A Sign of the Coming Grid Wars

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It happened in Nevada first, but it could come to Virginia eventually — the effort by major electricity consumers to bypass their local utilities and purchase power from wholesale electric markets.

Three big casino companies — Wynn Resorts, MGM Resorts International and Las Vegas Sands — say they could slash millions of dollars from their electric bills if they could buy power directly from merchant power producers, reports the Wall Street Journal. Power-hungry casinos would like to use more renewable energy to live up to commitments to shareholders and customers but they say NV Energy, the monopoly utility, charges too much for green power. They could acquire the energy far cheaper by contracting directly with independent power producers.

NV Energy is doing everything it can to thwart the departure of some of its largest customers, and so far regulators have obliged. But as long as it’s possible to purchase solar power wholesale for 4 cents per kilowatt-hour (and conventional power  for 3.5 cents per kilowatt-hour) and the company charges big commercial clients between 9 and 10 cents per kilowatt-hour, big consumers will have enormous incentive to cut their own deals.

The WSJ didn’t explain the regulators’ thinking, but it should be obvious. The loss of major customers would throw the burden of supporting the vast sunk cost of the existing electric-generating infrastructure onto remaining customers, forcing the utility to raise rates in order to prop up profit margins. And Nevada needs a financially healthy power company to maintain a reliable source of electric power for those who don’t have the size and clout to cut their own deals with merchant power companies.

“The same struggle is occurring across the country,” writes the WSJ, “as large power users watch wholesale energy prices fall while their utility bills rise.” Some states allow residents and businesses to buy their electricity from competitive suppliers. While favoring the power companies, Virginia’s regulatory system does allow options.

Wrote the SCC in its 2015 report on Electric Utility Regulation in September:

The ability of most customers to purchase electric generation service from competing suppliers has been limited. The Regulation Act permits large customers (those exceeding 5 MW of electricity demand) to shop among licensed competitive service providers (“CSP”), and nonresidential customers may apply with the Commission to aggregate load up to the 5 MW threshhold to receive services from a CSP. Residential retail customers currently have the statutory right under the Regulation Act to purchase electric generation service from CSPs selling electric energy “provided 100% from renewable energy.”

The SCC lists 29 such CSPs licensed to sell 100% renewable energy in Virginia.

These retail aggregators can purchase green power from the PJM wholesale market, of which Virginia is a part, but they don’t appear to have made any meaningful inroads. Whether that’s due to a lack of consumer interest or an inability to deliver green energy at a competitive price, I don’t know.

As for big customers, Amazon Energy Services recently contracted with a merchant producer to generate solar electricity in the Eastern Shore for data centers in Northern Virginia. But Amazon is holding everyone to a non-disclosure agreement, so the terms of the detail are not generally known. Acbar, a frequent contributor to the Bacon’s Rebellion comments section, tells me that many of the documents outlining the terms of the deal are publicly available, but I have not had time to track them down. In any case, I have not risen to a level of competency to decipher the meaning of these hyper-technical documents, and I’m not sure, given all the other issues to write about, that it’s worth the effort.

But the electric power industry is changing fast, and my priorities could change with it.

— JAB

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34 responses to “A Sign of the Coming Grid Wars

  1. Well, here’s one doc associated with the Amazon/Community Energy Solar:

    ” PJM Generation Interconnection Request”

    ftp://www.pjm.com/planning/project-queues/facilities/w1005.pdf

    Now.. it does also appear that Amazon is locating in the part of Loudoun that is served by Dominion…

  2. Let me stress one thing:

    Whether a consumer can “bypass” the local retail provider to buy wholesale electricity is entirely a matter of VIRGINIA law. Retail sales are governed by State law which allocates service territories, defines who is an electric utility, and specifies, directly or through the SCC, how retail rates are to be reviewed and published at the SCC and all sorts of utility services are to be performed. Those same State laws also govern distribution services, those wires that deliver to your home from the big substation down the road.

    PJM is an independent system operator created by the FERC and governed by FERC under federal law. The fed’s jurisdiction covers electric transmission and electric wholesale transactions. A sale to an end user is not “wholesale” regardless of its quantity, and is not under federal jurisdiction. This is a “bright line” jurisdictional distinction.

