MDV-SEIA represents solar installers, developers and manufacturers throughout Virginia, as well as in Maryland, the District of Columbia, and Delaware. The association was an integral part of the legislative process to declare 5,500 MW of solar and wind power in the public interest. The renewables component of SB 966 (also known as the Grid Modernization bill) represented a direct investment of $7 billion in the Virginia economy, generating millions in tax revenue for localities, and saving ratepayers money in the long run. According to the Solar Foundation, Virginia now employs 3,565 solar workers, adding 329 last year. These jobs include rooftop installers, engineers, sales and marketing professionals, developers, and electricians.
Yet the state lags in deployment compared to its neighbors. Without an RPS or significant rebates driving distributed solar deployment, Virginia has already missed out on substantial energy savings for consumers. Yet opportunities for Virginia to grow its solar economy are abundant.
The following points summarize the comments by MDV-SEIA for the Governor's’ Energy Plan:
The Administration should seek not only to increase megawatts of solar capacity, but advance a strong, diverse solar market that yields significant savings across residential, commercial and industrial customers, diversifies the Commonwealth’s energy portfolio, fosters energy independence, and creates well-paying jobs for a generation
Leverage the deployment of Advanced Metering Infrastructure (AMI) to provide data to customers, businesses and providers of distributed energy resources and non-wires alternatives
Appropriately compensate solar projects for the value the generation provides to the Commonwealth, including but not limited to, grid resiliency and reliability, avoided new capacity, generation portfolio diversification, pollutant reduction, and reduction of peak loads
Eliminate arbitrary barriers that restrict both onsite and offsite clean distributed renewable energy
Create an environment that welcomes and attracts private capital to invest in distributed energy resources in the Commonwealth, from customer-scale distributed generation and storage to utility-scale renewable energy and energy storage projects.
Raise Net Energy Metering (NEM) Cap: At present, there is a 1% cap on the level of net metered energy systems throughout investor-owned utility and co-op territory. There is no technical evidence this cap is necessary. While the cap has not been met in investor-owned utility territory, some co-ops are close to hitting the 1% NEM cap in their territory. Raising the cap would provide installers and developers the market certainty necessary to investing in the state solar market. MDV-SEIA recommends that in place of a cap, the utility conduct a grid feasibility study when the capacity of net metered systems has reached a certain percentage of peak load.
Remove Standby Charges on Residential Solar Projects: The average residential system in neighboring Maryland is 10 kW; at that size Virginia solar homeowners incur a ‘standby charge’ each month. Standby charges render many solar installations uneconomic, severely limiting the penetration of residential solar. Several MDV-SEIA members cite standby charges as a key reason for not expanding operations in Virginia.
Standby charges also create another barrier to electric vehicle owners who wish to offset their fuel costs with solar panels. The average Virginian homeowner would require a solar system with a capacity greater than 10 kW in order to meet their monthly electricity needs and charge an electric vehicle. Thus, standby charges unintentionally restrict the deployment of electric vehicles and carbon reduction potential of our transportation system.
The NC State Clean Energy Technology notes that “rate structures that target solar PV to the exclusion of the many other causes of utility revenue erosion and cost shifts from some customers to others constitute undue price discrimination against solar PV. Perhaps most damaging for solar PV technology, however, PV-specific charges will negatively impact the solar PV cost reduction goals of the U.S. Department of Energy’s SunShot Initiative, which has begun efforts to systematically target and reduce the non-hardware “soft” costs of solar PV. Narrowly designed and applied standby and fixed cost charges threaten to derail beneficial soft cost reductions, particularly for financing and customer acquisition, and thereby could lead to lengthy delays in the date by which rooftop PV technology requires no financial incentives.”
Raise System Size Cap
Similarly, restrictions of system size based on the previous year’s use tie the hands of customers that wish to generate more electricity in the future. For example, if you are planning on adding members to your household, purchasing an electric vehicle,or adding to your home’s footprint through a renovation or addition, your system can only be based off of last year’s usage. MDV-SEIA recommends Virginia consider enabling customers to install a solar system that can generate up to 125% of the previous year’s demand.
Offer Incentive for Distributed Solar Adoption: States with high penetration of solar energy have successfully built the market with special incentives for small-scale renewable energy. For example, tax credits, renewable energy credits (RECs), grants, tax exemptions have been credited with growing the rooftop solar market in select states across the country.
Fortunately, Virginia can learn from the experiences of others and adopt fiscally-conservative and efficient mechanisms for spurring rooftop solar deployment. MDV-SEIA recommends that rebates - whether or state or utility-funded - are designed to directly benefit all customer-classes, including non-profit and governmental organizations.
Drive Rooftop Solar Adoption in Low-to-Moderate Income (LMI) Communities: Successful state initiatives to increase solar deploy on LMI communities must be comprehensive and address several barriers installers often face when trying to increase solar access. MDV-SEIA recommends creating a statewide incentive to provide LMI consumers access to install onsite solar resources. Such supports could include rebates specifically designated for LMI consumers or innovative partnerships with financial institutions to provide loan-loss reserve, interest rate buydowns, or direct loan repayment support.
Maximize Opportunities of Smart Meter Deployment: Advanced Meter Infrastructure (AMI) deployment underpins the value solar energy provides to the Commonwealth. The ability for grid operators to communicate with distributed solar is essential to unlocking the value of grid-support services, such as voltage regulation, frequency regulation, and, in instances of high-penetration, curtailment. Thus, smart meters should be bidirectional and have the capacity to communicate with onsite inverters.
As residential commercial batteries are deployed at scale, these communication protocols will allow for the monetization of additional grid-support services including load shifting.
