The race to 100% renewable is on in Virginia: Floyd and Blacksburg lead in committing to energy transition (sort of)

On October 24, 2017, deep in the heart of Virginia, the mostly Republican supervisors of Floyd County (population 15, 755) issued a resolution proclaiming the county’s commitment to reduce greenhouse gas emissions by “replacing fossil fuels with renewable energy along with conservation and energy efficiency,” and “support[ing] the achievement of near zero greenhouse gas emissions through policies that shift the energy supply strategy of our County from fossil fuels to 100% clean renewable energy.” The vote in support was unanimous.

The vote made Floyd the first Virginia locality to join more than 70 cities, towns and counties across the U.S. that have committed to achieving 100% renewable electricity. At least five cities are already powered by renewable energy today, according to the Sierra Club. (And surprise! None of the five are in California.)

Floyd’s resolution does not set a date for accomplishing its goal, so some might call it more aspirational than committed. And even the residents of Floyd subsequently showed themselves more than a little conflicted. (I’ll get to that in a moment.)

But within three months, the Town of Blacksburg followed suit with its own resolution in favor of 100% renewable energy, and it upped the ante by setting a target date of 2050. The Blacksburg commitment is bolstered by the town’s previous work on a climate action plan and its own claim to fame as the location of Virginia’s first Solarize campaign.

As best I can tell, Floyd and Blacksburg are the only Virginia localities to take the pledge so far, but the idea is under consideration across the state. The Sierra Club launched its “Ready for 100” campaign in Virginia almost two years ago in an effort to persuade Arlington and Alexandria to set a target date of 2035 for both government and residents to be powered by 100% renewable electricity. Fairfax City and Charlottesville have also begun the conversation.

The 2035 target proposed for Arlington and Alexandria is both more and less ambitious than Blacksburg’s goal, since it covers only the electric sector. Moving to 100% renewable energy, as Blacksburg aims to do, also requires things like eliminating petroleum use in transportation and an end to heating by natural gas and fuel oil. These are harder in the near term but generally considered achievable by 2050, given the projections for electric vehicles, cost declines that make electricity from wind and solar competitive with fossil fuels, and a growing belief that combating climate change will soon push us towards a policy to “electrify everything.”

Not everyone agrees that abandoning fossil fuels is the right goal, including some of the same people who said it was. Immediately after passing the 100% resolution, supervisors in Floyd County contracted a case of buyers’ remorse when the local Tea Party found out and raised a ruckus. (The local newspaper had been covering the topic for months, but evidently it didn’t make Fox News.)

Barely six weeks later, on December 12, the board issued a hastily-prepared second resolution. It began by repeating several findings of the first resolution, including recognizing the threat of climate change and the role of humans in causing it. So far, so good. Then it took a sharp detour to praise fossil fuels and to pledge to “protect the freedom and economic interests” of residents by working for “viable, cost-effective, clean and reliable energy resources of all available types,” which the drafters seemed to think included fossil fuels. Only one supervisor voted no. They did not, however, repeal the first resolution. That leaves Floyd with its first-in-the-commonwealth status on embracing 100% renewable energy, but sadly paralyzed on putting it into action.

It is worth reading this second Floyd resolution to understand the underlying concerns of the noisy minority who pushed it through. It reveals that a belief in coal as a cheap fuel remains common, though it has been years since coal lost its competitiveness. And the reference to fossil fuels as “clean” is surely an echo of the “clean coal” propaganda that never had any truth behind it, but seemed to offer a free lunch. The very silliness of the phrase works in its favor: since no one would make up something so absurd, people figure, it has to be true.

The second resolution also reflects a genuine concern about the potential of an over-active government to infringe on individual liberties. Billy Weitzenfeld, President of Sustain Floyd, told me some local people who were opposed to the pro-renewable energy resolution expressed a fear that it would lead to the government taking away peoples’ wood stoves and forcing everyone to put solar panels on their houses. Thus the freedom from utility control that rooftop solar offers to consumers was turned on its head and made to look like a threat to individual liberty.

Weitzenfeld feels the Tea Party concerns are misplaced, but he also thinks the conflict could have been avoided by better dialog in the process. It was unfortunate, he said, that fear took over, and—at least temporarily—brought a halt to what had been an exciting momentum on clean energy initiatives.

