it is strange how often the Energy Plan finishes an in-depth discussion of an issue with a shallow recommendation, and frequently one that has the distinct odor of having been vetted by Dominion.

That observation leads us straight to grid modernization. The plan opens with a very fine discussion of grid modernization, one that shows the Administration understands both the problem and the solution. It opens by declaring, “Virginia needs a coordinated distribution system planning process.” And it notes, “One important rationale for a focus on grid modernization is that the transitions in our electricity system include a shift away from large, centralized power stations to more distributed energy resources.”

Well, exactly! Moreover: “The grid transformation improvements that the Commonwealth is contemplating include a significant focus on the distribution system, but our current resource planning process (Integrated Resource Plan or IRP) does not fully evaluate the integration of these resources. One overarching focus of this Energy Plan is the development of a comprehensive analysis of distributed energy resources.”

But just when you feel sure that the plan is about to announce the administration is setting up an independent process for comprehensive grid modernization, the discussion comes to a screeching halt. The plan offers just one recommendation, which starts out well but then takes a sudden turn down a dead-end road:

To ensure that utility investments align with long-term policy objectives and market shifts, Virginia should reform its regulatory process to include distribution system level planning in Virginia’s ongoing Integrated Resource Planning requirement.

Seriously? We need regulatory reform, but we will let the utilities handle it through their IRPs? Sorry, who let Dominion write that into the plan?

It’s possible the Administration is punting here because it doesn’t want to antagonize the State Corporation Commission (SCC). The SCC pretty much hated the grid mod bill and resented the legislation’s attack on the Commission’s oversight authority. And rightly so, but let’s face it, the SCC hasn’t shown any interest in “reforming the regulatory process.”

The Energy Plan’s failure to take up this challenge is all the more discouraging in light of a just-released report from the non-profit Grid Lab that evaluates Dominion’s spending proposal under SB 966 and finds it sorely lacking. The report clearly lays out how to do grid modernization right. It’s disheartening to see the Administration on board with doing it wrong.

Dominion’s influence also hobbles the recommendations on rooftop solar and net metering. This section begins by recognizing that “Net metering is one of the primary policy drivers for the installation of distributed solar resources from residential, small business, and agricultural stakeholders.” Then it describes some of the barriers that currently restrain the market: standby charges, system size caps, the rule that prevents customers from installing more solar than necessary to meet past (but not future) demand.

But its recommendations are limited to raising the 1% aggregate cap on net metering to 5% and making third-party power purchase agreements legal statewide. These are necessary reforms, and if the Administration can achieve them, Virginia will see a lot more solar development. But why not recommend doing away with all the unnecessary policy barriers and really open up the market? The answer, surely, is that Dominion wouldn’t stand for it.

Refusing to challenge these barriers (and others—the list is a long one) is especially regrettable given that the plan goes on to recommend Dominion develop distributed generation on customer property. Dominion has tried this before through its Solar Partnership Program, and mostly proved it can’t compete with private developers. If it wants to try again, that’s great. We love competition! But you have to suspect that competition is not what this particular monopoly has in mind.

The need to expand opportunities for private investment in solar is all the more pressing in light of the slow pace of utility investment. Legislators have been congratulating themselves on declaring 5,000 megawatts (MW) of solar and wind in the public interest, and the Energy Plan calls for Dominion to develop 500 MW of solar annually. I suspect our leaders don’t realize how little that is. After ten years, 5,000 MW of solar, at a projected capacity factor of 25%, would produce less electricity than the 1,588-MW gas plant Dominion is currently building in Greensville, operating at a projected 80% capacity.

Offshore wind capacities are in the range of 40-45%, so 2,000 MW of offshore wind will produce the amount of electricity equivalent to one of Dominion’s other gas plants. It won’t quite match the 1,358-MW Brunswick Power Station, or even the 1,329-MW Warren County Power Station, but Dominion also has several smaller gas plants.

But at this point you get the picture. If all the solar and wind Virginia plans to build over ten years adds up to two gas plants, Virginia is not building enough solar and wind.

