Category Archives: Energy

Floyd Judge Ponders Order to Return RGGI Tax

The states in the Regional Greenhouse Gas Initiative tax compact before Virginia withdrew.

By Steve Haner

A circuit court judge in Floyd County may soon order Virginia to rejoin the Regional Greenhouse Gas Initiative and to reimpose the related carbon tax on Virginia’s electricity consumers.

Judge Kenneth “Mike” Fleenor Jr. ruled earlier this month that a suit seeking reinstatement of RGGI could continue and held a hearing on February 5 on the question of “immediate relief.”  The plaintiff, a group of energy efficiency and insulation contractors using the RGGI tax dollars for their programs, has claimed it will suffer immediate and irreparable harm unless Virginia returns to collecting a carbon tax on coal and natural gas used by utilities.

The main impact of RGGI membership is on Virginia’s largest electricity provider, Dominion Energy Virginia, which simply passed the carbon tax directly on to customers on their monthly bills.  It stopped buying carbon allowances last year, but the bills had accumulated, so it is still charging customers.

Virginia’s Solicitor General Andrew Ferguson pointed out that the state bank account holding proceeds from the carbon tax collected in 2021, 2022 and 2023 still held $350 million and was only being expended at $30 million or so per month.  There should be enough to keep the plaintiff’s program going through 2024 as the case proceeds, he told the judge, according to a transcript of the hearing.

The plaintiff is the Association of Energy Conservation Professionals, with members who have been operating programs to insulate and weatherize properties using donated and government funds for almost 50 years.  It claims the RGGI dollars are the sole support for a particular program, but there are other funding sources for this work, including other money collected from utility customers.

Can an entity that benefits from a government spending program assert a right to maintain that spending program?  Once a tax funding a particular program is created, can it ever be repealed?  The contractors’ reliance on this stream of tax revenue has been recognized by two circuit courts now as sufficient standing to sue and demand reinstitution of the tax. Continue reading

If Assembly Wants SMR Bill, Then Fix It

By Steve Haner

This is progress. Only twenty members of the Virginia Senate voted Tuesday to ignore a key tenet of utility ratemaking and put utility stockholders and profits ahead of consumer protection. Usually when the utilities persuade the General Assembly to do that to Virginia consumers, they get a bigger vote margin than 20-16.*

Senate Bill 454 allows Virginia’s two monopoly electricity providers to spend undetermined millions of dollars on planning and developing small modular nuclear reactor projects and get it all paid by consumers, with a profit margin. But there is no guarantee any such plants will ever be built, and no other power plants built in Virginia have gotten this kind of up-front financial guarantee before the State Corporation Commission ruled them in the public interest. Continue reading

Will Dominion Fool Us Again with SMR Cost Bill?

Artist rendering of a NuScale small modular reactor plant, proposed but now not being built in Idaho.

By Steve Haner

Fool me once, shame on you.  Fool me twice, shame on me.  A utility-backed bill to stick electricity ratepayers with the high-risk costs of developing small (modular) nuclear reactors, approved by a Senate committee Friday, is a “fool me twice” example.  Shame on the General Assembly if it falls for it. Continue reading

Rare SCC Deadlock Sinks Dominion’s Energy Plan

By Steve Haner

The year long debate over Dominion Energy Virginia’s proposed integrated resource plan, which threw climate catastrophe activists into a frenzy because it added a new natural gas plant, is ending with no decision.  Two State Corporation Commission judges split on whether to approve it, basically a win for the anti-fossil fuel forces.

In December, a hearing officer assigned to study the case had ruled that Dominion’s plan should be rejected because it included the expansion of gas generation, when the anti-natural gas forces in the General Assembly had passed laws against that 2020 and 2021.  Those laws did include provisions for maintaining or adding fossil fuel generation on the basis of a threat to reliability, but only under limited circumstances. Continue reading

NJ Greenmailed Into Massive Wind Energy Costs

By Steve Haner

New Jersey just agreed to two ocean wind projects with astronomical guaranteed power prices. The price demanded and received by independent competitive suppliers shows there is at least some upside to the utility-owned, captive ratepayer-financed model behind Dominion Energy Virginia’s massive offshore wind facility.

