Standby charge of about US$60/month that would apply to Dominion Virginia Power's large-scale residential solar customers challenged by solar power advocates, who say fee would create disincentives for the renewable energy source
November 2, 2011
– Solar power advocates are challenging a residential charge proposed by Dominion Virginia Power they contend would create disincentives for a renewable energy source that is already lagging in the state.
The so-called standby charge would apply to large-scale residential solar customers when their thermal panels are not generating enough electricity, typically at night. The General Assembly approved legislation that allows the standby charge for residential solar generation systems ranging from 10 kilowatt hours to 20 kilowatt hours.
The State Corporation Commission is scheduled to hear the case Thursday. Regulators typically do not immediately rule on cases.
The Solar Industries Association, which represents the interests of manufacturers, installers and suppliers of solar systems, said Dominion's proposal is flawed, would be punitive for the small number of Virginians who rely on solar power and would discourage further investments in the renewable energy source.
Dominion defended the standby charge Tuesday and said it reflects the cost of serving residences that rely on solar power and the utility's power generation.
"That standby charge is just a charge for our wires and equipment that must be there when their self-generation isn't working," said Dianne Corsello, manager of customer solutions and new technology at Dominion. "It wouldn't be fair for our other customers to bear those costs."
The charge would total approximately $60 a month, Corsello said.
Francis Hodsoll, executive director of the Solar Industries Association's regional chapter, and other advocates of renewable energy said the standby charge erodes the value of solar systems. Owners typically seek a return on their initial investment in lower electric costs.
"When you add these charges to the solar panels on your roof, we find that the economics go negative," Hodsoll said. "You can no longer get any positive return."
The association has estimated that the Dominion charge, proposed by its subsidiary Virginia Electric and Power Co., would reduce the economic benefits of investing in a solar system by one-third.
Dominion stressed that the standby charge does not apply to smaller scale solar customers and would have a limited impact. The utility has more than 560 customers who use solar.
Hodsoll said the industry believes Dominion simply has not done an analysis to support the standby charge. It will ask regulators to order Dominion to conduct a more thorough analysis.
"Solar reduces costs to the system and Dominion needs to account for these avoided costs," Hodsoll said. Solar is generating power during a peak usage period for the utility, he said.
"That means you're using less transmission, you're using less distribution, you're using less generation when solar is producing its power," Hodsoll said.
Proponents of renewable energy said the charge reflects Dominion's overreliance on coal and other fossil fuels instead of diversifying.
"It is extremely disappointing that Dominion has not only failed to invest in wind and solar but uses its monopoly status to block businesses pursuing a vision of a renewable energy future," Glen Besa, Virginia director of the Sierra Club, wrote in an e-mail. "Dominion needs to lead or get out of the way."
Hodsoll agreed that a portfolio approach to energy incorporating a variety of energy technologies is a prudent approach. He said that is lacking in Virginia.
"Right now, Virginia is falling behind when it comes to renewable energy," he said. "Virginia is really losing out on the new energy, clean energy race."
A spokesman for Dominion disputed that claim, and pointed to a community solar program it rolled out Tuesday. The program would involve Dominion leasing rooftops and the grounds of commercial business and public spaces for solar panels.
"If the critics are saying we're not pro-renewable or pro-solar, that's incorrect," spokesman David Botkins said.
Steve Szkotak can be reached on Twitter at http://twitter.com/sszkotakap .
Solar Energy Industries Association: http://www.mdv-seia.org/events.shtml
Dominion Virginia Resources: http://www.dom.com/dominion-virginia-power/index.jsp
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