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Virginia clean energy advocates say expanding access to solar energy subscriptions statewide is already a top priority for the next legislative session, and they’re optimistic despite this month’s political reshuffling.
Barring last-minute disruptions, Dominion Energy customers are on the verge of being able to buy solar energy via subscriptions to shared, local solar projects instead of having to install panels on their own rooftops. The off-site power facilities are built and owned by third-party entities, not utilities.
Subscribers will earn credits in the form of savings on their monthly electric bills. The concept is attractive to low-income customers who can’t afford the upfront costs of rooftop solar arrays, those with shaded southern exposure, people subject to homeowner association restrictions, and apartment renters and condominium owners without control of their rooftops.
“Basically, you own a portion of a bigger system,” said Chelsea Barnes, legislative director for Appalachian Voices, a southwest Virginia nonprofit that now wants to expand the concept to the state’s two smaller investor-owned utilities. “It can be really helpful in a place like southwest Virginia where the terrain is more hilly and we have a lot of shade.”
The Dominion program is among the energy accomplishments of Democrats who controlled state government for the last two years. Voters this month flipped the governor’s office and one legislative chamber back to Republicans, but solar advocates don’t see that as an impediment to shared solar, also referred to as community solar.
“We’ll be working all through the fall and winter to educate the public and lawmakers so we can get support for this and show why it is needed in our region,” Barnes said. “It can really open up the market to take advantage of solar.”
The next legislative session begins in January. A proposal in the works will likely use last year’s Senate Bill 629 and House Bill 1634 as blueprints.
Democratic state Sen. Scott Surovell, who represents a district near Washington, D.C., was the author of SB 629. Solar and environmental justice advocates praised him for pressing for a measure heavy on accessibility and equity because they knew he would face fierce pushback from Dominion. Surovell’s goal was to lift barriers to the green economy and extend cost savings to consumers often left behind.
The Dominion program will be capped at 150 megawatts when it debuts in 2023. However, it can be boosted to 200 MW if it meets an incentive requiring at least 30% of enrollees to meet pre-established low-income standards. No single small-scale distributed generation project can be larger than 5 MW.
Barnes said she has designs on legislation that would initially commit to a 300 MW shared solar program in Appalachian Power service territory, and 15 MW in the smaller service area covered by Old Dominion Power.
Matt Hargarten, the Colorado-based campaigns director for the Coalition for Community Solar Access, said those starter goals are very reasonable, especially when compared to Dominion’s relatively puny 150 MW beginnings.
“In most places, 150 megawatts would be considered a small pilot program,” Hargarten said, adding that it’s well below 1% of all the electricity Dominion provides. “It’s a nice start, but just the tip of the iceberg because the grid can benefit by having a larger part of its load come from distributed generation.”
In early October, the U.S. Department of Energy said it wants to enable community solar systems nationwide to power the equivalent of 5 million households by 2025, creating $1 billion in energy bill savings. That milestone would help the Biden administration achieve its goal of a decarbonized grid by 2035.
Hargarten emphasized that a host of other states are viewing shared solar as a crucial piece of their power portfolio. For instance, Minnesota’s program is uncapped and New York has set an enormous 10-gigawatt limit.
At 588 MW, the cap for neighboring Maryland’s pilot program is almost four times the size of Dominion’s. Maryland, which has 2.5 million fewer people than Virginia, anticipates making significant increases to its annual megawatt allotments when it moves to a permanent program.
Hargarten’s coalition collaborates with organizations such as Appalachian Voices and in states nationwide to form sound community solar policy by educating lawmakers and working with utility regulators as they transform law into on-the-ground regulations.
“We can be a guide,” he said about the coalition’s role. “We have seen how policies good, bad and ugly have been written across the country. There are lots of good intentions, but we want to make sure the program rules work so steel gets put into the ground.”
‘Like Netflix for solar’
In an interview months ago, Rachel Smucker told the Energy News Network that it should be incredibly simple to enroll customers, especially those with lower incomes, in community solar programs.
“This should be like Netflix for solar,” said Smucker, then the policy manager for the D.C. area trade group now known as the Chesapeake Solar & Storage Association. “We want to maximize its reach to communities that could really benefit.”
Hargarten called that an apt analogy.
While it’s up to the individual solar developers, not the utilities, to recruit appropriate customers, regulators need to spell out details on a process that is fair and not overly burdensome.
For example, project builders should be filling out all paperwork related to customers’ income requirements. As well, customers should be able to unsubscribe from the program or move the benefits to a new residence without being penalized.