In late 2023 the news was full of reports that independent wind developers were pulling out of various projects along the East Coast because the projects were no longer economically viable. Those who thought the future of the industry was in jeopardy were wrong. Continue reading

The Aggressive Progressive Democratic Agenda

From tiny acorns grow the mighty oaks of government.

By Steve Haner

The Democrats now running Virginia’s General Assembly are not just more progressive, but far more ambitious than their predecessors. To fully understand how ambitious you must compile the entire list of progressive bills advancing in the 2024 session and consider their total impact on the cost of living and cost of doing business in the commonwealth. Individual news stories miss the big picture.  

The push to radically regulate Virginia’s energy future discussed earlier is being mimicked with equally aggressive legislation throughout the rest of our economy. None of the ideas below are new, and most are already in law in places like California, New York or other more liberal states. What has changed is that when proposed in the past, they usually were rejected in Virginia on a bipartisan basis. Democrats now march in lockstep.  

The Assembly is still in its first phase and adjournment is set for early March. Which of the following will pass remains to be seen, and in many cases, amendments are already appearing. Most may also face gubernatorial veto or amendment, but that just underscores that Virginia is only one election of one official away from total transformation.   

In the case of the bills to increase the minimum wage (here and here), Democrats are simply building upon what they did during their last period of control. But if they succeed in setting future wage increases to automatically grow with inflation, the impact just builds and builds. Classes of employees reasonably exempted from the law currently, such as farm workers, may now be covered, as well.   

Likewise, the previous Democratic majority also took the first steps toward collective bargaining for limited groups of local employees, but only after elected local officials gave a green light to negotiate a contract. This year’s bill expands the right to bargain to almost all local and now most state employees, with no vote needed by a school board or city council. It was revealed that the most recent version does conveniently exempt employees of the General Assembly, however. Continue reading

Great Judges Can’t Fix Bad Energy Laws

Former SCC Commissioner Mark Christie communicated his enthusiasm for Kelsey Bagot’s election with this photo on X.

By Steve Haner

The General Assembly has now filled the two open seats at the State Corporation Commission (SCC), ending two years of gridlock.  Unfortunately, the same legislators, on both sides of the aisle, are still working overtime to dictate and micromanage the state’s energy policy, reducing the discretion and authority of the independent, non-partisan regulators. 

Samuel T. Towell, elected to the SCC last week, fits the expected mold for such positions.  His legal career has been inside and outside the Virginia government, with his term as the civil litigation deputy under Attorney General Mark Herring (D) as the highlight of his resume.  In that role he supervised the consumer counsel functions under Herring, participating in SCC matters.  Since then, he has been working for Smithfield Foods.  

Breaking the mold is Kelsey Bagot, only a decade out of Harvard Law and with no real Virginia-specific experience.  She spent much of her career so far at the Federal Energy Regulatory Commission (FERC), working part of that time for former SCC Chairman Mark Christie.  Christie’s expressed enthusiasm for her qualifications makes her about as close to a bipartisan choice as was possible.   

They join current Commissioner Jehmal Hudson, also a veteran of FERC, who has been serving by himself for more than a year.  Towell and Hudson, less than 20 years out of law school, and the younger Bagot form a trio that could be in office together for decades.  That had to be on the minds of the legislators (all Democrats) who made these choices.   

Fully qualified and engaged judges are still bound to follow the law.  Virginia’s headlong rush into an economically foolish war on fossil fuels is being directed by the bills flowing from the General Assembly, not by rogue judges.  If the last two sessions controlled by Democrats, 2020 and 2021, were a two-alarm EV battery fire, the 2024 session could be the equivalent of the Maui apocalypse.    Continue reading

Will Democrats Revisit Virginia Net Zero Laws?

Senator David Marsden, D-Fairfax, sees “serious problems” in Virginia’s net zero laws.

By Steve Haner

For the third year in a row, Democrats in the Virginia Senate have shot down an effort to divorce Virginia’s auto dealers from California’s impending mandates on electric vehicle sales. But before the predetermined vote went down, the new chair of the committee made a surprise announcement that he and his colleagues are open to revisiting Virginia’s legal rush to end fossil fuels.