That gets us back to climate. The Administration can claim credit for following through on developing regulations to reduce carbon emissions from power plants by 30% by 2030, using the cap-and-trade program of the Regional Greenhouse Gas Initiative (RGGI) of the northeastern states. If successful, that still leaves us with 70% of the carbon emissions in 2030, when we need to be well on our way to zero. And for that, we don’t have a plan.

Of course, Ralph Northam has been Governor for only nine months. He has some solid people in place, but right now he has to work with a legislature controlled by Republicans and dominated by Dominion allies in both parties, not to mention an SCC that’s still way too fond of fossil fuels. Another blue wave in the 2019 election could sweep in enough new people to change the calculus on what is possible. In that case, we may yet see the kind of leadership we need.

 

This article first appeared in the Virginia Mercury on October 15, 2018.

Workshop Explores Local Government Clean Energy Financing Alternatives

Representatives from six local governments in Northern Virginia attended a workshop on budget-neutral, clean energy alternative financing options for local governments at the Fairfax County Government Center on September 7.

Presenters discussed financing approaches that can help local governments meet their energy and climate goals while saving taxpayer dollars. Specifically, the workshop covered Power Purchase Agreements (PPAs) for solar projects and Energy Savings Performance Contracts (ESPCs) for a range of energy efficiency retrofits. These budget-neutral tools allow local governments to invest in long-term energy savings without the up-front costs.

Elected officials and local government staff, as well as representatives of the Northern Virginia Regional Commission and community members attended the workshop organized by the Great Falls Group of the Sierra Club with the assistance of Fairfax Supervisor John Foust. The workshop was also televised for remote viewing.

The workshop video and background materials are available online.

Clean Energy Financing Workshop

More than 50 local government staff and community members attended the workshop organized by the Great Falls Group of the Sierra Club

Solar PPAs available for most Northern Virginia localities

 A PPA is a contract in which a local government agrees to purchase solar-generated energy from a solar developer at a set price over the term of the contract (typically 15-25 years). In his presentation, Eric Hurlocker of the GreeneHurlocker Law Firm explained why PPAs are attractive to local governments; they require no capital outlay, involve no fuel price risk, and make effective use of tax incentives, allowing local governments to focus on their core functions.

Eric Hurlocker

Eric Hurlocker attributes the surge in VA PPA projects to approaching sunset of the federal solar tax credit

Patricia Innocenti, Deputy Procurement Director for Fairfax County, stated the county will send out its first solar PPA request for proposals (RFP) for the Reston Community Center before the end of the year. This RFP also will encompass other Fairfax County government buildings. Fairfax County plans to draft the RFP so that other jurisdictions can ride the contract following contract award.

PPAs are governed by the terms of a pilot program applicable to customers of Dominion Energy Virginia, including localities that are members of the Virginia Energy Purchasing Governmental Association (VEPGA).

Click to view the fact sheet on on-site solar options for Virginia’s local governments.

Opportunities for local governments to receive state-level technical support for ESPCs

Nam Nguyen of the Virginia Department of Mines, Minerals, and Energy (DMME) presented the many advantages of ESPCs. The ESPC is a “financial mechanism to pay for today’s facility upgrades with tomorrow’s energy savings,” said Nguyen. Third-party contractors, called energy service companies (ESCOs), take on the investment risk, and state law requires the contractors to guarantee the energy savings for localities. DMME calculates that ESPCs have provided $860 million in energy savings in Virginia since 2001.

Nam Nguyen

Nam Nguyen, VA DMME, explains the many advantages of ESPCs and the technical and project management support his department provides to local governments

Nguyen made a Fact Sheet on ESPCs available to participants.

Justin Moss, Energy Coordinator for the Fairfax County Public Schools, said his department considers ESPCs “a very viable option to help replace aging equipment when we lack bond funding for that.” Their ESPC for 106 schools has saved $29 million in energy costs to date.

While smaller jurisdictions often know ESPCs could save them millions of dollars, they fear they lack staff and expertise to manage ESPC projects. This is where DMME comes in. Nguyen explained that his department provides technical and engineering support to ensure governments are empowered to negotiate good terms for the contract. DMME also provides hands-on project management support throughout the duration of the contract. Since there is no charge for requesting an initial energy audit to determine the feasibility of pursuing an ESPC project at government-owned facilities, it is a wonder why more Virginia localities do not take greater advantage of this financing tool.

