Category Archives: Energy

A PIPP of an Idea: Electricity Transfer Payments

By Steve Haner

Green energy advocates never tire of telling us that accomplishing their zero-carbon electricity supply will lower our costs. If so, why does their dream bill include a new income transfer entitlement program for low-income customers?

It is called the Percentage of Income Payment Program with a handy acronym PIPP. It first appeared in Delegate Lamont Bagby’s House Bill 1483. The Henrico County Democrat saw his bill pass the House Labor and Commerce Committee February 4, but for good measure it is now enshrined on lines 1828 through 1909 of the omnibus clean energy bill revealed February 6, House Bill 1526.

B. The monthly electric utility payment of any person participating in PIPP shall be capped at six percent, or, if the participant’s home uses electric heat, 10 percent, of the participant’s household income. A participant may further reduce his monthly electric utility payment through a conservation program incentive. Under this program incentive, if a participant lowers his monthly electricity usage below his historical baseline average, the participant’s electric utility bill for such month shall be reduced by 50 percent of the monetary amount by which such participant lowered his usage.

…Participants who transition to a budget billing system in accordance with this subsection shall be forgiven of any arrearages on electric utility bills accrued prior to participation in PIPP upon making timely and full PIPP payments to the electric utility provider for 12 consecutive months; all other PIPP participants shall be forgiven of arrearages accrued prior to participation in PIPP after making timely and full PIPP payments to the electric utility provider for 12 consecutive months.

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The Energy Whirlwind: Here Finally are the Bills

The House Labor and Commerce Committee has now seen (sort of) and passed out two major revisions to Virginia’s energy policies, promising a new clean energy economy and demanding that the two dominant electric power providers reach 100% renewable status in a few decades.

Delegate Richard Sullivan, D-Arlington, is patron of both House bills, which were were the product of furious private negotiations.  His House Bill 1451 is the shorter (12 page) RPS bill and his House Bill 1526 goes into more detail on how Virginia’s energy economy will change.  Buried deep in that 75-page bill are provisions on building offshore wind and a new income transfer program to subsidize the electricity bills of lower-income customers with other customers’ funds.

Let’s all start reading together.  I certainly am not ready to comment.  Here is Virginia Mercury’s take, which provides the headline talking points from proponents. Continue reading

Bill Changing Rate Rules on Dominion Advances

Will the General Assembly unshackle the SCC so it can grant refunds or lower rates?

By Steve Haner

As the energy whirlwind continues to spin at the General Assembly, changing the landscape the way a twister changes a trailer park, one proposal that should be a boon to Dominion Energy Virginia ratepayers passed a notable hurdle late Tuesday night.

House Bill 1132, the chance for legislators to repent and make amends for earlier sins against their constituents, cleared the House Labor and Commerce energy issues subcommittee on a 6-4 vote, following a long and instructive debate. Two versions of the bill were introduced, one by Powhatan Republican Lee Ware and the other by Norfolk Democrat Jay Jones. It was the Jones version that passed, but Ware was also at the podium sharing credit.

The subcommittee meeting, which ran until about midnight again, included many party-line votes, but this one had Democrat Steve Heretick of Portsmouth siding with Dominion along with several Republicans, while Ware joined the rest of the Democrats in support of the bill.  “Nay” was the wrong vote on this one. Very wrong. As wrong as the votes which enriched Dominion in 2014, 2015 and 2018.

As previously discussed, the bill will allow the State Corporation Commission to review and adjust Dominion’s rates and profits in 2021 without the handcuffs, leg irons, blindfolds and barbed wire fences previous General Assemblies have built into various laws to injure consumer rights and protect utility profits. It will use the traditional rate-making rules the State Corporation Commission applies to other companies, and most other states’ regulators use for their monopoly power companies (who also thrive, by the way).  Continue reading

The Growing Clout of Virginia’s Solar Lobby

by James A. Bacon

It may be a while before the solar industry matches the clout of Dominion Energy and Appalachian Power, but it has come into its own as a lobbying and political player. The new reality hit me forcefully when the Virginia Solar for All Campaign issued a statement applauding the advance of the Virginia Clean Economy Act out of committee yesterday.

