Water in the 2017 Virginia General Assembly: Renewable Energy Bills

This is one of a series of posts on particular water-related bills in the 2017 Virginia General Assembly.  For an inventory of about 160 water-related bills in the 2017 General Assembly, please visit the Virginia Water Resources Research Center’s “Virginia Water Legislation” page, online at http://www.vwrrc.vt.edu/virginia-water-legislation/.  Each post includes a summary of the bill(s), their legislative status (in committee, passed, failed, etc.), and a list of hyperlinked headlines for news media items on the bill(s).  Information on the bills’ provisions and status is taken from the Virginia Legislative Information System (LIS), online at http://leg1.state.va.us/lis.htm.  Each bill number is hyperlinked to the LIS entry for that bill.

Please note that the Virginia Electric Utility Regulation Act (Chapter 23, Sec. 56-576 of the Virginia Code), defines “renewable energy” as “energy derived from sunlight, wind, falling water, biomass, sustainable or otherwise, (the definitions of which shall be liberally construed), energy from waste, landfill gas, municipal solid waste, wave motion, tides, and geothermal power, and does not include energy derived from coal, oil, natural gas, or nuclear power.  Renewable energy shall also include the proportion of the thermal or electric energy from a facility that results from the co-firing of biomass.”

HB 1891 – Geothermal heat pump property expenditure; tax credit for taxable years 2017-2021.  This bill, sponsored by Del. Timothy Hugo (R-40th District), of Centreville, failed in the House Finance Committee.  The bill would have established a tax credit, for taxable years 2017 through 2021, for geothermal heat pump property expenditures at a residence in Virginia, equal to 25 percent of purchase or installation expenditures, up to a statewide maximum of $10 million in credits per year.  The bill defined “geothermal heat pump property expenditure” as any expenditure for equipment that uses the ground or groundwater as a thermal energy source to heat a residence or as a thermal energy sink to cool a residence.  The Senate companion bill, SB 1392, sponsored by Sen. Frank Wagner (R-7th District), of Virginia Beach, failed in the Senate Finance Committee.

HB 2112, Community renewable projects: SCC to adopt rules authorizing.  This bill, sponsored by Del. Mark Keam (D-35th District), of Vienna, failed in the House Commerce and Labor Committee.  The bill would have required the State Corporation Commission to adopt rules under which community renewable projects are authorized to operate.  A community renewable project would be defined as solar or wind-powered electric generation facility with a capacity of not more than 20 megawatts that is operated subject to requirements that the electricity generated by the facility belongs to the project’s subscribers.

HB 2303 – Small agricultural generators; establishes parameters of a program for selling electricity to a utility.  This bill, sponsored by Del. J. Randall Minchew (R-10th District), of Leesburg, passed the House and Senate and was approved by the governor.  The bill establishes the parameters of a program under which small agricultural generators may sell the electricity generated from a small agricultural generating facility to its utility.  Effective July 1, 2019, enrollment by eligible agricultural customer-generators in an existing net-energy-metering program conducted by an electric cooperative will cease, although a cooperative’s customers who were participating as eligible agricultural customer-generators before that date would be allowed to remain in the ne-metering program for not more than 25 years.  A small agricultural generator is defined in this measure as a customer who operates an electrical generating facility as part of an agricultural business, which generating facility, among other conditions, has a capacity of not more than 1.5 megawatts, uses renewable energy as its total source of fuel, has a capacity that does not exceed 150 percent of the customer’s expected annual energy consumption based on the previous 12 months of billing history, uses not more than 25 percent of contiguous land owned or controlled by the agricultural business for purposes of the renewable energy generating facility, and is a qualifying small power production facility under the federal Public Utility Regulatory Policies Act (PURPA).  The program requires the generator to enter into a power purchase agreement with its supplier to sell all of the electricity generated at a rate not less than the supplier’s State Corporation Commission-approved avoided cost tariff for energy and capacity.  The program also allows utilities to recover distribution service costs and costs incurred to purchase electricity, capacity, and renewable energy certificates from the small agricultural generator through its Renewable Energy Portfolio Standard (RPS) rate adjustment clause (if the utility has a Commission-approved RPS plan and rate adjustment clause) or through the supplier’s fuel adjustment clause or through the utility’s cost of purchased power (if the utility does not have a Commission-approved RPS rate adjustment clause).  The Senate companion bill, SB 1394, sponsored by Sen. Frank Wagner (R-7th District), of Virginia Beach, passed the Senate and House and was approved by the governor.

HB 2390, Renewable energy power purchase agreements; expands pilot program to Appalachian Power.  This bill, sponsored by Del. Terry Kilgore (R-1st District), of Gate City, passed the House and Senate.  The bill would expand the pilot program for renewable energy power purchase agreements authorized under legislation enacted in 2013 by directing that a pilot program be conducted by Appalachian Power; currently a pilot program is authorized only within Dominion Virginia Power’s service territory.  On March 24, the governor proposed an amendment terminating the pilot programs in 2022.  The amendment will be taken up in the reconvened session on April 5.

SB 813, Solar generation facilities: cost-recovery provisions.  This bill, sponsored by Sen. David Marsden (D-37th District), of Burke, failed in the Senate Commerce and Labor Committee.  The bill would have exempted investor-owned electric utilities from the requirement that in a proceeding for approval to construct a generating facility they demonstrate that they have considered and weighed alternative options, including third-party market alternatives, in their selection process, if the proposed generating facility is located in the Commonwealth, uses energy derived from sunlight, and has been declared by statute to be in the public interest.

