Category Archives: Utilities

APCO VCEA Plan Keeps Coal Until 2040 (In WVA)

Cover for the 2023 update of Appalachian Power Company’s plan to comply with the Virginia Clean Economy Act (VCEA) in coming decades.

by Steve Haner

Appalachian Power Company (APCO), serving Western Virginia, has now filed its annual update on Virginia Clean Economy Act compliance, including long term bill impact estimates. As the State Corporation Commission begins its review process, here are some highlights:

  • The projected increases in electric bills are little changed and perhaps a bit lower than those reported a year ago. The cost for 1,000 kilowatt hours to power a home for a month was $117.09 in 2020; using the compliance plan the company prefers, it is projected to be $172.12 in 2030 (up 55%) and $193.29 (up 65%) in 2035.
  • Despite all the political discussion about Virginia turning to the new, smaller nuclear reactor technology (so-called small modular reactors, or SMRs), they don’t turn up in APCO’s development plan as even an option for a long time, perhaps in 2040 when its major West Virginia coal plants will retire. Dominion Energy Virginia’s preferred VCEA compliance plan also didn’t turn to SMRs in the short term.
  • Energy demand projections within Appalachian’s territory are negative, going down. Over the next 15‐year period (2023‐2037), its service territory is expected to see population decline at 0.3% per year and non‐farm employment growth of ‐0.1% per year. It projects its customer count to decline by 0.1% over this period. Internal energy requirements and peak demand are expected to decline by 0.4% per year through 2037.

Continue reading

Lower Bills? Green Energy Keeps Them Climbing.

by Steve Haner

Customer cost projections for compliance with the Virginia Clean Economy Act have increased again from the first such estimates made in 2020.  The bill for 1,000 kilowatt hours of electricity from Dominion Energy Virginia to power a home for a month may rise almost $100, or 83%, by 2035.

Dominion residential customers were already paying $288 (21%) more per year for 1,000 kilowatt hours per month by December 2022, compared to May 2020, just before VCEA became law.  That will cost another $547 annually by 2030 and $878 more by 2035.  Cost projections are even higher for commercial and industrial customers.

After all the hyped discussion coming out of the 2023 General Assembly that regulatory changes it made will “lower electricity bills,” it is important to face reality.  Ignore claims from any incumbents who say they voted to “lower bills.”  VCEA compliance is still going to be very expensive, and nothing just passed changes any of that.

The most recent figures are very similar and slightly higher than those reported in 2020.  They were filed last year by the utility as part of the annual VCEA compliance plan, outlining its planned conversion from fossil fuel generation to massive amounts of wind and solar power over the next two decades. Continue reading

“Cheap” Solar Costs More Than Offshore Wind?

Whether Dominion is building the solar farm or just buying its output makes a huge difference in cost.

by Steve Haner

In preparing for the latest round of new additions to its solar generation assets, Dominion Energy Virginia rejected eight privately- developed projects which were substantially cheaper than the projects it wanted to build on its own with ratepayer money. Just how much more expensive the company-owned projects will be is not clear, but the higher costs will be locked in for decades.

It is the 2020 Virginia Clean Economy Act which is driving the massive solar buildout, and one part of the statute is being read one way by the utility and another way by most of the other stakeholders. Dominion believes the law requires it to provide a fixed 35% of the new renewable electricity from third-party providers under long-term power purchase agreements (PPAs). It claims the law dictates that it must own 65% of the generation assets directly.

Just about every other party to the most recent application for new solar believes that 35% is a floor, a “no less than” target, and a higher percentage could be from PPAs. Entities taking that position include the Office of the Attorney General,  environmental activists, and even large electricity users such as Walmart. The issue dominates final arguments on the application filed this week at the State Corporation Commission.

What is the solar price differential? As with far too many of these disputes, most of the key financial information is confidential, available only to case participants who have filed a promise to maintain secrecy. But in its final brief, the staff for Attorney General Jason Miyares (R) provides some dramatic comparisons. Continue reading

Under RGGI Virginia Releases More CO2, Not Less

With the March 8 RGGI results, Virginia power producers have now paid $590 million in carbon taxes. Click for larger view.

by Steve Haner

Since Virginia joined the Regional Greenhouse Gas Initiative (RGGI) compact at the start of 2021, according to data reported by the U.S. Energy Information Agency, the amount of carbon dioxide emitted to provide electricity to customers in the state has grown. Despite two years of RGGI caps and taxes, total CO2 emissions did not shrink, but grew by 3.7 million tons.

That is because the emissions total includes tracking all power producers providing electrons to the state, which is not the same as emissions from power producers located within the state. Virginia’s membership in RGGI is having the exact opposite effect from what its adherents claim it does because, as many predicted, it has forced Virginia to import far more electricity than it used to.