Weitzenfeld has not thrown in the towel, though. He and other advocates in Floyd are getting back to doing “the proactive stuff that can really make a difference”: putting solar on rooftops through a second Solarize program, encouraging energy audits, engaging the public, and building what he calls “the constituency of practitioners,” people whose own experience with renewable energy will make them the ones to push back against fear and misinformation the next time around.

Looking on the bright side, even the rebelling Tea Partiers recognized the climate threat, which is also a theme common to the other Virginia resolutions. In other conservative states, more prosaic considerations have driven the decision. And by that, of course, I mean money. The Republican mayor of Georgetown, Texas, said economics pushed them to become one of the first cities in America to run entirely on wind and solar energy, when they found they could save money doing it. Bentonville, Texas, may become the second city in that state to achieve the 100% goal, on economic grounds as well as due to concerns over air quality associated with coal and gas burning.

In 2008, tiny Rock Port, Missouri, became the first locality in the U.S to be powered entirely by wind energy, taking advantage of a cheap and abundant resource in a windy farm community. Greensburg, Kansas, also went all-wind in 2013, and uses this and other green initiatives as a major branding tool.

All of these are small communities that control their own electricity supply, which gives them options most Virginia localities lack. Blacksburg residents get their electricity from Appalachian Power; most others have to deal with Dominion Energy Virginia or one of the rural electric cooperatives. So even if they achieve consensus within their communities on a goal of 100% renewables, meeting the goal will require navigating a range of barriers.

We are not alone there. A fair number of the cities on the Ready for 100 list are also located in the Southeast, and suffer from the same outdated monopoly utility structure that we do. Virginia localities can look for guidance to Atlanta, Georgia (100% renewable energy by 2035), and Columbia, South Carolina (100% renewable electricity by 2036).

Next week Sierra Club will launch its “100% Virginia Campaign” to encourage residents across the state to advocate for clean energy in their communities, with the hope that more localities will take up resolutions for 100% renewable electricity by 2035.

More generally, Sierra Club organizer Alice Redhead says the goal is to “build a movement for clean energy across the state and set the conditions for Virginia to transition to 100% renewable energy statewide by 2050. We are pushing for localities around Virginia to commit to 100% clean energy, but we are also making sure that the campaign is flexible rather than one size fits all and allows for locally-tailored initiatives that are strategic for the conditions in different areas of the state. Local campaign teams that are a part of the 100% Virginia network will develop unique plans to advocate for clean energy progress specific to their area.”

In an upcoming blogpost I’ll take a harder look at the obstacles facing Virginia localities, as well as the opportunities that make getting to 100 a viable option.

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.

 

 

Virginia renewables report shows huge solar gains in 2017

The Virginia Renewable Energy Alliance (VA-REA) says Virginia had a total of 570 megawatts (MW) of solar installed at the end of 2017, well over twice the 176 MW we had at the end of 2016. VA-REA projects the industry will add another 376 MW in 2018.

The numbers are included in VA-REA’s “2017 Development Report,” which also summarizes other aspects of renewable energy development in the past year. The report is available on the group’s website.

VA-REA members include companies from the solar, wind, and other renewable energy industries in Virginia, as well as utilities, some environmental groups, and other advocates.

As we head into the General Assembly session beginning this Wednesday, the strong showing by the solar industry in 2017 should give added momentum to the raft of pro-solar bills we hear are in the works. So far most have not yet been filed, but I will be posting about them when they reach a critical mass.

Moving to block competition, Dominion files its own sort-of-green energy tariff

Just a couple of the great things that count as “renewable energy” in the Virginia Code.

Dominion Virginia Power has filed for permission from the State Corporation Commission (SCC) to offer a 100% renewable energy tariff to commercial and industrial customers with peak loads of over 1,000 kilowatts. In a footnote, Dominion states that it intends to propose a similar tariff for residential customers in the future. The case is PUR-2017-0060.