    Moreover, PJM is not allowed by its charter documents to sell at retail.

    But . . . .

    Many States have converted their utilities’ formerly exclusive retail service territories into exclusive distribution territories, while imposing a sort of “common carriage” obligation on the distribution company to deliver retail power from any electric company on the grid. In those states, the consumer can buy from the local utility or anyone else out there on the grid, including niche providers of all-renewables-generated-power and providers who compete for business customers strictly on price. The customer pays a separate distribution service charge to the local utility. The provider has a blanket contract with PJM to deliver the energy to the local utility; PJM tracks, but doesn’t particularly care, where the customer is located.

    Virginia started down that road, then backed up; in Virginia, Dominion (and Apco and REC, etc.) still has an exclusive right to sell at retail in its service territory.

    Now look at Amazon’s situation. Amazon wants to buy retail power for its data centers in Loudoun County. Amazon also has decided to get into the Green Power generating business in Accomack County. Amazon is NOT allowed under Virginia law to deliver its own wholesale power to itself; in Loudoun it must buy at retail from Dominion, like everyone else.

    So it does. And it sells its Accomack power to PJM at wholesale, where it goes into the PJM markets (via transmission lines actually owned by Delmarva Power and Light Co.).

    Nominally, Dominion could arrange to “purchase” the Accomack power directly from Amazon, turning Amazon’s deliveries to PJM into Dominion deliveries to PJM, but that contractual arrangement would be meaningless except for the “renewables” bragging rights attached. I don’t think they have bothered to do that.

    OK, I just wanted to review all that so that we are talking about the same transactions, here.

  3. There are laws that govern all this. Bypassing the local utility can be like bypassing local taxes; it reminds us that non-utility subsidies of social programs through utility rates can get out of hand. Too bad business customers of utilities in some states feel inclined to do so. But it isn’t allowed in Virginia.

    Whether a consumer can “bypass” the local retail provider to buy wholesale electricity is entirely a matter of VIRGINIA law. Retail sales are governed by State law which allocates service territories, defines who is an electric utility, and specifies, directly or through the SCC, how retail rates are to be reviewed and published at the SCC and all sorts of utility services are to be performed. Those same State laws also govern distribution services, those wires that deliver to your home from the big substation down the road.

    PJM is an independent system operator created by the FERC and governed by FERC under federal law. The fed’s jurisdiction covers electric transmission and electric wholesale transactions. A sale to an end user is not “wholesale” regardless of its quantity, and is not under federal jurisdiction. This is a “bright line” jurisdictional distinction.

    Moreover, PJM is not allowed by its charter documents to sell at retail.

    But . . . .

    Many States have converted their utilities’ formerly exclusive retail service territories into exclusive distribution territories, while imposing a sort of “common carriage” obligation on the distribution company to deliver retail power from any electric company on the grid. In those states, the consumer can buy from the local utility or anyone else out there on the grid, including niche providers of all-renewables-generated-power and providers who compete for business customers strictly on price. The customer pays a separate distribution service charge to the local utility. The provider has a blanket contract with PJM to deliver the energy to the local utility; PJM tracks, but doesn’t particularly care, where the customer is located.

    Virginia started down that road, then backed up; in Virginia, Dominion (and Apco and REC, etc.) still has an exclusive right to sell at retail in its service territory. More competition would be a good thing, right?

    Now look at Amazon’s situation. Amazon wants to buy retail power for its data centers in Loudoun County. Amazon also has decided to get into the Green Power generating business in Accomack County. Amazon is NOT allowed under Virginia law to deliver its own wholesale power to itself; in Loudoun it must buy at retail from Dominion, like everyone else.

    So it does. And it sells its Accomack power to PJM at wholesale, where it goes into the PJM markets (via transmission lines actually owned by Delmarva Power and Light Co.).

    Nominally, Dominion could arrange to “purchase” the Accomack power directly from Amazon, turning Amazon’s deliveries to PJM into Dominion deliveries to PJM, but that contractual arrangement would be meaningless except for the “renewables” bragging rights attached. I don’t think they have bothered to do that.

