The Virginia State Corporation Commission on Friday approved Appalachian Power Co.’s 2023 Renewable Energy Portfolio Standard development plan.
The plan has the American Electric Power subsidiary entering into six new power purchase agreements for 184 MW of solar, renegotiating another solar PPA worth 20 MW, and approves its purchase of the Grover Hill wind farm in Ohio at 146.2 MW.
The commission rejected Appalachian’s request for cost recovery associated with a legacy wind project built more than a decade ago, finding it did not lead to positive value for customers.
The SCC approved a revenue requirement for the renewable purchases, required under the Virginia Clean Economy Act (VCEA), of $16.37 million for the rate year of October 2023 through September 2024.
“The commission … is guided in these matters by the statutes and the record,” the SCC’s order said. “The commission has continued to exercise its delegated discretion in a manner that faithfully implements the VCEA’s carbon-reduction requirements, while best protecting consumers who expect and deserve reliable and affordable service.”
Appalachian’s territory is in the southwest of the state, while most of the rest is served by Dominion Energy. Its larger neighbor weighed in on the proceeding in favor of removing the load of customers who sign up voluntarily for 100% renewable energy to cover their demand, an idea the AEP subsidiary agreed with.
SCC’s senior hearing examiner asked for different treatment of such customers, which instead would count their renewable credits toward Appalachian’s RPS compliance.
The SCC itself was unable to decide on the issue, which would both cover customers taking service under the two utilities’ renewable tariffs and large “shopping” customers who get 100% renewable energy.
SCC directed the two utilities to make either a joint filing, or file separately, in a new docket addressing those issues and presenting specific proposals. The filing would need to include a proposed mechanism for netting the benefits of such renewable energy credits.
Appalachian wanted to recover some of the costs of its power purchase agreement with the Beechwood 100-MW wind farm in West Virginia, which it entered back in 2010, despite the SCC previously rejecting a similar request.
The Beech Ridge PPA would have inflated the cost of the total RPS package by $4.5 million on the year. The utility tried to get the deal approved under what was at the time a voluntary renewable portfolio standard, the state attorney general said in a filing from last month. It was rejected as too costly by regulators.
The company argued new wind projects have been more difficult to build lately, and the project does produce renewable energy, which is a requirement under Virginia law., However, nothing in the statute requires the purchase of renewable energy that would be a net negative for consumers, said the attorney general’s office.
“The record reflects in this case, among other things, the Beech Ridge PPA fails to produce a positive NPV under any of the analyses presented in this case,” the commission said in explaining its rejection of that request.