During the two-year period, electricity consumption within the state grew to 130 million megawatt hours, up 11%. Electricity imports grew from 14 million megawatt hours in 2020 to more than 39 million MWH in 2022, up 280%. RGGI has simply driven power production from fossil fuels used by Virginia to other states. As it has for the other RGGI member states.

These conclusions come from EIA data compiled by David Stevenson, director of the Caesar Rodney Institute in Delaware, and long a skeptic on the benefits of RGGI in this region. He added them to the growing list of public comments on the Virginia Air Pollution Control Board’s pending proposal to take Virginia out of RGGI at the end of 2023. More details and citations from Stevenson are contained in a longer discussion which you can read here; and in a table he created, which is reproduced below. Continue reading

SCC, SMR Nukes Caught in Energy Wars Deadlock

Available: Lovely Main Street  office space, with views.

by Steve Haner

What the 2023 General Assembly didn’t pass is also an important Virginia energy policy story, starting with failure on its part to fill the two open seats on the crucial State Corporation Commission. This follows its failure last year to fill one open seat on the three-judge panel.

As reported yesterday, advocates for restored SCC authority over utility rates had more success this year than in a long time, largely because Governor Glenn Youngkin (R) was among them. The bills awaiting his signature may not mean much if the Commission itself is barely functioning. A string of major cases for 2023 was created by these new bills, with just one commissioner and perhaps some interim substitute judges to hear them. Continue reading

SCC Oversight Restored, Don’t Expect Lower Bills

What Dominion is promoting as how to “save” you money while paying off its old fuel bills, with ten years of Tuesdays to pay. With interest.

by Steve Haner

The final version of a regulatory revision for Dominion Energy Virginia restores State Corporation Commission authority over the utility’s profit margin and rates, a major goal for Governor Glenn Youngkin (R). It was also the highest priority in a detailed energy policy put forward by the Thomas Jefferson Institute for Public Policy.

Of the aggressive goals set out in Dominion’s initial legislation, few were accomplished in the end. The General Assembly did agree to directly legislate a profit margin for the utility for two years, and it is an increase.  Come 2025 the SCC will be free to set the next profit rate without any reference to the peer group of other utilities now required by law. Continue reading

RTD Promises Lower Electric Bills? Watch and See.

From this morning’s Richmond Times-Dispatch:

 A reduction in Dominion Energy bills is on the way after a compromise on a new approach to regulate the company made it through the General Assembly on the last day of the session….

The compromise on electric bills — in legislation that passed nearly unanimously — would bring an immediate $6 to $7 cut in a benchmark 1,000 kilowatt-hour monthly bill, which now stands at $137.

Now there is a firm prediction, a promise even, that we can track.  The reductions will be immediate, right?  So, look for them on your next monthly bill?  Or should we be honest that the bill, if signed as is, doesn’t go into effect until July 1.  Will your bill immediately go down on July 2?  September 1?  The newspaper predicts it will be lower even though as the year progresses, Dominion begins to charge even more for the Coastal Virginia Offshore Wind project, the upgrades at its four nuclear reactors, and puts the tax to pay for the Regional Greenhouse Gas Initiative back onto your monthly bills. Oh, and the new legislation increases Dominion’s authorized profit margin, which customers will start to pay in the near future.

Pick a date in the future, maybe just before Election Day 2023, and we’ll see then what 1,000 kilowatt hours of electricity costs a Dominion customer.  The RTD is promising $131.

A deeper analysis of the final conference report substitute on Dominion’s proposed regulatory will likely appear later today.  But that ridiculous claim that your bills will actually go down “immediately” needs to be highlighted and filed away for future reference.  And once again the newspaper has to be dismissed as a serious, independent news outlet when it writes propaganda ledes to please one of its largest advertisers.

— Steve Haner

General Assembly: Status of Selected Issues

by Dick Hall-Sizemore

The General Assembly is scheduled to adjourn on Saturday, February 25.  Time to check on the status of some issues that have been discussed on this blog.

Budget bill. The budget bill contains not only the usual appropriations, but also all those tax cuts proposed by the Governor. There is activity behind the scenes, but, so far, no public hint that any sort of compromise is near.

Utility bills. One major utility regulation bill has been passed, but the others are in conference. I will defer to Steve Haner to comment on these as he deems fit.

SCC judgeships. Last year, the General Assembly could not agree on a person to fill a vacant SCC judgeship. The House supported one person; the Senate favored another. In late 2020, one of the two sitting judges, Judith Jagdmann, announced her retirement with a year left on her appointment. That left two vacancies, seeming to solve the problem: Each legislative house could have its own favorite. But, there was a fly in the ointment.  ne vacancy, Jagdmann’s, was only for the year left on her term. The other vacancy was for a full six years. Who was going to get the short straw? Another impasse. Continue reading

The Future Is Here

EV charging station, Henrico WalMart

Energy Outcome Cloudy as Adjournment Looms

Rube Goldberg is the best illustration when our General Assembly does energy policy bills.

by Steve Haner

With adjournment less than a week away, the 2023 General Assembly is a mixed bag for electricity consumers, with the Assembly seeming to release control to regulators in some areas but continuing to assert its tight control in others.