Provide Greater Access to Data: Distributed energy resource data should be made widely accessible to energy stakeholders. By ensuring greater access to electricity consumption patterns across the state’s grid, utilities and firms alike will have more insight on the where solar energy can deliver maximum benefit to consumers. For example, the Department of Mines, Minerals and Energy (DMME) could, and ensure privacy is maintained by removing unique identifiers to customer meters.
Similarly, the DMME could house a Geographic Information System (GIS) map of all distribution infrastructure that was created as part of SB 966. The map would greatly assist small-scale developers site solar and effectively locate projects to minimize transmission and interconnection expenses.
Absent 100% smart meter deployment, which would enable complete nodal analysis, understanding the capacity for DG on the distribution system requires greater visibility into the capacity and flow of energy between substations and end-user meters. MDV-SEIA recommends the deployment of metering at some periodic interval along distribution lines.
Furthermore, an electric utility should not transition default residential service schedules to a time-variant rate structure until completing deployment of advanced metering infrastructure, collecting a minimum of two years of hourly interval data from all customers, and completing a rate pilot of the proposed new time-variant default rate. An electric utility may offer a time-variant rate to residential customers on a voluntary basis. To ensure transparency the utility company shall develop a web portal and smartphone application to allow customers to access all of their personal interval data, electricity consumption and any other relevant data point. Additionally, all interval data and relevant data points associated with distributed generation, including but not limited to location and nameplate capacity, shall be shared and housed in real time at DMME.
Couple Smart Meter Deployment with Solar Deployment: Smart meter adoption should accompany new solar installations to ensure both the utility and customer have real-time data on the effects of solar adoption. This light-touch feature would provide utilities with insight on the value of distributed solar, as well as the generation and consumption patterns of distributed energy resource providers.
Remove Barriers to Distributed Energy Resource (DER) Ownership: Power purchase agreements (PPAs) are key mechanisms to expanding access to solar energy, particularly to middle-income homeowners, and entities with low tax liability, such as non-profits and governmental organizations.
MDV-SEIA recommends removing restrictions on the ownership, size, financing, and use of distributed energy resource facilities to clarify that providers of onsite distributed generation that do not depend on the utility grid for delivery of electricity to the host customer are not public utilities, and any sale of electricity associated with providing electricity from such facilities is legal.
Enable Retail Energy Choice: By mandating suppliers provide customers 100% renewable energy to customers, the Commonwealth is restricting access to low-cost clean energy. MDV-SEIA recommends this would enable companies to enter into power-purchase agreements (PPAs) with solar projects offsite. Many corporations are familiar and comfortable with this model.
Remove barriers to Aggregate Net Energy Metering (ANEM): Current law limits the output of a solar facility to on-site use. MDV-SEIA recommends enabling units of state, county, and local government, as well as multifamily residential and commercial buildings to participate in load sharing. Public accounts that are located within the same county, and served by the same utility, should be able to offset combined demand through aggregated net energy metering (ANEM). This would allow a local government to credit the output of a solar array located on government-owned property where there is no electric load (e.g., a closed landfill) to load on nearby (but not necessarily contiguous) properties such as schools and municipal buildings.This would allow the efficient use of government property and result in taxpayer savings.
Support Broad Adoption of Commercial Property Assessed Clean Energy (C-PACE): MDV-SEIA encourages all Virginia counties to enact an ordinance necessary to support a C-PACE Program. C-PACE unlocks key financing opportunities of to supercharge the inclusion of energy efficiency and renewable energy measures in eligible buildings, thereby supporting the County’s goals to repurpose and revitalize underutilized buildings.
Enable Third Party Participation in Community Solar Projects
At present, community solar programs in Virginia are owned and administered by the utility, and developed by a third party. The restrictive nature of the program should be opened to 3rd parties, and modeled after Colorado or Minnesota. MDV-SEIA recommends the Commonwealth enable a competitive, market-based approach to community solar that can attract millions of dollars in private investment and expand solar access across the state. The utility-administered community solar program in Virginia are priced above subscription programs found in other states
Maximize Economies of Scale through System Size Increases
In general, the larger the community solar project, the greater savings are passed on to subscribers. Thus, legislation should increase the maximum system size level of a project; one option is to make the maximize size equivalent to the amount of energy generated that would remain on the distribution rather than transmission level. MDV-SEIA also recommends changes to the community solar program refrain from low subscriber limits, which can restrict the program from low energy users, such as apartment dwellers.
Currently, there are no community solar programs in Virginia specifically designed to provide options for low- and middle-income customers. Legislation should consider mechanisms - such set-asides within projects- to provide greater access to solar among households disproportionately affected by high energy bills.
Nationally, corporate procurement accounted for 30% of solar growth in 2017, the most investment since 2010. Data centers and other high-energy users are key driver solar energy in Virginia. While large businesses have the leverage to negotiate their own rate structures directly with Virginia utilities, smaller businesses cannot take advantage of clean energy options found in other states. The majority of procurement in the United States has been from off site PPAs, and meter aggregation, which have been largely restricted in Virginia. Thus, the Commonwealth is missing out on the opportunity for significant investment from medium and small businesses.
Siting: Provide Adequate Resources and Clear Direction to Administrative Staff: We recommend the Administration take steps to ensure it has an efficient and effective process for managing stormwater and related land use permitting as the large-scale solar is poised to grow at rapid pace in the next few years.
We recommend the Administration clarify the roles of DEQ and DHR to ensure clear responsibilities for each as it relates to solar siting projects. Similarly, departments do not have set timelines in which they must respond to on proposed projects. Implementation of a timeline would allow developers to plan projects more effectively. MDV-SEIA also recommends an expedited review process to facilitate greater processing of permits and applications, especially as the number of these projects seeking approval will increase significantly.