Customers who want only carbon-free energy like wind and solar will likely be disappointed. Dominion intends to use a “portfolio of resources” that will include “dispatchable resources”—i.e., hydropower and stuff that can be burned. Dominion promises the sources it uses will meet Virginia’s definition of renewable. That’s not reassuring. Under Virginia law, renewable energy can include sources like landfill gas and municipal solid waste, as well as “biomass, sustainable or otherwise (the definitions of which shall be liberally construed).”

Dominion’s filing comes scarcely one month after an SCC decision confirmed the right of independent renewable energy provider Direct Energy to offer its products to Dominion customers, but only so long as Dominion lacks its own green tariff for those customers. The SCC order (explained here) made clear that under Virginia law, a competitor like Direct Energy would be blocked from taking on new customers once Dominion has an approved tariff.

Dominion’s filing looks suspiciously like an effort to cut Direct Energy off at the knees. If the upstart competitor follows through with its plans to offer Virginia residents a renewable energy option, Dominion will surely propose a residential renewable energy tariff. SCC approval of Dominion’s tariff would shut out Direct Energy, which is targeting only residential consumers for its product. Under the language of the Code, it does not appear to matter whether a competitor can offer a better product, or a better price.

For the moment, Direct Energy is not backing down. The company has set up a web page to gauge the interest of residential consumers while it deliberates its next move. Ron Cerniglia, Director of Corporate and Regulatory Affairs for the Mid-Atlantic Region, told me he thinks the timing of Dominion’s filing is “curious,” given that “Dominion has had ten years to file a renewable energy tariff and hasn’t. We’re concerned about the implications of limiting choice for consumers. We don’t know if the move will actually offer a choice consumers want, or if it is just closing doors on others.”

Indeed, ten years have passed since Virginia enacted its current utility law, which includes the right of a customer to “purchase electric energy provided 100 percent from renewable energy” from another supplier if its own utility isn’t offering it. During most of that time, Dominion has sold Renewable Energy Certificates to customers under its “Green Power Program,” but it has never offered residential customers an opportunity to buy actual renewable energy. (See “Is a Green Power program worth your money?”)

This is slated to change as the utility works with the solar industry on implementing a new solar option under legislation passed this year. However, the new law specifies that the solar option will not count as a tariff for “electric energy provided 100 percent from renewable energy,” so it does not block competitive offerings like Direct Energy’s.

Dominion was agreeable to excluding the solar program because it interprets the Code’s reference to “electric energy provided 100% from renewable electricity” to mean the electricity must come from renewables 100% of the time, an interpretation almost no one else shares.

This seems to be the reason Dominion intends to include carbon-emitting sources into its renewable energy offering, even though it’s safe to say there are no customers clamoring to get their electricity from garbage or the clear-cutting of forests. It also means the new tariff will likely be priced higher than one that included only solar, because electricity from biomass is more expensive today than harvesting the sun. (No word from Dominion on why it doesn’t just assign a portion of its pumped storage capacity to serve an all-wind-and-solar product.)

But if customers want only wind and solar, they are also likely to be disappointed in Direct Energy’s product. Cerniglia says his company includes baseload sources like “cleaner biomass” in its renewable energy product to provide 24/7 power. He estimated that the initial mixture would consist of “50% to 60% municipal waste biomass (Pennsylvania and Virginia sourced) and 40% to 50% wind (Pennsylvania sourced) . . . We are also committing to not utilize virgin wood / clear cut wood biomass in our product mix at any time.”

Direct Energy also has not determined the pricing of its product yet, but Cerniglia said it would be “equal to or lower than what Dominion Virginia Power residential customers pay for ‘brown’ power.”

Perhaps most importantly, he noted, “The benefit of a competitive market is that customers can leave us at any time. They’re not captive.”

 

Update: On June 21, a Hearing Examiner for the SCC recommended rejection of a similar application for a renewable energy tariff filed last year by Appalachian Power. See my discussion here for how this may affect Dominion’s application. 

Dominion Power promises huge solar investments and a lower carbon footprint—or does it?

Dominion Virginia Power says energy from solar farms is now a low-cost option. Photo credit Kanadaurlauber.

Dominion Virginia Power released its updated Integrated Resource Plan (IRP) this week with a press release that promised thousands of megawatts (MW) of new solar power and a dramatically lower carbon footprint. In a remarkable turnabout, the Executive Summary declares, “The Company must now prepare for a future in which solar PV generation can become a major contributor to the Company’s overall energy mix.”

