Virginia approves Dominion foray into solar power

The Virginia State Corporation Commission (SCC) has approved a Dominion (NYSE: D) subsidiary’s largest foray to date into in-state distributed solar power.

In an order issued Nov. 28, the Virginia SCC opened the door for Dominion to develop up to 30 MW of solar distributed generation (DG) by the end of 2015. The SCC took no action, at this time, on a Dominion proposal to develop another 3MW from residential rooftop efforts.

The SCC order caps the cost of the solar distribution generation program that can be charged to customers at $80m. The company was seeking authorization to spend $111m, a figure that did not include financing costs.

Under the program, Dominion Virginia Power will seek volunteers among commercial businesses and public facilities throughout its service territory that are willing to lease sites for installation of solar panels. The capacity of each such installation will range from 500 kW to 2 MW.

The SCC said Nov. 28 that it has approved a demonstration project where Dominion will build, own and operate solar generation facilities at various commercial, industrial and government locations.

Still under SCC consideration is the company’s proposal to purchase solar-generated electricity directly from residential and small commercial customers who have installed their own solar panels. That demonstration project, as proposed, would be limited to 3 MW.

Dominion’s utility subsidiary Virginia Electric and Power Co. (VEPCO) had filed an application for approval of a community solar program in February.

The Dominion company sought to own and operate up to 30 MW of distributed solar generation – comprised of 30-to-50 installations at public buildings.

The company asked to develop the first 10 MW of distributed solar by Dec. 31, 2013. In Phase II, the company would develop up to 20 MW of additional distributed solar by Dec. 31, 2015.

As a part of its application, Dominion acknowledged the proposal has a “negative” net present value of about $61m, “which means that (when compared to other generation options) customers are expected to lose money as a result of this program,” the SCC said in a 13-page order.

The SCC said it is granting Dominion a “blanket” certificate of public convenience and necessity for the renewable project. This is necessary in part due to the “practical realities of selecting multiple locations to install these small, dispersed facilities,” the SCC said.

However, the program is “voluntary” and Dominion cannot exercise any eminent domain authority. The state commission also stipulated that Dominion must use the renewable energy credits (RECs) obtained from the solar DG program to offset the costs of the program.

The SCC case is No. PUE-2011-00117.

Dominion renewable program still exists mostly on paper

Dominion has applied to be one of the companies to develop federal land off the coast of Virginia into a wind project of 1,500- to- 2,000 MW. The federal process for selecting companies for the auction is underway, a company spokesperson noted.

“We are still pursuing onshore wind projects in three locations in Virginia – Tazewell County and two undisclosed locations,” Dominion spokesperson Jim Norvelle said in an email. The Tazewell County Board of Supervisors in early 2010 passed a county height ordinance that effectively prohibits wind turbine structures, Norvelle told GenerationHub.

Dominion is no longer pursuing a solar development project in Halifax County, Va. That project was associated with a privately-held startup company seeking to develop battery technology. The private company, however, encountered delays in commercialization and Dominion cancelled the solar project earlier in 2012, the spokesperson said.

“Our largest renewable energy project right now is the conversion of the three small peak load power stations from coal to biomass in Altavista, Hopewell and Southampton County,” Norvelle said. Combined, they will generate about 150 MW of baseload generation when completed, the spokesperson said.

 

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.