Virginia Senate Committee Reports Out Scaled Down Bill Allowing Limited Pilot For Handful Of Customers To Aggregate Non-contiguous Sites To Take Competitive Retail Supply

Committee Also Revives Bill Allowing Customers To Take 100% Renewable Energy From Supplier Regardless Of Utility Green Offering

March 3, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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The Virginia Senate's Committee on Commerce and Labor has reported out a substitute for HB 889 with the substitute significantly reducing the retail electric choice provisions versus the version passed by the House

As previously reported by EnergyChoiceMatters.com, the bill as passed by the House would have eliminated a contiguous site requirement for a single customer to aggregate to the current 5 MW threshold allowing a customer to take retail electric choice, provided that the non-contiguous aggregated customer's supply meets the state's minimum renewable energy percentage

The terms of the Senate Committee substitute had been previewed last week by EnergyChoiceMatters.com

The Senate Committee substitute, as reported by the Committee, would only authorize, on a "pilot" basis at Dominion Virginia Power only (not Appalachian Power), a handful of specific customers, with participation capped at 200 MW, to aggregate their non-contiguous loads to a 5 MW threshold to take competitive electric supply -- with such customers being those who previously filed such aggregation applications with the State Corporation Commission

Such customers who have applied to the SCC for non-contiguous aggregation to take competitive supply have included Walmart, Costco, Target, Harris Teeter, Kroger, Safeway, and Cox. During a discussion of the substitute, it was represented that the 200 MW cap represents to load of customers who would be eligible under the bill (a discussion last week has suggested that such load equaled 275 MW, but during a discussions yesterday it was stated such a total would have allowed for 40% load growth)

The pilot would also terminate after two years; the substitute bill's language does not provide for the pilot to continue after such time.

Specifically, the Committee substitute for HB 889 provides that, "That the State Corporation Commission (the Commission) shall conduct a pilot program under which two or more nonresidential customers that, as of February 25, 2019, had filed applications seeking to aggregate their load pursuant to subdivision A 4 of § 56-577 of the Code of Virginia within the service territory of a Phase II Utility, as that term is defined in subsection A of § 56-585.1 of the Code of Virginia, shall be permitted to purchase electric energy from any supplier of electric energy licensed to sell electric energy within the Commonwealth, subject to the following terms, conditions, and restrictions[.]"

The Committee substitute for HB 889 provides the terms for the pilot as follows:

a. A pilot program shall be conducted within the certified service territory of the Phase II Utility in which such nonresidential customers are located.

b. The aggregated load participating in the pilot program shall not exceed 200 megawatts.

c. All customers participating in the pilot program shall be subject in all respects to the provisions of subdivision A 3 of § 56-577 of the Code of Virginia (with participation in this pilot program being deemed to satisfy subdivision A 4 of § 56-577 of the Code of Virginia), with the load set forth in each application being treated as a single, individual customer for purposes of said subdivision, and shall submit an annual report to the Commission by March 31 each year to demonstrate that, for the preceding calendar year, such load continued to meet the demand limitations of subdivision A 3 of § 56-577 of the Code of Virginia.

During a discussion at a hearing yesterday, a patron for the bill represented that Dominion supports the substitute

Unlike the House version of the bill, the substitute no longer addresses existing provisions concerning the ability of all customers to take competitive supply if such supply is 100% renewable and if the incumbent utility does not offer a qualifying 100% renewable tariff (see discussion of the House version here)

As such, if the Committee substitute Senate passes the House will need to re-pass the Senate version of the bill or the bill will need to be addressed in a conference process

The Senate Committee also revived HB 868, a stand-alone bill only addressing the current renewable electricity exemption for competitive supply, and which would allow customers to purchase 100% renewable electricity from a competitive retail supplier regardless of whether the incumbent utility offers a qualifying 100% renewable tariff

As reported by EnergyChoiceMatters.com last week, the Committee had continued HB 868 until 2021, which generally means the bill will not be further considered by the Senate this year

However, at a hearing yesterday a patron of the bill, which has passed the House, said that he is working with Dominion concerning a revised version of the bill and potential pilot. The Committee reported the bill with the addition of a "re-enactment clause", which would require that the bill again pass the 2021 General Assembly before becoming law. However, the clause was included more so to allow the bill to proceed to conference to develop further revisions

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