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Tag Archive: Energy

Solar and Wind Take Center Stage at the 2018 Virginia Energy Conference

wind turbines and solar arraysRenewable energy development, driven by rising corporate demand, was a central theme of Wednesday’s 2018 Virginia Energy Conference, hosted by the Virginia Chamber of Commerce. Garret Bean, Vice President of Development for sPower and one of the keynote speakers at the conference, discussed his company’s proposed 500-megawatt facility in Spotsylvania County, which will serve corporate customers in Virginia. Microsoft announced that it will purchase 315 MW of energy from sPower’s 500 MW project as part of its sustainability goal of 60 percent renewable energy by early 2020. In addition to Microsoft, major global companies including Google, Apple, Facebook, and Walmart have joined together to commit to 100% renewable power as a part of the RE100 initiative.

In his keynote, Bean explained that rapid data center development in Virginia, sustaining 70 percent of the world’s internet traffic, coupled with customer demand for cloud services powered by clean energy sources, presents a significant opportunity for growth in Virginia’s renewable energy sector. However, with the growth of renewable energy, developers are facing siting, permitting, and interconnection challenges that will have to be overcome.

Delegate Terry Kilgore, Senator Frank Wagner, and Secretary of Natural Resources Matt Strickler also discussed the opportunities and challenges of Virginia’s renewable energy industry. Senator Wagner voiced concerns about Virginia’s proposed regulations to link to the Regional Greenhouse Gas Initiative (RGGI) and participate in its regional greenhouse gas emissions cap-and-trade program. However, with the passage of SB 966 this session, paving the way for 5,000 megawatts of solar and wind energy in Virginia, and Governor Northam’s announcement that the Virginia Department of Mines, Minerals and Energy has posted a Request for Proposals for contracts to help strengthen Virginia’s offshore wind supply chain and service industry, the future for Virginia’s renewable energy industry is looking bright.

If you have questions about Virginia’s renewable energy industry, legislation, or regulatory structure, please contact one of GreeneHurlocker’s energy and regulatory lawyers.

SCC Decision Expands Access to Competitive Electric Supply

transmission towers for electricityWhile many political observers were focused on Senate Bill 966, the omnibus utility legislation that was just passed by the General Assembly, the Virginia State Corporation Commission (“Commission” or “SCC”) recently issued an important decision affecting customers’ rights to purchase energy from competitive suppliers.

On February 21, 2018, in Case No. PUR-2017-00109, the Commission approved the first ever “customer aggregation” petition under § 56-577 A 4 of the Code of Virginia. As explained in detail below, this section of the Code allows customers to aggregate their demand for the purposes of satisfying the 5 MW demand threshold required to purchase generation from non-utility companies.

In most circumstances, Virginia’s incumbent electric utilities, including Dominion Energy Virginia (“Dominion”), have a monopoly on the sale of electricity in their service territories. Customers must purchase energy from their utility. Virginia law, however, provides two exceptions to the utilities’ monopoly rights. (Under these two exceptions, customers may purchase generation from non-utility suppliers. But shopping customers must still pay for the utility’s distribution services.)

First, under Va. Code § 56-577 A 5, customers may purchase “100 percent renewable energy” from competitive suppliers if  the customer’s monopoly electric utility does not offer an SCC-approved 100% renewable energy tariff. No utility currently offers an SCC-approved 100% renewable tariff.

Second, Va. Code § 56-577 A 3 law allows large customers with annual demands over 5 MW to purchase generation from competitive suppliers. Importantly, the law also allows a group of customers to “aggregate” their demands in order to reach the 5 MW threshold. The statute treats large customers with multiple meter locations as different customers but allows them to aggregate to meet the 5 MW threshold. Once aggregated, the group will be treated as a “single, individual customer” under the law. Before allowing an aggregation, however, the Commission must find that the requested aggregation would be “consistent with the public interest.”

SCC Case No. PUR-2017-00109 was the first test of this statutory provision – that is, the first time a group of customers sought to combine their demands in order to reach the 5 MW threshold. In this case, Reynolds Group Holdings, Inc. (“Reynolds”), a metals and packaging manufacturer, petitioned the SCC for approval to aggregate six of its retail accounts in Dominion’s service territory.