Click to view the full-length workshop video.

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

two men installing solar panels on a roof

Photo credit NREL.

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

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

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

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

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

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

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

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

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

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

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

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

Dominion gets the nod to sell solar energy to us regular folks

alternative energy building clouds energy

Photo by Pixabay on Pexels.com

The State Corporation Commission (SCC) has approved Dominion Energy Virginia’s so-called Community Solar pilot program, under which the utility will offer its residential and commercial customers the output of solar farms to be built by independent solar developers here in Virginia.

Customers will have the option to meet either all or part of their electric demand with solar. The added cost of the program, at least initially, will be 2.01 cents per kilowatt-hour (kWh). For a customer who uses an average of 1,000 kWh monthly and wants to use only solar, that would add up to a premium of $20.10 per month.

Customers who want to meet just a portion of their total demand with solar will have the option of subscribing to “blocks” consisting of 100 kWh, up to a maximum of 5 blocks for residential customers or 10 blocks for non-residential customers.

The premium cost of the program may surprise customers who have heard that large-scale solar is now one of the cheapest sources of energy in Virginia. But according to Will Cleveland, a staff attorney at the Southern Environmental Law Center who helped to develop the program, cost was not the only consideration in choosing which solar facilities to include in the program.

Facilities were selected to be smaller and distributed around the state, in keeping with the “community” concept, which meant they sometimes came with higher prices. Program costs also include Dominion’s costs of administration and marketing. Cleveland says he consulted experts who advised him these numbers were reasonable.

In addition to selling the electrical output of the solar facilities to customers, Dominion will retire the associated renewable energy certificates (RECs). The RECs represent the legal proof that the energy comes from solar, an important factor for commercial customers that wish to represent they use renewable energy in their business. “Retiring” the RECs guarantees that Dominion isn’t also selling them elsewhere.

The program is a result of legislation passed by the General Assembly in 2017 that authorized a three-year pilot program in Dominion’s territory for up to 40 megawatts (MW) of solar capacity. The legislation also authorized Appalachian Power to develop up to 10 MW for a similar program. To date, Appalachian Power has not submitted a proposal.

Although the program is called “community solar,” customers will not own shares in the solar facilities, and the facilities do not have to be located in the same communities as the customers. Virginia law does not permit the kind of community solar in which customers share in the ownership and output of solar facilities.

Calling Dominion’s program “community solar” is bound to confuse people, and it’s hard not to believe that was a calculated move on the utility’s part. Yet Dominion’s solar offering is a major step forward for the company, and for customers who aren’t able to put solar panels on their own rooftops.

And while it is somewhat more expensive than the company’s Green Power Program, it should prove much more attractive with people who understand the difference between the programs.

Subscribers to the Green Power Program don’t get electricity from renewable energy; Dominion sells them regular “brown” power, then tacks on an added charge to match the dirty energy with renewable energy certificates (RECs). Most of the RECs come from existing wind projects in other states, where wind is already the cheapest power source. By contrast, the solar program provides solar energy (and the RECs) from new Virginia solar farms, ones that would not get built otherwise.

Dominion is expected to begin signing up subscribers for its solar program later this fall, with the program getting underway once the solar projects come online next year. For those of us without the sunny roofs needed to put up our own solar panels, this promises to be—for now—the next best option.

A version of this article first appeared in the Virginia Mercury, a new (and if I do say so, quite excellent) independent online news source dedicated to covering Virginia issues that matter. 

Northam’s energy plan: A blueprint for action or destined for dusty shelf?

Virginia Governor Ralph Northam standing in front of a new solar farm.

Governor Northam speaks at the opening of the Palmer Solar Center on May 23.

[Note: A version of this post originally appeared in Virginia Mercury on July 23. Virginia Mercury is a nonprofit, independent online news organization that launched this summer. Subscribe to its free daily newsletter here.]

