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Newly empowered Virginia Democrats are pushing legislation this session that would elevate the role of customers and private developers in meeting the state’s clean energy targets.
A chief aim of the ARC bill — shorthand for Affordable, Reliable and Competitive — is to significantly expand the amount of power generated by less expensive, third-party solar and onshore wind projects in the service territories of both Dominion Power and Appalachian Power.
After legislators green-lighted the bold Virginia Clean Economy Act (VCEA) in 2020, regulators capped those types of projects at 35% of an investor-owned utility’s renewable energy portfolio.
Backers of the ARC legislation, House Bill 638 and Senate Bill 230, are calling for that 35% to act as a floor rather than a ceiling.
“We know the market can support at least 35%,” said Nate Benforado, senior attorney with the Southern Environmental Law Center. “We’re not saying the new target should be 100%. Whatever the number is, it’s best left to the discretion of the State Corporation Commission.”
Benforado’s organization collaborated with policy specialists at organizations including Advanced Energy United and the Sierra Club to shape the ARC legislation. They expect the proposal — with its emphasis on increasing market competition and lowering costs — will attract Republican supporters on its way through the General Assembly.
“This is one of those issues that is bipartisan,” he said about adjusting the existing statutory framework to escalate growth of renewables.
Briefly, the VCEA requires Dominion to incrementally meet a goal of 100% clean energy generation by 2045. Targets for 2025 and 2035 are 26% and 59%, respectively. Appalachian Power is supposed to follow suit by 2050.
Del. Rip Sullivan, a Fairfax County Democrat, is the patron of HB 638, while Sen. Ghazala Hashmi, a Democrat representing the Richmond region, is sponsoring the upper chamber version.
Just days after the legislative session convened on Jan. 10, Sullivan told attendees at a Virginia Grassroots Coalition online gathering that he was reluctant to attempt to tweak the VCEA until Democrats again regained majorities in both chambers.
That happened during the November election when Democrats held on to a slim majority in the Senate and flipped the House back to their control. Still, narrow vote margins mean they don’t have the supermajorities necessary to override vetoes or enact new laws that Republican Gov. Glenn Youngkin opposes.
Sullivan’s bill would also require the two large utilities to allow a fivefold increase in the percentage of distributed energy generated by small-scale solar and solar storage projects.
Solar installers are on the verge of exceeding the 1% renewable portfolio limit included in the VCEA because of customer demand for closer-to-home energy.
Bumping that upward to 5% is an incentive to let Virginia unlock the lowest-cost path to clean energy because it veers away from a utility-only approach, said Robin Dutta, acting executive director of the Chesapeake Solar & Storage Association.
His organization represents renewable energy developers in Virginia, Maryland, Delaware and the District of Columbia.
“There’s a huge climate argument for distributed generation,” Dutta said. “By lowering peak (energy) demand as much as possible, utilities don’t have to build out the grid with transmission lines and other infrastructure.”
The legislation would allow local, small-scale projects — which include rooftop solar, community solar and related storage — to be as large as 3 megawatts. That triples the current 1 MW cap.
Inviting the private sector to play a larger role not only drives technical innovation, but also lets non-utility entities and regular ratepayers be armed with their own power generation, Dutta said.
He praised Sullivan’s bill for folding in a pair of renewable stalwarts — third-party-owned solar projects and distributed energy — that green the grid and protect affordability for ratepayers.
“Those two pieces move the ball forward in two different ways,” Dutta said. “And that leads to a more equitable clean energy transition for ratepayers.”
One advantage of distributed generation is that solar panels aren’t covering acres of farmland, Benforado said. Instead, projects are sited near the people using the renewable energy, which avoids costly transmission and distribution upgrades.
Despite industry enthusiasm, Dominion Energy has a “number of concerns with the legislation” and is “working with the sponsor to hopefully address some of them,” utility spokesman Aaron Ruby told the Energy News Network.
The utility’s most pressing issue revolves around raising the distributed solar carve-out. Dominion claims that boosting it to 5% would require the utility to buy renewable energy credits from roughly 3,700 megawatts of distributed solar projects by 2048.
That is “completely unrealistic,” Ruby said, adding that adhering to the increase would cost Dominion about $260 million in penalties annually for being out of compliance with the incremental renewable energy goals laid out in the VCEA.
Ruby explained that Dominion has lowered customer electricity rates significantly and is more than a year ahead of schedule on meeting its renewable energy requirements.
“This legislation heads in the opposite direction on both scores,” he said. “You’ve heard the old saying, ‘If it ain’t broke, don’t fix it.’ I’d go even further. If it’s working, don’t break it.”
