Bills that would allow the state’s two largest utilities to seek approval to start charging ratepayers development costs for small modular nuclear reactors, or SMRs, were sent back to the General Assembly late Monday with amendments from the governor.
The amendments were filed just minutes before the 11:59 p.m. deadline for Gov. Glenn Youngkin to sign, veto or recommend changes to legislation.
Sen. David Marsden’s SB 454 applies only to Dominion Energy, while HB 1491, a similar bill introduced by Del. Israel O’Quinn, R-Washington County, applies only to Appalachian Power.
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The utilities would have to seek approval to start charging customers from the State Corporation Commission.
SMRs are smaller, simpler versions of traditional nuclear reactors and can be built in a factory and shipped to a site, which saves time, reduces the risks and is cheaper than constructing a large reactor.
Many, including Marsden, believe that the state can’t meet its clean energy goals without SMRs.
In October 2022, Youngkin announced he planned to deploy a commercial SMR in Southwest Virginia within 10 years, as part of his “all-of-the-above” energy plan. However, the governor said last month that there are other sites better suited for the first one, though he did not name another site or sites.
Appalachian Power and Dominion have expressed an interest in building SMRs, and Dominion has included them in its long-range plans. But there have been no approvals or final decisions made. No SMR has yet been built in the United States.
Marsden, D-Fairfax County, said Tuesday that he worked with the governor on three changes to his bill.
The amendments would mean that Dominion could not recover any costs prior to this July; the amount charged to the typical residential customer who uses 1,000 kilowatt hours of electricity per month could not exceed $1.40, a decrease from the $1.75 in the bill; and only 80% of development costs could be collected until an SMR is in operation.
“I think the changes are good for ratepayers and I think it’s something Dominion can live with,” Marsden said. “It’s fair to everybody, but the big thing here is that I think the governor did a nice job of improving the bill in favor of ratepayers, which is what people’s concerns were.”
Under the governor’s changes to the House bill, Appalachian Power could request permission from the SCC to charge for development costs no earlier than July 1. Beginning July 1, 2025, the utility could file annually to recover project development costs for an SMR provided that the annual revenue requirement doesn’t exceed $25 million and the overall project development costs don’t exceed $125 million, excluding the cost of buying a site. Any such rate adjustment clause couldn’t be implemented prior to Jan. 1, 2026.
The General Assembly reconvenes April 17, when it will vote on the amendments. If approved, they go back to the governor for his signature. If the amendments aren’t approved, the governor can sign or veto the original bills.