Alas, a closer look reveals Dominion will actually increase its carbon emissions over the period studied. Meanwhile, the solar would be built at a rate of only 240 MW per year over the 15-year period covered by the IRP, about the same amount being installed in Virginia this year. (Over 25 years, Dominion says its solar could reach 5,200 MW, which means the pace of installation would actually drop in the out years.) That should elicit yawns, not excitement.

The solar numbers pale in comparison to the more than 4,600 MW of new natural gas combined-cycle plants Dominion has been building just in this decade. (Remember that solar farms generate electricity at about 20-25% of “nameplate” capacity on average, while combined-cycle gas plants nationally average 50-60%, and can achieve 70% or higher.*) And even come 2032, the new solar will make up only a tiny fraction of a generation portfolio that consists almost entirely of coal, gas and nuclear.

I’ll be interested to see the numbers analyzed, but my guess is that all the renewable energy Dominion proposes to build over the next 15 years represents no more than 5-10% of its total electric generation. That’s too little, too late, in a state that can do so much better.

So the more things change, the more Dominion stays the same. Behind the hype being offered to the press stands a utility that is still committed to fossil fuels and nuclear power.

Virginia utilities file IRPs with the State Corporation Commission (SCC) every year. The plans are supposed to reflect the utilities’ best sense of how they will meet consumers’ needs for electricity while complying with state and federal laws and policies. This involves some guesswork about the direction of future regulations, including regulations of CO2 emissions.

In spite of President Trump’s determination to roll back climate protections while he is in office, Dominion’s IRP assumes an eventual price on carbon. Most utilities nationwide are doing the same thing. But given the uncertainties, Dominion has chosen (as it did last year) to model different scenarios instead of committing to a single plan.

Even the low-cost plan that wouldn’t comply with the EPA Clean Power Plan contains just as much solar as the other plans, reflecting the company’s assessment (on page 3) that solar is now “cost-competitive with other more traditional forms of generation, such as combined-cycle natural gas.”

Yet the carbon reductions Dominion promises in its press release appear to be something of a sleight-of-hand. For one thing, Dominion has chosen to compare its CO2 output in 2032 to its output in 2007, not 2017. CO2 emissions were markedly higher in 2007 than now, with the shale gas boom and the rise of renewables leading to massive coal retirements in the interim.

Moreover, a careful reading of the press release reveals the reductions Dominion promises are per-capita, not overall. A chart on page 115 of Dominion’s IRP shows every one of the scenarios Dominion studied will actually increase the company’s total CO2 emissions between now and 2042.

That reality exasperates climate activists. Glen Besa, former Director of the Virginia Chapter of the Sierra Club, comments, “The only impression you could have reading Dominion’s release was that it was making dramatic reductions in carbon pollution, which obviously is not the case.”

CO2 emissions would not increase if Dominion were simply shutting down coal and building more solar. But all of the alternative scenarios Dominion models for its IRP contain more gas plants: at least another 1,374 MW of gas combustion turbines in all plans, and 1,591 MW of combined cycle gas in some scenarios. Combustion turbines are more flexible than combined-cycle plants and so are better for meeting spikes in demand and integrating renewable energy like solar, but while they run less often, they are typically higher-polluting. Many utilities are using demand response or installing battery storage instead; Dominion appears to prefer gas.

All this gas means higher CO2 output. Not incidentally, burning more gas also means more business for Dominion’s parent corporation, Dominion Resources (soon to be known as Dominion Energy), which is heavily invested in gas transmission. And crucially, Dominion Energy needs more gas power plants to justify building the Atlantic Coast Pipeline. So building more gas plants serves the interests of Dominion’s affiliates, not its customers.

The problem with building new gas plants is that it lowers carbon only so far compared to coal, and then you’re stuck at that level for the life of the gas plants, unless you’re willing to abandon them early. That’s why any utility that’s serious about protecting ratepayers from stranded costs has to invest in wind, solar, energy efficiency and storage, not natural gas.