“It’s pretty easy to sign people up because it’s guaranteed they’ll see savings on their electric bill,” Hargarten said.
Nationwide, two bones of contention regularly hashed out between regulators and utilities revolve around the annual reset of enrollees’ monthly minimum charge and how customers will be credited on monthly electric bills for the solar energy they use.
In Virginia, Appalachian Voices joined other advocates in calling for shared solar customers to be permitted to roll over bill credit, month to month, as long as the credits don’t exceed a customer’s average annual bill.
A debate over the price of the minimum charge is playing out now as the Virginia State Corporation Commission wrestles with shaping Surovell’s legislation into actual regulations. Solar advocates are calling for what they call a reasonable minimum charge of $8 to $10.
In an earlier interview, Surovell said he was forced to include language about a minimum bill charge in his measure by legislators who threatened to withdraw their support unless it included a charge dedicated to covering Dominion’s cost of serving customers and administering the program.
Solar advocates don’t subscribe to the notion that solar customers are unfairly exempt from basic utility infrastructure and upkeep costs.
“We believe ratepayers should pay for poles, wires and other utility infrastructure, but the minimum charge has to be such that the customer will sign up and save,” Hargarten said. “If it’s $75 to $85 a month, that offers very little benefit for subscribers and it isn’t lowering their energy burden.
“That’s why it’s so critical that the SCC address the minimum bill issue. If it doesn’t get settled, there will be no community solar program in Virginia.”
Dominion spokesperson Lucy Rhodes said the utility submitted a proposal for the minimum bill to regulators on March 1, as required by the Virginia Clean Economy Act.
“This is still an active proceeding, so we look forward to working with the commission and other stakeholders,” Rhodes said. “We anticipate a ruling from the commission sometime in 2022.”
Appalachian Power spokesperson Teresa Hamilton Hall said her utility is closely monitoring the commission’s decisions regarding the Dominion program as “the results will help us determine what type of program may work for us.”
‘Inherently a bipartisan issue’
Hargarten doesn’t view Virginia’s recent political shift — to a Republican governor and House of Delegates — as detrimental to efforts by Appalachian Voices to advance shared solar beyond Dominion’s service area.
“We think community solar fits in really well with the Republican agenda,” he said. “It’s inherently a bipartisan issue.”
He pointed to Wisconsin, Pennsylvania and Ohio, where Republicans are sponsoring community solar initiatives, and to Michigan, where another measure has bipartisan support.
During the Nov. 2 election, Democrats in the Virginia House lost their small majority when Republicans gained seven seats. Unless results change with anticipated recounts, Republicans now have a 52-to-48 seat advantage. All 100 members of the lower chamber were up for election.
The 40-member Senate maintains a slim Democratic majority as those seats weren’t on the ballot this time around.
Voters also elected Republican and political novice Glenn Youngkin to a four-year term as the next governor. The former co-CEO of the private equity giant the Carlyle Group defeated Democrat Terry McAuliffe, whose sole term as governor ended in 2018.
Incumbent Democratic Gov. Ralph Northam couldn’t run for a second term this year because state law doesn’t allow governors to serve consecutive terms.
Hargarten emphasized that the idea of shared solar was birthed by rural electric cooperatives in GOP-leaning states.
“It has a lot of things conservatives like,” he said, ticking off attributes such as lowering electric bills for families, creating a resilient grid and encouraging rural revitalization. “They are free-market people, so programs like community solar speak to them, especially as prices for renewable energy plunge.”
It’s vital that the state “gets it right quickly” with Dominion’s program, he said, because Virginia is primed for shared solar expansion.
“Virginia is a big state with big ambitions,” Hargarten said. “We think this is an issue both parties can get behind.”
Barnes, of Appalachian Voices, sifted through a plethora of regional solar challenges before moving shared solar to number one on a lengthy to-do list.
“We’re at a disadvantage in a lot of different ways,” Barnes said, mentioning energy storage procurement, solar rebates for low-income residents and small-scale distributed generation as just some of the issues that need to be tweaked and expanded in the state’s more isolated locales.
“They all require legislative solutions,” she said. “The fact is that as a small nonprofit, I can’t run bills to fix all those things at once.”
Shared solar is in the spotlight because it already has momentum and has the potential to scale up relatively quickly.
Barnes is fearless about digging in to benefit her neighbors in Appalachia, but she’s sometimes astounded that legislators don’t recognize gaps on their own, and act without prodding.
“The fact that inequities are built into laws is disappointing,” she said. “It shows how the people crafting legislation aren’t necessarily thinking about this part of the state.”