    OK, I just wanted to review all that so that we are talking about the same transactions, here.

  4. Apologies, all, for the double posting above. Was trying to edit not re-post.

  5. Letting companies or individuals provide their own power is fine as a policy matter. If transmission is required from off-site generating plants, the self-generator needs to pay rates that reflect the costs of transmitting the power, including opportunity costs. Ordinary ratepayers, business or residential, should not subsidize the transmission costs for a “self-generator.”

    If the self-supplier is totally off the grid – no access to backup power – it should not pay any of the utility’s fixed or variable costs. If, on the other hand, the self-supplier has access to backup power, it should pay all costs for maintaining the network-grid connection. Power should be sold at a rate that covers the utility’s cost to supply the incremental power. At night, this is probably a low rate. During a hot summer afternoon, the rate should be quite high. Bottom line, so long as the ordinary user is protected, self-supply should be OK.

  6. Jim, and others interested, the Amazon case has been assigned Case No. PUE-2015-00103 by the Commission and the filing and related documents should be available on the Commission website.

    Regarding the issue of “bypass” and the Nevada situation, from the regulatory viewpoint the Nevada commission likely approved many many many costs that got “sunk” so the local utility could provide the casinos with power over the many decades they’ve been in operation and to meet that load as it has steadily grown over the years. I don’t blame the Nevada commission a bit for being reluctant to shift these costs to other captive ratepayers who have no ability to avoid them.

    In Virginia, self generation is allowed, but as TMT notes just above, any use of the grid by the company or individual that self-generates needs to be fairly paid for by that entity. That includes not just compensation for the incremental power consumed from the grid by the self-generator, but a portion of the costs of capacity necessary to provide that power and a portion of the costs of facilities needed to deliver the power.

    Lastly, for Acbar, PJM was not actually “created” by the FERC, although FERC does regulate it. PJM has existed since 1927. It has been certified by the FERC as the regional transmission system operator following FERC’s decision to require open access to the transmission grid about 15 years ago. DVP and Apco joined PJM in 2004 and 2005, but Delmarva Power and Light, which formerly provided electricity to the Eastern Shore, was a founding member, I believe. Incidentally, I think you have the schematics of the DVP-Amazon transaction very closely, if not exactly, correct.

    • Rowinguy, your history is correct. PJM started as a voluntary group of utilities, a so-called “power pool,” and was converted through a series of steps into a FERC-mandated and approved ISO in the early 90s. Calling that “created by FERC” doesn’t do it justice.

  7. PJM = Pennsylvania, New Jersey and Maryland. It was founded in 1927. Dominion Virginia didn’t join until May, 2005. What benefits did the Commonwealth of Virginia and / or its electricity ratepayers get from Dominion Virginia joining PJM? If these benefits are clear, why did it take 78 years for Dominion – Virginia to join?

    Ask a Virginia government apologist why Virginia didn’t continue with its electrical deregulation plan and you’ll hear, “Electricity deregulation doesn’t work”. Well, it does work in 16 states – including quite a footprint in the PJM area:

    http://www.eia.gov/electricity/policies/restructuring/restructure_elect.html

    In fact, the three original member states of PJM have all deregulated to include retail choice.

    I wonder why deregulation was suspended in Virginia?

    01/07: Virginia State Sen. Thomas K. Norment introduced legislation that would replace the state’s deregulated electric power market with regulated profits at 7 percent over utilities’ long-term bond costs.

    02/07: Legislation backed by the state’s dominant power company to pull the plug on the state’s experiment with electric utility deregulation was unanimously endorsed by a Senate committee Monday evening.

    Why would Tommy Norment do such a thing?

    “Norment, who is running unopposed for his seventh term, raised $205,187 in April and May. Dominion Resources, parent of Dominion Virginia Power, cigarette-maker Altria and coal giant Alpha Natural Resources each gave $10,000. Dominion chief executive Thomas Farrell gave $1,000.”