Speaking of wind, the IRP includes the 12 MW pilot project known as VOWTAP in all of the plans, even though Dominion lost millions of dollars in federal funding when it would not commit to building the two test turbines by 2020, three years past the original deadline. But none of the scenarios studied include any land-based wind, and none include a build-out of the federal offshore wind energy area Dominion bought the rights to, which could support at least 2,000 MW of offshore wind power. This is a strange omission given that Dominion continues to include a scenario in which it would build the world’s most expensive nuclear reactor, known as North Anna 3.

Polls consistently show overwhelming public support for renewable energy. Yet right now, ordinary Virginia ratepayers have no access to renewable energy unless they put solar on their own rooftop. Corporations like Amazon Web Services and Microsoft account for the bulk of the solar energy being installed in Virginia, with most of the remaining going to the military, state government, universities, and schools.

So 3,200 MW over 15 years won’t even begin to satisfy consumer demand. North Carolina installed almost 1,000 MW last year; I’d like to see Dominion set that as an annual target, bringing it up to the 15,000 MW over 15 years it modeled for last year’s IRP (before hiding the encouraging results from pubic view). Round out the solar with other cost-effective clean energy options, and we will see the kind of carbon reductions that don’t have to be fudged in a press release.


*On page 88 of the IRP, Dominion provides it own capacity factor forecasts: solar 25%, combined cycle gas 70%, gas combustion turbines 10%, nuclear 96%, onshore wind 42%, offshore wind 42%. The chart does not include a number for coal.

Virginia General Assembly session opens. What can we expect?

Photo credit: Corrina Beall

Photo credit: Corrina Beall

The General Assembly failed to act on clean energy bills in 2016, but as the 2017 legislative session gets underway, advocates hope the delay will have only increased pressure for progress this year.

New energy legislation includes the four bills negotiated over the summer by the utilities and the solar industry promoting utility, community-scale, and agricultural renewable energy projects. The “Rubin Group” (named for facilitator Mark Rubin) brought together utilities, the solar industry trade group MDV-SEIA, and a group called Powered by Facts, but largely excluded environmental and consumer interests. Not surprisingly, the resulting bills are heavily weighted towards utility-scale solar, and utility control of solar in general.

But if the chairmen of House and Senate Commerce and Labor thought the Rubin Group’s work would mean no one else would float new renewable energy bills, they were certainly wrong.

Community-scale solar. I’ve previously addressed the Rubin Group’s legislation that enables a utility-administered, community-scale program to sell solar to participants on a voluntary basis. I see Senator Wagner will be carrying the bill in the Senate, now designated SB 1393. I haven’t had time to compare the current bill to the draft previously shared with stakeholders, but I’m cautiously optimistic that it will produce a viable solar option for consumers. Even better would be HB 2112 from Delgate Keam and SB 1208 from Senator Wexton, which authorize a broader set of community solar models. Delegate Krizek’s solar gardens bill, HB 618, also authorizes shared solar.

Utility-scale solar. Another bill from the Rubin Group, SB 1395 (Wagner), would raise from 100 MW to 150 MW the size of wind and solar projects that qualify as “small renewable energy projects” subject to Permit By Rule (PBR) permitting by DEQ, and allowing utilities to use that process for facilities that won’t be rate-based. In contrast, Senator Deeds’ SB 1197 would undo much of the streamlining gained by the PBR process, sending projects to the SCC if they either disturb an area of 100 acres or more or are within five miles of a boundary between political subdivisions.

The third Rubin Group bill, Wagner’s SB 1388, would allow utilities to earn a margin when they obtain solar energy via power purchase agreements with (lower cost) third-party developers rather than building projects themselves.

Senator Marsden’s SB 813 exempts investor-owned utilities from the requirement that they consider alternative options, including third-party market alternatives, when building solar facilities that have been declared in the public interest. This is surely an attempt to smooth the way for utility-owned solar at the SCC. However, if you’re trying to get utilities to keep costs down by using third-party installers, this is the wrong incentive.

Agricultural net metering. The last bill from the Rubin Group, Senator Wagner’s SB 1394, would revoke the recently enacted code provisions that allow agricultural customers to attribute electricity from a renewable energy facility to more than one meter on their property for the purposes of net metering. The proposed legislation would terminate this provision in 2018 (grandfathering existing net metering customers for 20 years) and instead offer farmers a buy-all, sell-all option for their renewable production.

