By Arianna Skibell, E&E News reporter
A large coalition of Virginia residents and national advocacy groups sent a message yesterday to Dominion Energy Inc.: Abandon the Atlantic Coast pipeline.
The pushback follows Dominion CEO Thomas Farrell saying he expects the project, owned by units of Dominion and Duke Energy Corp., to be ready for business in early 2022.
“We can maintain the existing schedule and cost estimates, so long as we can take advantage of the November 2020 through March 2021 tree-felling season,” he told analysts after Dominion released its first-quarter earnings this week.
Ahead of the energy giant’s annual shareholder meeting, nearly 80 organizations launched an ad campaign and thousands of individuals signed on to two petitions urging the company to cancel the $8 billion pipeline, the nation’s most expensive.
“Dominion Energy’s stubborn push to continue building the Atlantic Coast Pipeline despite ballooning costs, legal and permitting challenges, and a seismic shift in Virginia’s energy landscape betrays its duty to shareholders,” Brennan Gilmore, executive director of the nonprofit Clean Virginia, said in a statement. “The responsible thing — for Virginians and shareholders alike — is for Dominion to shutter the project before another tree is felled.”
The pipeline has been held up for years by state, environmental and regulatory hurdles, which Farrell said he expects the pipeline to soon clear. But as a growing number of states and territories pursue aggressive clean energy goals to curb the impacts of climate change, the embattled Atlantic Coast pipeline is emblematic of a larger national question about whether investment in new natural gas infrastructure still makes sense.
In a full-page ad in the Richmond Times-Dispatch and a half-page ad in The Washington Post, the coalition says the pipeline still faces a battle, including getting eight additional permits. Its primary permit is under review by U.S. Court of Appeals for the District of Columbia Circuit, the ad states.
“New legislation and legal challenges have rendered the completion of the Atlantic Coast Pipeline unrealistic,” the ad says. “It’s time Dominion Energy walks away from the project for good.”
The coalition includes the Alliance for Affordable Energy, the Chesapeake Climate Action Network, the Hip Hop Caucus, the Indigenous Environmental Network, the Virginia League of Conservation Voters, 350.org and others.
Separately, 2,200 Virginia residents urged Farrell in a petition to walk away from the pipeline for the financial health of his company. Another petition, which received 1,800 signatures, targeted Dominion shareholders and argued that the pipeline “no longer makes economic sense, even based on Dominion Energy’s own logic” and that “continuing to pursue this project is fiscally irresponsible.”
Dominion spokeswoman Ann Nallo said the company disagrees with the coalition’s message, “as do tens of thousands of others across the region.”
“As Dominion Energy and Duke Energy have made clear in recent days, natural gas will continue to play a critical role in our company plans for reaching net zero in the coming decades. One of the main purposes of the ACP is to move our region from coal to cleaner natural gas and renewables,” she said in an email. “The project will bring many environmental and economic benefits to the region and we are completely committed to its completion.”
Atlantic Coast, which is slated to run from West Virginia east through Virginia and into North Carolina, was announced in the fall of 2014, with an estimated price tag of $4.5 billion.
The Federal Energy Regulatory Commission approved the project in 2017, and in the ensuing years the cost has ballooned to $8 billion. The cost increase — in combination with other holdups like complicated lawsuits and construction delays — has led financial analysts to downgrade the pipeline as an investment.
In March, Gov. Ralph Northam (D) enacted the sweeping Clean Economy Act, Virginia’s landmark clean energy law, which would require Dominion to reach net-zero emissions by 2045, further casting doubt on the necessity of the proposed 600-mile-long gas line.
Additionally, the Virginia General Assembly pushed through a measure that requires a utility to prove new infrastructure is necessary for reliability and is the least-cost way to meet electricity demands before it can recoup the costs from its captive ratepayers. With the state headed toward renewable integration, the law could spell additional trouble for the project (Energywire, April 24).
In Dominion’s recent blueprint for its energy future, the company made no mention of the pipeline. A spokesperson said the pipeline will be addressed in the utility’s upcoming fuel cost review (Energywire, May 5).
By Derek Seidman
Virginia Governor Ralph Northam announced last week that Grant Neely will become his new Communications Chief. Neely has been the Director of Strategic Communications for Dominion Energy since August 2016.
Dominion is an energy utility that is one of the most powerful corporate forces in Virginia. The appointment reinforces concerns over the revolving door between Dominion and state governments and potential conflicts of interests of government officials regarding Dominion, which is pushing the controversial Atlantic Coast Pipeline, a proposed 600-mile fracked gas pipeline that would run through West Virginia, Virginia, and North Carolina.