Dominion Energy Virginia’s legislation to sweeten its authorized profit margin, which will not lower customer bills despite claims in its advertising blitz, passed the Senate but remains in trouble in the Virginia House of Delegates. A key House committee voted late last week to stick with a version of the bill that leaves the return on equity formula unchanged. Continue reading

Strange Bedfellows Unite Against Dominion Bill

Ad placed by opponents of Dominion’s bill on profit margins in Sunday’s Richmond Times-Dispatch. Click for larger view.

by Steve Haner

Battles over utility ratemaking can produce some “strange bedfellow” coalitions. Check out the list of advocacy organizations which have banded together to oppose Dominion Energy Virginia’s pending bill to mandate a higher profit margin.

The list appeared in a full page advertisement in the Sunday Richmond Times-Dispatch and can also be found on a website. It is a longer and more interesting list than a coalition previously mentioned, calling itself the Energy Burden Coalition. The broader group also just focused on this one bill.

The list in the paper includes the Virginia Manufacturers Association and the union-affiliated Virginia Organizing, certainly on opposite sides of many issues. Americans for Prosperity, usually attacked from the left as being founded by major fossil fuel magnates, finds itself listed along with Clean Virginia and plenty of other organizations affiliated with and/or funded by the wind and solar industries. Continue reading

Dominion’s Ads Deceive About Ratepayer Impact

Dominion’s ad copy in this morning’s Richmond Times-Dispatch. Click for larger view.

by Steve Haner

Dominion Energy Virginia has launched a major advertising campaign advocating  legislation to increase its allowed profit margin, with ads focused on a deceptive message that the bill will actually lower costs for consumers.  It will not.

The print version of the campaign, which can be seen in a full page ad in the Richmond Times-Dispatch in print and online, refers to and reproduces part of a February 1 letter from the State Corporation Commission that answered one question about the bill, looking at one item in isolation from the whole. It ignores an earlier, longer, January 27 letter from the SCC that outlines the cumulative rate impacts from the bill.

With all its many deceptions, nothing tops the headline which implies the SCC has claimed this bill will save customers money. There is no other word for that than “lie.” Continue reading

Youngkin Thwarts Dominion Push for Higher Profit

Gov. Glenn Youngkin (R)

by Steve Haner

A Virginia House of Delegates committee has rebuffed Dominion Energy Virginia’s bid to change the rules on how much profit it can earn, setting up a confrontation with the utility and its allies in the Virginia Senate.  Governor Glenn Youngkin (R) reportedly encouraged the delegates to take the step and sent a member of his cabinet to speak in favor of watering down Dominion’s bill.

When they were introduced a few weeks back, House Bill 1770 and Senate Bill 1265 were identical.  It was probably Dominion’s game plan to have them remain identical as they passed in their houses of introduction by the February 7 deadline.  Now the bills likely to pass have morphed into very different substitutes, with all observers expecting a high stakes joint conference committee to follow. Continue reading

Now We Will Enrich Dominion’s Creditors, Too

Who gets rich when debtors make smaller payments over longer periods of time? The lenders, that’s who.

by Steve Haner

Facing the prospect of a jaw-dropping jump in electricity prices because of fuel price hikes last year, the State Corporation Commission approved Dominion Energy Virginia’s request to defer most of those costs for future collection. The unpaid bill for fuel already burned is now about $1.5 billion, apparently, and Dominion has a new plan on how to collect it from you.

Have you ever made the mistake of running up a big credit card bill, and then trying to pay it off by making just the minimum payment? The banks behind the credit cards love it when you do that, because of all the interest they collect over the years it takes you to pay down to zero. Dominion is proposing to do exactly that with that unpaid $1.5 billion in fuel costs. Continue reading

Dominion Seeks Return of RGGI Tax to Its Bills

The states currently in the Regional Greenhouse Gas Initiative CO2 emissions compact.

by Steve Haner

The on again, off again, direct tax on Dominion Energy Virginia bills to pay for the Regional Greenhouse Gas Initiative (RGGI) may be on again. If you feel like you are watching a shell game and just cannot find the pea, that is intentional.

In its sales pitch for its latest effort to create a more favorable regulatory environment, Dominion Energy Virginia is touting its proposal to take several of its existing stand-alone rate adjustment charges (RACs) and roll them into its base rates. The claim is that will save ratepayers $350 million. Continue reading