    Source: Daily Press – 06/05/2015

    Campaign contributions for a candidate running unopposed? In fact, the last time Norment had an opponent in the general election was 2003. So, these are campaign contributions for a politician who hasn’t had an opponent in 12 years.

    I wonder why Dominion needs to fund a campaign against The Invisible Man?

    • DonR–DVP and Apco joined PJM because the original Virginia deregulation act required investor-owned electric utilities to become members of what the law called a “regional transmission entity.” Right around the same time the dereg act was passed here (1999) FERC began shopping the concept of the “regional transmission organization” or RTO, and that is the name that stuck. Originally, the parent companies of both DVP (Dominion) and Apco (AEP), along with several other utilities attempted to organize an RTO apart from PJM, which had not yet been finalized its grant of RTO status with FERC. That organization was to be called the “Alliance RTO.” Here’s a link:

      http://www.prnewswire.com/news-releases/alliance-rto-companies-submit-compliance-filing-with-federal-energy-regulatory-commission-73285722.html

      FERC granted approval of several interim steps in the Alliance’s formation, but for very murky reasons, abruptly reversed course and withdrew its interim approval and ordered the Alliance members to forthwith join other RTOs. There’s likely a fascinating story behind that switcheroo that will never be told. So, DVP joining PJM was really a regulatory shotgun wedding. DVP resisted joining PJM (as did several large Pennsylvania based utilities) when PJM was a tight power pool, although it was interconnected and did business with some of the companies that made up the old PJM over the years. AEP did not join either. Both Dominion in Virginia and AEP in Ohio and West Virginia, primarily, preferred to be the “800 lb. gorilla” in their own home states.

  8. Jim, I mispoke on one point. I wasn’t aware what exceptions to the “exclusive right to serve” were left in Virginia when the GA retreated from all-out retail electric competition. Apparently Virginia consumers can still buy renewable power from a CSP, and business customers may also buy competitively if in excess of 5 MW.

    This vestigial competition begs the question, why does Virginia impose any limitations on CSP activity? The contracting, billing and delivery mechanisms of retail competition are the same regardless of scale. We have to conclude, Dominion wants it this way.

    Personally I think it’s short sighted as a business matter, and perhaps even counterproductive politically, for Dominion to have supported that change in the law. Dominion has relatively very low retail rates today and is fully capable of competing for sales to retail customers wherever retail competition is permitted in the PJM region. Dominion certainly ought to play by the same competitive rules in its own backyard, and Virginia consumers should have the option to keep Dominion (and the SCC) honest if it ever strays from relatively low-cost production.

    • Retail electric competition was a huge failure in Virginia. There were no market disrupters offering consumers or small business lower rates. The only marketing literature I saw from “competitors” was from “green generators” that wanted me to assuage some level of guilt by paying more for electricity. That’s like going to Giant and asking the cashier to add $50 bucks to my tab.

      When competition doesn’t work, we need regulation. A duty to serve all comers in the service territory also comes with an effective monopoly. Half solutions don’t work.

      • So, why has it worked in 16 other states?

        Could it be that our blessed legislature constructed an intentionally faulty plan and then ended the “experiment” when Dominion told it to?

        Here’s a hint from the land of PJM:

        Corporate campaign contribution limits:

        (P)ennsylvania – prohibited
        New (J)ersey – $2,600 per candidate per election
        (M)aryland – $6,000 per candidate, $24,000 in aggregate

        Virginia – unlimited, even for state regulated monopolies

        You tell me why our deregulation plan failed while Pennsylvania’s, New Jersey’s and Maryland’s did not.

        As of June, Dominion’s contributions to a state senator who is running unopposed and has run unopposed every general election for the last 12 years would have violated the law in PA, NJ and MD.

