Hearing requested by the MDV-SEIA to be held November 3rd
The Virginia State Corporation Commission will hold a hearing, as requested by us here at the MDV-SEIA, on the stand-by rates proposed by Dominion Power in July. Legislation passed by the General Assembly allows utilities to collect Stand By charges from owners of “electrical generating facility[ies] with a capacity that exceeds 10 kilowatts.”. However, Dominion can only set the charges to “recover … infrastructure costs that are properly associated with serving” these systems.
Dominion’s stand-by rates will severely reduce or eliminate the economic value of eligible PV systems (10-20kW) that can reduce infrastructure costs that are ultimately passed on to all customers and provide clean energy for decades to come.
Our case focuses on serious irregularities between the new law and Dominion’s rate proposal. First, Dominion has not provided sufficient data or a proven methodology to show that their proposed rates accurately represent their infrastructure costs caused by 10kw to 20kw solar energy systems.
Second, and more broadly, solar photovoltaic (PV) systems actually reduce a utility’s infrastructure costs, meaning these rates are unlawful. Dominion fails to consider the benefits of distributed generation (DG), which offset the distribution infrastructure costs. Additionally, PV systems generate electricity at the location where used and during the “peak” cost periods. These systems displace the need for generation that is both high cost and spews carcinogenic and other polluting toxins into the air. This, as we know and many researchers have shown, leads to fewer new power plants fewer highly controversial transmission and distribution lines; and lowers overall demand for electricity. Thus, these systems actually reduce the need for infrastructure and lower costs.
It is imperative to note that Dominion’s stand-by charge structure results in higher charges for a net-metered customer than a regular customer with a similar load profile. This appears to violate the Virginia statute requiring utilities to provide uniform rates to similarly situated customers.
Dominion’s proposal is not only shortsighted, but also premature. Additional information and analysis on net metering in Virginia will be available in the near future.
For all the above-mentioned reasons, MDV-SEIA, representing the regional solar industry, will ask the Virginia State Corporation Commission not to approve Dominion’s rate proposal. The proposed rates would discourage the development of and investment in PV systems. Instead, we suggest that Dominion perform a ‘cost-of-service’ study before proposing any stand-by rates, as required by law.
The hearing will be held on November 3, and I invite you to join MDV-SEIA in opposition of Dominion’s standby rate proposal. To learn more or to support this effort please email us at Director@mdv-seia.org and write in the subject line “Dominion Stand By Rate case.”
Francis Hodsoll
Executive Director
MD DC VA Solar Energy Industry Association
MDV-SEIA Blog 