Residential customers will be charged about $55/month to participate in community solar programs in Dominion Energy (NYSE:D) territory in Virginia, a fee that solar advocates say will cripple the nascent program.

The Virginia State Corporation Commission on July 7 approved the $55.10 monthly minimum fee for residential customers using 1,000 kWh/month (PUR-2020-00125).

Low-income customers will be exempt from the minimum. But others will be dissuaded from participating because the fee is among the highest in the country, solar supporters say.

“If shared solar is going to work, Virginians need to pay less than $660/year just to be plugged into the grid before netting a single electron off it,” tweeted Sen. Scott Surovell (D), who co-sponsored the bipartisan 2020 bill establishing the shared-solar program (HB 1634/SB 629).

The Coalition for Community Solar Access (CCSA) called the commission’s order “an anti-consumer, anti-business” ruling “that does not align with the legislative intent and undermines the economics and accessibility of the shared-solar program for participating subscribers, while perpetuating a culture of egregious overcollections by Dominion Energy.”

“The SCC’s decision will decrease crucial investments in the commonwealth’s economy and lock out thousands of consumers and businesses from accessing local, clean energy generation,” the group said in a statement.

The commission’s order accepted the minimum monthly fee recommended by a commission hearing officer in February. It is substantially less than Dominion’s proposed charge but more than double that urged by CCSA. (See Advocates Offer Compromise on Minimum Charge for Va. Shared Solar.)

The commission said the fee includes costs “relevant to ensure subscribing customers pay a fair share of the generation, transmission, distribution and fixed costs of providing electric service.”

The minimum charge comprises fixed customer ($6.58) and administrative ($1) charges and volumetric costs, including non-bypassable generation charges ($3.37); base distribution charges ($19.26); distribution rate adjustment clause (RAC) charges ($4.62); base transmission charges ($9.70); and transmission RAC charges ($10.59).

The order also adopted Dominion’s proposed bill credit of 11.7650 cents/kWh for residential customers, 7.1200 cents/kWh for commercial customers and 5.9010 cents/kWh for industrial customers. The commission said the bill credit rates reflect generation, transmission and distribution revenues and “generally offsets the full costs typically included in the customer’s bill.”

The 2020 legislation required the SCC to approve a shared-solar program of 150 MW, with a minimum requirement of 30% low-income customers. The program can be expanded by 50 MW once the 30% low-income participation threshold is reached.

Dominion said that a residential customer who consumes 1,000 kWh should receive a minimum bill of $74.90 (distribution service charges: $29.45; transmission service charges: $20.29; generation balancing service charges: $25.16), not including administrative overhead costs, which it estimated at $10 to $20/month per customer. Anything less than that would result in cost shifts to nonparticipating customers, the utility said.

Commission staff proposed two alternatives: $10.95/month, which excludes transmission and distribution charges, or $55.10/month, which includes them. “Staff believes that, ultimately, the determination of the appropriate minimum bill is a policy question for the commission’s determination,” a staffer testified in a hearing last year.

Dominion Energy says it has received applications for 11 shared solar projects totaling almost 43 MW. | Dominion Energy

Former Texas regulator Karl Rabago, CCSA’s witness at the hearing, said, “Dominion’s approach appears specifically designed to make shared-solar subscription unattractive to potential subscribers and, therefore, renders the shared-solar program unworkable.”

In a letter to the SCC in April, Surovell, Sen. Emmett Hanger (R) and Del. Rip Sullivan (D) protested the hearing examiner’s recommendation, saying “we did not pass legislation to create a program that exists in name only.”

Surovell said the commission’s ruling “highlights why the SCC vacancy is critical.”

The SCC currently has only two members after Democrats were unable to win a full term for Angela Navarro, who was appointed by former Gov. Ralph Northam to replace Mark Christie when he left to join FERC. Navarro herself left in March.

Dominion did not respond to a request for comment Monday. The company reports having received applications for 11 shared-solar projects totaling almost 43 MW.