Fairfax County legislators are leading the charge to lift a cap on solar power purchase agreements in Dominion’s territory.
Kambiz Agazi is beyond frustrated with the squeeze on rooftop solar for Virginia’s schools, recreation centers, government offices and libraries.
The longtime Fairfax County energy official last year helped the county draft a plan to install enough solar panels at 113 sites to power more than 213,000 homes — the largest project of its type in Virginia.
For now, much of the project has been curtailed due to a state cap on solar power purchase agreements, or PPAs, in Dominion Energy’s territory. The financing tool allows solar developers to build, own and maintain projects and sell the power to customers, often tax-exempt entities such as local governments that can’t directly claim federal tax credits for renewable projects.
“Allowing local governments to engage in PPAs is a total no-brainer,” said Agazi, who directs Fairfax County’s Office of Environmental and Energy Coordination. Instead, “we’re in a byzantine discussion with a regulated utility that suppresses the market so they can control it. We need state government to say enough is enough.”
Agazi is encouraged that state legislators from the large, wealthy county in northern Virginia have been instrumental this legislative session in introducing bills designed to lift the PPA cap and expand distributed renewable generation across the state. Until something changes, Fairfax remains in the thick of an unfolding PPA drama. The county’s ambitious proposal called for covering rooftops and carports with photovoltaic panels with a combined capacity of roughly 45 megawatts.
Only 6.5 MW of that total was greenlighted before Dominion reached the 50-megawatt limit at year’s end. That means the remaining 38.5 or so megawatts are on hold — at least temporarily.
For now, Agazi said the county is proceeding with the 6.5 MW, which encompasses canopy/carport-mounted solar panels at seven county high schools. Six of the projects are 1 MW and the seventh is 0.5 MW.
Read more: Virginia schools’ rapid solar growth is headed for ceiling without legislative fix
Third-party power purchase agreements are an ideal financing tool for tax-exempt entities because they have little or no upfront expenses and usually pay less for electricity their projects generate. The third party owner, which can qualify for federal investment tax credits, is responsible for buying and maintaining the photovoltaic panels.
Yes, PPAs are a funding mechanism, Agazi said, but beyond that they allow local governments to roll out renewable energy in a meaningful way without being burdened by the complexities of interconnections, maintenance and operations.
In December, Fairfax County awarded contracts to three teams of solar providers for its projects. Sun Tribe Solar of Charlottesville is pairing with BrightSuite, a Dominion subsidiary, on the canopy/carport-mounted installations. The other two are Sigora Solar/Standard Solar and Ipsun Solar/SunLight General Capital.
A majority of the 113 proposed sites are schools, but the list also includes libraries, police and fire stations, an animal shelter, parking garages, community centers, a warehouse, and an array of local government facilities. Officials representing county government, schools, parks and housing collaborated on the initial solar-ready list, and continue to add to it.
Sun Tribe CEO Devin Welch said power purchase agreements level the playing field by allowing schools, local governments and nonprofits to save money and open solar-related educational opportunities.
Of the legislative options under consideration, Welch said his company favors the Virginia Clean Economy Act because it “allows us the best chance to create jobs, expand the PPA cap and meet the commonwealth’s carbon-free energy goals.”
The measure would create a minimum of 2,000 MW of distributed solar by 2030. Distributed solar can be owned by customers, third parties or communities.
A January report stated that boosting the amount of solar on Virginia’s distribution grid from today’s relatively low 92 MW to 2500 MW could mean a jump from 2,900 direct jobs to 29,500 jobs.
Researchers at Virginia Commonwealth University’s Center for Urban and Regional Analysis completed the study and 18-page report at the behest of the Maryland-D.C.-Delaware-Virginia Solar Energy Industries Association.
That report also cited research by the National Renewable Energy Laboratory estimating that Virginia could support 19 gigawatts of distributed solar, producing 22 million megawatt-hours of electricity. That equals about one-fifth of the state’s electricity demand.
Del. Richard “Rip” Sullivan, a Democrat representing parts of Fairfax and Arlington counties, introduced the House of Delegates version (HB 1526) of the all-encompassing Virginia Clean Economy Act. Sen. Jennifer McClellan, D-Richmond, is the chief sponsor of the companion bill in the Senate (SB 851).
A separate bill that would lift the PPA cap and address other distributed renewable energy issues is the Solar Freedom Bill. Del. Mark Keam, a Democrat representing Fairfax County, introduced the House version (HB 572); McClellan is chief sponsor of the Senate version (SB 710).
When and if Fairfax County completes all 113 sites, it estimates a savings of at least $60 million over 25 years on the electricity it now buys from Dominion. The contracts also have the potential to cut 1.2 million metric tons of heat-trapping gases — equivalent to the amount emitted by 260,155 passenger vehicles annually.
Dominion, the state’s largest power provider, didn’t offer comment for this article. But in an interview late last year, a utility executive told the Energy News Network that Dominion was open to reviewing the policy because enrollment has increased so significantly.
“We remain committed to and support the coordinated expansion of small-scale solar,” said Joe Woomer, vice president of grid and technical solutions for Dominion’s Power Delivery Group. “To fulfill this commitment, we will work with stakeholders to develop an approach to responsibly expand the current 50-MW cap in a way that is equitable to both participating and non-participating customers.”
It’s also noteworthy that one of Dominion’s subsidiaries, BrightSuite, bid on the Fairfax County solar installations.
Richmond-based Dominion is the largest electric utility in Virginia, serving 2.5 million customers in the northern, central and southeastern regions of the state.
State legislators set the cap on power purchase agreements seven years ago. Under Dominion’s pilot program, each individual project can be no larger than 1 MW.
Welch, of Sun Tribe Solar, noted that the current PPA cap is an equity issue.
“By raising the PPA cap, we can ensure that all communities — regardless of their access to capital — can participate in the clean energy economy,” he said. “If we can do that, we’ll be unlocking Virginia’s clean energy potential and building a future that’s not just sustainable, but equitable.”
Virginia should be focused on setting a solar access example for the country, not pitting one community against another, said Agazi, who has dedicated more than two decades to environmental work in Fairfax County.
“My two cents is that we are in a climate crisis and we are way behind the eight ball as a nation,” he said. “When you are in a crisis you need to think about mass production of solar, and one of the best ways to roll that out statewide is a PPA.”
Some sort of solution seems likely because both chambers of the General Assembly now have Democratic majorities.
Agazi said he is hopeful legislators will act to curb greenhouse gas emissions because he has witnessed how the state has made progress with air pollution and stormwater issues.
“The state of Virginia needs to be asking what its aspirations are and if its goal is to do its part to solve the climate crisis.”