Neely is not new to the revolving door between industry and government. Before going to work for Dominion in 2016, Neely was chief of staff to Richmond Mayor Dwight C. Jones. He resigned from the Jones administration to go work for Dominion as the company’s media point person.
Neely will now serve in an administration that has regulatory oversight over his immediate former employer. This comes at a time when Dominion’s power and influence has come under increasing scrutiny.
Grant Neely is not the only person to have walked through the revolving door between Dominion and state government. In early 2018, North Carolina Governor Roy Cooper hired Lee Lilley as his Director of Legislative Affairs. Lilley had been a lobbyist for Dominion for years – right up until the time he joined the Cooper administration.
Before becoming a lobbyist, Lilley was a legislative director for North Carolina U.S. House Representative George Butterfield, developing skills and connections that he could later bring to his lobbying work on behalf of private corporate interests. After serving in government from January 2007 to May 2012, Lilley became a lobbyist for McGuireWoods, a powerhouse consulting firm (Richard Cullen, the brother-in-law of Dominion CEO Tom Farrell, is a partner at McGuireWoods).
From 2012 to 2017, Dominion paid $690,000 to McGuireWoods for lobbying services carried out by teams of lobbyists that included Lilley. Some of these lobbying efforts for Dominion that Lilley was part of involved meetings with the U.S. Senate and House on the issue of “Proposed Interstate Natural Gas Pipeline approval” – likely a reference to the Atlantic Coast Pipeline.
The revolving door between states governments and Dominion – with persons entering the top ranks of gubernatorial administrations directly from positions where they were paid to lobby for Dominion or held positions directly within the utility – raises questions about Dominion’s influence over and access to these administrations.
Notably, Virginia and North Carolina have both seen intense debate over the Atlantic Coast Pipeline, much of which would run through those two states to transport fracked gas from the Marcellus Shale formation. Dominion is the pipeline’s top (48%) owner, while Duke Energy is the second top (47%) owner.
Dominion has been a top donor in Virginia politics for years. According to the Virginia Public Access Project, Dominion has spent at least $16,694,987 in Virginia politics since 1996. Since October 2015, it has given $216,751 to Ralph Northam throughout his career. Dominion CEO Tom Farrell has also showered Virginia politicians with hundreds of thousands of dollars.
Dominion’s vast influence in Virginia – including tied its interests regarding the Atlantic Coast Pipeline – is illustrated in other ways.
For example, as we reported earlier this year, a host of Virginia state legislators who have proactively supported the Atlantic Coast Pipeline are personally invested in Dominion – meaning they are potentially set to profit from the pipeline they are supporting from the platform of their elected position. One State Senator, Bill DeSteph, owns more than $250,000 in Dominion stock (you can view a table with all these investments here).
Others have pointed out further evidence of Dominion’s troubling influence on government officials and regulators.
For example, Kelly Roache at Energy Policy Institute recently wrote about how U.S. Attorney General William Barr and states Attorneys General have supported Dominion as the U.S. Supreme Court is “poised to decide this month whether it will review a ruling key to the Atlantic Coast Pipeline’s future.” Barr received $2.3 million in cash and stock awards as a Dominion board member from 2009 to 2018 and Dominion has given tens of thousands of dollars to the Republican Attorneys General Association.
By Frank Bass
A trio of utility giants building a natural gas pipeline that would cut across the Appalachian Trail has spent more than $109 million lobbying federal lawmakers and officials since the $7.8 billion project was unveiled five years ago, according to a MapLight analysis.
The Atlantic Coast Pipeline, a 600-mile-long project that has been compared to the Dakota Access Pipeline because of its stiff opposition from Native and local communities, would bisect the fabled trail, as well as the Blue Ridge Parkway and a pair of national forests.
Appeals courts have thrown out seven separate permits for the project, with sentiment running so high that one judge wrote an opinion using a quote from The Lorax to blast the U.S. Forest Service for its failure “to speak for the trees, for the trees have no tongues.” Despite the setbacks, the utilities have continued to press their case, hoping the rulings can be overturned by the U.S. Supreme Court or Congress. The companies ― Dominion Energy, Duke Energy, and Southern Co. ― have described the Atlantic Coast Pipeline as “a critical infrastructure project that will strengthen the economic vitality, environmental health, and energy security of the Mid-Atlantic region.” The U.S. Chamber of Commerce, which separately has spent almost $361 million lobbying since the project was announced, estimates economic losses of $91.9 billion and 730,000 lost jobs if the pipeline isn’t built.
