It doesn’t go unnoticed when a Southern state takes a stand on clean energy. But saying you’re supportive of renewable energy standards and carbon-free electricity is much different than actually making it happen, as Virginia is beginning to take steps to accomplish.
In April 2020, Virginia Gov. Ralph Northam signed into law the Virginia Clean Economy Act (VCEA). In addition to energy efficiency pilot programs, an expansion of net metering and energy storage goals, the state’s two utilities are expected to source 100% carbon-free electricity (Dominion Energy by 2045 and Appalachian Power by 2050). All coal-fired plants must also close by the end of 2024.
Now begins the process of determining how the requirements of the VCEA will be met — and the big question from many residential solar installers is how much their business fits into the equation. After all, Virginia’s 100% goal is for carbon-free electricity, not necessarily from renewable energy sources or solar specifically. Dominion already produces a significant portion of its electricity from four nuclear plants and intends to continue its use of natural gas. The utility does have plans for the country’s largest offshore wind project (2.6 GW), but only 1% of Dominion’s power must come from DG/rooftop solar under the VCEA.
“We’re happy to see rooftop solar being part of the RPS, but it is an extremely small carveout. There’s a lot more work to be done there to make sure it’s a more significant part of the RPS. But this is a step in the right direction,” said Rachel Smucker, Virginia policy and development manager for advocacy group MDV-SEIA.
Karla Loeb, chief policy and development officer for installer Sigora Solar and the DG policy chair for MDV-SEIA, also commented that the real work is now just beginning to ensure the state meets its lofty goals.
“Is the legislation perfect? Absolutely not,” she said. “A bunch of dockets have been started at the State Corporation Commission on the implementation of the VCEA because legislation passage in isolation doesn’t create markets, you need good rules to make the market work. And, that happens at the Commission.”
The Virginia State Corporation Commission (SCC) spent the summer establishing workgroups to determine regulations that achieve VCEA-outlined goals. In addition to the carbon-free electricity requirements, the Act must also shape energy efficiency standards, how to scale-up offshore wind, where to construct/acquire 3.1 GW of energy storage capacity and how best to advance solar and DG. One area of focus that will benefit solar most is cutting through the red tape around permitting.
“The solar industry is advocating for more streamlined processes particularly with permitting and interconnection,” Smucker said. “These two processes have a huge impact on construction timelines, which we know can often determine whether a project is economic and is actually going to get built. We are working to refine those processes with a number of stakeholders.”
Many in-state installers are making sure their voices are heard. As Sigora Solar’s Loeb said, “All clean energy is dictated by policy. That is why we are actively engaged in the dockets at the State Corporation Commission to ensure the implementation of the various pieces of clean energy legislation create the most competitive market possible, especially for distributed generation providers. We believe if you’re not at the table, you’re on the menu.”
Residential installer Ipsun Solar has been vocal on permitting issues, with co-founder and VP Joe Marhamati describing some counties as “stuck in the last century on paperwork, bureaucracy and their core understanding of solar.”
That’s why the SCC will hopefully listen to the right stakeholders to make sure the VCEA’s goals are attainable.
“Our commission is going to be crucial for the next year as we turn to the implementation process of this bill. They’re there to regulate, and the success of the VCEA will really rely on proper implementation and whether that meets the legislative intent of the bill,” Smucker said.
Although the initial residential solar requirements aren’t especially significant, that doesn’t mean things can’t change.
“This is certainly not going to be the last piece of legislation that will shape the clean energy market in Virginia,” Smucker said. “The distributed generation carveout is very small, and there are a lot more areas for growth. We are excited to take this first step but recognize that there’s a long way to go.”
Ipsun Solar still sees only benefits coming from the VCEA for its residential business.
“Having a 100% carbon-free electricity plan means not only that Virginia residents are demanding clean energy, but that those who may not have been paying attention are now aware that solar is far cheaper than fossil fuels,” Marhamati said. “This means that the entire Virginia market is likely to be aware of and considering clean energy and backup power for their family, to reduce energy bills, provide resiliency during grid outages, add value to their home, and begin the process of cleaning up the Virginia grid. We expect an exponential rise in the number of inquiries from Virginia residents on how they can own their own solar power as a result of this plan.”
Virginia joins California, Hawaii, Maine, Puerto Rico and Washington, D.C., on their journeys to 100% renewable or carbon-free electricity. As the South’s guinea pig for 100% clean energy policy, Virginia may be a model for solar legislation in the region for years to come.
“It is exciting to be the first southern state to implement a clean energy standard. We hope Virginia will finally be seen as a leader in solar generation and forward development. I hope this will spur other states in the Southeast to head in this direction and become leaders themselves,” Smucker said. “I don’t think we are quite in the ranks with California and Hawaii yet — they both have over 10% solar penetration, and we are nowhere near that. We are just at the cusp of realizing those economic gains. We took a huge step almost overnight to have some of the most progressive clean energy policy in the nation, but we’ve got a number of building years ahead.”
This story is part of Solar Power World’s annual Regional Solar Policy Report. Find out more in our digital edition of the magazine.