Virginia Legislature Passes Sweeping Energy Bill

The bill rescinds a 2015 rate review freeze to defend consumers against potential Clean Power Plan costs, and calls for much larger and faster deployment of renewable energy.

Both houses of the Virginia Legislature have now approved HB 1558/SB 966, ‘Electric utility regulation; grid modernization, energy efficiency programs.’ The Senate version passed March 1, while the House passed their version on February 13th. It is expected to be signed by Governor Northam in the coming days.

Some key features of the bill:

  • increases the amount of capacity of solar and wind generation facilities constructed by a utility that are in the public interest from 50 megawatts to 5,000 megawatts
  • electric distribution grid transformation projects, offshore wind generation facilities with a capacity of not more than 16 megawatts, and all onshore wind generation facilities, are in the public interest and that the costs thereof may be recovered either through a rate adjustment clause or through a customer credit reinvestment offset
  • direct the SCC to conduct pilot programs for the deployment of electric power storage batteries with capacity limits of up to 10 MW for APCo and 30 MW for DEV
  • require APCo and DEV to develop programs of energy conservation measures, with APCo’s program costing not less than $140 million and DEV’s program costing not less than $870 million

Virginia Advanced Energy Economy (AEE) has applauded the measure. The group pointed out a tripling of energy efficiency investment and moving 2GW of renewable energy construction forward by four years.

The main driver of the law was to rescind a 2015 ‘rate review’ suspension law. Historically, the Virginia State Corporation Commission (SCC) would review utility rates every two years, and if the utilities had overcharge consumers, the SCC would force the utilities to lower rates and issues refunds to ratepayers.

In 2015, Dominion Energy pushed Virginia politicians for protection for President Barack Obama’s ‘Clean Power Plan.’ The law froze base electric rates for seven years, and stopped the biennial review. The law was signed by then-Gov. Terry McAuliffe (D).

Now, new political and economic realities have dawned. President Trump has pushed to abandon the Clean Power Plan, and a review by SCC has found that the utilities have earned hundreds of millions in extra profits due to the suspension of rates reviews.


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