The battle over the pipeline highlights the shifting landscape for power companies, which have been presenting natural gas as an energy source that can serve as a bridge fuel during the transition from fossil fuels to renewable energy sources, even while the effects of climate change become more apparent. The Atlantic Coast Pipeline would transfer as much as 1.5 billion cubic feet of gas daily from West Virginia, Ohio, and Pennsylvania shale fields to facilities in Virginia and North Carolina.
Opponents, however, warn that a pipeline leak or rupture would present potentially calamitous risks for large parts of Appalachia and add the pollution equivalent of 14 million additional cars. The project also has drawn criticism for its use of eminent domain to acquire land for the pipeline and its route, which would include a terminus in Robeson County, N.C., home to the largest Native tribe east of the Mississippi River.
“This isn’t just a bad idea,” Jonathan Jarvis, former National Park Service director, wrote in a Politico opinion piece last month. “It’s an unprecedented one.”
The consortium attempting to build the pipeline includes three of the most politically potent utilities in the nation; all are part of the Fortune 500. Dominion, which has a 48 percent stake in the project, is a Richmond, Va.-based monopoly that exerts legendary control over Virginia politics. The company is the largest corporate campaign donor in the state and gave at least $10 million to Virginia political campaigns between 1998 and 2018, according to a Food & Water Watch study. Gov. Ralph Northam, a Democrat, took office in 2018 while holding as much as $50,000 of the company’s stock. A 2018 Virginia Senate bill that would have prevented public service companies from making campaign contributions was soundly defeated in committee.
Since the project’s inception in 2014, Dominion has spent more than $11.8 million lobbying federal lawmakers and agencies. Company lobbyists reported at least 86 instances of attempts to influence pipeline policy. More than two dozen lobbying reports included specific references to the Atlantic Coast Pipeline project.
The company has sought bipartisan support in the nation’s capital. Attorney General William Barr served on Dominion’s board for a decade and owned $2.8 million of its stock in December 201. Earlier this summer, Solicitor General Noel Francisco ― the fourth-highest ranking person in the U.S. Justice Department ― asked the Supreme Court for extra time to prepare a Trump administration appeal on behalf of the pipeline owners. The company also spent more than $2.7 million for services from SKDKnickerbocker, a consulting and public relations firm whose managing director, Anita Dunn, is a top adviser for the Democratic presidential campaign of former Vice President Joe Biden.
Duke, which has a 47 percent stake in the project, has spent more than $31 million lobbying since mid-2014. The Charlotte, N.C.-based monopoly is almost as politically powerful in its home state as Dominion is in Virginia. Former Gov. Pat McCrory, a Republican, worked for Duke for 28 years before winning his first statewide race in 2012. Between 2014 and 2018, the company gave more than $3.9 million to the Republican Governors Association; NC WARN, a 30-year-old nonprofit that describes its mission as “watch-dogging Duke Energy practices and building people power for a swift North Carolina transition to clean, renewable, and affordable power generation,” estimates the company spends roughly $80 million annually to shape public opinion. The nonprofit teamed up with Friends of the Earth in November to petition the North Carolina Utilities Commission to prevent Duke from using customer revenues for “pervasive influence spending.”
Southern Co., which owns 5 percent of the project, has been tied closely to the Trump administration. The Atlanta-based utility, whose chief executive has cast doubt on the role people play in climate change, gave $100,000 to the president’s inaugural fund and $1 million to America First Policies, a pro-Trump “dark money” nonprofit criticized for racist, sexist, homophobic, and anti-Muslim views expressed by its staff.
The company has spent more than $66 million on lobbying since mid-2014.
Although the three companies have touted a poll claiming public support for the project, a wide range of people and organizations have united to stop the pipeline. The Lewisburg, W.Va.-based Appalachian Mountains Advocates, a nonprofit, argued that the pipeline would “provide economic incentive to increase destructive fracking throughout Appalachia.”
The pipeline also has drawn opposition in Virginia. The Federal Energy Regulatory Commission, which is responsible for regulating pipelines, received almost 6,000 public comments when it solicited input on the project in 2015. More than one-third of the comments originated from Nelson County, a suburb of Charlottesville, Va., and 99 percent of the comments expressed concerns about the pipeline’s impact on health, water, and forests.
A 2017 study partially funded by Friends of Nelson, a local nonprofit that opposes the project, raised the specter of landslides posing hazards to people, property, and waterways. The construction would require a 125-foot-wide strip of land across roughly 2,700 private parcels of land, much of it running through steep, mountainous terrain.
Buckingham County, Va., where a massive compressor station would release toxic compounds into the air near a plantation-era community that was settled by freed blacks after the Civil War, also has emerged as a high-profile battleground. A University of Virginia study found 85 percent of residents living within a 1.1-mile radius of the compressor station are black. The Virginia Advisory Council on Environmental Justice called for a moratorium on the pipeline work in August 2018 until the social ramifications of the project could be investigated.