Third-party solar developers in Virginia — and elsewhere — usually engage in a mutually beneficial arrangement known as a power purchase agreement, or PPA for short, to help customers meet sustainability goals.
Generally, those deals allow the builder to install, own and operate the energy system on land the customer owns. The customer receives stable, often low-cost electricity with no upfront cost for a predetermined length of time, which enables the owner to take advantage of tax credits and earn income from the sale of electricity.
Environmental advocates maintain that solar projects built, operated and maintained by third parties are less expensive than those coordinated by utilities. For one, utilities receive a return on equity for capital expenditures and project costs are then passed on to ratepayers.
However, third-party builders are not only competing for business but investing their own capital, which means they assume all financial risks. That alone is incentive enough to deliver a successful project at a reasonable cost.
“With the Clean Economy Act, we have a path and a structure to improve the affordability of this transition to clean energy,” the SELC’s Benforado said. “We don’t want to see lower-cost options for customers dismissed because of a 35 percent cap.”
He pointed to testimony presented last January to utility regulators by Gregory Abbott on behalf of Appalachian Voices, an environmental nonprofit. Abbott, who had recently retired from the SCC after 24 years in the commission’s Division of Public Utility Regulation, was commenting on a case involving Dominion’s renewable energy portfolio.
Abbott stated that third-party-owned solar projects are a more affordable and “attractive option for captive customers” because of lower risks associated with performance and project development
Abbott also noted that Dominion has consistently left lower-cost, third-party solar projects out of its renewable energy mix because of its interpretation of 35% as an exact number instead of a suggestion.
On the Senate side, the bill has been referred to the full Labor and Commerce Committee. Over in the House, it was in front of a Labor and Commerce subcommittee as of Jan. 16.
“Virginia’s curve is headed up when it comes to renewables and clean energy,” said Sullivan, the House sponsor. “Despite what you may be hearing from some quarters, we can and should be on track to meet our goals. Having said that, we need to do better, we need to do it faster and we need to do more.”
WORKFORCE: Renewable energy is boosting West Virginia with a series of new factories and projects, but the state is hampered by a low labor force participation rate and lack of policies supporting smaller community-scale projects. (Mountain State Spotlight)
GRID:
STORAGE: A Louisiana parish board votes to approve tax incentives for a chemical company to build a $491 million factory to make materials for electric vehicle batteries. (NOLA.com)
EFFICIENCY: Duke Energy introduces a North Carolina program to incentivize homeowners with high energy usage to add energy-efficient HVAC systems, insulation and other measures. (Raleigh News & Observer)
SOLAR:
CLIMATE:
PIPELINES: A North Carolina county board delays approval of a permit for Dominion Energy to use a property as an operational base to build a pipeline after residents raise concerns about safety and pollution. (Salisbury Post)
COAL: A federal judge orders a helicopter owned by West Virginia Gov. Jim Justice’s coal companies to be prepared for sale to satisfy a debt to a company for royalty payments for mined coal. (WV Metro News)
OIL & GAS: Wind carries a natural gas odor from an oil field into Austin, Texas, fueling concerns from residents. (KVUE)
UTILITIES:
COMMENTARY:
POWER PLANTS: South Dakota regulators ask Xcel Energy to reconsider closing two large Minnesota coal plants in the coming years based on concerns over whether there will be adequate power on the grid. (Utility Dive)
ALSO: Dozens of residents, local officials and business leaders are divided over Minnesota Power’s plans for a 550 MW natural gas plant in northern Wisconsin near Lake Superior. (Northern News Now)
ELECTRIC VEHICLES:
BIOGAS: Michigan environmental groups raise concerns over legislation that would define biogas from animal waste at industrial farms as clean energy. (Metro Times)
NUCLEAR: Despite growing public and governmental support for nuclear power, industry experts say it’s unclear when the next U.S. reactor may come online. (Canary Media)
EFFICIENCY: An Illinois school district saved $4.3 million in energy costs by investing in energy efficiency measures at multiple schools. (WGLT)
SOLAR:
CLIMATE: Indiana youth climate activists call on state lawmakers to pass bills supporting community solar, creating incentives for wetland protections and requiring permits for large water withdrawals. (Indiana Public Radio)
RENEWABLES: A western Nebraska county board approves a six-month moratorium on utility-scale wind and solar projects as it considers local regulations. (Nebraska Rural Radio)
COMMENTARY:
SOLAR: The U.S. military will install rooftop solar panels on the Pentagon as part of a $250 million package announced Wednesday to reduce emissions from federal buildings. (Associated Press)
ALSO:
ELECTRIC VEHICLES:
NUCLEAR:
POLITICS:
WORKFORCE: Renewable energy is boosting West Virginia with a series of new factories and projects, but the state is hampered by a low labor force participation rate and lack of policies supporting smaller community-scale projects. (Mountain State Spotlight)
GRID:
SOLAR: The Biden administration adds Idaho, Montana, Oregon, Washington and Wyoming to the original six states in its federal land solar development plan, saying the additional 22 million acres are needed to meet the nation’s clean energy needs. (The Hill)
ALSO:
CLEAN ENERGY: Fierce debate breaks out over proposed Alaska legislation that would require utilities to generate 80% of their electricity from renewable sources by 2040. (Northern Journal)
OIL & GAS:
NUCLEAR: The Biden administration approves spending $1.1 billion to help keep the Diablo Canyon nuclear plant in California running beyond its previously scheduled 2025 retirement date. (Associated Press)
UTILITIES:
CLIMATE: Washington voters will have a chance this November to vote on a ballot measure to repeal or uphold the state’s two-year-old landmark climate policy. (Spokesman-Review)
ELECTRIC VEHICLES: A California air pollution control district receives $56 million in federal funds to develop an electric freight-truck charging network. (Turlock Journal)
COAL: A Colorado private equity firm throws a financial lifeline to a struggling Wyoming coal processing company that claims a cleaner production method. (Cowboy State Daily)
POLICY: As Vermonters struggle to pay for climate-related disasters, many state representatives are supporting legislation to make the fossil fuel industry pay into a climate change “superfund.” (WCAX, VT Digger)
ALSO: Connecticut has begun offering payments to help environmental justice and ratepayer groups participate in utility regulatory proceedings, but nonprofits say the program is only the first step toward encouraging more diverse participation. (Energy News Network)
PIPELINES:
FOSSIL FUELS:
BUILDINGS:
CLIMATE:
OFFSHORE WIND: Two small New York businesses — an efficiency component manufacturer for coal plants and an ironworks — describe how the offshore wind development push benefits them, as well as the workforce development challenges of working offshore. (RTO Insider, subscription)
CLEAN ENERGY: Sunderland, Vermont, becomes the southern half of the state’s first “green procurement town,” meaning it plans to opt for carbon-free alternatives for equipment, services and power. (news release)
ELECTRIC VEHICLES: In Pennsylvania’s Lehigh Valley, an armored truck company receives about $1.3 million in state-directed Volkswagen settlement funds to replace six diesel trucks with battery-electric models and install charging infrastructure. (Lehigh Valley Live, news release)
Connecticut’s utilities commission is the latest to begin offering payments to help environmental justice and ratepayer groups participate in regulatory proceedings.
The Stakeholder Group Compensation Program was required to take effect this month as part of an energy consumer protection bill passed by the state legislature last year. It seeks to encourage more diverse engagement in proceedings on utility regulation, which can set direction for grid resiliency, rate relief, clean energy development, corporate accountability, storm response and more.
In a Jan. 3 decision and new online guidance, the state’s Public Utilities Regulatory Authority (PURA) says each eligible stakeholder group can apply for up to $100,000 at a time. Each docket is limited to $300,000 in funding across all groups, with $1.2 million total available per year.
The program covers groups and nonprofits representing at least one of a few types of utility customers: a person living in a designated environmental justice community; a “hardship” case, defined as someone seeking to reinstate shut-off electric or gas service in winter who cannot pay their bill; or a small business.
“The process of engaging with proceedings at public utility commissions across the nation is historically exclusive,” wrote Jayson Velazquez, the climate and energy justice policy associate with the nonprofit Acadia Center, in comments on the PURA docket creating the new program. “Compensation can play a significant role in ensuring diverse stakeholders are included in proceedings, specifically at PURA.”
Groups that might use the program say this approach, which has also been contemplated at the federal level, is an important step forward — and they argue that more can be done to encourage inclusive engagement in regulators’ work on climate and economic justice issues.
Mark LeBel, a senior associate with the Regulatory Assistance Project, a nonprofit energy consulting firm, said the concept of intervenor compensation dates back decades and goes hand-in-hand with other consumer protection initiatives, like citizen utility boards and stronger ratepayer advocate offices.
The idea is regaining steam amid a trend toward more attention on equity and the overall mechanics of utility regulation, LeBel said.
“Each state spends implicitly millions of dollars to support utility regulatory participation,” he said. “It’s a perfectly reasonable idea to apply a version of that to other parties, including those in need.”
