The pending conference report on adopting a new Virginia state budget includes a process to rebate the cost of the Regional Greenhouse Gas Initiative’s carbon tax, but only to smaller customers and only if their utility is charging them for it directly.

Larger energy users, especially the largest industrial, commercial and data customers, will still pay in full. The full economic impact of the tax on electricity prices in general will be unchanged, and RGGI raises energy costs across the board in Virginia. 

The complicated rebate process outlined in one paragraph in the budget section on the Department of Environmental Quality would apply only if the utility paying the RGGI carbon tax to run its hydrocarbon power plants then collects the tax from its customers through a special charge on monthly bills.

This might apply only to customers of Dominion Energy Virginia, which has applied to the State Corporation Commission for a 1.3 cent per kilowatt hour “rate adjustment clause” on all its customers. Appalachian Power Company, serving parts of Western Virginia, pays very little RGGI tax on just one in-state plant and has not used a RGGI rider to collect the funds from customers. Maybe now it will do so. There is no provision for rebates to rural cooperative customers, and again, the RGGI cost has not been segregated on their bills as it is buried in their purchased power costs.

This is another admission by the Democrats so fond of this carbon tax that it ultimately is paid by customers, not the power companies. When the tax was $5- to $6 per ton of carbon emissions, it was harder to see, but now at $35 per ton it is impossible to miss. 

The provision directs that 45 percent of the RGGI tax revenue collected by Dominion or Appalachian be returned for rebates to customers who pay on the residential, small general service or church class electricity tariff (yes, churches get a special lower rate.) The Assembly is also ordering the utility to list the credit clearly on the bill. The various large general service tariffs for major users will not benefit.

The remaining 55 percent collected by Dominion (and 100 percent paid by generators unable to impose the cost directly on customer bills) will continue to be split as the existing RGGI law demands, with about half going to home energy projects and half to flood mitigation or prevention.

Just a few days ago a legislative study committee voted to consider whether or how to offer rebates. But there was this pending budget just begging for legislative creativity. Now we have an approach likely to be voted into law tomorrow. As mentioned earlier, any rebates will not cover the general rise in electricity prices throughout Virginia caused by adding on this carbon tax. But they will cover some exposed political anatomy. 

Man, what else in this conference report haven’t we seen yet?  

— SDH