“The House of Delegates is taking bold action on energy, advancing legislation that will create a clean energy economy, put Virginia on a path to 100% clean energy, and eliminate harmful carbon emissions to turn back the tide against climate change,” said Rachel Smucker, Virginia Policy and Development Manager for the Maryland Delaware Virginia Solar Energy Industries Association (MDV-SEIA).

Distributed solar generation — small-scale rooftop and community projects — is a key component of the bill, which would mandate a 100% renewable electric grid by 2050. At present, distributed solar is capped at 1% of Dominion’s peak load forecast. Lifting that cap, expanding opportunities for Power Purchase Agreements (PPAs), and mandating 100% renewable energy sources would open up multibillion-dollar market opportunities for solar companies.

The collection of logos seen above, representing members of the Virginia Solar for All Campaign, does not even account for all the solar players in the state. Continue reading

Consistency? Seek it Not at the General Assembly

The Virginia Constitution grants exemption from local real estate taxes for veterans with 100% service-related disability and for the Gold Star families of those killed in action, a move enthusiastically endorsed by voters in 2010. But in a House Finance Committee subcommittee this morning Virginia’s local governments presented the General Assembly with a bill.

The subcommittee endorsed two bills to provide localities reimbursement from the state treasury for the real estate taxes foregone. House Bill 363 from Del. Mark Cole, R-Fredericksburg, would allow the reimbursement once the tax exemption amount exceeds one percent of the overall local real estate tax revenue. House Bill 1496 from new Del.Martha Mugler, D-Hampton, did not set a threshold and would reimburse all lost revenue.  Continue reading

High Cost Detailed, Offshore Wind Support Fades

Delegate Mark Keam, D-Vienna. He voted against a bill eliminating SCC oversight on an $8 billion wind investment, then abstained to save the bill. Watch it here.

By Steve Haner

Dominion Energy Virginia’s massive $7.8 billion offshore wind project received a tepid 5-4 endorsement late Thursday night in a House subcommittee, after legislators were told it would add $13 per month to typical residential bills starting in 2027. In stark contrast to a similar hearing in the Senate Wednesday, both the State Corporation Commission and Office of the Attorney General staff spoke forcefully.

That 5-4 vote to report the bill came on a second try, as the first roll call was scrambled by legislators changing their votes before the chairman closed the roll. At times on the first roll call the proposal was failing by 6-3 or on a 5-5 tied vote, but that roll call was discarded. The final vote was 5-4, with Delegate Mark Keam, D-Vienna, abstaining. He had voted “nay” before but can be heard on the video tape saying he didn’t want his vote to kill it.

The basis for his abstention, normally used when a legislator has a conflict of interest, was not stated.

The bill in question is Chesapeake Democrat Del. Cliff Hayes’ House Bill 1664 but pay no attention to the introduced bill.  There was a substitute.  It was a dream bill for Dominion’s plans, once again dictating to the SCC that “all costs” of the project would be “deemed to be reasonably and prudently incurred.” Those are the magic words one opponent labeled “a blank check.”  Continue reading

Offshore Wind Mandate Advances, Cost Ignored

By Steve Haner

Smart lawyers, and the General Assembly is full of them, don’t ask questions unless they know the answer already and want the information included in the debate. Nobody down at the General Assembly is asking what it will cost Virginians on their monthly bills to build massive offshore wind facilities to generate electricity.

Case in point, a meeting of a Senate subcommittee still underway as this is being written. The Energy Subcommittee of the Senate Commerce and Labor Committee has endorsed two Senate bills that will dictate to the State Corporation Commission that it must allow Dominion Energy Virginia to build its proposed 2,600-megawatt turbine farm and pass the costs to ratepayers.