Under the proposed bill, negotiated between the utilities and Powered by Facts, farmers would have to buy all their (dirty) power from their utility at retail, and sell their renewable power to the utility at the utility’s avoided cost—essentially wholesale. This doesn’t sound like a good deal for the farmers, but we’re told it more or less pencils out. On the plus side, the bill would allow farmers to build up to 1.5 megawatts of renewable capacity on up to 25% of their land, or up to 150% of the amount of electricity they use, whichever is less, which is more than they can under today’s rules. (But since federal law allows anyone to sell power they produce from a qualifying facility into the grid at avoided cost, even this part of the bill is of dubious added benefit.)

Regardless, removing the net metering option seems both unnecessary and unwise; many farmers specifically want to run their farms on solar, for marketing reasons or otherwise, and taking away their ability to aggregate meters and use net metering will be viewed as a serious setback.

The first draft of this bill that I had seen contained a provision that projects under the new program would apply against the state’s 1% cap on total net metering output, even though the projects would not be net metered. Fortunately, I don’t see that in the current version. [Update: this provision does appear in the version of the bill reported out of the Senate subcommittee on January 27, presenting a reason sufficient in itself to oppose the legislation.]

An agricultural bill that is more readily supportable is Senator Edwards’ SB 917, which eases the rules for agricultural customer-generators and increases the size of projects that can qualify for meter aggregation under the net metering statute. It also extends the law to include small hydro projects.

PPAs. Two bills attempt to resolve the ongoing dispute over customers’ rights to use third-party power purchase agreements for their on-site renewable facilities. Delegate Toscano’s HB 1800 essentially reiterates what solar advocates believe to be existing law allowing on-site PPAs, but—as a peace offering to utilities—narrows it to exclude residential customers. Senator Edwards’ SB 918 takes a different approach, replacing the Dominion PPA pilot program with a permanent statewide program to be designed by the State Corporation Commission.

Tax credits. Delegate Hugo’s HB 1891 provides a tax credit for residents who install geothermal heat pumps—a nice idea, but it will face tough sledding in a tight budget year. That budget reality could also doom Delegate Sullivan’s HB 1632, offering a broader renewable energy property tax credit (it would include geothermal heat pumps).

In spite of the current budget deficit, Republicans are making a new attempt to reinstate taxpayer subsidies for coal mining companies (Delegate Kilgore’s HB 2198). Delegate Morefield’s HB 1917 takes a better approach, offering a new tax credit for “capital investment in an energy production facility in the coalfield region.” This is worth watching, as it is not limited to coal facilities but applies to any facility that has “the primary purpose of producing energy for sale.”

Climate. Republicans seem inclined to make a renewed attack on the EPA’s Clean Power Plan (Delegate O’Quinn’s HB 1974), even though Trump’s election seems likely to send it to an early grave. This probable fate inspired Senator Petersen’s SB 1095, which says that if and when the Clean Power Plan is really declared dead, then the notorious “rate-freeze” imposed two years ago will end. As readers know, that law (Wagner’s SB 1349 from the 2015 session), will allow Dominion to keep an estimated $1 billion in excess revenues; at the time, Dominion said the law was needed to protect its customers from rate hikes required by compliance with the Clean Power Plan. Unfortunately the condition in Petersen’s bill doesn’t seem likely to kick in for at least a year or two, and possibly more; we’d prefer to see the legislation revoke the freeze immediately, and put the ill-gotten gains to use as a massive stimulus package supporting clean energy jobs.

On the flip side, Delegate Villanueva is gamely making another run at getting Virginia to join the Regional Greenhouse Gas Initiative (HB 2018) as a way to change utility incentives and raise money for climate adaptation and clean energy.

Nuclear. Delegate Kilgore has introduced HB 2291, a bill to make it easier for Dominion Virginia Power to stick ratepayers with the costs of any upgrades it makes to its nuclear power plants. The bill further attacks and undermines the SCC’s authority to determine whether expenses are reasonable, the sort of favor to Dominion that has become a theme in recent years. Kilgore doesn’t even represent any Dominion customers; he’s in APCo territory. I guess that’s why he’s okay with raising rates for Dominion customers.