Dominion and Appalachian Power Company (“APCo”) intervened in the case and opposed the petition. Dominion argued that allowing customers to aggregate their demand “would unreasonably expand the scope of retail access [and would] have the potential effect of eroding a significant portion of the utility’s jurisdictional customer base.” Dominion also suggested that the General Assembly – despite authorizing customer shopping and aggregation – intended to allow retail choice “only in limited circumstances.”

But the SCC, relying on the plain language of Va. Code § 56-577 A 4, rejected Dominion’s and APCo’s arguments and approved the petition. Dominion and APCo have until March 23, 2018, to appeal the decision to the Virginia Supreme Court.

The SCC is also currently considering additional aggregation requests filed by over 160 Walmart customer accounts in Case Nos. PUR-2017-00173 and PUR-2017-00174. (In both of these cases, GreeneHurlocker is representing competitive suppliers who are supporting approval of Walmart’s aggregation requests.)

Should you have any questions about customer aggregation or competitive supply options in Virginia, please contact one our regulatory attorneys.

Additionally, GreeneHurlocker recently published Principles of Electric Utility Regulation in Virginia, which provides a plain-English explanation of Virginia’s electric utility laws, including the statutes affecting retail choice.

Notable Energy Bills Clear 2017 General Assembly

wind turbines and solar arraysThe Regular Session of the 2017 Virginia General Assembly wrapped up on Saturday, February 25. While the approval of an amendment to Virginia’s biennial budget received the most attention, the session also resulted in some notable bills affecting the energy industry. In particular, the General Assembly sent several bills to Governor McAuliffe’s desk that could accelerate the development of renewable generation in Virginia. Each of these bills is currently awaiting the Governor’s signature. Below is a our summary of a few of the noteworthy energy bills passed this session:

SB 1395 – Expansion of Virginia’s Permit By Rule (“PBR”) option for renewable developers

Currently, developers proposing to construct renewable energy facilities of 100 MW or less may use the Virginia Department of Environmental Quality’s (“DEQ”) PBR process. The PBR can often reduce the time and expense necessary to receive the state approvals required to begin construction and operation of a solar or wind facility.SB 1395 (Wagner) expands the facility size threshold to allow renewable facilities up to 150 MW to utilize the PBR process. The bill also provides that a small renewable facility owned or operated by a public utility may obtain a PBR, and will be exempted from State Corporation Commission review, so long as the project costs are not recovered from the utility’s ratepayers.

HB 2390 – Limited expansion of Dominion’s renewable energy purchase pilot program in Appalachian Power’s (“APCo”) service territory

Virginia law currently allows customers in Dominion’s service territory to purchase generation from renewable energy facilities that are located on their property, but that are owned and operated by a third party.HB 2390 (Kilgore) would expand this pilot program to allow non-profit institutions of higher education in APCo’s service territory to participate in the same pilot program. The bill, for example, would allow private colleges to purchase 100% renewable energy from facilities owned and operated by third parties. This bill is intended to address an economic challenge faced by colleges who wish to use renewable energy. Colleges, because they have no federal tax liability, are often unable to benefit from federal tax credits for capital investments in renewable energy. Third-party sellers, however, are able to pass the tax savings on to non-profithigher education customers, which reduces customers’ power purchase expenses. The program is capped at 7 MW for non-profit customers in APCo’s service territory.

SB 1393 – Community solar pilot program

SB 1393 (Wagner) requires both APCo and Dominion to conduct a pilot program that would allow all retail customers to purchase 100% solar energy from new solar facilities located in Virginia and owned by the utilities. Customers would be permitted to voluntarily “subscribe” to a solar energy rate schedule. Currently, neither utility offers customers an option to purchase 100% solar energy. APCo and Dominion would be required to conduct a competitive request for proposals (“RFP”) prior to dedicating any particular solar resource to the pilot program.

SB 1394 – Renewable energy program for agricultural customers

SB 1394 (Wagner) authorizes a new program for agricultural customers operating renewable energy facilities on their property. The bill establishes a buy-all, sell-all program whereby agricultural generators may sell 100% of the renewable energy generated to their incumbent electric utility, while continuing to purchase 100% of their electricity requirements from their utility. The utilities are required to purchase the renewable energy generated at a rate not less than the utility’s avoided cost rate. (The utility’s “avoided cost” is a rate approved by the State Corporation Commission which represents the theoretical cost the utility would incur to obtain replacement power.) The buy-all, sell-all program would only be available for agricultural customers with renewable energy facilities 1.5 MW or smaller.

