Parties reach agreement on offshore wind project with significant customer cost protections
CHARLOTTESVILLE, Va. — Today the Office of the Attorney General’s Division of Consumer Counsel, Dominion Energy, Walmart, the Sierra Club, and Appalachian Voices filed a settlement proposal with Virginia’s State Corporation Commission, ending months-long debate regarding the funding and ratepayer risks surrounding Dominion’s proposed offshore wind project.
During this time, the Commission expressed concern about both the construction and operation risk for ratepayers, and the performance guarantee it imposed when it approved the project was an excellent protection against performance risk. The final order did not, however, include construction risk protections. Today’s settlement proposal does, providing significant cost certainty for customers while allowing this vital project to move forward, should the Commission find that adopting the settlement in place of its final order is in the best interest of customers.
While Virginia law allows Dominion to own this project, no other offshore wind project under development in the US is funded by captive ratepayers, and no other project has a monopoly utility owner acting as its own general contractor.
In response, Will Cleveland, a senior attorney in Southern Environmental Law Center’s Charlottesville office, issued the following statement:
“Offshore wind is a proven resource and is vital to Virginia’s clean energy transition. The primary issue in this case has never been about offshore wind’s value but the risks created by the ownership structure.
Where utility-owned projects are concerned, shareholders get guaranteed profits but ratepayers bear all the risks, both in terms of construction and operations. These risks have nothing to do with the fact that offshore wind is clean and has zero fuel costs, and there are cautionary tales in the non-renewable context the Commission can look to for both types of risks. Today’s settlement strikes a much better balance between shareholders and ratepayers that enables the project to move forward.”
Appalachian Voices Virginia Policy Director Peter Anderson said:
“Justice requires that we build the clean energy infrastructure required for a carbon-free economy while keeping customer bills as low as possible. Fortunately, these imperatives are not mutually exclusive, and in fact they can be complementary. We will continue to demand similarly thoughtful solutions as we move forward with the energy transition.”