Sierra Club Report, Dominion Post article spotlight benefits of PPAs

Click on image to download a pdf of the Sierra Club report.

A Sierra Club report titled "Clean Energy Works in West Virginia" highlights how expanding solar-friendly policies like Power Purchase Agreements (PPAs) can expand access to affordable solar energy, create good new jobs, and drive economic growth in the Mountain State.

From the report:

Timothy Reese of Capon Bridge sees major potential for policies like Power Purchase Agreements to benefit small farmers like himself. “There is a lot of marginal farmland in West Virginia. We need policies that allow small farmers to take some of our acreage and install solar that would help the agricultural community generate income from their land. Solar energy is the perfect fit for a rural state.”

The report, released in January, was developed with Vandalia Energy Services. Both the Sierra Club and Vandalia Energy Services are members of the West Virginians for Energy Freedom coalition.

Reporter David Beard of The Dominion-Post spotlighted the Sierra Club report, PPAs, and interviews with renewable energy leaders and advocates in a recent article on expanding solar energy in West Virginia.

During the 2021 West Virginia Legislature’s session, Del. Evan Hansen (D-Monongalia) plans to sponsor a bill to legalize PPAs, according to the article.

Last session, Senate Judiciary chair Charles Trump, R-Morgan, co-sponsored a PPA bill, SB 611, that was co-sponsored by Energy chair Randy Smith, R-Tucker, but it didn't move.

But with that kind of support plus a planned interim study on the topic this summer, Hansen is optimistic about its chances. "Hopefully we can get that across the finish line next session."

WV News: Sun may be rising on solar energy in West Virginia

Renewable energy leaders and advocates in the state think the passage of the Utility Solar Bill (SB 583) is a step in increasing energy freedom and job creation, reports Clarissa Cottrill, Morgantown News Editor for WV News, and they hope the legalization of on-site Power Purchase Agreements are on the horizon.

From the report:

SB 583 is one of the baby steps being taken to address the issue, but there’s more to be done if lawmakers really want to impact the energy and economic landscape in the Mountain State.

On-site power purchase agreements and allowing the property owner to purchase the energy the facility produces on a month-to-month basis, similar to leasing, is a possible next step, according to Long.

“It’s a really appealing option for businesses who want to go solar but who don’t want to put out the capital investment to own that solar,” she said.

WVPB recaps legislative action on Power Purchase Agreements and Utility Solar Bill

Lawmakers in the 2020 regular session of the West Virginia Legislature failed again to legalize Power Purchase Agreements but they did pass the Utility Solar Bill allowing the state’s two major energy providers to expand solar access, according to a recap by Brittany Patterson of West Virginia Public Broadcasting (WVPB).

“I would say we made some incremental progress this year and that’s a good thing,” said Autumn Long, regional field director for the nonprofit solar advocacy group, Solar United Neighbors, told WVPB. “It does open the door for large-scale solar development. So, it is a landmark year in our Legislature in so much as leadership and the rank and file lawmakers are really recognizing the need for West Virginia to step up and get in the game with renewable energy development.”

Solar United Neighbors of West Virginia is a founding member of our coalition.

"It's a first step that I hope will encourage our state's leaders to really be open-minded about more renewable energy policy that can encourage this industry's development in future years,” Long said in the interview.

WV legislature fails to legalize PPAs. But we're not giving up!

The 2020 regular session of the West Virginia Legislature is drawing to a close without action on Power Purchase Agreements (PPAs). After several false starts in the state Senate and House of Delegates, legislation supporting PPAs failed to materialize this year.

West Virginians for Energy Freedom and our partner, Solar United Neighbors, are preparing to fight again in 2021.

Why it matters: The federal solar investment tax credit is rapidly decreasing. 

• The tax credit offsets 26% of total costs for projects completed in 2020. The tax credit decreases to 22% next year, and is set to expire altogether for residential projects and decrease to a permanent 10% for commercial projects in 2022. 

• Engaging in a PPA with a private, income tax-paying solar developer is the only way for tax-exempt institutions such as schools, governments, and churches to take advantage of the federal solar investment tax credit. 

• Legalizing PPAs will create good new jobs for West Virginians in the rapidly growing solar industry. Check out this economic impact report to learn more.

What happened: West Virginia lawmakers introduced but failed to move forward a bill, Senate Bill 611, to legalize on-site PPAs for renewable and alternative energy generation facilities.

• S.B. 611 was introduced by a bipartisan group of sponsors: Senate Judiciary Committee Chair Charles Trump (R-Morgan, 15); Senate Energy, Industry, and Mining Committee Chair Randy Smith (R-Tucker, 14); Senate Interstate Cooperation Committee Chair Sue Cline (R-Wyoming, 09); Senator Richard Lindsay (D-Kanawha, 08); and Senator Stephen Baldwin (D-Greenbrier, 10).