HB 2291 – Cost recovery for Dominion’s nuclear expenditures

HB 2291 (Kilgore) would allow Dominion to seek cost recovery for future upgrades to its nuclear facilities. The bill would allow Dominion to recover such costs through a rider, called a rate adjustment clause (“RAC”), as opposed to through base rates. Before receiving approval of a nuclear upgrade RAC, Dominion would have to prove that it “considered and weighed” the option of obtaining new generation through third-party market purchases. Without the bill, such costs would recovered through a utility’s base rates, which are currently frozen due to due 2015 legislation supported by APCo and Dominion. Recovering costs through RACs provides several benefits to utilities, including guaranteed recovery of all expenses, plus a guaranteed rate of return. (Recovering costs through base rates, meanwhile, does not guarantee full cost recovery. If a utility sells fewer kilowatt hours than forecasted, for example, the utility might not fully recover its costs plus a rate of return.)

SB 990 – Tracking Virginia’s achievement of energy efficiency goals

Finally, SB 990 (Dance) would direct the Virginia Department of Mines, Minerals and Energy (“DMME”) to provide an annual report regarding the Commonwealth’s progress towards its energy efficiency goals. In 2007, the General Assembly adopted a goal for the Commonwealth to reduce its energy consumption by 10% by 2022. In 2015, Governor McAuliffe created an Executive Committee on Energy Efficiency to help accelerate the achievement of the 10% energy reduction goal.

Please contact one of our renewable energy lawyers or regulatory attorneys should you have questions about these energy bills.

Reisinger Joins Nuclear Energy Discussions

On February 11, GreeneHurlocker attorney Will Reisinger participated in a symposium on the future of nuclear energy sponsored by the William & Mary Law School’s Environmental Law & Policy Review. The symposium, “Nuclear Energy: Gap-Filler for Renewables or Energy for the Ages?,” included speakers from the electric power industry, academia, and the legal profession.

Will took part in a debate with the Chief Technology Officer for the U.S. Department of Energy’s Office of Nuclear Energy and the Chief Nuclear Officer for Dominion Resources. Among other issues, the speakers debated the pros and cons of new nuclear power projects, including discussion of potential rate impacts to utility consumers, the status of federal carbon regulations, and the viability of new renewable energy resources. Will noted that the cost of renewable energy technologies, such as solar and battery storage, are declining significantly, while the costs of new nuclear construction continue to rise. He also pointed out that, if completed, a new reactor currently being developed by Dominion Virginia Power would be the most expensive power generation facility ever constructed in the United States. The Virginia Attorney General has previously estimated that building just one new nuclear power plant in Virginia could raise customers’ electric rates by 26% or more.

The symposium panel discussions were moderated by William & Mary law students. If you would like to know more about our participation in this forum or energy development and regulation, contact Will Reisingerr or any of our energy lawyerspanel at W&M energy symposium panel at W&M energy symposium.

Reisinger Appearing At Nuclear Energy Symposium

On Saturday, February 11, GreeneHurlocker attorney Will Reisinger will be speaking at a symposium on the future of nuclear energy sponsored by the William & Mary Law School’s Will Reisinger energy lawyerEnvironmental Law & Policy Review. The symposium, “Nuclear Energy: Gap-Filler for Renewables or Energy for the Ages?,” will include speakers from the electric power industry, academia, and the legal profession. Among other issues, the speakers will debate the pros and cons of new nuclear power projects, including discussion of potential rate impacts to utility consumers, the status of federal carbon regulations affecting the industry, and state and federal subsidies for new projects. Reisinger will discuss several nuclear energy projects under construction and the economic viability of future units in the U.S.

The symposium will be held at the William & Mary law school in Williamsburg, Virginia, and is free and open to the public. The event will be broadcast live here.

Get Your Lobby On! Virginia Clean Energy Lobby Days 2017

We’re big on advocating the expansion of development and use of renewable energy sources in Virginia and, as members of the Maryland-DC-Virginia Solar Energy Industry Association (MDV-SEIA), we show up on Clean Energy Lobby Day. CELD is an annual advocacy day which allows legislators and constituents to connect regarding energy policy under consideration by the General Assembly. It’s always a great time to talk with legislators and our industry partners.

