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Summary
In March 2007, Virginia set a legislative goal of reducing electricity consumption by 10% (from 2006 levels) by 2022. In 2008, the legislature mandated that utilities submit integrated resource plans that lay out demand-side resources. In 2009, the state’s utilities are expected to file integrated resource plans with the Virginia State Corporation Commission (VSCC). Dominion Power, one of the main utilities in Virginia, recently began implementing nine energy efficiency pilot programs.
The VSCC has approved natural gas decoupling and has opened a docket to consider reward mechanisms for energy efficiency. It is also currently developing a consumer education program designed to strengthen awareness of electricity efficiency and conservation in Virginia. |
| Customer Energy Efficiency Programs |
Currently, Dominion Power is implementing nine pilot energy efficiency programs. On March 31, 2009, Dominion submitted a notice of intent to file a petition to seek approval of demand-side management programs with the Virginia State Corporation Commission. The notice claims the programs will reduce demand by approximately 900 MW and save approximately 3,200 GWh over a 15-year period. Customers are expected to save more than $1 billion over that time period. Dominion estimates a revenue requirement of $20–30 million for the portfolio between 2009 and 2010.
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HB 2506, enacted April 8, 2009, authorizes investor-owned electric utilities to recover the costs of designing, implementing, and operating energy efficiency programs by adjusting their rates, if such programs are found to be in the public interest. The Virginia State Corporation Commission may allow utilities to recover reductions in revenue related to energy efficiency programs, to the extent the revenue is not recovered through off-system sales. Certain large customers are exempt from paying for the costs of new energy efficiency programs. According to the Energy Information Administration, utility spending on energy efficiency in 2007 was less than 0.01% of total spending.
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| Energy Efficiency Resource Standard |
In March 2007, Virginia set a legislative goal of reducing electricity consumption by 10% (from 2006 levels) by 2022. In November 2007, the VSCC issued a report stating that the goal is attainable by 2022. To reach the target, the commission has thus far approved nine pilot programs for Dominion Power.
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In December 2008, Virginia Gas received approval to implement a three-year conservation and ratemaking efficiency plan. The plan has two main components: an Energy Conservation Plan (ECP) to promote conservation and efficiency and a Revenue Normalization Adjustment, Rider D ("RNA Rider" or "Rider"), which is a natural gas decoupling mechanism that provides for a sales adjustment to customers’ monthly bills. The ECP and RNA Rider became effective on January 1, 2009 (Docket No. PUE-2008-00060; December 23, 2008).
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| Reward Structures for Successful Energy Efficiency Programs |
The 2007 legislation amending the state's earlier restructuring law calls for the Virginia State Corporation Commission to open a proceeding to initiate the development and implementation of efficiency programs with incentives and alternative means of compliance to achieve such goals. The legislation also states that a utility may recover projected and actual costs of energy efficiency programs, including a margin recoverable on operating expenses, which is equal to the general rate of return on common equity. The Commission can only approve such recovery if it finds that the program is in the public interest. As part of its cost recovery, the Commission, if requested by the utility, shall allow for the recovery of revenue reductions related to energy efficiency programs.
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| Energy Efficiency as a Resource |
In 2008, the legislature required Integrated Resource Planning (IRP) for Virginia’s utilities. The IRPs will forecast electric utilities' expected loads (projected over a 15-year period) and the utilities' plans to meet these obligations by using supply-side and demand-side resources. The VSCC expected to initiate a rulemaking regarding IRP filings in late 2008. Utilities will begin filing IRPs September 1, 2009.
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Last Updated
10/19/2009
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