A spokeswoman for the governor said earlier this year that Northam hopes the pipeline owners will “listen and respond to the concerns of this important historic community and act as a good neighbor.” “The legacy of placing toxic facilities in places where they disproportionately affect poor communities of color is unjust and unacceptable and needs acute examination,” Friends of Buckingham, a community organization opposing the pipeline, wrote in a December 2018 petition to the State Air Pollution Control Board. “It is not right to look the other way while this continues.”
Former Vice President Al Gore was blunter, calling the location “a reckless, racist ripoff.”
Racial issues have emerged in North Carolina, as well. Members of the Lumbee Tribe, the largest non-reservation tribe in the nation, argued they weren’t consulted about potential environmental impacts of the pipeline, such as its potential routing over unmarked ancestral graves. The National Congress of American Indians, which said as many as two dozen tribes could be affected by the pipeline, passed a resolution in June 2018 citing “gross neglect of the trust relationship by the responsible federal agency” and called for a re-examination of the pipeline’s impact on historic sites.
The pipeline’s impact on current businesses also has drawn criticism. The consortium attempted to claim part of a 50-acre distillery owned by Rep. Denver Riggleman, a Virginia Republican. While few landowners have the clout of a federal lawmaker, pipeline opponents have cobbled together a coalition of 51 organizations known as the Allegheny-Blue Ridge Alliance “to work to limit the inevitable environmental damage.” “It is a David and Goliath story,” one landowner told Energy News, “and David is getting some good shots in here.”
A move by Dominion Energy to monopolize renewables in their service has the potential to debilitate energy choice in Virginia.
Dominion is asking the Virginia State Corporation Commission (SCC) to approve a 100% renewables tariff that would give the utility a tremendous amount of control over its service territory, according to Cassady Craighill, communications director of renewables-focused Clean Virginia.
“If this tariff Dominion is asking for is approved by the SCC it pretty much eliminates competition for renewables in their service territories,” Craighill said. “People want choice. They want competition. They want wind and solar and this tariff would not exclusively provide that.”
The tariff would make it difficult for customers who want renewables to exit their Dominion contracts because Dominion would argue it has the SCC’s stamp of approval as a renewable energy supplier.
“We’ve seen a lot of companies apply to leave based on wanting renewables and based on more competitive pricing,” Craighill said. “Several tech companies back in the spring actually sent a letter to the regulatory agency saying Dominion wasn’t offering enough renewables.
“You’re also seeing that from companies like Walmart and Costco, too,” she added. “They’re all clamoring to leave Dominion’s grip and go with another service provider.”
Dominion’s renewable energy makes up 2% of its overall generation, Craighill said. The tariff could make it possible for Dominion to provide what would be dubbed renewable energy from coal, too, Craighill said.
The combination of these two facts has some doubting the company’s intention to provide the renewable energy its commercial, industrial and residential customers seek.
“It’s not a good faith effort to provide renewable energy,” Caighill said. “As we stand now, Dominion has a really poor track record for renewables, period.
“To bully other service providers of offering (a 100% renewables) option when they don’t really offer it themselves is pretty poor practice,” she added.
When asked why the SCC would approve Dominion’s request for a tariff in light the negative side effects, she said she didn’t have a good answer.
“It’s a bad move for the environment, it’s a bad move for customers who want energy choice, it’s a bad move for climate change and it’s a bad move for attracting new companies and employers,” she said. “I don’t think there’s any good reason approve.”
In an increasingly changing energy world, state energy markets vary widely in how they allow companies to compete for and retain customers. And that’s beginning to matter more in states with large retail customers in a (mostly) regulated vertical energy market, such as in Virginia.
Dominion Energy, the state’s dominant utility, in May filed an application with the State Corporation Commission (SCC) for approval of its 100% renewable energy tariff. If approved, that tariff offering would prevent other retail electricity providers from competing in the market to give large and residential customers a 100% renewable option.
Virginia customers are only able to procure energy outside Dominion through two routes: If a customer has a load larger than 5 MW, it can apply to exit through the SCC. Or, customers of any size can shop for a 100% energy product from competitive services providers (CSPs).
Two CSPs — Direct Energy and Calpine Energy — have been soliciting business customers in the state to offer a 100% renewable energy package. On July 15, Dominion terminated processing all current and future interconnection applications with those CSPs, citing concerns over their ability to provide that offering to customers.