Energy efficiency. Efficiency bills suffered the same fate as renewable energy bills last year; many were offered, but few were chosen. (Actually, it might have been none. We don’t do much energy efficiency in Virginia.)

Delegate Sullivan is trying again to set energy efficiency goals with HB 1703, or at the very least to have government track our progress towards meeting (or rather, not meeting) the state’s existing goal, with HB 1465. He is also trying again to change how the SCC evaluates energy efficiency programs to make them easier to implement (HB 1636). Senator Dance’s SB 990 also sets an energy consumption reduction goal.

Delegate Krizek’s HJ 575 would authorize a study of infrastructure investments that yield energy savings. Delegate Minchew’s HB 1712 authorizes energy performance-based contracting for public bodies.

Miscellaneous. Delegate Kilgore’s HB 1760 supports a new pumped storage facility in the Coalfields region (news to me). Senator Ebbin’s SB 1258 would add energy storage to the work of the Virginia Solar Development Authority, which seems eminently sensible.

More bills are likely to be filed in the coming days, and I would promise to update you on them if I weren’t marking Trump’s inauguration by leaving the country for a week. Serious advocates should peruse the LIS website and perhaps sign up for the bill tracking service “Lobbyist in a Box.” Also watch for a clean energy lobby day that MDV-SEIA will organize, likely on the yet-to-be-announced day the House Commerce and Labor Subcommittee on Energy meets, usually in early February.

This year’s legislative session lasts a mere 45 days, weekends included. Cynics say the tight schedule limits the damage politicians can do, but in reality it just means lawmakers have to lean heavily on lobbyists and constituents—and as the lobbyists are on hand, and the constituents are at home, the schedule favors the lobbyists. So if you want to make your voice heard, now’s the time.

Virginia hearing examiner says renewable energy PPAs are legal, but will the ruling stick?

A third-party PPA made it possible to build this solar facility at the University of Richmond. Appalachian Power Company contends that a project like this would be illegal in its territory.

A third-party PPA made it possible to build this solar facility at the University of Richmond. Appalachian Power Company contends that a project like this would be illegal in its territory.

A hearing examiner for the Virginia State Corporation Commission recommended on August 31 that the SCC reject Appalachian Power Company’s proposed alternative to third-party power purchase agreements (PPAs) for renewable energy, concluding the program is not in the public interest. The parties will have three weeks to comment before the recommendation goes to the Commissioners for a final decision. The case is PUE-2015-00040.

The ruling against APCo’s proposed Rider RGP is less important to customers than the reasoning behind it. In addition to finding a myriad of faults with the proposal, the Hearing Examiner concluded it isn’t needed because PPAs are already legal under the Virginia Code. This is an outcome long sought by the solar industry and environmental groups, and one supported by the Attorney General’s Office of Consumer Counsel.

However, the Hearing Examiner’s report is merely a recommendation. Nothing is final until the Commissioners rule, and they could make a decision about Rider RGP without addressing the current legality of PPAs. Moreover, earlier this year, APCo proposed another program that it clearly hopes will nip in the bud any surge of PPA activity that might result from a decision in the present case. (I’ll get to that in a moment.)

The rejection of Rider RGP won’t disappoint any would-be customers. A long line of witnesses testified at the hearing on September 29, 2015 that APCo’s expensive and convoluted program would find no takers. As the Solar Research Institute summarized it, the proposed Rider RGP “would require a customer interested in a solar PPA to first pay for 100% of their service under the standard tariff, pay for 100% of the solar energy generated, pay a $30 program fee, and receive excess payments back through a Renewable Output Credit.” Oh, and they still wouldn’t be using renewable energy. (Note that although solar energy was the focus of the discussion for participants, the decision applies to other forms of renewable energy as well.)

The SCC staff made some suggestions to improve the program, but the hearing examiner, Deborah Ellenberg, concluded it was really beyond saving. Not only that, but the plain language of the Virginia Code makes third-party PPAs legal in the state already. Thus, there is no need for a utility-sponsored alternative.

