Yesterday, Governor Terry McAuliffe formally unveiled his highly-anticipated energy plan for Virginia. The nearly 500-page document was officially released two weeks ago, but the administration presented the plan with analysis for the first time before a room of 200 interested clean energy advocates, utility representatives, business associates, and the general public.
Speaking on the plan, Governor McAuliffe spoke passionately about his desire to catch up to neighboring states in renewable development. Specifically, McAuliffe stated affirmatively that “climate change exists and humans contribute to climate change.” He also declared that “it’s time for the commonwealth to lead on solar and wind generation.” I couldn’t agree more.
The details of the Virginia Energy Plan offer some glimpses into exactly how the governor will accomplish his pledge to use renewables to “diversify and build a new Virginia economy.” Although none of the recommendations in the energy plan are binding in any way, the plan provides an opportunity to lay forth a strong vision for clean energy. On the whole, the plan is fairly strong with some notable exceptions. Without further ado, here’s a recap on the Virginia Energy Plan and a look forward into Virginia’s near future.
A Recap on Renewables
Grow. Strength. Diversity. Those three words were the self-described “hallmarks” of McAuliffe’s energy plan. McAuliffe pledged to make solar a priority and that is evident in his plan. The first set of recommendations deals mostly with solar and calls for the increase of this zero-emitting resource. Among several recommendation, the plan calls for an increase from 1% to 3% in the net-metering program cap. Tripling the total limit would be great if we were anywhere close to the existing 1% cap on net-metering.
(note: the 1% program cap refers to a limit of the percentage of customer-owned net-metering energy in Virginia. Currently, the max is 1% of peak-load from the previous year)
As you know, one of the reasons why Virginia hasn’t sniffed the 1% net-metering limit is because utilities have moved heaven and earth to stop the growth of customer-owned solar dead in its tracks. Current laws place onerous standby charges on solar homeowners and place limits on the size of systems that residents and businesses may install and net-meter on their own property.
But Governor McAuliffe has a solution to at least one of these problems. His energy plan proposes doubling the allowed maximum net-metered system size for both residential and non-residential customers, from 20 kw to 40 kw for residential and 500 kw to 1 MW for non-residential customers.
Additionally, the energy plan recommends the creation of a Solar Energy Development Authority to facilitate the development of 15 MW of solar on state and local government facilities and an additional 15 MW of solar on commercial, industrial, and residential facilities by July of 2017.
These are terrific ideas, but I would’ve taken them a few steps further. The net-metering non-residential project cap should be increased to 2 MW rather than the 1 MW proposed in the plan. Both Maryland and Florida for instance have similar project caps at 2 MW. Although our neighbors to the south, North Carolina, has a 1 MW cap similar to McAuliffe’s proposed new limit, it’s worth mentioning that North Carolina has a very generous state tax credit which is helping to drive solar in the state (Virginia was denied this opportunity by our General Assembly last year and this needed solution is not recommended in the plan). North Carolina also has a mandatory RPS with a solar carve-out (Virginia was denied this opportunity by our utilities and our General Assembly virtually every year and this needed solution is also not recommended in the plan.)
Georgia has a project cap less than Virginia, but benefits significantly due to their state Public Service Commission recently issuing an order mandating the state’s largest utility to increase its solar development by 525 MW by 2016. I can’t imagine our State Corporation Commission doing the same to Dominion Virginia Power.
And while we’re talking total megawatts installed, having an energy plan that specifically calls on 30 MW of additional solar in a state that only has about 15 MW installed may sound great if it were not for the fact that North Carolina has 627 MW of solar currently installed and Maryland has 161 MW. If the governor wants to truly play catch-up to our neighbors, we should set more ambitious goals. All that being said, the eagerness of this administration to grow solar in the state is fairly evident in the plan.
By now you may be wondering why this section summarizing renewables within the energy plan so heavily focuses on solar and not, for instance, offshore wind. Well, that’s because concrete recommendations for offshore wind in the energy plan are hard to come by. The plan mentions the need to develop offshore wind in the 112,000 acres Dominion exclusively leased in September of last year, but there’s no actionable recommendation to be found.
The administration could have, and should have, specifically recommended that Dominion develop this resource as soon as possible and include offshore wind in their 15 year Integrated Resource Plan (IRP) mandated by the SCC. But the plan doesn’t go “there”.
A Recap on Coal, Oil, and Natural Gas
The plan encourages more coal exports. The plan endorses offshore oil and gas drilling. The plan doubles-down on increasing natural gas pipelines like Dominion’s behemoth 550-mile pipeline that is generating so much controversy. How can a governor, who so passionately talks about the need to address climate change, endorse the three-headed monster of coal, oil, and gas expansions?
Well, the administration will tell you that it’s a part of the governor’s “all of the above” energy strategy, although the governor assures the environmental community that he is serious about addressing climate change. For what it’s worth, I have zero doubt about Governor McAuliffe’s sincerity in fighting the climate battle, but the mixed message is tough to ignore.
I’ll let others explain how we can encourage Virginia companies to export coal products abroad so other countries can burn it there while stressing the need to address global climate change. It’s akin to a father asking his child to clean his room but allowing the child to shovel clothes under the bed. Out of sight out of mind? Unfortunately climate change doesn’t work that way.
We all know the dangers of offshore oil and gas drilling. Racing to dig deeper and burn more fossil fuels is not the answer. Nor is supporting Dominion’s gas pipeline. But the McAuliffe administration got an earful from 30 or so protesters, mostly from Nelson County, who vented their frustration about the pipeline during his speech yesterday. That’s all I have to say about that.
A Look Forward to Efficiency
What can we expect in the immediate future as a result of the energy plan? That answer has to do with energy efficiency, which aside from solar, is easily the 2nd biggest component of the energy plan and topic that Governor McAuliffe seems most excited about pursuing. Virginia currently has a goal of reducing energy consumption 10% by 2022 according to 2006 levels. Of course the goal is voluntary for Virginia loves its toothless, voluntary targets.
The energy plan states that the governor will create a new Virginia Board on Energy Efficiency through executive order whose task will be to achieve the 10% reduction target by 2020, two years earlier than the original goal. The new Board will be convened quickly – the plan states by the end of the year. Fast action is necessary as Virginia has achieved less than 1% reductions to-date.
Governor McAuliffe took things one step further in the effort to make Virginia a “leader on efficiency” by stating in the plan that he will appoint a Chief Energy Efficiency Officer in his administration to oversee the aforementioned efforts and jumpstart crucial efficiency programs in state facilities.
As the governor said himself during his speech yesterday, “the cheapest energy is the energy we don’t use.” We need to aggressively explore our efficiency options which has the added benefit of saving homeowners money and creating thousands of new jobs in the state. Here the governor deserves unquestioned praise.
Summary
Virginia has incredible untapped potential in renewables and energy efficiency. While it’s disappointing the administration supports increases in fossil fuels generation and exploration, the level to which Governor McAuliffe openly talks about the need to address climate change is encouraging, and several of the policy proposals outlined in the plan are good steps in the right direction.