Policy watchers say this fight between Dominion and the CSPs highlights a larger tension in the state — whether Virginia should move toward a competitive retail choice market, something customer advocates, environmentalists, corporate customers and others are advocating for.
The state’s other utility, Appalachian Power Company (APCo), had its tariff approved in January, meaning CSPs cannot offer their 100% renewables package through that power provider’s load zone. And though Dominion filed with regulators in 2017 for approval of its 100% tariff, it says it has modeled its new application off APCo’s.
“Our goal is to ensure that all customers in Virginia are protected. And so we want the competitive service providers to be held to the same standard that APCo and Dominion Energy are being held to,” Dominion spokesperson Audrey Cannon told Utility Dive. “We want them to have to be able to show the SCC that they have that generation in the same way that we’re showing it.”
Direct Energy serves almost a quarter million business customers across North America and says they “clearly have the expertise needed to provide renewable power to customers,” Direct Energy Director of Government and Regulatory Affairs Ron Cerniglia told Utility Dive. “We look forward to establishing in the course of this proceeding that we are supplying customers with 100% renewable energy. And we’ve certainly adequately documented [Direct Energy’s] ability to do so.”
That process is “very prescriptive,” according to Cerniglia. Direct Energy contracts with a renewable energy provider and delivers that power through Dominion’s load zone, pending its approval.
The only exception, is if the utility offers a 100% renewable option in the form of a tariff, regulators ruled in 2017 after pressure from Direct Energy to clarify the rules.
In May of that year, Dominion proposed one of those tariffs, but regulators shot down the proposal a year later, ruling the process would have allowed “extraordinary discretion delegated to the utility.”
But Dominion says this time around it expects to receive approval — because APCo pulled it off in January.
“We modeled that 100% renewable tariff really closely after the one that was recently approved by the Commission for APCo,” said Cannon. “We intentionally followed their guidance. So that’s why we feel good about, hopefully, the commission approving it.”
The utility, under its proposed tariff, would use wind, solar and its four biomass units, including its 600 MW Virginia City Hybrid Energy Center, which generates the majority of its power from coal, and up to 117 MW from biomass. By 2023, 10% of the plant’s power will come from biomass, which qualifies the plant as a renewable facility, said Cannon.
But the fight between the two providers and Dominion highlights a larger standoff in the state.
“There are sort of two fights,” Harrison Godfrey, executive director of Advanced Energy Economy’s Virginia chapter told Utility Dive. “One is this very technical fight” around qualifying the CSPs to deliver renewable energy into Dominion’s load zone, he said.
“That’s a concern in of itself — obstruction by bureaucracy and slow walking these processes. That coincides with a concern about whether or not you essentially get the introduction of a tariff … that closes down the 100% market for consumers large and small, but provides them with an option that is substandard or does not meet their specific requirements.”
“Virginia is a little unique,” said Godfrey. The state currently operates under a “hybrid” market, somewhere between regulated and deregulated, he told Utility Dive.
Virginia began the process of deregulation, along with a lot of the Northeast, in the late 1990s, before the “Re-regulation Act” was passed in 2007, creating the current structure, which incorporates most customers into the vertical utility model, with a few exceptions.
If a business customer’s load is greater than 5 MW of electricity, it can apply to the SCC to leave Dominion’s service. Regulators earlier this year denied the exit applications of two of the utility’s larger customers, Walmart and Costco, citing concerns over impacts to other ratepayers.
That brings forward another concern outside customer access to clean energy: cost.
“As an entrepreneur I just prefer a competitive marketplace,” said Bob Pizzini, CEO of iFly, an indoor skydiving company in Virginia Beach, which has a demand capacity of approximately 1 MW. Pizzini is one potential customer of Direct Energy and says he has a problem with both the pricing structure and the accessibility of clean energy under Dominion.
Expense was a large driver for Walmart and Costco as well — Costco in its application complained Dominion’s “excessive costs” compounded through “piling on” rate adjustment clauses were unfair. The utility in April filed for a return on equity of 10.75% and last week a coalition of customer groups, including the U.S. Navy, Walmart and low-income advocacy groups protested that proposed increase.
And in May, several technology customers, including Microsoft, Apple and Salesforce, wrote a letter to the utility, criticizing its integrated resource planfor not incorporating enough renewable energy and relying too heavily on natural gas. Earlier that month, a group of environmentalists and free market advocates formed a coalition, calling for the state to deregulate its energy market.
“Big retail customers like Walmart, Costco, all the tech companies that are creating a data center right now in northern Virginia, they’re pretty much shackled to Dominion Energy,” Cassady Craighill, communications director at Clean Virginia, one of the groups in the coalition, told Utility Dive.