Six states have similar, active programs: Idaho, Michigan, Minnesota, Oregon, Wisconsin and California, the largest such program in the country with $10 to $15 million in payouts per year, according to a 2021 report from the National Association of Regulatory Utility Commissioners. A handful of other states have authorized such a program but don’t use it in practice, the report said.
Perfecting the scope of these programs can be tricky, LeBel said. In designing rules and setting funding levels, legislators and regulators may choose either to target money narrowly to the groups that need it most — or to cast a wider net to a range of stakeholders.
Lillian Brough, associate director of the Connecticut-based energy nonprofit Efficiency For All, noted this trade-off as she reviewed the new PURA program’s details.
Brough said her organization’s executive director Leticia Colon de Mejias, a longtime Connecticut environmental justice advocate, has participated in several PURA proceedings over the years, but they don’t have designated staff or resources for this complex work and can’t currently prioritize it as a result.
This means the new compensation program could greatly benefit Efficiency For All in theory, Brough said, especially “if we were fully funded in other areas,” such as in their energy efficiency workforce training program.
In practice, however, Brough saw a range of barriers to actually applying for and using the new funding to participate in PURA work — including a tight application window of two weeks at the beginning of a case, potentially onerous rules for proving a group needs funding up-front rather than reimbursement after the fact, and the challenge of writing an itemized budget ahead of time with limited PURA experience.
“How am I supposed to know my budget if I don’t know how much lawyers are going to cost, how many hours it’s going to take, how many people — I don’t know unless I’ve already participated,” Brough said.
In its online guidance, PURA says the new funding may be used for “reasonable attorneys’ fees, reasonable expert witness fees and other reasonable costs for preparation and participation in Authority proceedings.”
In all, Brough felt the new program would fit best for larger or better funded organizations — those with firsthand knowledge of what participation requires, such as hiring attorneys and expert witnesses or translating questions and comments in and out of regulatory jargon. In some states, like California, certain frequent utility intervenors make this kind of funding a major recurring part of their budgets.
Though the PURA program nominally seeks to benefit the ratepayers and communities that are the most disenfranchised, Brough argued that many smaller groups representing these people may be too overstretched to even navigate the application process.
In the Acadia Center’s comments on the new program’s docket, Velazquez said PURA should also begin a broader look at equity and inclusion across all of its work, similar to a docket now underway in Hawaii.
Brough also raised concerns about what LeBel of the Regulatory Assistance Project said is a relatively common feature of these compensation schemes: To get paid, groups must make a “substantial contribution” to the proceeding.
The PURA order creating the program says regulators will define this case-by-case, but emphasizes an intervenor’s active engagement throughout the process and its capacity to provide “unique or meaningful” facts and perspectives — contributions that “substantially assist the Authority in its decision making.”
Brough said she would worry about subjective interpretations of this leading to further disenfranchisement: “Like, ‘you came to all the meetings, but you didn’t say as much as we wanted, or we didn’t agree with you, or you caused a ruckus, so you can’t have the money.’ So that’s a problem.”
LeBel said ideally such requirements as part of these programs will be relatively loose and forgiving, a low bar designed to prevent funds from going to waste.
PURA’s order points to the program’s basis in utility rates in explaining this approach: “The cost of stakeholder group compensation is ultimately borne by ratepayers, and the substantial contribution requirement ensures that the interests of customers are meaningfully being represented in exchange for that compensation,” the commissioners wrote in their order.
In their comments on the docket, Connecticut’s utilities sought more clarity on the timing of this cost recovery process and its application to gas companies as compared to electric utilities. PURA did not appear to adopt the utilities’ requested changes on this issue in its final order.
“While PURA did not grant our reasonable request on full cost recovery, we look forward to having more stakeholders participate in the regulatory process and share their views, as we always value and appreciate feedback from our customers,” said Eversource spokesperson Jamie Ratliff in a statement.
The Connecticut gas and electric companies owned by Avangrid, including United Illuminating, said in a statement from spokesperson Sarah Wall Fliotsos that they “appreciate the creation of a program that will provide underrepresented groups greater voice in the important issues the energy industry currently faces, including grid modernization and the transition to a clean energy future.”
Last week, the Biden administration announced a big boost for the country’s burgeoning electric vehicle charging network. The U.S. Department of Transportation picked 47 EV charging projects to receive nearly $623 million in funding under the 2021 bipartisan infrastructure law.
The projects include a $15 million network of chargers across Maine, $51.5 million for alternative fuel corridors in Puerto Rico, and a $67.8 million for electric truck and other chargers in New Mexico.