SB 918, Renewable energy: third-party power purchase agreements to be authorized for each electric utility.  This bill, sponsored by Sen. John Edwards (D-21st District), of Roanoke, failed in the Senate Labor and Commerce Committee.  The bill would have replaced the pilot program enacted in 2013 that authorized certain third-party power purchase agreements providing financing of certain renewable generation facilities, would have required the State Corporation Commission to establish third-party power purchase agreement programs for each electric utility.  The existing pilot program applies only to Dominion Virginia Power and sets the maximum size of a renewable generation facility at one megawatt; the programs authorized by this measure would have applied to all electric utilities and without a limit on the size of facilities.

SB 1197, Small renewable energy projects; State Corporation Commission jurisdiction.  This bill, sponsored by Sen. Creigh Deeds (D- 25th District), of Charlottesville, failed in the Senate Commerce and Labor Committee.  The bill would have restored the requirement for State Corporation Commission (SCC) to review construction and operation of small renewable energy projects that either disturb an area of 100 acres or more, or are located within five miles of a political subdivision boundary.  In 2009 the General Assembly removed the requirement that the owner or operator of a small renewable energy project obtain a certificate of public convenience and necessity approval for the project from the SCC.  Small renewable energy projects are defined an electrical generation facility with a rated capacity not exceeding 100 megawatts that generates electricity only from sunlight, wind, falling water, wave motion, tides, or geothermal power; or an electrical generation facility with a rated capacity not exceeding 20 megawatts that generates electricity only from biomass or certain waste.

SB 1226, Virginia Freedom of Information Act (FOIA); proprietary records and trade secrets related to solar energy.  This bill, sponsored by Sen. John Edwards (D-21st District), of Roanoke, passed the Senate and House and was approved by the governor.  The bill excludes from the mandatory disclosure provisions of FOIA proprietary information, voluntarily provided by a private business under a promise of confidentiality from a public body, used by the public body for a solar photovoltaic services agreement, a solar power purchase agreement, or a solar self-generation agreement.

SB 1258, Virginia Solar Energy Development and Energy Storage Authority; name change, increase in membership, and expansion of purposes.  This bill, sponsored by Sen. Adam Ebbin (D-30th District), of Alexandria, passed the Senate and the House.  The bill continues the Virginia Solar Energy Development Authority and renames it the Virginia Solar Energy Development and Energy Storage Authority.  The measure expands the authority’s purposes to include positioning the Commonwealth as a leader in research, development, commercialization, manufacturing, and deployment of energy storage technology; and would expand the Authority’s powers to include 1) promoting collaborative efforts among Virginia’s public and private institutions of higher education in research, development, and commercialization efforts related to energy storage; 2) monitoring relevant developments nationally and globally; and 3) identifying and working with the Commonwealth’s industries and nonprofit partners.  On March 3, the governor proposed technical amendments that will be taken up in the reconvened session on April 5.

SB 1388, Electric utilities’ margin on solar energy power purchase agreements.  This bill, sponsored by Sen. Frank Wagner (R-7th District), of Virginia Beach, failed (was stricken at the sponsors request) in the Senate Commerce and Labor Committee.  The bill would have authorized any investor-owned incumbent electric utility to enter into, recover the costs of, and earn a margin on power purchase agreements executed between July 1, 2017, and July 1, 2018, and for power generated by solar energy systems located in the Commonwealth with a capacity equal to or greater than two megawatts which systems in the aggregate have a capacity not more than one percent of the utility’s adjusted Virginia peak-load forecast for the previous year.  The bill would have provided that the costs and margin are recoverable, that such agreements are in the public interest, and that in reviewing the costs and the level of costs to be recovered the State Corporation Commission shall liberally construe the provisions of this measure and shall presume that the costs associated with such agreements are reasonably and prudently incurred.

SB 1395, Small renewable energy projects; eligibility for permits by rule.  This bill, sponsored by Sen. Frank Wagner (R-7th District), of Virginia Beach, passed the Senate and House and was approved by the governor.  The bill provides that certain small renewable energy projects proposed, developed, constructed, or purchased by either by a public utility (if the project’s costs are not recovered from Virginia jurisdictional customers under base rates, a fuel factor charge, or a rate adjustment clause) or by a utility aggregation cooperative are eligible for a permit by rule and are exempt from environmental review and permitting by the State Corporation Commission.  The measure specifies that a small renewable energy project shall be eligible for permit by rule if it is proposed, developed, constructed, or purchased by a person that is not a regulated utility.  The measure exempts any small renewable energy project for which the Department of Environmental Quality has issued a permit by rule from the requirement that it obtain a certificate of public convenience and necessity.  Finally, the measure increases from 100 megawatts to 150 megawatts the maximum rated capacity of solar and wind facilities that qualify as small renewable energy projects.

News Media Items Related to One or More of These Bills
“We broke a logjam”: New laws are expected to boost solar development in Virginia, Virginia Business, 3/31/17 [regarding HB 2303, HB 2390, and SB 1395].
New utility solar program called a small step forward for Virginia renewable energy, Richmond Times-Dispatch, 3/26/17 [regarding SB 1395].
More solar options could emerge from General Assembly session, Richmond Times-Dispatch, 1/7/17.
Bill could brighten prospects for Berglund Center’s solar energy project, Roanoke Times, 2/22/17 [regarding SB 1226].

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