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March 13, 2020

Virginia Clean Economy Act Passes in the Virginia General Assembly

By Shannon Weigel, Director of Policy, Edison Energy

This blog is part of an ongoing series on energy policy and legislation. To read more from the series, click here.


Last week, the Virginia General Assembly passed the Virginia Clean Economy Act (VCEA), which now awaits Governor Northam’s signature. The House voted 51-45 and the Senate voted 22-17. The act requires Virginia to achieve zero carbon emissions by 2050, catapulting it as a key growth state for the renewable and energy storage industry. Many of the final changes to the bill focused on tightening cost caps and State Corporation Commission (SCC) oversight of utility renewable procurement to keep ratepayer costs low.

The final version of the bill requires Dominion to cover 100% of its retail power sales with renewables by 2045, with Appalachian Power following by 2050. The new mandatory Renewable Portfolio Standard (RPS) includes a significant offshore wind target of 5.2 GW by 2034. The bill also exempts accelerated renewable energy buyers from the incremental costs of the RPS if they meet or exceed the renewable mandates through their own actions. For companies looking for smaller scale renewable opportunities, the bill increases the net metering program cap from 1% to 6% of net load, the net metering size thresholds from 1 MW to 3 MW and expands the state’s pilot PPA program from 50 MW to 1,000 MW, allowing more non-residential customers to capture the value from the federal investment tax credit.

The bill also sets an ambitious energy storage deployment mandate totaling 3,100 MW by the end of 2035, of which Dominion will deploy 2,700 MW and Appalachian Power the remaining 400 MW. Of that, at least 35% of the energy storage must be procured from third parties in an effort to spur competition and keep costs low and there’s a goal that 10% of the storage come  from “behind-the-meter”, creating a new opportunity for customers to deploy energy storage onsite.

The VCEA also establishes an Energy Efficiency Resource Standard, setting a 5% energy savings target for Dominion by 2025 and 2% for Appalachian Power. The SCC will then adjust the energy efficiency targets every three years after. The energy efficiency provisions in the VCEA include a verified self-direct energy option for large energy consumers (over 1 MW) in lieu of the automatic opt-out, meaning that these customers can self direct those funds to their own savings programs, giving them greater autonomy on how they reduce their Scope 1 emissions.

What’s Next?

Of importance to note, bills introduced to expand competitive market access and retail choice were sidelined this short session. However, the Governor’s office has signaled that they want to do additional work on this issue next year. Following Governor Northam’s signature of the VCEA, stakeholders will turn towards implementation of the new programs.

For companies looking to reduce their greenhouse gas Scope 1 and 2 emissions in Virginia, Edison Energy can help position your company to participate in the these future programs. To find out more, please contact Shannon.Weigel@EdisonEnergy.com