Ellenberg pointed to two statutory provisions that support the legality of third-party PPAs. First, Virginia Code §56-577 A 5 provides that customers may purchase renewable energy from third-party sellers if their own utility does not offer a tariff for renewable energy. Specifically, customers may:

[P]urchase electric energy provided 100 percent from renewable energy from any supplier of electric energy licensed to sell retail electric energy within the Commonwealth . . . if the incumbent electric utility serving the exclusive service territory does not offer an approved tariff for electric energy provided 100 percent from renewable energy. . . .

Until now, APCo has offered only a green power program that sells RECs, which the SCC says doesn’t count.

The language of §56-577 sounds clear enough, but APCo and Dominion Power have maintained that this section only allows customers to go elsewhere if the other supplier can provide 100% of their electricity from renewable energy, something that can’t be done with a solar facility or a wind turbine.

This flimsy reading of the statute was the basis on which Dominion challenged a PPA at Washington and Lee University back in 2011. The issue was temporarily resolved two years later when Dominion and the solar industry agreed to a pilot program that now allows a limited number of PPAs in Dominion territory, under tight parameters that exclude residential customers. The program never applied in APCo territory, however—a sore point to customers there. APCo has clung to its reading of §56-577, regardless of the growing clamor for renewable energy in southwestern Virginia.

Ellenberg’s report flatly rejects the utility interpretation. If the SCC adopts her reading, any customer in APCo territory would be free to buy renewable energy from third-party suppliers, until APCo offers a qualifying program.

Ellenberg also cited Virginia’s net metering statute. Virginia Code §56-594 authorizes “customer generators” to enter into behind-the-meter PPAs with third parties that own and operate a renewable facility for the customer. Code §56-594 B defines an eligible customer generator for net metering purposes as “a customer that owns and operates, or contracts with other persons to own or operate, or both, an electrical generating facility that . . . uses as its total source of fuel renewable energy . . .” (emphasis added).

Interpreting this provision takes no special legal talent, surely. It would seem to cover residential and commercial facilities installed and owned by third-party developers, including the familiar no-money-down contract offered to residential customers by Solar City. But again, APCo and Dominion Virginia Power claim the Code doesn’t mean what it says. For more than five years they’ve backed up their position with threats of lawsuits, creating the kind of uncertainty that is toxic to development deals.

If the SCC’s final order endorses the hearing examiner’s finding that PPAs are currently legal, the result could be to open up the Virginia solar (and wind) market to large amounts of private investment statewide.

However, Ellenberg’s finding that PPAs are currently legal appears in her discussion but not in her recommendations to the commissioners; her recommendations are limited to the actions she proposes (rejecting or modifying the tariff). The SCC does not have to rule on the question of PPA legality in order to decide this case. Surely, though, it would be strange if it were to duck the opportunity now that the issue has been fully briefed. With solar a hot commodity across the state, the current legal limbo has become a significant economic drag that the SCC ought not to ignore.

As I mentioned, though, APCo still has one card up its sleeve. This spring it proposed a new tariff to offer its customers 100% renewable energy derived from existing wind, solar and hydro projects. The product appears to meet the condition of §56-577. If approved, it would slam shut the door that the Hearing Examiner just opened (or rather, that she said was open all along, if you had dared to go through it into the toxic miasma where gray-suited lawyers lay in wait). APCo’s request for approval of the tariff (PUE-2016-00051) is scheduled to be heard by the SCC on November 15, with comments due by November 8.

Solar advocates take a dim view of APCo’s move. The new tariff won’t build any new facilities; it simply shifts the burden of paying for existing renewable energy projects onto volunteers, at a significant premium. In today’s market, third-party developers can offer electricity generated by new solar projects at competitive prices. So APCo’s tariff looks less like an accommodation to its eco-conscious customers, and more like a maneuver to prevent anyone from building solar on its turf.

It’s high time the SCC put a stop to this anti-competitive behavior and let Virginians build solar projects with their own money. The Commissioners can follow the Hearing Examiner’s advice, or they can take a pragmatic approach and recognize that PPAs are really just a way to finance projects. They don’t turn solar developers into utilities, and APCo should stop wasting everyone’s time and money blocking private investment in a part of the Commonwealth that desperately needs it.