“But what’s important to remember that you shouldn’t have to be a major corporate customer to use and even have the option to buy renewable energy. … So in the case of Direct Energy, we’re not necessarily saying that that’s the choice for everybody, but the point is that there’s no choice right now.”
Written comments on the application are due by Nov. 14 and a public hearing to receive testimony on Dominion’s Tariff is scheduled for Nov. 21.
By Ivy Main
When the General Assembly session opened Jan. 9, legislators were presented with dozens of bills designed to save money for consumers, lower energy consumption, provide more solar options and set us on a pathway to an all-renewables future.
Almost none of these measures passed, while bills that benefited utilities kept up their track record of success.
Before I review the individual bills, it’s worth considering for a moment how very different Virginia’s energy future would look if the best of 2019’s bills had passed. In that alternate universe, Virginians could have looked forward to:
But in a legislature still ruled by Dominion Energy and Republicans (in that order), what we mostly got instead were bills letting utilities charge their electricity customers for speculative development projects (HB 1840, HB 2738 and SB 1695) and rural broadband infrastructure (HB 2691), and another that would actually prevent the state from pursuing carbon-reduction regulations (HB 2611). The governor is likely to veto this last one, however.
A year ago, legislators agreed that Dominion and Appalachian Power should propose hundreds of millions of dollars in energy efficiency programs, as a way to sop up some of those companies’ excess earnings instead of the unthinkable alternative of taking the money away from them.
The energy efficiency bills that did pass were far more modest: making it harder for the SCC to reject utility-proposed programs (HB 2292 and SB 1662) and establishing a stakeholder group to provide input on programs (HB 2293).
“Energy Freedom,” and other similar legislation aimed at opening up the rooftop solar market, died on party-line votes in committee.
In fact, the party-line vote became a theme whenever bills came up that Dominion opposed. Anyone sitting through the House Commerce and Labor subcommittee hearing, watching one customer solar bill after another be unceremoniously killed, might have wondered if the vote buttons had gotten stuck.
The only significant renewable energy legislation to make it through the committee gauntlet was a long-negotiated compromise bill that gives customers of Virginia’s rural electric cooperatives more opportunities to install solar, at the cost of accepting future new demand charges (HB 2547and SB 1769).
Customers of Dominion and APCo didn’t get even that much, though one bill — from a Republican — calls for those utilities to provide a total of $50 million in assistance to low-income, elderly and disabled customers for solar and energy efficiency. HB 2789 by Del. Israel O’Quinn, R-Washington, marks one of the rare bright spots of the 2019 session.
And that, I’m sorry to say, is pretty much it for energy legislation this year.
• HB 2192 (Del. Nick Rush, R-Montgomery) and SB 1331 (Sen. Bill Stanley, R-Franklin) is a school modernization initiative that includes language encouraging energy efficient building standards and net zero design. It also encourages schools to consider lease agreements with private developers. It does not provide for the more common use of third-party power purchase agreements. It has nice (but not mandatory) language on net zero schools. It allows leases with private developers who will construct and operate buildings and facilities. It permits public schools to contract with utilities for solar energy as part of the school modernization project. An amendment added language requiring that renewable energy facilities must be on school property and cannot be used to serve any other property. PPAs are not mentioned. Ambiguous language in these provisions may cause problems for schools. Both bills passed the House and Senate almost unanimously with Sen. Dick Black, R-Loudoun, the only naysayer.
• HB 2547 (Del. Tim Hugo, R-Fairfax) and SB 1769 (Sen. Glen Sturtevant, R-Richmond) make changes to the net metering program for customers of electric cooperatives. The overall net metering cap is raised from the current one percent to a total of five percent, divided into separate buckets by customer type and with an option for coops to choose to go up to seven percent. Customers will be permitted to install enough renewable energy to meet up to 125 percent of previous year’s demand, up from 100 percent today. Third-party PPAs are generally legal for tax-exempt entities, with a self-certification requirement. However, the co-ops will begin imposing demand charges on customers with solar, to be phased in over several years, replacing any standby charges. This bill was negotiated between the co-ops and the solar industry via the “Rubin Group.” An amendment to the bill establishes a stakeholder group for further discussions with Dominion and Appalachian on net metering, a prospect that will appeal only to eternal optimists and amnesiacs who don’t remember the past five years of time-wasting, fruitless negotiations. SB 1769 passed both the Senate and House unanimously. HB 2547 passed the House unanimously and the Senate 36-4, with Black and Sens. Amanda Chase, R-Chesterfield, Richard Stuart, R-Stafford, and David Suetterlein, R-Roanoke County, voting no this time.
