Any doubt that some members of the Virginia General Assembly’s reconstituted electricity regulation commission intend on taking full control of our energy economy was dispelled at its second meeting Wednesday. With that control, the goal is to then impose a full anti-hydrocarbon energy agenda.
Three proposed legislative initiatives were floated. None were voted on, and opposition quickly surfaced from some other panel members and in comments, especially from the state’s dominant electric utility. The three proposals (also available on the group’s state website) were:
· A draft bill that would dictate a 13-point checklist of factors the regulatory State Corporation Commission would have to use in evaluating any application where it has the power to decide what is or is not in the public interest. Anti-hydrocarbon fuel provisions were prominent among the new elements.
· A staff white paper on a complete revision of the integrated resource plan process now in state law. One proposal was to override an SCC requirement that those plans offer an option that illustrates the lowest cost for meeting the energy needs, which invariably is a lower consumer cost than the plans which comply with the Virginia Clean Economy Act. It also proposed bringing transmission and distribution issues into what would be an “integrated system plan” and again adding emphasis on ending hydrocarbon energy.
· A draft bill to change of the group’s name from the Commission on Electric Utility Regulation to the Virginia Energy Commission, with an expansion of its oversight authority to the entirety of the state’s energy policy, which envisions ending the use of hydrocarbons in Virginia agriculture, transportation and new buildings along with electricity.
Chairman Scott Surovell, D-Fairfax, argued the proposal on “in the public interest” determinations was simply an effort to promote more transparency from the State Corporation Commission. “Transparency” was his go to word often in the meeting, but to those in the room familiar with the current SCC practices, the intent to force radical change was what was most “transparent.”
But the draft was immediately challenged by Senator Creigh Deeds, D-Charlottesville, who noted the General Assembly made some major reforms in the SCC’s processes just two sessions ago and has finally appointed a full panel of SCC judges. “A lot of us have said for years we need to just let the SCC do its job.”
Dominion brought its main lawyer on SCC cases, Joseph K. Reid III of McGuireWoods, to challenge that proposal. “We don’t believe the Commission’s process is broken,” he told the legislators and public members. “I’m not sure what problem this bill is trying to fix.”
Most of the elements enumerated in the bills, some of them quite vague, are the issues the SCC process examines, and any party to the case can introduce just about any issue it wants to advocate. While SCC final orders seldom delve into all of them, before the final order there is a long hearing process, and a hearing officer does write a longer report that usually touches on every issue raised.
What the current process doesn’t do is require the SCC to explicitly accept or reject and reveal how much weight it gave to every single argument or fact. And if required to do so – as a lawyer with Surovell’s ability knows – it will create innumerable new opportunities for disappointed parties to appeal.
The current process puts great weight on the traditional question when considering a new power plant or new transmission line. Is it needed, is the plan proposed reasonable and prudent, were alternatives considered, what will be the short term and long-term cost to consumer, has it received the needed environmental permits? To that the proposed bill would add, arguably with equal weight to prudent cost and necessity:
· All positive and negative effects on public health, public safety, and the environment, including the proposal’s ability to reduce greenhouse gas emissions from electricity generation, transportation, or buildings. (Buildings? They contemplate “in the public interest” decisions on buildings at the SCC?)
· The effect of the proposal on a utility’s ability to meet the goals of the renewable energy portfolio standard program.
· The social cost of carbon, as a benefit or a cost, whichever is appropriate.
The “social cost of carbon” is the most important proposed new element. The dollar value used is subjective, controversial, and some believe it is imaginary. Determining that number and applying it to a cost-benefit formula will kill any future hydrocarbon proposal or transmission designed to serve a hydrocarbon plant and put a fat thumb on the scale in favor of wind, solar or battery projects. It might be neutral on a nuclear proposal.
But as Dominion’s Reid pointed out, only hydrocarbon or nuclear proposals would face these tests. The draft bill concluded with a carve out for any project “where the relevant statutes expressly provide a standard for such determination or declare a project to be in the public interest.” That means all the solar, wind and battery projects already declared “in the public interest” by the Virginia Clean Economy Act need not be subjected to these new tests.
Could the effort be more transparent? Surovell himself noted that the carve-out seemed a bit unfair and said it might change in a future draft. By the end of the meeting, Surovell was adding the bill might not be ready for the 2025 session at all.
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