What Does the Clean Power Plan Mean for Virginia? A Real Opportunity for Renewable Energy

, senior energy analyst | May 15, 2015, 9:44 am EDT
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Virginia Governor Terry McAuliffe has recently said he “fully supports” the EPA’s Clean Power Plan, designed to reduce heat-trapping carbon emissions from existing power plants. The governor last month signed a suite of clean energy bills into law. Clean sources like renewable energy and energy efficiency can go a long way toward getting the state where it needs to be.

Virginia’s electricity mix

Virginia produced 4.5 percent of the coal from the eastern U.S. in 2012, and the coal export facility in Norfolk processed more than 38 percent of U.S. coal exports in that year. Virginia’s electric generation mix is fairly evenly split among nuclear (38 percent, from just two plants), natural gas (29 percent), and coal (28 percent), as shown below.

Virginia’s renewable energy deployment, although growing, is lagging. The state’s renewables represented about 5.5 percent of its generation mix in 2013, but half of that was from biomass and another third was from hydro. That leaves the state lagging in solar and wind, both of which have been falling in cost dramatically and expanding nationally.

Originally enacted in 2007, the Voluntary Renewable Electricity Standard sets renewable goals for the state’s utilities. Relative to a base year of non-nuclear electricity sales in 2007, the renewable energy goal increases from 4 percent of base-year sales in 2010, to 7 percent in 2016, to 12 percent in 2022, and to 15 percent in 2025.

Virginia also has an Energy Efficiency Resource Goal, which sets a voluntary goal of 10 percent electricity savings by 2022 relative to 2006 base sales. Governor McAuliffe released his state energy plan last fall that aims to achieve the energy efficiency goal two years earlier, in 2020, and the energy savings from meeting this goal would be a huge benefit to Virginia families.

Virginia's Electricity Generation: Evenly split, but renewables underutilized. (Source: EIA)

Virginia’s Electricity Generation: Evenly split, but renewables are underutilized. (Source: EIA)

How do Virginia’s renewables stack up?

NREL (the National Renewable Energy Lab) has documented the state’s tremendous renewable energy technical potential far beyond today’s levels: for biomass, rooftop solar PV, utility-scale solar PV, wind, and other technologies.

And Virginia can get there from here. For comparison, in the past 7 years, neighboring North Carolina has gone from having virtually no solar energy, to having 150 utility-scale solar facilities (573 MW) already in place and another 377 facilities (3,034 MW) planned. There are now over 450 solar companies in the state, which have brought in over $2 billion in direct investments and support more than 4,300 jobs.

Energy efficiency is another clear opportunity for Virginia, which currently ranks as only the 35th most energy efficient state. Efficiency instead of new generation would be an easy, cost-effective way to reduce negative impacts from electricity generation in the state and save consumers money. Experience from leading states suggests that states could be improving their efficiency by 1.5–2% every year—putting Virginia on track to meet its voluntary goals.

The EPA’s Clean Power Plan

The EPA’s proposed Clean Power Plan is a clear, near-term opportunity to align Virginia’s energy goals with its need for safe, reliable, and clean power—while simultaneously providing important economic, health, and environmental benefits to the Commonwealth and its residents.

Under the draft plan, Virginia would reduce its rate of CO2 emissions by about 38 percent. However, worth noting is that the state would get credit for things it’s already doing—like retirements of old coal plants and meeting the voluntary renewable standards.

Making its voluntary renewable and energy efficiency goals mandatory is an obvious way to move the ball even further down the field. Our own analysis found that Virginia could do even better in terms of developing its renewable resources—from about 4% of electricity sales in 2013 to at least 14% by 2030—just by committing to grow renewable energy at the same rate that other states have demonstrated is achievable and affordable.

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A clean energy future

Virginia leaders should continue to strengthen policies that send strong, consistent signals to prioritize renewable energy and energy efficiency, and by doing so, prepare the state to submit a strong compliance plan for carbon emission reductions. Investing in renewables and efficiency would also help the state avoid betting its entire energy future on natural gas; a more balanced portfolio will help Virginia cut emissions further and minimize the consumer and environmental risks of an overreliance on natural gas.

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