        • DonR, you ask why deregulation has worked in 16 other states. There have been states where deregulation has worked, some where it has not. I will offer that to the extent that deregulation has worked anywhere, it is not due to competition for the production of electricity, but due to the massive reduction in gas prices coincident with the development of hydraulic fracturing of shale gas in the Marcellus, Utica, Barnett and other shale formations. This really started occurring after 2007. Up to that point, dereg in the mid-Atlantic had been a massive failure. Retail rates in Maryland rose 72% in one year after Baltimore Gas & Electric divested its generation plants to its parent company Constellation and that company discovered the enormous leverage it possessed through economic withholding of supply. Maryland still has not recovered entirely, although eventually development of low-cost gas generation throughout the PJM footprint (and notably in Virginia) reduced the wholesale price of electricity. This neighboring example of dereg gone wrong had a big influence on the General Assembly enacting the Reregulation Act, which became law just a season or two before gas prices started their dramatic fall.

          Of course, those donations you note did not hurt. However, the utilities were donating to those same politicians 7 or 8 years before when they wanted deregulation, too.

      • TMT, you are right, the whole retail competition scene failed to get off the ground initially in VA, and by implication you say we must go back to past regulatory models. I agree retail competition in Virginia never got to the point where it invited retail rate deregulation; but I disagree that “Retail electric competition was a huge failure in Virginia.” You can continue to have the exclusive territories and all the regulation that comes with that for distribution services and rates, without necessarily tying that to the exclusive right, or obligation, to provide retail electricity.

        In fact the biggest reason retail competition failed in Virginia had nothing to do with how it was handled but the fact that all the Virginia franchised suppliers were already low-cost suppliers. They were too low-cost for a competitor to come in and, net of start-up and marketing costs, beat their price by enough to attract attention. The incumbent utilities’ existing business models were so far from threatened, they were not even challenged.

        The real question for retail competition is twofold: what to do about “default” service to retail customers who refuse to choose any particular supplier but draw from the grid anyway; and, what to do about regulating those “default” service rates (i.e., is competition a sufficient substitute?). Some states have experimented with allocating all default customers among all the registered retail vendors in the state, which works if there are a lot of them. Competition also works as a substitute for rate regulation, but only if there are a lot of competitors. Virginia, like other low-cost-energy States, did not attract hardly any competitive suppliers — after all they could sell anywhere in the eastern U.S. so they concentrated on the locations where the existing retail prices were high and they could induce customers to switch, and there weren’t enough of them to saturate those attractive markets and seek out the marginal opportunities elsewhere.

        So was that a failure of electric retail competion? Emphatically, no! It worked well in parts of the country where the competition arose. But that raises a couple of issues. First, in the absence of a lot of competition (and perhaps even with it), who should have the “default” service obligation particularly for residential customers, and second, how should the rates for that service be regulated? Obviously, the “default” rate establishes a ceiling for the market rate (why would anyone pay more if they didn’t have to) and the competition must offer something lower, or better-packaged. But in low cost states like Virginia, a cost-based “default” rate basically kills the competitive market because no competitor can beat it. In some other states people have argued for deliberately fixing a default rate higher than costs, in order to encourage competition; others have argued for abandoning cost-based energy rate regulation entirely and letting the markets decide the right level for energy prices based on competitive pressures. In Virginia (and, importantly, in many if not most other states stuck with the same conundrum), the regulators decided that (1) the exclusive distribution service provider would also be the exclusive default electricity provider, and (2) the default electricity rate would continue to be set by traditional cost-of-service ratemaking methods by the state utility commission, at least until the level of competition allowed the commission to revisit the question.

        Virginia was there and could have left it there and gone forward on that basis, leaving the legal and regulatory possibility of competition in place although not expecting much of it unless/until conditions changed. Instead, pursuant to the incumbent providers’ lobbying campaign in 2007 or so, the GA scrapped Virginia’s competitive retail framework — more or less entirely (with limited exceptions).

        I think that was a wasted opportunity. Retail competition today in states that allow it is much more widespread and more sophisticated; it isn’t just based on total price today but also the way the service is packaged, and financed, and combined with different sources. There are many more subcategories of power supply, and lots of talented entrepreneurs out there selling these products. We should let the market be open to these developments in Virginia. And as noted earlier, Dominion is well equipped to handle the competition in Virginia and even to compete in other utilities’ home markets elsewhere. In the short run, the exclusive right to serve, particularly business customers, is an “advantage” Dominion doesn’t need.

