Utilities across the United States are increasingly offering their customers – including not only residential customers but businesses and institutions – the option to purchase 100% of their power from renewable energy. However, the devil is often in the details.
Yesterday the Virginia State Corporation Commission (SCC) rejected an application by Dominion to create six new rate structures for its non-residential customers to provide electricity from a variety of renewable energy sources, finding that the rates Dominion sought to impose were not “just or reasonable”.
SCC provided a litany of reasons why Dominion’s application was unreasonable. From the ruling:
The combination of factors – when taken together – that inform this decision include: the extraordinary discretion delegated to the utility; the magnitude of combined uncertainty and subjectivity in the formula’s variables and resulting rates; the proposed use of ROE; unknown administrative fees on a customer-by-customer basis; unknown negotiated contract terms on a customer-by-customer basis; and the inability to ensure that the resulting charges will be uniform for customers taking service under like conditions.
SCC has also made it clear that it is leaving the door open to providing new tariffs with “just and reasonable rates, terms and conditions”.
While Virginia has been late to developing significant renewable energy, in 2017 Dominion Energy Virginia put online 246 MW of solar, as the 8th-largest volume of any U.S. utility. Dominion is further planning at least 4.7 GW of solar in Virginia and North Carolina through 2033, as the result of a new law that found that multiple GW of renewables are in “the public interest”. It is unclear what affect this rejection will have on its plans.