• HB 2621 (Del. Riley Ingram, R-Hopewell) and SB 1398 (Stanley) authorize a locality to require the owner or developer of a solar farm, as part of the approval process, to agree to a decommissioning plan. This was a negotiated Rubin Group bill. SB 1398 was incorporated into SB 1091 (Sen. Bryce Reeves, R-Spotsylvania), which was amended to conform to the compromise language of HB 2621.
• HB 2741 (Del. Lashrecse Aird, D-Petersburg) establishes a rebate program for low and moderate-income households that install solar. Amended so it retains the structure of the program but removes funding. As amended it passed both House and Senate.
• HB 2792 (Del. Kathy Tran, D-Prince William) and SB 1779 (Sen. Adam Ebbin, D-Alexandria) establish a six-year pilot program for municipal net metering for localities that are retail customers of investor-owned utilities. The initial bill negotiated with the utilities was much more limited than most localities wanted; further amendments whittled it down to a point where it won’t help localities with significant projects like landfill solar. However, we are told it will be useful for a few small on-site projects that don’t need PPAs. Even with the utilities on board, 21 House Republicans and one senator (Sutterlein) voted against the House bill, though only 12 House Republicans were hardcore enough to vote against the identical Senate bill when it crossed over.
• HB 2789 (O’Quinn) requires Dominion and Appalachian to develop pilot programs to offer solar and energy efficiency incentives to low-income, elderly and disabled customers. The energy efficiency money, totaling $25 million, is to come out of the amount the utilities are required to propose in efficiency spending under last year’s SB 966. The renewable energy incentives, also $25 million, cannot come out of that spending; the legislation is silent on how it will be paid for. Passed the House 90-9, with only Republicans as holdouts. Passed the Senate 37-3, with only Black, Stuart and Suetterlein in opposition.
• HB 2292 (Del. Rip Sullivan, D-Fairfax) and SB 1662 (Sen. Frank Wagner, R-Virginia Beach), dubbed the “show your work bill,” requires the State Corporation Commission to provide justification if it rejects a utility energy efficiency program. As amended, the bills passed almost unanimously.
• HB 2293 (Sullivan) establishes a stakeholder process to provide input on the development of utility energy efficiency programs. Passed both houses unanimously.
• HB 2332 (Del. Mark Keam, D-Fairfax) protects customer data collected by utilities while allowing the use of aggregated anonymous data for energy efficiency and demand-side management efforts. A substitute changed the bill to one requiring the SCC to convene a Data Access Stakeholder Group to review customer privacy and data access issues. As amended, the bill passed both Houses unanimously.
• SB 1400 (Sen. Chap Petersen, D-Fairfax City) would have removed the exclusion of residential buildings from the Property Assessed Clean Energy (PACE) program, which allows localities to provide low-interest loans for energy efficiency and renewable energy improvements on buildings. After passing the Senate unanimously, the bill was amended in the House to remove the residential PACE authorization (it does expand PACE to include stormwater improvements). As amended, it passed both houses unanimously. It’s probably cheating putting this one in the “passed” category, but I needed the win.
• HB 2611 (Del. Charles Poindexter, R-Franklin) would prohibit Virginia from joining or participating in RGGI without support from two-thirds of the members of the House and Senate, making it sort of an anti-Virginia Coastal Protection Act. Passed the House on a 51-48 party-line vote. Passed the Senate on a 20-19 vote. Only one Republican, Jill Vogel, voted against it. The governor is expected to veto it.
• HB 2747 (Del. Terry Kilgore, R-Scott) and SB 1707 (Sen. Ben Chafin, R-Russell) create a Southwest Virginia Energy Research and Development Authority “for the purposes of promoting opportunities for energy development in Southwest Virginia, to create jobs and economic activity in Southwest Virginia consistent with the Virginia Energy Plan prepared pursuant to Chapter 2 (§ 67-200 et seq.), and to position Southwest Virginia and the commonwealth as a leader in energy workforce and energy technology research and development.” Among the powers listed are promoting renewable energy on brownfield sites, including abandoned mine sites, and supporting energy storage, including pumped storage hydro. Fossil fuel projects are not listed, but are also not excluded. Both bills passed unanimously.
• HB 1840 (Del. Danny Marshall, R-Danville) allows utilities to develop transmission infrastructure at megasites in anticipation of development, charging today’s customers for the expense of attracting new customers. The legislation was amended to change the language to the nicer-sounding “business park,” but it continues to allow utilities to recover costs for constructing transmission lines and substations to serve these speculative projects. It passed unanimously in the Senate and 82-18 in the House, with mainly the newer Democrats voting no.
