“Virginia has a unique opportunity to fundamentally transform the state’s electric grid in ... our COVID-19 economic recovery and drive down harmful carbon pollution,” said Governor Northam. This initiative follows on the recent enactment of the Virginia Clean Economy Act and related solar, wind, and energy efficiency legislation passed in the last legislative session. These clean energy policies require most carbon emitting sources of electricity to be discontinued by 2045, and replacing them with new investments in solar, onshore wind, offshore wind, energy efficiency to reduce overall demand, and battery storage to smooth out energy production by solar and wind versus need timing mismatch.
The Virginia Clean Economy Act accomplishes the following broad goals:
- Establishes renewable portfolio standards.
- Establishes energy efficiency standards. The Act sets an energy efficiency resource standard, requiring third party review of whether energy companies meet savings goals; and creates a new program to reduce the energy burden for low-income customers.
- Advances offshore wind. The Act requires Dominion Energy Virginia to generate 5,200 megawatts of offshore wind generation and prioritize hiring local workers from historically disadvantaged communities.
- Advances solar and distributed generation. The Act targets generating 16,100 megawatts of solar and onshore wind power. The Act requires Virginia’s two largest energy companies to construct or acquire more than 3,100 megawatts of energy storage capacity.
The EIA reports that renewable resources generated less than 7% of Virginia's electricity in 2018. Unfortunately, not all renewable energy is carbon free. Biomass fuels generated the largest share of renewable electricity, followed by hydroelectric power. In 2018, biomass fueled more than 4% of the state's total electricity net generation and hydropower supplied under 2%. Municipal solid waste and landfill gas are common forms of biomass used for electricity generation in Virginia, but the largest share of generating capacity is at facilities that use wood and wood waste (paper plant and forestry product waste). All these renewable biomass sources emit carbon, though the Act does not eliminate them. It appears that the language of what qualifies as renewable energy under the Act includes solar, wind hydropower, landfill gas-fired generation and a limited amount of biomass.
The largest share of solar PV generation in Virginia is provided by utility-scale facilities built in the last several years. Although solar PV to Virginia's net generation is very small (less than 1%), it doubled in 2018. Virginia does not have any wind-powered utility-scale electricity generation, yet . A test project, Coastal Virginia Offshore Wind, is to come on line this year in federal waters 27 miles off Virginia Beach.
As the Washington Post pointed out the Act defines “ total electric energy to mean the electric energy sold by Dominion Energy and Appalachian Power in the previous calendar year, excluding nuclear power generated by plants in service in 2020, and excluding carbon-free (but not renewable) electrical power sources established after July 1, 2030.” This definition allows Dominion Energy and Appalachian Power the flexibility to ensure that they can provide reliable power 24/7 to a future that includes the needs of data centers, and envisioned to have increased demand from the electrification of cars and other portions of the transportation sector as well as electrification of space heating. The nuclear power that provides over 30% of Virginia’s needs will stay in the mix and provide the base power.
Under Virginia’s electricity regulations, utilities are allowed to recover the costs they invest in the grid as well as a “fair rate of return” on equity to customer bills to pay for particular projects. Dominion and Appalachian Power will be permitted to pass along the costs of their new solar, wind and storage projects to the customer base; and sunk costs of any abandoned infrastructure or closed plants can continued to be recovered in full. The State Corporation Commission has estimated ratepayers could see at least a $23 per month increase on their bills by 2027-2030 this includes cost savings from energy efficiency.
Electricity consumption in Virginia is greater than electricity generation within Virginia. The additional power we need is purchased from the regional grid managed by the PJM Interconnection. All but four counties in southwest Virginia are within the PJM Interconnection, a regional transmission organization that coordinates the movement of electricity in all or parts of 13 Mid-Atlantic and Midwestern states plus the District of Columbia. The four counties in southwestern Virginia that are not served by PJM are supplied by the Tennessee Valley Authority. Under the Act at least 75% of all of the energy that counts towards the renewable goal have to come from facilities in Virginia. There did not appear to be hard limits on power supplied from outside the Commonwealth to ensure uninterrupted supply of electricity.
Virginia is offering a Clean Energy Virginia Five-Part Webinar Series hosted by Governor
Ralph Northam’s Office and the Virginia Department of Mines, Minerals and Energy (DMME). The focus
of the webinar series is on the recent legislation. You can sign up for at this link and see what it's about. The snap shot of Virginia electricity generation by fuel type for March 2020 from the EIA shows the basic challenge ahead.
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