Senator David Marsden, D-Fairfax, said he and Senator Creigh Deeds, D-Charlottesville, have discussed using the period between the 2024 and 2025 General Assembly sessions to convene a conference on the 2020 Virginia Clean Economy Act (VCEA) and the many other statues they passed to suppress coal, oil and natural gas use.  Republicans later shared his musings on X.

What serious problems, Mr. Chairman? Tell us more.

Marsden is the new chair of the Senate Agriculture, Conservation and Natural Resources Committee and Deeds now chairs the Commerce and Labor Committee. The Virginia Mercury noted Marsden’s comments at the tail end of its report on the meeting, but it was the only actual news to break out that afternoon. The Richmond Times-Dispatch failed to mention Marsden’s announcement but had a nice photo of a half-empty Tesla charging lot in California.

Truth would have been better served by a photo of the stranded EV’s waiting for crowded, failing chargers in frigid climes this week. There is a reason consumers have not been rushing to buy EV’s at the expected rates.  Despite the happy talk from mandate proponents, the targets are pie-in-the-sky. The only winner in this whole process is Tesla, getting rich selling carbon credits under the cap-and-trade element of the California regime. Continue reading

Thank Coal, Gas for Your Warm House Today

PJM generation mix as of 8 a.m. this morning. Coal, natural gas and nuclear are meeting the vast majority of the demand.

By Steve Haner

Good morning, Virginia.  Your lights and heat are on, and you can thank coal and natural gas. Here are the 8 a.m. charts from PJM’s website, which you can check periodically today as the winter weather closes in. Those fuels were providing more than 66% of our electricity, with nuclear providing almost another third. Go to the website for the interactive version. The 9 a.m. chart is little changed.

The data are for the entire PJM region, not just Virginia.

Billions of dollars into the renewable energy transition, various renewable sources were providing less than 6 megawatts throughout the entire system, not even 5% of demand. Solar should increase a bit as the day proceeds, but the projection (on the same website) is that wind will dip toward the middle of the day.

The breakdown of generation from renewable sources, mainly hydro. The solar output should improve but in much of the region winter storm clouds will continue to limit it, and snow may pile up on solar panels.

Remember, this is a holiday and the peak demand projected for the workday tomorrow is higher. But the sun may be back to help at least a bit.

We could be Alberta, Canada. Here is what they are going through. Or Texas. Read those links and know, that is the future the General Assembly and the wind and solar industrial complex that owns it have planned for us.

As Dominion and APCO $oar, NOVEC Drops Rates

Northern Virginia Electric Cooperative’s territory within the greater Northern Virginia region.

By Steve Haner

The major “rural” electric cooperative serving very urban Northern Virginia is drastically lowering its rates as of this month, because the cost it is paying for bulk power purchases has dropped. The contrast with what is happening with Virginia’s two major investor-owned electric companies may be telling Virginia something if anybody wants to listen.

NOVEC, or Northern Virginia Electric Cooperative, will be charging its residential users just under $114 for each 1,000 kilowatt hours of usage, down more than $26. The commercial and industrial users among its 175,000 customers are seeing comparable reductions. Continue reading

SCC Examiner Says No to Dominion Gas Plans

By Steve Haner

A hearing examiner at the Virginia State Corporation Commission has recommended rejection of Dominion Virginia Energy’s plan to maintain and add to its fleet of fossil fuel generators. It failed to overcome the presumption in state law that all such plants must go away, she wrote.

In her extensive report following the months-long regulatory battle, Ann Berkebile notes that the Commission itself (still hobbled with only one full member and a retired commissioner sitting in) may reach a different conclusion. And the pending case, Dominion’s Integrated Resource Plan (IRP), does not actually involve final decisions on what power plants to add or delete from its assets in coming years.

But Dominion was looking for a blessing from the Commission on its proposal to maintain most of its natural gas plants and even add one, a 1,000 megawatt facility it wants to place in Chesterfield County. The 2020 Virginia Clean Economy Act has set a schedule for their retirement, with all fossil fuel generation expected to be gone in about 20 years. Dominion’s announcement last May that it was seeking to keep and add to its natural gas plants was immediately denounced by environmental advocates.