• HB 2477 (Kilgore) originally would have eliminated one of the few areas of retail choice allowed in Virginia by preventing large customers from using competitive retail suppliers of electricity, including for the purpose of procuring renewable energy, in any utility territory with less than two percent annual load growth. A substitute bill removed most of the bad provisions and confined its operation to Appalachian, but also left it incomprehensible, so I can’t possibly tell you what it does. As far as I was able to determine, no customers opposed the final bill, which passed the House and Senate unanimously.
• HB 2691 (O’Quinn) originally would have established a pilot program for electric utilities to provide broadband services in underserved areas, and raise rates for the rest of us to pay for it. The bill was amended so utilities can only provide the capacity on their lines to private broadband suppliers. The investment is eligible for recovery as an electric grid transformation project under last year’s SB 966, presumably so it is paid for out of utility overearnings instead of a new rate increase. The amended bill passed both houses almost unanimously.
• HB 2738 (Del. Lamont Bagby, D-Henrico) and SB 1695 (Wagner) authorizes utilities to acquire rights of way for sites that the Virginia Economic Development Partnership Authority decides could be developed to attract new customers and allows utilities to recover costs from existing customers. A substitute tightened the requirements somewhat, but it remains another giveaway to utilities in the name of speculative development, at the expense of landowners and consumers. The House bill passed 85-13 with mostly newer Democrats in opposition, then passed the Senate 37-3, with McPike, Spruill and Suetterlein voting no. The Senate bill passed 34-6; although the bills appear to have been identical, Sens. Amanda Chase, R-Chesterfield, Stephen Newman, R-Lynchburg and Mark Peake, R-Lynchburg, also voted no. The House vote on SB 1695 was 84-13.
• HB 1718 (Del. Lee Ware, R-Powhatan) would have required an electric utility to demonstrate that any pipeline capacity contracts it enters are the lowest-cost option available, before being given approval to charge customers in a fuel factor case. Ware testified in committee that the bill was not intended to stop the Atlantic Coast Pipeline, but would simply guide the SCC’s review of cost recovery after the pipeline is operational. Dominion’s lobbyist argued the legislation was unnecessary because the SCC already has all the authority it needs, and it shouldn’t be allowed to look back to second-guess the contents of the ACP contract. The bill passed the House 57-40. Do look at the votes; this is the most interesting energy vote of the year, as it neatly separates the Dominion faction from the pro-consumer faction. Unfortunately, the bill was then killed in Senate Commerce & Labor, where the Dominion faction runs the show, so most senators didn’t have the opportunity to demonstrate whose side they’re on. In an interesting side note, however, Sen. Dick Saslaw, D-Fairfax, the minority leader and long one of Dominion’s most reliable allies in the General Assembly, voted against killing the bill. Maybe it has something to do with the line of attack his primary challenger has taken.
• HB 2329 (Keam) and SB 1456 (Sens. Jennifer McClellan, D-Richmond and John Edwards, D-Roanoke) is the Solar Freedom bill that would have removed eight barriers to renewable energy installations by utility customers, including lifting the one percent net metering cap, removing PPA caps, and allowing municipal net metering. HB 2329 was defeated inCommerce and Labor 8-7 on a party-line vote. The Senate companion was killed in Commerce and Labor on a 10-3 party-line vote.
• HB 1928 (Del. David Bulova, D-Fairfax) and SB 1460 (McClellan) would have expanded utility programs allowing third-party power purchase agreements for renewable energy while continuing to restrict the classes of customers who are allowed to have access to this important financing tool. In committee hearings, utility lobbyists claimed there was no need for the legislation because there is “plenty of room left” under the existing caps. Industry members testified that there is a lot more in the queue than is public, and caps will likely be reached this year. HB 1928 killed in Commerce and Labor subcommittee 3 by a 6-4 vote; Republican Tim Hugo voted with Democrats in support of the bill. SB 1460 killed in Senate Commerce and Labor 10-3, with only Democrats supporting.
• HB 2645 (Del. Sam Rasoul, D-Roanoke, with 13 co-patrons), nicknamed the REFUND Act, would have prohibited electric utilities from making nonessential expenditures and requires refunds if the SCC finds they have. It also would have barred fuel cost recovery for more pipeline capacity than appropriate to ensure a reliable supply of gas. Other reforms in the bill would undo some of the provisions of last year’s SB 966, lower the percentage of excess earnings utilities can retain, and require the SCC to determine rates of return based on cost of service rather than peer group analysis. Democrat Steve Heretick voted with Republicans to kill the bill in Commerce and Labor subcommittee 3.
For a complete list of the several dozen pieces of legislation that might have been, go to powerforthepeopleva.com