August 29, 2020
Editorials, Virginia

A cautionary energy tale from California

By the editorial page staff of The Free Lance-Star | Aug 29, 2020 | fredericksburg.com

If you’ve oticed that your electricity bills have slowly creeped up over the past decade or so, you’re not imagining things. According to the Virginia State Corporation Commission, energy legislation passed by the General Assembly have increased Dominion Energy customers’ power bills nearly 29 percent since 2007.

When the COVID-19 pandemic lockdown imposed by Gov. Ralph Northam caused hundreds of thousands of Virginians to lose their jobs, the SCC imposed a moratorium on utility shutoffs, which was to have expired on Monday. The moratorium was extended to Sept. 16 to give the General Assembly, now meeting in special session, a bit more time to pass emergency legislation to help people who lost their livelihoods keep the lights on, at least temporarily.

The monopoly utility’s average profits over the last three years exceeded its guaranteed 9.2 percent rate of return by $502.7 million, according to the SCC, so there’s no danger of Dominion going broke over the next two weeks.

Longer term, electricity bills are set to rise another 45 percent over the next decade due to Dominion’s ambitious multi-billion-dollar plans, approved by the legislature, to close more coal and natural gas power plants and expand its solar and wind portfolio.

According to the SCC’s annual report, the average residential customer’s electric bill for 1,000 kilowatt hours of power was $90.57 a month in 2007. It’s $116.69 now, and will increase to more than $168 a month by 2030.

What will Virginians get for such a steep hike in their monthly electric bill? Less reliable power when they need it most.

This is no longer a theoretical argument. There’s a real-world example in California, where highly subsidized solar and wind farms replaced natural gas plants and hydroelectric dams.

The Golden State, home of Silicon Valley and its power-guzzling tech companies, had to institute a rolling blackout for hundreds of thousands of state residents this month—right in the middle of a triple-digit heat wave—because it didn’t have enough juice in its cannibalized power generation system to meet peak demand. And the state’s previous reliance on “backup” electricity from other states, which have also been closing their fossil fuel plants, failed to make up the difference.

Even California Gov. Gavin Newsom, a strong advocate for the state equivalent of the Green New Deal, now admits that “we failed to predict and plan [for] these shortages, and that’s simply unacceptable.”

Although Newsom publicly emphasized that California remains “committed to radically changing the way we produce and consume energy,” state energy officials are now considering delaying the planned retirement of four natural gas-fired power plants that were supposed to be replaced by renewable energy sources, and extending the life of Diablo Canyon, California’s only operating nuclear power plant, which is set to close in 2025.

“We cannot sacrifice reliability as we move forward in this transition,” Newsom told reporters at a press conference in Sacramento.

Neither can Virginia. When Dominion and its partner, Duke Energy, canceled the Atlantic Coast Pipeline Project after years of litigation due to ongoing “legal uncertainty,” the CEOs of both utilities warned that “until these issues are resolved, the ability to satisfy the country’s energy needs will be significantly challenged.”

By next year, capacity restraints on existing East Coast pipelines could start affecting utilities’ ability to generate sufficient power to meet increasing demand.

Three years ago, Californians—who pay 50 percent more for electricity than the national average—were told that because the state had a “glut of power,” it didn’t need any new traditional power plants.

This month, they found themselves sitting in the dark in 100-plus degree heat under a rolling blackout because their state officials and the experts they relied upon were spectacularly wrong.