Forget “all of the above.” Under Governor Ralph Northam, Virginia’s next Energy Plan will emphasize the features of a clean energy future: solar and wind, energy efficiency, electric vehicles, energy storage, and offshore wind. This marks a welcome departure from previous state energy plans, though whether the end result serves as a blueprint for action or just stuffing for a filing cabinet remains to be seen.

Since 2007, Virginia law has required the Department of Mines, Minerals and Energy (DMME) to write a ten-year Energy Plan in the first year of every new administration. The statute lists vague requirements for the plan, including that it be consistent with the Commonwealth Energy Policy, itself a toothless statute. That means each new governor can pretty much tell DMME what to focus on.

Previous governors’ plans have read more like campaign rhetoric than like meaningful indicators of an administration’s direction. Tim Kaine’s plan supported carbon reductions, but by the next spring Kaine was promoting construction of a coal plant in Wise County that would become one of the last coal plants ever built in America.

Bob McDonnell used his energy plan to announce Virginia as the Energy Capital of the East Coast, perhaps the strongest indication that Energy Plans need not be tethered to reality.

Terry McAuliffe pushed an “all of the above” agenda, heavy on offshore drilling, natural gas, and offshore wind. He later backpedaled on offshore drilling, went all in on gas pipelines, and forgot about offshore wind.

Northam surely feels the pressure to write a pro-clean energy plan, and not merely because economic trends have swung decisively in favor of wind and solar. In his short time in office, Governor Northam has deeply undermined his standing as an environmentalist. Even before his inauguration, his public silence about gas pipeline projects fed rumors of private support. Once in office, he caved early on negotiations with Dominion Energy over this year’s energy legislation; reappointed David Paylor, the controversial director of the Department of Environmental Quality (DEQ), whom he had promised to replace; and passed up a rare opportunity to appoint a progressive to the State Corporation Commission.

One bright spot remains DEQ’s work towards completion of rules to lower carbon emissions from power plants by trading carbon allowances with states to the north of us. But the plan is not yet finalized, and the devil (or Dominion’s fingerprints) may prove to be in the details.

The Energy Plan gives Northam an opportunity to change the subject, and possibly even to change course. DMME’s presentation at its initial public meeting on June 25 addressed only clean energy topics—no coal, no natural gas, no nuclear, no oil. For some topics, the agency has already proposed recommendations for policy changes and scheduled public meetings to discuss them.

In the solar and wind “stakeholder track,” DMME proposes to “increase the residential cap on net metering from 20 kW to 40 kW; increase the overall net metering program from 1% of the utility’s peak load to 3% of peak load; make third-party Power Purchase Agreements (PPAs) available throughout all utility service territories; increase the total PPA installation cap from 50 MW to 100 MW and increase the installation-specific cap from 1 MW to 2 MW.” These recommendations are guaranteed to be popular with solar advocates and industry members, but won’t get past the utility blockade without a fight.

Recommendations for other tracks run the gamut from practical to aspirational. A recommendation to track energy consumption by state agencies through an energy data registry and dashboard is specific and achievable. Less so is the recommendation for Virginia to “reach the voluntary goal of reducing energy consumption by 10 percent by 2020.” Yes, that would be nice, but getting there would require a level of utility cooperation we have never seen in Virginia, and that neither the General Assembly nor any previous governor has had the tenacity to fight for.

The fact that our utilities are so often barriers to positive change underscores a need for the Energy Plan to address one subject missing from DMME’s list: a comprehensive study of grid transformation. Within the next ten years covered by the Energy Plan, our electric grid will need to incorporate vastly more wind and solar generation (much of it consumer-sited), plus electric vehicle charging, battery storage, and new metering technology that gives consumers greater control over their energy use.

Left to their own devices, the utilities will create the energy generation and delivery system most profitable for themselves, not the one most efficient and beneficial for the public. If Governor Northam is serious about a clean energy future, his Energy Plan should kick off a comprehensive study of grid transformation, managed by an independent expert who can help DMME and stakeholders develop a specific, actionable roadmap for the future of Virginia’s energy economy.

Without such a roadmap, we are likely to make progress only in fits and starts and at greater expense than necessary. Utility bills are rising and will keep going up as a result of the legislation Northam supported. Now the Governor needs to make sure Virginians have something to show for it.