        In the long run, the only real check on a run-away-cozy relationship between a regulated utility and its regulators is the customer’s ability to buy energy elsewhere. The existence of competitive suppliers allowed to supply any retail electric service in Virginia helps keep that relationship honest.

        • Acbar – interesting comments. Thanks.

          Deregulation of most telecom services worked chiefly because there were more than one connection between carriers and customers. Besides the traditional telecom company, most homes were connected by the cable company. Some other competitors invested in fiber rings and even connected some buildings – not so much for residences. And the wireless revolution sparked by agreement between the GOP in Congress looking for non-tax sources of income and Democratic President Bill Clinton, just looking for money, to have radio spectrum auctions, allowed many to bypass the wireline connections altogether. However, fiber optic cables still connect cell tower cites.

          In the early 80s, I worked on introducing measured local service so that small and larger telecom customers would have access to affordable service and big users would pay more. Today, local and long distance services are bundled into affordable packages of virtual unlimited calling. So much for my work.

          There is nothing comparable on the electric side, unless you go off the grid. No one is building any alternative distribution systems. And so far, wireless distribution of electric power is pretty much in the lab. I also think there will be great fear among the public about wireless distribution of electricity. The distribution of electricity seems to be a natural monopoly that implies regulation. There also seems to be a risk that, by separating generation from distribution, the latter needs to make a profit, which, in turn, likely increases rates. So, unless generation and commodity rates decrease by more than the increase in distribution rates, the average customer is worse off with competition.

          Yet, I remain somewhat hopeful that we will see breakouts in lower-cost generation, the alternative energy business is still dominated by scolds, rather than disrupters. That may be changing.

          So it seems to me that

          • TMT actually everyone doesn’t have access to cable or fiber. There are many communities that providers have refused to serve. We have a situation where providers are picking and choosing what areas to serve and the people who live/ work there have no options except wireless, which is more expensive, has caps,and is a lot less reliable. I live in about a 5 mile diameter bubble that got left out as telecom and cable providers laid lines. I’ve been repeatedly told, publicly, that I need to move to get the internet service I need and that the needs of my neighbors are not my concern. There are many areas where new residents cannot get service, where those already served request more robust service, and the provider refuses to expand the infrastructure.

            The definitions used and way coverage areas are calculated overstate the true penetration of good, dependable, affordable internet service. If we want all areas to be economically viable, we’ve got to figure out how to serve everyone. That is not possible under today’s laws and regulations or industry desires. So far, society has not stood up and demanded that everyone have access.

          • Thanks, TMT. But first let me commiserate with VaConsumer; I have a house in Mathews County on the Bay and it took me 8 years and countless stratagems to get a decent internet connection out of the local cable ISP. There’s just not the population density to attract real competition. The saving grace down here is a fantastic public library at Mathews C.H. with dozens of free high speed computer terminals for local families to come use; they just completed an addition to house more.

            One comment. You say, “by separating generation from distribution, the latter needs to make a profit, which, in turn, likely increases rates” — in my experience such a rate increase did not happen in the states that did this. That’s because under FERC’s accounting rules the allowed “return” is allocated across the investment, or rate base, so when distribution rate base is pulled out as a separate business it already has an associated return built in and the remaining return allocated to generation is only what’s left. That said, deregulating the generation component certainly affected overall rates, for example, where the generation business was spun off and its output had to be “bought back” from the wholesale market by customers who formerly “owned” it.

            Love your “alternative energy” descriptive, “scolds, rather than disrupters.”

  9. DonR, yes undoubtedly Dominion caused this to happen in 2007. My question is, why? Was, or is, it just the shock of the unfamiliar falling on executives not thinking it through? Was, or is, there some financial analyst out there saying to Dominion, your stock price will crater if you lose your exclusive retail right to sell? Was it just a mistake, that should be undone? Because Dominion is one of the best situated utilities in the eastern US to not only not worry about retail competition but to take advantage of it! And retail competition can be attractive to some businesses looking to decide where to locate or expand, i.e., in Virginia or not.

