The Virginia State Corporation Commission on Friday approved Dominion Energy’s (NYSE:D) 2022 Renewable Energy Portfolio Standard plan, which includes more than 800 MW of carbon-free electricity.
The utility has to file such a plan every year in compliance with the Virginia Clean Economy Act. The SCC approved Dominion’s $89.154 million revenue requirement for VCEA-related costs in the rate year of May 2023 through April 2024.
“This is another big step forward in delivering reliable, affordable and cleaner energy to our customers,” Dominion Energy Virginia President Ed Baine said in a statement. “These projects will bring jobs and economic opportunity to our communities, and they will deliver fuel savings for our customers. That’s a win-win for Virginia.”
The projects approved on Friday are expected to lead to $250 million in fuel savings for customers over their first decade of operation. They include nine solar facilities and one energy storage project, which total nearly 500 MW and will be owned by Dominion itself. Kings Creek Solar and Ivy Landfill Solar are being built on previously developed land, with the latter being the first solar plant Dominion has built on a former landfill.
The commission also approved power purchase agreements with 13 solar and energy storage projects, which total more than 300 MW and are owned by independent developers.
Construction of the projects is projected to support thousands of jobs and more than $920 million in economic benefits across Virginia. The projects will cost the average residential customer an extra 38 cents on their monthly bill, with construction of the new renewable projects expected to be complete by 2025.
The SCC directed Dominion to provide additional analysis with its next RPS plan due later this year, including an assessment of the impacts of the federal Inflation Reduction Act and modeling that shows Virginia both inside and outside the Regional Greenhouse Gas Initiative’s cap-and-trade system for power plants.
The commission sided with the utility and against its own hearing examiner’s report, which recommended the rejection of cost recovery for the Shands Storage project. The project will be the largest storage facility in Virginia at nearly 16 MW once completed, but the report found it would cost consumers $36.8 million without corresponding benefits, especially given the so-far light development of renewables in PJM, though Dominion argued that was changing.
“The extent to which Shands Storage can take advantage of any such market evolution would depend in part on both the actual market design changes (which cannot be known at this time) and timing,” the examiner said in their report filed in early March. “As Shands Storage degrades over time, each year this project is operational under PJM’s current market design seemingly means it will have less product to sell in PJM if and when a market redesign occurs.”
The SCC disagreed, noting that the VCEA includes targets for storage and that Dominion will benefit from starting to roll out the resource in Virginia.
