With the return of the trifecta of political success that Democrats now bolstered by a 64-36 House of Delegates majority – the decision on how to address Virginia’s energy challenges is entirely in their own hands.
The Republican legislators will only vote in committees or on the floor of the chamber if there is a deep division among the Democrats. With 64 votes (meaning Democrats also hold at least two thirds of the committee seats), a significant Democratic split is required for Republicans to have any impact.
The majority of new Democratic members, including those who replaced incumbent Republicans, expressed their commitment to the Virginia Clean Economy Act and its goal of eliminating the use of oil and natural gas. Many people in Northern Virginia also want to slow the growth of data centers, which are driving up the electricity demand throughout the state.
Inside Climate News, a group that advocates against hydrocarbons, has written a long article about the efforts of Abigail Spanberger to limit the development of data centers. She is vague and lacks details. In the same way as the Clean Virginia rallies for solar described in the earlier report, those who support maintaining the VCEA targets and mandates used their interviews to create a defensive position against anyone in their caucus that might be hesitant.
Inside Climate News did not quote any Republican or other advocate of changes to the VCEA. Dominion Energy Virginia, the state’s largest electricity provider, did not issue a lengthy statement. However it indicated that new natural-gas plants were still needed soon despite VCEA roadblocks.
This year, Dominion spent money to bolster its own defensive line. In this two-year electoral cycle, Dominion spent more than $16 million in campaign donations. The majority of these were given to Democrats. House Speaker Don Scott’s political action committee received 2,15 million dollars, which was quickly distributed to Democratic House candidates.
State Corporation Commission is expected to make a decision soon on Dominion’s application for the construction of the first natural gas plant built after VCEA. The plant will be a 944 megawatt facility that will run only during peak demand and will be located in Chesterfield County. The VCEA granted the SCC the authority to approve natural gas plants in cases where reliability is threatened.
Voters are concerned that the price of energy has risen more quickly than justified, and is putting pressure on their household budgets. This perception was widely held and reflected in polling. Democrats in the Commonwealth made this a major issue and promised to find a solution. Republicans rarely reacted by pointing out that the Virginia Clean Economy Act is a major contributor to these higher costs. And there are still many more mandates to come. It is possible to trace the impact of the VCEA to a penny.
Fairly, the New Jersey governor’s race was markedly more heated in terms of the energy debate. The Republican candidate focused a lot on the Democrats’ demands for solar and wind power that is weather dependent. Dominion is far less controversial in its offshore wind projects than the ones at New Jersey. The result of the election on November 4, however, was the same: a crushing defeat for that Republican.
New Jersey and Virginia belong to the same regional transmission organisation, PJM interconnection. Refusing to add reliable generators in either state will weaken the grid in both. Energy sanity is needed in both states.
Dominion sent an updated version of its integrated resource plan, a long-range planning document that was published two weeks prior to the election. It was the first 20-year plan, and included a deadline of 2045 for full compliance to the Virginia Clean Economy Act.
Dominion provided planning scenarios that were based on the huge demand growth created by data centers. All options assumed that it would build solar and wind power generation as demanded by VCEA. One scenario, however, assumed that it would be able to build more natural gas plants in the future and keep them open despite VCEA. One scenario assumes that all of these plants will have to be closed by 2045.
Dominion’s plan, which included full VCEA compliance, an end to the use of hydrocarbons, was the most costly, in part because it rejected the idea that solar, batteries, and wind could carry the burden. It claimed that the only way to meet the demand without using hydrocarbons was to build up nuclear power by more than three-fold the current power of its reactor fleet. The plan to retire all natural gas and coal power plants relied on more batteries than the current law required.
The utility then projected the pricing of the options.
The residential price for 1,000 kilowatt-hours of electricity in 2020 was $116.18. On October 1, the price had risen to $159.57. That’s a $43.39 increase or 37 percent in just five years. By 2035, the plan that adheres to VCEA requirements but maintains hydrocarbons will add another $100 per 1,000 kWh in costs. This would amount to a 120% price increase.\
If you choose the option that replaces hydrocarbons with massive nuclear and batteries, the price for 1,000 kWh would be just under $290, which is a 150% rise in 15 years, since the passage of the VCEA. Dominion, a major energy supplier in all options tested by the model, would add more wrinkles to the equation and possibly increase cost uncertainty.
The SCC staff uses a different model that is just as dramatic. Under its model, retaining hydrocarbons beyond 2045 would cost $309 per 1000 kWh in 2035. The more expensive scenario, which would retire the hydrocarbons in favor of building all nuclear plants, would cost $354 per 1,000kWh by 2035. This triples the cost of $116 from only five and a quarter years ago.
Dominion has not produced a model that shows how it could meet Virginia’s future energy needs by simply repealing the Virginia Clean Economy Act, nor what this might cost. Virginians can only test the Democratic claim that the VCEA is the most cost-effective route if they have a model based on this basis.
The utility may never produce a similar model again. One of the first actions of the new Democrat-majority will be to further bind the integrated resource plan with the VCEA’s various mandates. They will also insist on accounting for the “social cost carbon” in order to make hydrocarbons appear more expensive than solar.
The grass is not growing on their feet. Two days after the election, the bill doing all of these things was discussed in the Commission on Electric Utility Regulation. It is expected to be approved before January. Outgoing Governor Glenn Youngkin vetoed the bill, but incoming governor Spanberger will sign it. This will be just the first.
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