Virginia Enacts Suite of Clean Energy Legislation

On May 8, 2017, Virginia Governor Terry McAuliffe signed eleven energy-related bills at a ceremonial event.  The Governor’s office released a press release [link eliminated] describing the legislation as “promot[ing] the use of solar and other renewable energy options and aim[ing] to reduce energy consumption across the Commonwealth.”  Also in attendance were several of the bills’ patrons, including legislators from both parties, as well as clean energy industry stakeholders.

The legislation covers a range of clean energy issues, from battery storage technology to so-called “local green development zones.”  Below we break down each of the eleven bills.

SB 1393 provides that each investor-owned utility shall design a community solar pilot program, which will allow retail customers to voluntarily subscribe to receive electricity generated by a small solar generation facility.  The pilot programs are to last for three years unless renewed or made permanent through new legislation.

SB 990 directs the Virginia Department of Mines, Minerals and Energy, in consultation with the staff of the Virginia State Corporation Commission, to assess the progress Virginia is making toward the 2022 goal of reducing retail electric energy consumption by 10% of the amount of energy consumed in 2006.

SB 1258 reconstitutes the Virginia Solar Energy Development Authority as the Virginia Solar Energy Development and Energy Storage Authority, and it increases the composition of the Authority by four seats.  The Authority’s mandate now will include the promotion and development of storage technology in Virginia.

SB 1394/HB 2303 are identical bills that create a new framework for “small agricultural generating facilities” for certain small, renewable generating facilities operated as part of an agricultural business.  The Virginia State Corporation Commission is to conduct a proceeding to amend or adopt its regulations in order to implement this law, and it must issue an order by June 1, 2018.  Utilities will be required to make a compliance filing with a schedule to accommodate small agricultural generators within three months of that order.

SB 1395 increases the maximum capacity of “small renewable energy projects” from 100 megawatts to 150 megawatts.  This increase only applies to solar or wind facilities; the maximum capacity for facilities that generate electricity from falling water, wave motion, ties, or geothermal power remains 100 megawatts.  These projects are eligible to be permitted through the Permit by Rule process.

HB 1565 establishes “local green development zones.”  Counties, cities, or towns may establish such zones in order to grant tax incentives and provide certain regulatory flexibility within the zone.  Local governments may choose to grant such benefits to green development businesses within the zone or to businesses operating in qualifying “energy-efficient buildings” located within the zone.

HB 1712 furthers the ability of state agencies and localities to enter into energy performance-based contracts, which provide a financing mechanism for building and facility improvements that reduce energy consumption.  The new law allows a government body, in certain circumstances, to enter into the same energy performance-based contract that a different government body previously entered into.

HB 1760/SB 1418 both pertain to pumped hydroelectricity facilities.  The new legislation declares that the construction of “pumped hydroelectricity generation and storage facilities” is in the public interest, and that the Virginia State Corporation Commission is to liberally construe the relevant provisions of the Code of Virginia when determining whether to approve such facilities.

HB 2390 expands previous legislation authorizing pilot programs for renewable energy power purchase agreements.  This new law establishes a pilot program in the service territory of Appalachian Power Company, with private institutions of higher education as eligible participants.

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