Legislation that would create a shared solar program for Appalachian Power customers and expand Dominion Energy’s existing program is headed to Gov. Glenn Youngkin following votes in the Senate on Thursday.
SB 255, from Senate Majority Leader Scott Surovell, D-Fairfax County, and HB 108, from Del. Rip Sullivan Jr., D-Fairfax County, would create a 50-megawatt shared solar program in Appalachian Power’s service territory.
Surovell’s SB 253 and Sullivan’s HB 106 would expand Dominion’s existing program from 200 megawatts to 350. The program was first authorized in 2020 and most of its capacity has already been awarded to solar developers.
[Disclosure: Dominion is one of our donors, but donors have no say in news decisions; see our policy.]
A shared solar, or community solar, program allows an electric utility customer to buy energy from a participating third-party solar company without the customer needing to own solar panels. Proponents say such programs advance clean energy and can help customers save money, but opponents say that they shift costs onto other electric utility customers.
“Not everybody lives on a property or has the money where they can get solar power for their house,” Surovell said while addressing the Senate on Feb. 13 before passage of his bills.
For example, a homeowner might live in an area with a lot of trees. A tenant of a commercial building might not want to commit to the long-term investment of adding solar panels to a building they don’t own. That building’s owner might not be motivated to buy panels because the tenant pays the cost of electricity. Or a person might simply lack the financial means to buy panels.
“What shared solar does, it allows you to sign up on a subscription with a solar company where you can say, I want to purchase, say, 1, 2, 3, 5% of the output of those solar panels and then net them against your home meter,” Surovell said. “And that way you definitively know that the power that’s powering your house or your business is renewable energy.”
On Thursday, HB 106 and HB 108 both passed the Senate on a mostly party-line vote of 22-17, with Sens. Mark Peake, R-Lynchburg, and David Suetterlein, R-Roanoke County, joining 20 Democrats.
That followed the Feb. 23 votes in the House to pass SB 253, 51-47, and SB 255, 52-46. The Senate on Tuesday voted 21-18 to accept the House version of SB 255 that adds language intended to guarantee that low-income subscribers to Appalachian Power’s program will see some financial savings.
Generally speaking, shared solar subscribers earn credits by purchasing renewable energy through the program. When those credits exceed the program’s costs, subscribers can save money.
Under Dominion’s program, the costs and credits of participating in a shared solar program are bundled into a subscriber’s electric bill. Under Appalachian’s new program, billing for the solar company is expected to be handled separately from a customer’s regular electric bill because combining the two bills would be too expensive for the utility to set up, Surovell has said.
Shared solar subscribers must pay a monthly minimum to utilities to help cover the costs of maintaining the electric grid. That monthly minimum, currently around $62 in Dominion’s program, has been a point of contention: Dominion has said a higher minimum is needed to pay shared solar subscribers’ “fair share” toward the grid, while shared solar advocates have said the program is only cost-effective for low-income customers who are exempt from paying the minimum.
“It basically created a low-income solar program instead of a solar program that everybody could use,” Surovell said during the Feb. 13 Senate session.
The new legislation directs the State Corporation Commission to reevaluate Dominion’s minimum and establish Appalachian’s minimum, considering not just the costs of electric distribution and transmission that utilities want to recover from shared solar subscribers but also the value that solar power provides to utilities in the form of energy production and grid upgrades.
Unlike with Dominion’s program, the legislation to create Appalachian’s program does not include an exemption from the monthly minimum for low-income customers. But it does require that low-income customers see financial savings.
Sullivan said in an email that low-income customers would receive at least 10% of the credit value generated in a given month, with the rest going to the solar company as its subscription fee.
For example, if a low-income subscriber to Appalachian’s shared solar program received $100 in bill credit, the legislation mandates that they would get to keep at least $10 of that credit to help lower their electric bill, he said. He noted that a solar company could choose to offer an even higher discount than 10% to entice customers.
The shared solar legislation caps the size of each participating solar facility at 5 megawatts. Examples include a 5-megawatt facility recently completed in Waynesboro and a 3.125-megawatt project planned for South Boston.
The legislation provides for incentives to build shared solar facilities on brownfields, landfills and rooftops, and establishes a workgroup to determine those incentives.
It also says that under Appalachian’s new program and the expanded portion of Dominion’s program, shared solar projects’ renewable energy certificates — market instruments created when a company produces solar energy and which utilities and businesses can buy to put toward clean-energy goals — cannot be kept and sold by the developers but must be retired and allowed to go toward Appalachian’s and Dominion’s efforts in meeting such goals.