Senate Bill 860 actually dictates that up to 5,200 megawatts shall be found “in the public interest,” including projects built off the shores of neighboring states, and covers power purchase agreements. Senate Bill 998 is tightly focused on the Dominion-built project off Virginia Beach, but goes beyond the “public interest” declaration. It tells the SCC to accept the full cost as “reasonable and prudent” and pass those costs on to ratepayers. Probably over 30 years. With an enhanced double-digit all-but-guaranteed rate of return.  Continue reading

Bill to Expand (Pack?) SCC a First Test of Change

by Steve Haner

Legislation to increase the size of the State Corporation Commission from three to five judges, giving majority Democrats a chance to pack the panel with their appointees, may provide the first real test of how much things have changed in New Blue Virginia.

Freshman Delegate Dan Helmer, D-Fairfax, introduced House Bill 1297, which is on the docket for the full meeting of the House Labor and Commerce meeting Thursday afternoon. One of the three existing SCC judges, Patricia West, could be re-elected this session and is not expected to be, giving the new majority one seat to fill by March. As introduced, Helmer’s bill creates two more seats to be filled at some future special or regular session.

Energy issues, and the SCC’s perceived hesitance to charge forward and save the planet from climate catastrophe, are front of mind with many of the new (and some of the old) legislators. But a reconstituted SCC could also change direction on insurance, banking, corporate governance, pipelines and other areas of regulation under its purview. Its key role on those is often overlooked.

Once the full committee rises, in a meeting of the newly constituted energy subcommittee of House Labor and Commerce, more than twenty energy bills will face their first hearing. The meeting will probably start late and run long, but Friday’s dawn may mark a new green energy age, at least in the House of Delegates.    Continue reading

Rate Case Bill Offers Repentence to Legislators

By Steve Haner

Sinners! The hour of redemption is at hand! For years now some of you have deprived your fellow Virginians of a fair hearing in front of the judges set above them. To deny justice is among the worst of abominations, but a chance for salvation has appeared.

Yes, I am talking to the many Virginia legislators who helped protect the profits of the state’s dominant electric utility from proper review and adjustment. You have corrupted the law with “this is in the public interest” and “refunds shall not be ordered unless” and “rates may not be reduced until” and “this shall be deemed reasonable and prudent.”  The judges you have fettered with these phrases sit on the State Corporation Commission

Some of you fell from grace in this way in 2013, 2014, 2015 and then again in 2018. One correct vote in 2020 can wipe the slate clean, returning your political souls to purity.

With passage and implementation of House Bill 969, all will be forgiven. Even this author of countless energy Jeremiads will praise your return to the fold. But woe unto you who fail to heed this final trumpet and abandon the people again. The day of decision is here.  Continue reading

The Wildest Energy Whirlwind Ever is Underway

by Steve Haner

If Bacon’s Rebellion at times has been “Dominion Pravda,” providing a window into that corporate giant’s C suite, our friends at the Virginia Mercury sometimes take the opposite role of “Environmental People’s Daily.”

Its story today is a good example, for what it includes and what it does not. The long, detailed and worthwhile summary of energy and environment issues coming to the 2020 General Assembly has a glaring omission. It makes no reference to the Transportation and Climate Initiative. If anybody could get a straight answer out of the Northam Administration, you’d think it would be Virginia Mercury. The silence is deafening and perhaps significant.

At some point soon somebody has to say something, wouldn’t you think? In others states in the proposed interstate compact, governors are being pinned down, actual TCI bills are pending, legislators are taking positions, coalitions are forming. This will have to happen in Virginia soon if the organizers of TCI want their proposed memorandum of understanding signed by enough states to actually impose the carbon caps and taxes by 2022.  Continue reading

Dominion Plans Four New Gas Units

Photo credit; Southern Environmental Law Center

By Peter Galuszka

Despite its recent advertising campaign rebranding itself as a “green” utility, Dominion Energy is planning to build four natural gas “peaking units” costing $600 million at its Chesterfield County generating station.

The utility filed for a permit for the State Air Pollution Control Board, according to the Chesterfield Observer.

The gas plants would generate 1,000 megawatts of power to electrify 250,000 homes. One phase of the project would be completed in 2023 with another going online the following year. The units will be switched on when more power is needed.

