Battery Bills Still Charging Toward Passage
By Steve Haner
The Virginia General Assembly is still poised to pass a vastly expanded mandate for future utility battery storage systems, but the bills are no longer passing unanimously. At least some discussion of the ratepayer cost impact has come up in committee and floor discussions since being raised by Bacon’s Rebellion. Most Republicans are now on record as opposed.
The effort was given a strong cheerleading push from Virginia Mercury in a story Thursday that made no effort to estimate that customer cost (but also no effort to dispute Bacon’s Rebellion’s figures.) The Mercury article also glossed over the incredibly important detail that battery storage in megawatts is a useless measurement, and the real metric is megawatt hours.
The cost should be calculated in dollars per megawatt hour. At this point, the legislative histories on the bill still do not show any official estimate of the capital costs or ratepayer impact. On that front, legislators still seem to enjoy not hearing any bad news.
The bill is being pushed by Dominion Energy Virginia, among others, and Mercury quoted one of its contract lobbyists saying the bill gives the regulatory State Corporation Commission “full authority to agree with the targets set in the code or alter them up or down and we think that is the right approach.”
What she ignores, and she avoided this point in committee testimony witnessed by Bacon’s Rebellion, is that question is the only discretion being left to the SCC. Elsewhere in the Virginia Clean Economy Act, the regulators are all but mandated to approve the first 3,100 megawatts of battery storage as being “in the public interest” by law. The traditional tests of reasonableness, prudence and necessity are not applied. The General Assembly already decided those questions and didn’t set any cost cap, either.
For many more battery applications to come, that means the fix is already in. Beyond that point, after those first projects for both Dominion and Appalachian Power Company, the SCC might have full regulatory authority. If this bill passes, however, it is a message to the regulators that the legislature wants more, much more, and that always makes it harder for the SCC to say no.
The 2020 battery mandate also glosses over the distinction between megawatts versus megawatt hours, so those “in the public interest” projects could be thousands of megawatts of 10-hour or 24-hour batteries, more expensive by an order of magnitude. Surely that is the position the utilities will take if the statute remains vague. The battery industry and utility lobbyists see this.
The bills remain premature, based on a ridiculous assumption that anybody can know today about storage requirements for 20 years in the future. House Bill 2537 has cleared one Senate committee but is resting in front of Senate Finance and Appropriations, and Senate Bill 1394 cleared the House committee and should be on the House floor soon. The more red lights show up, the better.
