The Circus Is Back In Town: Dominion's Monopoly-Money IRP
Alas, some things never change.
By that, I mean that Dominion Energy is continuing its ham-handed tradition of contorting its triennial Integrated Resource Plan ("IRP") filing to make a grossly exaggerated opening bid to jack up unnecessary spending of—and profit from—many, many, many billions of Virginians' money. Because all of that is for what should be a straightforward task of keeping the lights on and gradually phasing out climate pollution, this $80 billion IRP might be better labelled an Irrational Rip-off Plan.
That's too bad, as the IRP is another missed opportunity for Virginia's largest monopoly to look out for both Virginians and the environment, by showing how a clean energy transition, founded upon a bedrock of doubling down on energy efficiency to reduce demand and costs, steady growth in solar, wind, and battery storage to replace fossil fuels, and smart investment in the grid to use and move clean electrons as smartly as possible.
Anywhere else, it would not be too much to ask for that kind of credible, thoughtful planning exercise on how Dominion can provide their basic utility service, while also cleaning up their climate pollution at the lowest possible cost.
Instead, that would-be sober assessment has been reduced to an almost cartoonish, exercise in propping up disingenuous strawmen—that climate change can be solved by fracking more gas—and the shopworn utility boogeyman that solar energy is unreliable—which we know is patently untrue.
It's hard to take such stretches at face value, and we've seen a variety of pretzel-like contortions used in previous IRPs, also to justify stuffing in billions in unnecessary spending.
This time around, Dominion leans heavily on the recently passed Virginia Clean Economy Act, to justify spending up to an additional $80 billion of Virginians' dollars by 2045. That's the far-fetched and reverse-engineered price tag supposedly needed to continue shifting our electric grid over the quarter-century away from climate busting fracked gas plants.
Most egregiously, Dominion nudges up their opening spending bid to their stratospheric $80 billion figure by concocting a scenario in which no efficiency or innovation improves over the next quarter-century, and we're still left in 2050 with a clunky, 20th-century style power system unable to incorporate basic energy efficiency, clean renewable electrons on an efficiency power grid with storage and smart meters.
Such a deliberately jack-legged view of our grid's actual future is engineered to be overpriced. Dominion's fantasy spending plan does so in two key ways:
First, Dominion overprices basic utility service by ignoring the reality that Virginia's untapped and massive energy efficiency reserves are by far the best, most cost-effective way to dramatically lower and even eliminate costs across the board. The supposed $80 billion in energy generation, new transmission, and new plant builds? That is merely a fiction in Dominion's world in which no real energy efficiency advances can be made. That's nonsense. Dozens of other states have made or are making major energy efficiency gains. Virginia should, too.
This deliberately misleading approach is no surprise, as Dominion quashed energy efficiency in the VCEA. They quash energy efficiency in the IRP as well (despite the fact that it is literally the lowest cost resource), by assigning it the absurd cost of $200/MWh. This expensive thumb on the scale unfairly ensures that efficiency won't enter their power mix in any meaningful way beyond previously made commitments.
Second, Dominion's IRP jacks up prices by assuming today’s existing clean energy technology and costs will be permanently frozen in place for the next quarter century (e.g. no cheap battery storage; no smart meter-enabled demand response programs). That like assuming today’s energy grid would be stuck back in Bill Clinton’s first term, when coal plants were our primary means of generating energy. But today's coal plants are shutting sown across the country because they cannot compete in an energy marketplace that has fundamentally transformed over the past quarter-century.
That astounding contortion results in Dominion converting a basic utility service into a Rube Goldberg device: rather than simply plan on providing low-cost, zero-carbon electricity with a sensible mix of energy efficiency, solar, wind, storage, and intelligent transmission and rate design upgrades enabled by smart meters, Dominion instead talks up a dizzying, convoluted array of hydrogen fuel cells, "modular" nuclear plants, coal-fired lake and dam pumped storage projects, and an unnecessary doubling of interstate transmission capacity.
Dominion—and its balance sheet fantasies—need to come back down to earth. If it is truly concerned about costs and the climate, then stop trying to invent an overcomplicated wheel. It should instead double down on energy efficiency, steadily scale up solar, wind, and storage, and plan to move those resources around with intelligent grid upgrades over the next quarter century.
In doing so, rather than pushing a three-ring spectacle of monkeyed up cost figures, clownish assumptions, and poorly-concealed sleights-of-hand, we would all have a credible forward-thinking planning exercise that the Integrated Resource Plan was intended to be--delivering benefits, not higher bills, to Virginians.
Now THAT would be something new.