From Clean Virginia:
Dominion Energy’s offshore wind project proceeds with strong customer safeguards
Pressure from environmental groups, Attorney General, Walmart led to cost and accountability measures
Richmond — Dominion Energy’s offshore wind project, one of the largest energy projects in Virginia’s history, can proceed with a cost cap and performance provisions, according to a final ruling from the State Corporation Commission (SCC) issued today. The SCC’s ruling concludes months of pressure from multiple parties including Clean Virginia, a reconsideration attempt by Dominion Energy to remove a common performance standard, and a settlement reached in October by Dominion Energy, the Office of the Attorney General, Sierra Club, Appalachian Voices, and Walmart. The ruling includes a cost cap that would shift significant cost overruns to shareholders and a process for accountability if Dominion fails to produce sufficient renewable energy from the project.
“With its final ruling today, the State Corporation Commission demonstrated that consumer protection must go hand in hand with Virginia’s clean energy transition,” said Clean Virginia Energy Policy Manager Laura Gonzalez. “Absent the Commission’s leadership and pressure from environmental groups, the Attorney General, and Walmart, Dominion Energy would have zero incentive to actually produce clean energy from its offshore wind project or keep costs reasonable.”
In earlier filings with the SCC, Clean Virginia recognized that offshore wind represents a paramount addition to Virginia’s clean energy transition and requested a cost cap, an independent monitor, and an evaluation of alternative ownership models. Clean Virginia also staunchly defended the regulatory agency’s decision to adopt the performance standard, a common consumer protection intended to hold customers harmless if Dominion’s wind project does not generate as much power as projected. The Office of the Attorney General, Walmart, and the Southern Environmental Law Center on behalf of Appalachian Voices also supported the performance standard.
Dominion’s 100% utility-owned model essentially places all of the financial risk on customers, making strong consumer protections critical to ensuring that ratepayers do not shoulder all the financial burden for the project’s possible poor performance and cost overruns. In its order approving the settlement, the SCC notes that “the magnitude of this Project is so great that it will likely be the costliest project being undertaken by any regulated utility in the United States. And the electricity produced by this Project will be among the most expensive sources of power – on both a per kilowatt of firm capacity and a per megawatt-hour basis – in the entire United States.”
“As Virginia moves to develop the next phase of offshore wind, it is imperative that Virginia lawmakers consider alternatives to the utility ownership model that maximize cost savings for ratepayers and environmental benefits to Virginia overall,” Gonzalez said.
Clean Virginia did not oppose the settlement and testified during an SCC hearing last month that regulators did have the authority to implement a strong performance provision and cost containment measures.
Clean Virginia is a 501(c)4 independent advocacy organization with an associated Political Action Committee, Clean Virginia Fund. Clean Virginia works to fight corruption in Virginia politics in order to promote clean energy, a robust, competitive economy, and community control over our energy policy. We are motivated by the core belief that our democracy should serve everyday Virginians over special interests.