    • Dominion controls more factors in the current system and the law gives them a higher guaranteed return. It was a mistake to make the change but unless someone finds a way to undo the stranglehold Dominion has on Virginia, it won’t be changed.

      • We were looking into creating a municipal utility to demonstrate energy efficiency measures, distributed generation, and customer services that Dominion seemed unwilling to embrace.

        After searching state law we were shocked to see that there was a special provision passed by the GA that prohibited retail sales of electricity by a municipality in Virginia. I don’t think customer choice has been limited in that way in any other state.

        • Virgina allows our utilities to have a stranglehold on their marketplace. There are umpteen ways they can block new players and innovation. So far, not enough people have stood up and demanded a new paradigm.

        • Didn’t know that. The Municipal Electric Power Association of Virginia has over a dozen members who think they are selling retail power legally. Are they grandfathered, with the door closed going forward?

          • Oh yes. They are legal. There just aren’t going to be more of them if the IOU’s have anything to do with it. Also, lots of us are on electric cooperatives and most of us do not own generation. We’re the areas no one wanted to serve when territory was split up so the federal government set up funding we could access to get power. Sadly, the IOU’s, primarily Dominion call the shots. Often our co-op has bought power by contract with a public power provider.

            As a side note, those of us not getting real internet are in much smaller areas than those left behind when electricity came through. The area I live in includes a subdivision so it’s not just open farm or timberland. Comcast ran the last bit of their fiber down a side road rather than finishing to the interstate, which would have covered all of us. There’s fiber running down the middle of the interstate but we can’t access it. Only 2 miles from the interstate is US 460/11 which has Verizon service. I don’t think we’re big enough for someone other than an existing provider to afford. However, neither has interest in us and it was Verizon’s president who told me publicly, twice, to move to get it.

          • Acbar,

            Yes, that is exactly what the law did. Those that pre-existed were OK – no new muni’s. Even if it were allowed, I suspect Dominion would overvalue their distribution system (beyond what is in the rate base) at something like replacement costs. And then still fight it for years in the courts. That is what is happening in Boulder. The process has been dragging for over nine years, increasing costs so that even if approved, the muni might not have competitive prices. They approach it like the tobacco companies – they’ll spend as much as it takes, not to lose the first case.

  10. well , one thing to have de-regulation “fail” , quite another, to not allow or make difficult for other providers to compete.

    I get the impression by the way that Amazon is not saving any money but is essentially buying green “cred”…

    but maybe I’m wrong and this is a real business case.

    • I agree with your impression. They tout that “cred” in ads across the country; I think it drove the deal. That said, they probably figure to make a modest profit just on the solar aspect of it.

  11. Virginia’s utilities don’t want other providers to compete. Sen. Norment introduced the re-regulation legislation because it was what Dominion wanted. It has been virtually impossible to stop or change anything Dominion has wanted for years even decades.
    Few of us believed competition would yield lower prices in Virginia. However, the situation we now have with the law now aligned with what our utilities want is not conducive to new ideas not offered by the utilities or anything they can find a way to not like.
    It’s a sad situation but overall, rates are low enough that most consumers don’t even pay attention, much less get involved. The system is now much harder for consumers to participate in since there are so many cases to follow at the SCC and the limitations on what each can address make it hard to ever consider the whole picture at once. We’ve gone from having cases before the SCC too rarely to now having too many that don’t do what consumers need to have done.

  12. well… one thing is fairly obvious. It’s not like all other states have done this and Virginia is the sole holdout.

    eh?

    • No other state has adopted the utility benefit form of regulation Dominion designed for Virginia. There’s a message there, too.

    • Only the 16 enlightened states with honest legislatures.

    • Well, yes and no. I don’t know of another state that put retail competition in place, then gutted it, the way Virginia did. Some states didn’t go down that road at all. Others went ahead and put the competitive retail structure in place without expecting much from it, with or without deregulation of the utilities’ generation assets. The Virginia GA’s vacillation has been particularly obsequious.

  13. A skeptic might believe that Virginia purposely set up de-regulation to fail – on purpose – so that later – they could point to that failure as a reason not to repeat it. Only problem is – all the other states… that did not fail at it.

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