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Virginia's New Renewable Energy Legislation Sets Clean Energy Targets


Virginia has intensified the Commonwealth’s focus on clean energy to power its future. On April 13, 2020, Governor Ralph Northam signed the Virginia Clean Economy Act into law. This makes Virginia the ninth state to mandate a move to 100 percent clean electricity with a deadline of 2050 for achieving a zero-carbon grid.

LaBella has been working with clients to meet similar goals established in New York State. LaBella's expertise in planning, siting, and engineering renewable energy projects has enabled us to assist clients at every step of development. With a staff of over 20 professionals in Richmond, Virginia, the LaBella team is well-equipped to tackle large scale renewable energy development in the Mid-Atlantic region.

The extensive new law affects multiple aspects of energy policy, including generation, finance, environmental justice, and beyond. While we continue to comb the entirety of the legislation, we’ve identified eight main takeaways from the most prominent provisions.

Energy Generation from Sunlight and Wind

  • Increases the aggregate nameplate capacity of solar, onshore wind, and offshore wind generation facilities declared to be in the public interest.

  • Establishes a schedule for utilities to construct, acquire, or enter into agreements to purchase generating capacity within the Commonwealth using energy derived from sunlight or onshore wind.

  • Required the largest utility in the Commonwealth to develop 5200 megawatts of offshore wind capacity by 2034.

Renewable Energy Sources

  • Establishes a mandatory renewable energy portfolio standard (RPS) program commencing in 2021 and culminating in a requirement for utilities to produce all electric energy from renewable sources by 2045–2050.

Energy Storage

  • Establishes 2035 as a deadline by which utilities must construct or acquire energy storage facilities of specific capacities.

Private Non-utility Participation

  • Reserves 35 percent of all required new renewables development for private, non-utility companies.

Third Party Power Purchase Agreements

  • Increases the existing cap on third party power purchase agreements for utility customers.

Net Metering

  • Increases existing maximums that have restricted greater participation in net energy metering programs.

Energy Efficiency

  • Establishes an energy efficiency standard under which electric utilities must achieve incremental and annual increases in energy efficiency savings quantified as a percentage of annual energy sales, beginning in 2022.

Carbon Emissions

  • Requires Virginia to enter into the Regional Greenhouse Gas Initiative carbon cap-and-trade market.

  • Requires the State Air Pollution Control Board to adopt regulations to reduce the carbon dioxide emissions from electricity generating units in the Commonwealth and authorizes the Board to establish an auction program to sell allowances to accomplish such reductions.

  • Requires an agency report and recommendations regarding how to achieve 100 percent carbon-free electric energy generation by 2045 at the least cost for ratepayers.

  • Requires utilities to include the social cost of carbon in applications to construct new generating facilities.

  • Establishes a schedule for utilities to retire generating units in the Commonwealth that emit carbon as a by-product of combusting fuel to generate electricity.

We are committed to continuing to provide our clients with the information they need to be successful in future renewable energy projects in every state we service. Stay tuned as we continue to break down components of the law and keep you up to date. For more information on this legislation visit:

https://lis.virginia.gov/cgi-bin/legp604.exe?201+ful+CHAP1194

If you have questions about how this could change your renewable energy portfolio, please contact LaBella’s Renewable Energy Team at renewables@labellapc.com.

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