Home Energy and Environment Dominion Thwarts Solar Net Metering Bill in Virginia

Dominion Thwarts Solar Net Metering Bill in Virginia

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This 54kW solar PV system provides electricity to a multi-family low-income housing complex owned by a non-profit in Russell County, Virginia.Cross-posted from the Energy & Policy Institute.

Last week, Dominion Virginia Power, the largest utility in Virginia, successfully blocked a solar net-metering bill from moving forward in the Special Subcommittee on Energy in the House of Delegates Commerce & Labor Committee. Days earlier, Dominion had attempted to hijack a bill meant to boost the installation of solar on multi-family housing communities. According to Virginia Sierra Club’s Ivy Main, Dominion lobbied for “substitute language that would give the utility the exclusive right to build and own community systems and sell the power to the customers” thereby forcing multi-family residents to purchase solar only from Dominion. The utility company was unsuccessful, but still managed to stop the bill in its tracks. 

From Ivy Main’s Power for the People VA blog:

Solar advocates and industry members successfully beat back Dominion Power’s bid to hijack the multi-family net metering provisions of HB 879 (Yost) and HB 906 (Krupicka). Alas, Dominion got its revenge Thursday in the House Commerce & Labor energy subcommittee, where the Republican majority had clearly come prepared to kill the bills. The two bills, plus Delegate Surovell’s solar gardens bill, HB 1158, were tabled with little debate, though with dissenting votes from the subcommittee’s three Democrats.

The ten delegates who were against the solar bills all came from the Republican party but more importantly, Dominion’s campaign contributions to these ten delegates may have led to the delegates’ opposition to the pro-solar bill. 

Dominion is the largest contributor to candidates’ electoral campaigns than any entity in the state besides the two political parties. In 2013, Dominion spent over $800,000 to influence Virginia state elections. Chairman of the Special Subcommittee on Energy Terry Kilgore received $23,500 from Dominion for his 2013 reelection effort, and another $31,000 in 2011, making Dominion his largest campaign donor in the past two election cycles. In total, Dominion contributed $45,750 to these ten Republican candidates in 2013. 

The company also very likely lobbied the Subcommittee to table the pro-solar net metering bill. The latest lobbying expenditures report details that Dominion spent $299,753 from May 2012 through April 2013 lobbying the state legislature and had at least eight lobbyists as employees and retained four additional lobbyists as contractors. 

Dominion Virginia Power power plant in Southwest Virginia.

Dominion Virginia Power has an interest in maintaining its dominance of the Virginia electricity market and stopping growth of emerging clean energy industries, especially distributed clean energy because of the threat it poses to Dominion’s profits. The Edison Electric Institute (EEI), the utilities trade group, released a report (.PDF) entitled “Disruptive Challenges” in January 2013, outlining the threat that distributed energy generation presents to the traditional utility industry business model of selling electricity from large, centralized, mostly fossil fuel power plants. According to the latest disclosures to the Securities and Exchange Commission, Dominion Virginia Power primarily generates electricity from large power plants using nuclear technology (33%), coal (22%), and natural gas (17%).

It’s no wonder Dominion wants to limit the growth of distributed solar energy by blocking net metering from reaching multi-family communities. Republican delegates support for Dominion’s protectionism is the equivalent of supporting an attempt by Kodak to stop people from buying digital cameras. Dominion’s lobbying effort is anti-competitive and anti-free market. It’s meant to slow the growth of clean energy in order to maintain one special interest’s “dominion” on the sale of electricity in Virginia, and should generate bipartisan opposition.

  • …I just got this email from the Chesapeake Climate Action Network:

    I wanted to update you on an important victory for clean energy that just came out of the Virginia General Assembly. The House voted overwhelmingly (93-5) this afternoon for a bill, HB 1239, that will remove tax barriers to solar power installations across the commonwealth. The vote today follows the Senate’s unanimous passage of a companion bill (SB 418) late last week.

    This bill was a priority for climate and clean energy advocates in 2014. It will be a key piece of the puzzle in helping Virginia catch up to its neighbors in attracting new clean energy business and jobs.

    The bill’s swift, near-unanimous passage is significant for another reason: It shows that, when powerful lobbies like Dominion Power or the coal industry aren’t standing in the way, Virginia legislators from both sides of the aisle are willing and eager to support common-sense policies to boost clean energy.

    Here’s what the bill will do for Virginia’s solar industry and why it matters:

    Extend tax relief: HB 1239/SB 418 will exempt solar equipment from state and local taxes on machinery and tools for installation projects up to 20 megawatts. The bill defines solar equipment as pollution control equipment, extending to solar the same tax relief that the General Assembly passed for landfill gas in 2009.

    Level the playing field: While some localities in Virginia have already exempted solar machinery and tools from tax liability, others levy punishing and sometimes prohibitive taxes on solar development. Statewide tax relief will level the playing field and incentivize developers to install projects across the state.

    Spur clean energy investment in Virginia: Solar is a $11.5 billion industry and one of the fastest growing industries in the U.S. – creating more than 23,600 jobs in 2013. While the solar industry is flourishing in neighboring Maryland and North Carolina, Virginia is lagging behind. Removing the tax on solar equipment will attract new business to Virginia, lead to in-state job creation and new revenue, and help power more homes and businesses with clean, carbon-free technology.

    For more information about the benefits of tax relief for solar machinery and tools, see this briefing paper.