Va. State Corporation Commission Approves Coastal Virginia Offshore Wind Project
- Aug 7, 2022 5:25 pm GMT
The Commission also approved the electric interconnection and transmission facilities to connect CVOW reliably with the existing transmission system.
The Commission approved a revenue requirement of
In 2020, the
Following a full proceeding, the Commission found, as directed by the
In its final order, the SCC stated: "In so finding that these costs must be recovered from customers, the Commission is also keenly aware of the ongoing rise in gas prices, inflation, and other economic pressures that are impacting all utility customers. This is a prescriptive statute, and we applied it based on the record in this case."
The Commission further stated that significant concerns were raised throughout the proceeding regarding the affordability of the project and the financial risk to ratepayers. With a project of this magnitude, the SCC ordered the following consumer protections:
* Dominion shall file a notice with the SCC within 30 calendar days if it determines that the total project costs are expected to exceed the current estimate, or if the final turbine installation is expected to be delayed beyond
* Each annual Rider OSW update application filed by Dominion prior to the project's commercial operation shall include any material changes to the project, the most recent biannual project update, and a written explanation as to the reason for any cost overruns above the most recent estimate provided by the company to include the reasonableness and prudence of the additional costs.
* Beginning with the commercial operation and extending for the life of the project, customers shall be held harmless for any shortfall in energy production below an annual net capacity factor of 42 percent, as measured on a three-year rolling average.
In a concurring opinion, Commissioner Jagdmann wrote that she agrees with the Final Order in all respects. She emphasized:
This is a legislatively favored Project. If the elements of Code Sec. 56 585.1:11 are met, the costs of the Project are presumed "reasonable and prudent" - which means, in effect, "ratepayers pay." While no case participants oppose this Project - most urge the Commission to enact ratepayer protections given the high cost of this Project and its significant risk.... [T]he Commission has added specific protections - those being a requirement for regular reporting and a requirement (referred to as the "performance standard") that Dominion fund the cost of replacement power if the Project doesn't run or produce the quantity of power projected in the Company's analysis. But these protections do not address the Project's already high projected cost or the fact that the projected price could well [increase].... These protections also do not completely address potential Project abandonment risks. Importantly, the
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