The funding is a much-needed stimulus for the U.S. charging network, which remains spotty in much of the country. So far only New York and Ohio have opened charging stations using bipartisan infrastructure law funding, and a handful of other states have broken ground on their EV projects, the Associated Press reports. As of last January, there were only about 20,000 publicly accessible, high-speed Level 3 chargers across the country.
But by 2050, the National Renewable Energy Lab estimates the country will have another 40 million EVs on the road. That means we’ll need at least 182,000 Level 3 chargers across the country by 2050 to accommodate them — and a lot more private and government funding to get them all built.
📉 Power emissions fall: U.S. power sector emissions dropped 8% in 2023 from the year before, largely thanks to a record number of new solar and utility-scale battery installations and a decline in coal use. (Canary Media)
🥶 Gas’ winter worries: An environmental group’s new report warns about the vulnerability of gas plants during extreme temperatures and cautions against the “vicious cycle” of investing in new gas-fired resources. (Utility Dive)
🌪️ Billion-dollar climate disasters: The U.S. saw a record number of billion-dollar disasters last year, facing 28 instances of intense flooding, tornadoes, and other severe weather. (Yale Climate Connections)
💰 Utilities’ roundabout influence: An investigation finds power companies have courted and at times co-opted more than two dozen Black civil rights leaders in the Southeast to help divert attention from environmental harms related to fossil fuel plants. (Capital B/Floodlight)
📹 Subscribing to climate denial: YouTube creators that have long pushed climate skepticism now seek to discredit renewable energy and other climate solutions. (CNBC)
😶🌫️ Cooking with gas? Testing reveals gas stoves release hazardous levels of pollutants that can be harmful to vulnerable populations, but protective measures can reduce those risks. (Washington Post)
🏠 Clean energy’s equity shortcoming: Low-income households could benefit most from clean energy upgrades such as heat pumps and solar panels but often don’t have access to financing or government incentives to afford them. (New York Times)
⛰️ A coal-to-solar solution: An energy company’s plan to build a solar farm on a mountaintop removal mine site in Kentucky could become a model to repurpose environmentally disturbed sites in Appalachia for renewables. (Daily Yonder)
GAS: Vermont’s top court dismisses a lawsuit against the state’s main gas utility that sought to prevent it from buying and distributing methane from a large New York landfill, a plan criticized by some as a greenwashing scheme. (Seven Days)
ALSO: Three oil tankers catch fire in Epping, New Hampshire, leading to a massive response from neighboring fire departments. (WMUR)
ELECTRIC VEHICLES:
SOLAR:
CLEAN ENERGY: Rhode Island’s Block Island is now running on only renewable energy, roughly six years after it became home to the country’s first offshore wind farm. (news release)
CLIMATE: A new study shows how New England states have seen a precipitous drop in snowpack since the 1980’s, a problem evident at the region’s mountain resorts, which increasingly rely on making their own snow. (Boston Globe, Stowe Reporter)
POLICY:
GRID: Relatively few power outages are being reported this morning across the region even though thousands lost power over the weekend amid a major winter storm. (PowerOutage.US, In-Depth NH, WGRZ, )
AFFORDABILITY: Connecticut politicians debate whether to direct surplus state funds to help shrink the unmet residential demand for heating bill financial assistance. (CT Mirror)
COMMENTARY: A New Hampshire farmer details how climate change has “upended” standard seasonal weather patterns over the past four decades and how that impacts his business. (Concord Monitor)
EMISSIONS: The EPA proposes new rules that would charge oil and gas producers methane emissions fees starting at $900 per metric ton and rising to $1,500 by 2026. (The Hill)
ALSO: Advocates celebrate proposed U.S. EPA restrictions on pollution from waste-to-energy facilities but say they don’t go far enough to combat environmental justice concerns. (Inside Climate News)
CLIMATE:
CLEAN ENERGY:
GAS:
PIPELINES:
SOLAR: Xcel Energy’s plan to replace one of the country’s largest coal plants with solar on the same site is meant to minimize economic losses for the local Minnesota community. (Inside Climate News)
CLEANTECH: Massachusetts’ booming clean tech economy is expanding, and politicians, including the state’s governor, are looking at how to keep that growth in state. (Boston Globe)
WIND: A northern California port commits to using electricity instead of diesel to power a planned terminal that would serve the offshore wind industry. (JPR)
CARBON CAPTURE: California’s petroleum companies look to survive the transition from fossil fuels by establishing a carbon management industry that stores captured greenhouse gasses in depleted oil fields. (Los Angeles Times)
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