Clean Energy In The 2022 General Assembly
The 2022 regular General Assembly session has adjourned. This legislative session was the first under the governorship of Glenn Youngkin, and the first with Republicans in control of the House of Delegates since 2019. Consequently, energy policy this session looked different compared to the policy of the past two years, when the landmark Clean Economy Act was passed and Virginia joined the Regional Greenhouse Gas Initiative. Much of the energy proposals this session revolved around rolling back the clean energy progress Virginia has made recently.
Here’s a look at some of the most important actions the General Assembly took on energy this year:
Solar
After becoming a national leader in new solar capacity developments last year, the General Assembly did very little to continue advancing solar energy in the Commonwealth this year. One of the most important actions taken by the General Assembly on solar was defensive: a bill that would have lowered from 150 MW to 20 MW the maximum capacity of a solar facility in order to qualify for a permit by rule was unable to advance out of committee.
Meanwhile, bills that would have brought more solar energy to Virginia met similar success. A bill requiring that any new building being constructed for certain government agencies above a certain size have the structural capacity to hold solar panels was also killed in committee. The bill would have required new school buildings be designed, constructed, maintained, and operated to generate more electricity than consumed.
There is at least one new law pertaining to solar energy, however. HB 206 requires that proposed small energy projects include a mitigation plan in the event the Department of Environmental Quality determines that the project would adversely impact wildlife, historic resources, prime agricultural soils, or forest lands. The bill awaits a signature from the governor.
Modifying the Clean Economy Act
Passed in 2020, the Virginia Clean Economy Act is a landmark piece of legislation that puts the state on the path to a carbon-free electric grid and declares the development of renewables like wind and solar to be in the public interest. With a new power dynamic in Richmond, this session saw several attempts to modify the VCEA in a way that curbs its authority in ushering in a clean energy revolution.
HB 118 attempted to eliminate provisions of the VCEA that mandate a carbon-free electric grid by 2050 and by allowing the SCC to approve new fossil fuel plants under certain conditions. Although this bill passed the House, it failed to win approval in a Senate committee.
HB 73 aimed to remove from state law certain language declaring the development of wind and solar energy generation to be in the public interest. With state law encouraging the development of renewable energy sources in place, Virginia has benefited from less expensive electricity rates, the creation of high-paying clean energy jobs, and investment from businesses looking to cut their carbon emissions. The bill was killed in the Senate.
HB 74 would have allowed certain industrial companies to avoid paying for VCEA costs related to the development of renewable energy, which would overburden ratepayers for costs related to Virginia’s energy transition. Like similar bills, HB 74 passed the House but failed in the Senate.
Rolling Back RGGI
The Regional Greenhouse Gas Initiative is a cap-and-trade program requiring power producers to purchase carbon allowances at quarterly auctions equal to each ton of carbon their product emits. As a result, carbon-emitting energy production becomes more expensive during a time in which renewable energy options are cheaper than ever, incentivizing the transition to clean energy. Before taking office, Governor Youngkin said he would use executive power to remove Virginia from RGGI; when legal experts said this wouldn’t be possible, members of the General Assembly introduced legislation to accomplish the same goal.
SB 532 attempted to repeal the law authorizing Virginia’s participation in RGGI and directed the Department of Environmental Quality to leave the program. This bill was unable to make it out of the Senate, but a similar bill introduced in the House passed before being killed in the Senate.
With attempts to leave RGGI completely failing, other bills looked to redirect RGGI funds. SB 390 attempted to use RGGI funds to subsidize carbon auction payments for certain fossil fuel generators; this bill did not advance out of a Senate subcommittee. Another bill would have reduced the percentage of RGGI funds going to the Community Flood Preparedness Fund. The funds would be redirected to pay to owners of private property that may have been impacted by flooding. This bill did not pass the House.
Net Metering
Net metering allows energy customers who have solar panels installed on their property to generate power for themselves. Any excess power generated is distributed into the electrical grid, and customers receive credit toward future electric bills from their utility.
HB 396 increases the net metering cap for municipalities from 25 MW to 500 MW. This bill passed throughout the legislature without receiving a single “no” vote, underscoring the popularity of net metering programs in Virginia.
HB 266 eliminates the cap on net metering for electric cooperative customers. The bill also allows for power purchase agreements to finance the purchase of renewable generation facilities through the sale of retail electricity. The bill passed the General Assembly and is on its way to the governor.
Waste Coal
Despite the fact that Virginia is working to decrease its reliance on fossil fuels like coal, this session saw several bills introduced that seek to incentivize the use of waste coal for energy production. Waste coal is the byproduct of previous coal processing operations that can be used to generate energy. This development was especially surprising considering that the price of coal is non-competitive compared to renewables like solar.
SB 120 declares waste coal a “renewable energy.” The bill passed both the House and the Senate. Similarly, HB 1326 declares the use of waste coal to be in the public interest; this bill also passed both the House and the Senate.
HB 656 would have established a tax credit for the use of waste coal, equivalent to $4 per ton of waste coal used to generate electricity. One year after the General Assembly voted to eliminate coal tax credits in Virginia, this bill did not advance out of the House.