The 2020 legislation included a provision to allow the SCC to approve an additional fossil fuel plant if a utility demonstrates “that it has already met the energy savings goals identified in § 56-596.2 and that the identified need cannot be met more affordably through the deployment or utilization of demand-side resources or energy storage resources and that it has considered and weighed alternative options, including third-party market alternatives, in its selection process.” Continue reading

Virginia’s Final (Maybe) RGGI Tax Grab: $97M

Virginia’s final (maybe) sale of allowances for power plant carbon emissions produced a record $97.4 million. The price for each permit to emit one ton of carbon dioxide, which is passed to customers, has about doubled in four years.

by Steve Haner

Virginia has participated in its final (for a while anyway) Regional Greenhouse Gas Initiative auction and the proceeds on the carbon tax set a new record, with Virginia collecting more than $97 million in one swoop. The total carbon tax take for the state is just under $828 million in three years.

The clearing price on December 6 reached $14.88 per ton. It would have been higher but the demand for allowances was so high the RGGI organization released some of its “cost containment reserve” or CCR allowances to tamp down the price increase. The news release on the auction is here. A chart showing Virginia’s proceeds over the three years is attached.

Why the record price? Here’s a solid suggestion: Power producers fear another major winter stressing their systems and know full well that wind and solar are unpredictable and unreliable. They are stocking up on allowances to keep our lights on with fossil fuels.

Just four years ago when the Thomas Jefferson Institute of Public Policy produced this explainer on what RGGI was, the “carbon price” was $5.27 a ton and the prediction was Virginia would collect $150 million a year from electricity producers and eventually their customers. “There is no guarantee the price won’t rise,” we noted, and indeed a steadily rising price for carbon emissions is entirely the point of RGGI.

Pushed by Governor Glenn Youngkin (R) the Air Pollution Control Board voted earlier this year to rescind the state regulation that forces Virginia’s larger electric power plants to purchase allowances from RGGI for every ton of coal, natural gas or oil they burn. So far, efforts to reverse that decision in the courts have failed. Continue reading

Virginia Beach Nixes Kitty Hawk Wind Cables

Site map for the first phase and cable connection route for the proposed Kitty Hawk Wind project.

by Steve Haner

The political leaders of the City of Virginia Beach have informed an offshore wind developer that they oppose its plan to bring power cables ashore at Sandbridge Beach. No formal vote was taken on the application, however, according to media reports.

The story appeared in The Virginian-Pilot and on local television station WAVY around Thanksgiving. When Bacon’s Rebellion last visited this matter, Virginia Beach City Council had conducted a May public hearing at which most speakers strongly opposed the power cable location. Continue reading

Excess Profits Squeezed Out From Dominion Rates

By Steve Haner

The long struggle to prevent Dominion Energy Virginia from earning excess profits in its base rates year after year appears to be over and consumers finally won.  That is the main takeaway as the first general review of its base rates since the 2023 regulatory re-write is moving toward a quick settlement.

The complicated changes in the regulatory structure included wins and losses for consumers, but the impact on this first rate case review is proving to be net positive for the 2.6 million customer accounts.  Most of the various parties who have been dissecting the company’s accounts and forward projections are now willing to end the case with a settlement. Continue reading

Dominion Wind May Be Sued, Hikes Customer Bills

The first eight monopile bases for Dominion Energy’s CVOW project arrive on the Portsmouth waterfront. But a planned German-owned wind turbine blade factory nearby ist kaput.

by Steve Haner

Two national activist groups on energy and environmental issues, both with connections to Virginia, have taken the first legal steps to challenge the recent federal approvals for Virginia’s planned offshore wind complex.  Most of what follows is directly from their announcement dated November 14.

The Heartland Institute and the Committee for a Constructive Tomorrow (CFACT) are filing with the Bureau of Ocean Energy Management (BOEM) and the National Marine Fisheries Service (NMFS) a 60 Day Notice of Intent to Sue letter for a violation of the Endangered Species Act. The violation is contained in a defective “biological opinion,” which authorizes the construction of Dominion Energy Virginia’s Virginia Offshore Wind Project (VOW). Continue reading