This year, there will be two CELD opportunities at subcommittee meetings at the Capitol in Richmond: Thursday, January 26th, for the Senate Energy Subcommittee and Tuesday January 31st, for the House Energy Subcommittee. If you want more solar development, this might be a chance to make your opinion heard by the General Assembly. Come join us!

If you want to know more about MDV-SEIA, where GreeneHurlocker co-founder Eric Hurlocker serves on the Board, or about renewable energy development in Virginia, please call Eric or any of our Virginia energy lawyers.

News about APCo Proposed Tariff Includes Reisinger

GreeneHurlocker energy lawyer Will Reisinger was interviewed by the Richmond Times Dispatch for an article on Monday, November 14, 2016, because we are involved in Appalachian Power Company’s (“APCo”) proposed green Tariff, Rider REO (“Rider”) proceeding in Virginia. His comments are related to the firm’s representation of the Maryland, DC and Virginia Solar Energy Industries Association (“MDV-SEIA”), which filed testimony with the Virginia State Corporation Commission (the “SCC”) in Case No. PUE-2016-00051, opposing APCo’s proposed Rider.  Reisinger also participated in the hearing on the case at the SCC on Tuesday, November 15, 2016.

In the proceeding, APCo requested approval by the SCC of the Rider, a voluntary, 100% renewable energy rider.  MDV-SEIA and other opponents of the Rider argue that it actually impedes competition from third-party renewable energy providers in APCo’s service area in Virginia.  In testimony filed with the SCC, MDV-SEIA argues that the Rider will not offer customers the access to solar energy that APCo’s customers desire, nor will it support the development of solar energy in Virginia.  It is also unclear from the Rider whether its efforts would result in the development of any new renewable generation in Virginia, as the Rider would simply bundle the output of several existing, out-of-state renewable energy facilities that are currently under long-term power purchase agreements.

We will be preparing and filing post-hearing briefs in the coming months and will continue our efforts to bring more renewable energy projects to the Commonwealth. If you have any questions about this proceeding, or other regulatory matters at the SCC, please contact Will or our other regulatory and energy lawyers.

We’re In with the Renewable Leaders.

We’re new members of The Virginia Renewable Energy Alliance, which means we’re allied with the brightest renewable energy wind turbines and solar arraysexperts in Virginia, many of whom we’ve known for years. From the utility industry to developers, from engineers to associations and educational institutions, VA-REA offers tremendous opportunities for all branches of the renewable industry to connect and collaborate.

This group seeks to leverage the diverse interest and market knowledge of members to find solutions that:

  1. Identify and close the gaps to renewable energy develop through collaboration on targeted initiatives;
  2. Research and support best industry practices;
  3. Generate policy analysis;
  4. Serve as an authority and resource through public education; and
  5. Foster coordination and partnerships through networking opportunities.

We’re proud to be a part of this effort and the continued advancement of Virginia’s renewable energy market! You can learn more about VA-REA here: http://www.va-rea.org/

Maryland Proposes Community Solar Pilot Program Regulations

sunset-solar-squareThe proposed regulations for Maryland’s Community Solar Pilot Program were published in the Maryland Register on April 29, 2016.  Here is a link to the Community Solar Pilot Program rules as published. Under the proposed rules, customers that subscribe to a community solar energy generating system will receive full retail rate credit for their subscription up to break-even (i.e. the point where their subscribed generation matches their usage). However, credit for subscribed generation exceeding a customer’s actual usage will be limited to the supply price (transmission and distribution excluded).

The proposed program structure includes: (1) an overall cap of 1.5 percent of 2015 Maryland peak demand; (2) annual capacity caps for each of the three years of the program; (3) a per-utility cap of 1.5 percent of 2015 Maryland peak demand; (4) capacity allocations to “small,” “open,” and “Low and Moderate Income (LMI)” categories; and (5) a limit of 350 accounts per community solar energy generating system.

Comments on the proposed rules are due to the Maryland Public Service Commission by May 30, 2016. For more information about Maryland Community Solar Pilot Program, please contact one of GreeneHurlocker’s energy attorneys.