Other than the Observer, there has been remarkably little news coverage of the plans. It could be that Dominion wanted to lie low after announcing plans to build 220 wind turbines off of the Virginia coast. Ads have touted Virginia as a “leader” nationally in renewable energy. Other announcements have involved solar farms and one to turn hog waste into methane. Continue reading

The Carbon Car Tax Nobody Is Discussing

By Steve Haner

So far there appear to be about six schemes before the 2020 General Assembly to save the Earth and its inhabitants from the fiery holocaust of climate catastrophe. The one that is going to cost you the most money in the shortest period of time is still missing in action. Finally we have details, but not from anybody in Richmond.

The organizers of the Transportation and Climate Initiative (TCI) met and held a streamed webinar in Washington, D.C. Tuesday, releasing their long-anticipated draft memorandum of understanding and quite a bit more information about the impact of this new carbon car tax. See the slides here. Does a starting bid of 17 cents per gallon on gasoline get your attention? Do not confuse this with the separate proposal from Governor Ralph Northam to add 12 cents onto the existing state excise tax.  Continue reading

The Gas Boom Is Over

Natural gas storage tanks in the Marcellus shale fields. Photo credit: New York Times

By Peter Galuszka

The boom in shale natural gas is over, reports The New York Times.

The trend raises more questions about billions of dollars worth of gas-related projects in Virginia, including Dominion’s plans to build the Atlantic Coast Pipeline and other firms’ efforts to place two big generating stations near Charles City.

The boom in shale gas began a decade ago when hydraulic fracking methods went into wide use in fields such as Marcellus in West Virginia and Pennsylvania, Eagle Ford and Permian in Texas and Williston in North Dakota.

The results were profound as gas displaced coal as a major generator of electricity. A bump in exporting liquefied natural gas (LNG) loomed, as Dominion converted its Cove Point LNG facility to handle exports.

Independent firms such as Chesapeake Energy in Oklahoma led the way. Big energy firms such as Exxon Mobil and Chevron bought up smaller firms and invested billions in shale gas operations. Numerous pipeline projects were announced, including the Atlantic Coast Pipeline and the Mountain Valley projects in Virginia.

The result? Too much gas and resulting price drops.

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Watch Out, Here Comes the Transportation and Climate Initiative

Virginia voter priorities. Source: Click to enlarge.

by James A. Bacon

A new poll from a “nonpartisan nonprofit think tank,” MassInc., has found that 60% of Virginians surveyed support the Transportation and Climate Initiative Framework while only 29% oppose it and 11% are unsure of their feelings, reports The Virginia Mercury.

We know right off the bat that the findings are nonsense. The fact is, most Virginians have never heard of the Transportation and Climate Initiative. Those who answered MassInc.’s questions were responding to a description of TCI provided by MassInc.’s pollsters:

Under the plan, companies that sell and distribute gasoline and diesel fuel to gas stations in the region would have to pay for the pollution created by the fuels sold and used there. Each state in the program would get a share of the money collected from those companies, based on how much fuel is used in their state. States could use this money to make transportation in their state better, cleaner, and more resilient to the effects of climate change. They could also use it to help residents with any higher costs the companies try to pass on to them.

That poll is about as loaded as you can get. Continue reading

S&P Global Slams Dominion for Gas Plants

Dominion Virginia Power’s gas-burning plant in Brunswick County.

By Peter Galuszka

International financial analysis firm S&P Global has issued a scathing report criticizing Dominion Energy Virginia for over emphasizing future electricity demand and proposing unneeded natural gas-fired generating plants.

According to S&P: “An examination of State Corporation Commission, or SCC, records; Dominion’s past integrated resource plans, or IRPs; campaign finance documents; and independent reports, along with interviews with utility analysts and environmental advocates and statements from Dominion officials, shows that the company has consistently over-forecast electricity demand to justify building new capacity, primarily natural gas plants with dubious economics that will ultimately be paid for by ratepayers.”

Dominion plans on adding at least eight gas plants with a generating capacity of 3,700 megawatts by 2033, S&P reports. An update to its 2018 IRP plan would add three alternatives that would add 2,425 megawatts of gas capacity by 2044. Continue reading