RICHMOND—Governor Ralph Northam is accelerating Virginia’s transition to clean energy by signing the Virginia Clean Economy Act and by amending the Clean Energy and Community Flood Preparedness Act that requires Virginia to join the Regional Greenhouse Gas Initiative.
“These new clean energy laws propel Virginia to leadership among the states in fighting climate change,” said Governor Northam. “They advance environmental justice and help create clean energy jobs. In Virginia, we are proving that a clean environment and a strong economy go hand-in-hand.”
The Virginia Clean Economy Act was passed as House Bill 1526 and Senate Bill 851, which were sponsored by Delegate Richard C. “Rip” Sullivan, Jr. and Senator Jennifer McClellan, respectively. The Act incorporates clean energy directions that the Governor issued in Executive Order Forty-Three in September 2019. It results from extensive stakeholder input and incorporates environmental justice concepts related to the Green New Deal.
The law requires new measures to promote energy efficiency, sets a schedule for closing old fossil fuel power plants, and requires electricity to come from 100 percent renewable sources such as solar or wind. Energy companies must pay penalties for not meeting their targets, and part of that revenue would fund job training and renewable energy programs in historically disadvantaged communities. The Act accomplishes the following broad goals:
- Establishes renewable portfolio standards. The Act requires Dominion Energy Virginia to be 100 percent carbon-free by 2045 and Appalachian Power to be 100 percent carbon-free by 2050. It requires nearly all coal-fired plants to close by the end of 2024.
- Establishes energy efficiency standards. The Act declares energy efficiency pilot programs to be “in the public interest.” It creates a new program to reduce the energy burden for low-income customers, and it requires the Department of Social Services and the Department of Housing and Community Development to convene stakeholders to develop recommendations to implement this program. The Act sets an energy efficiency resource standard, requiring third party review of whether energy companies meet savings goals.
- Advances offshore wind. The Act provides that 5,200 megawatts of offshore wind generation is “in the public interest.” It requires Dominion Energy Virginia to prioritize hiring local workers from historically disadvantaged communities, to work with the Commonwealth to advance apprenticeship and job training, and to include an environmental and fisheries mitigation plan.
- Advances solar and distributed generation. The Act establishes that 16,100 megawatts of solar and onshore wind is “in the public interest.” The law expands “net metering,” making it easier for rooftop solar to advance across Virginia. The new law requires Virginia’s largest energy companies to construct or acquire more than 3,100 megawatts of energy storage capacity.
“This is a terrific day for Virginia,” said Delegate Richard C. “Rip” Sullivan, Jr. “While some said Virginia is moving too fast, we said this is the year to get it right. This is an historic step forward on clean energy in Virginia.”
“This is the most significant clean energy law in Virginia’s history,” said Senator Jennifer McClellan. “The bill that the Governor signed will make Virginia the first southern state with a 100 percent clean energy standard. The Act will create thousands of clean energy jobs, make major progress on fighting climate change, and break Virginia’s reliance on fossil fuels.”
The Act establishes a carbon dioxide cap-and-trade program to reduce emissions from power plants, in compliance with the Regional Greenhouse Gas Initiative (RGGI). The Department of Environmental Quality will establish and operate an auction program to sell allowances into a market-based trading program.
The Act creates a Virginia Community Flood Preparedness Fund to enhance flood prevention, protection, and coastal resilience. It creates a low-interest loan program to help inland and coastal communities that are subject to recurrent flooding. The sale of emissions allowances would fund it.
The Governor proposed technical amendments to clarify how the fund would operate. The amendments provide for forgiveness of loans used in low-income geographic areas.
“By joining RGGI, Virginia will take part in a proven, market-based program for reducing carbon pollution in a manner that protects consumers,” said Governor Northam. “I am proposing important refinements and I look forward to signing it into law soon.”
“Advocates have worked hard for many years to put Virginia on the path to clean energy,” said House Majority Leader Charniele Herring. “This will bring cleaner air and water to Virginia, and the Governor’s amendments will make a good law even better.”
“Joining RGGI will secure a sustainable clean energy future for Virginia,” said Senator Lynwood Lewis. “Thanks to the Governor’s leadership, we’re almost at the finish line.”
Last year’s budget explicitly prevented Virginia from joining RGGI.
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