• The bill was single-referenced to the Senate Economic Development Committee. But the Chair of this committee, Senator Chandler Swope (R-Mercer, 06), never placed S.B. 611 on the committee’s agenda.

The big picture: A PPA is a common and popular financing tool that allows a developer to build and own an energy facility, such as a solar array, on a host customer’s property. The property owner purchases the electricity the facility generates at a fixed rate — typically lower than that of the local utility company — for a predetermined time period, usually 15-25 years.

• Similar to leasing, PPAs allow property owners to go solar with little to no upfront cost.

• PPA customers lock in long-term electric rates, which helps to stabilize their monthly budgets and avoid utility rate increases.

• PPAs are legal in at least 28 states, including West Virginia’s neighbors Virginia, Maryland, Pennsylvania, and Ohio. 

The problem: PPAs are not explicitly legal in West Virginia state code. 

• This leads to confusion about whether or not PPAs are allowed here.

• This lack of clarity prevents most solar developers from offering PPA contracts to their West Virginia customers.

The solution: West Virginia lawmakers can pass legislation to clarify that this type of energy financing is legal in our state.

• Alternatively, the state’s Public Service Commission (PSC) could issue a ruling to clarify the legal status of PPAs for on-site renewable and alternative energy facilities in West Virginia. 

What’s next: Although S.B. 611 did not become law during this legislative session, we made significant incremental progress toward our goal of legalizing PPAs in West Virginia. 

• State legislative leaders have agreed to an interim study on PPAs. The study could result in leadership support for a PPA bill during the 2021 legislative session.

• Support for PPAs is growing among West Virginia lawmakers and the public: 

  • More than 330 people sent 540 emails, calls, and letters of support for PPAs to their lawmakers during the 2020 regular legislative session.

  • Morgantown City Council, Bluefield Board of Directors, Huntington Mayor’s Office, Charleston City Council, and Jefferson County Development Authority all have issued statements of support urging legislators to act.

• We will continue to educate lawmakers about how PPAs can expand access to solar and renewable energy in West Virginia and bring new jobs and economic benefits to the state.

Charleston City Council and Jefferson County Development Authority show support for PPAs as bill awaits action in legislature

The Charleston City Council passed a resolution this week urging state lawmakers to legalize on-site Power Purchase Agreements (PPAs). On the same day, the Jefferson County Development Authority issued a letter to state legislative leaders with the same message.

Charleston and Jefferson County join the City of Morgantown, the City of Bluefield, and the Huntington Mayor’s Office in support of PPAs, a widely available method to finance distributed energy generation projects such as rooftop solar or landfill biogas. Most states allow PPAs, including Virginia, Ohio, Pennsylvania, and Maryland.

“These latest shows of support from local leaders confirm that West Virginians recognize the benefits of generating affordable renewable energy in their communities,” said Autumn Long, West Virginia program director for Solar United Neighbors. “But a bill to legalize on-site PPAs, Senate Bill 611, has been stalled in the Senate Economic Development Committee for weeks.”

“This week is the last chance for the bill to move forward during this legislative session. We are calling on Senate President Carmichael to convene a special committee meeting to give SB 611 a fair hearing before it’s too late,” Long said. Click here to email or call Sen. President Carmichael today.

The City of Charleston resolution No. 277-20 cites tax and money savings, job creation, and attracting corporations with mandates to use renewable and alternative energy among the reasons for the legislature to legalize on-site PPAs.

The Jefferson County Development Authority (JCDA) also cited those reasons. “Jefferson County and West Virginia need to be in a position to attract these corporations to ensure our residents have access to good-paying jobs and to increase and diversify the tax base.

“Finally, the JCDA sees this legislation as an opportunity for county and municipal governments, as well as local school boards, to consider entering power purchase agreements as a strategy for reducing their utility expenses and saving money for local taxpayers,” the letter says.

WV News report: Experts weigh in on reality of renewable energy in WV

WV News file photo: Six wind energy projects are online in West Virginia.

A WV News report by Clarissa Cottrill offers a good overview of why West Virginia needs to diversify its energy offering to include renewables. SB 611, a bill legalizing on-site power purchase agreements, is a relatively easy first step for lawmakers to take, according to Autumn Long, regional field director and West Virginia State Director for Solar United Neighbors, and James Van Nostrand, director of the Center for Energy and Sustainable Development and West Virginia University law professor.

“A big barrier of solar now is you’ve got the upfront cost,” Van Nostrand said. “The power purchase agreement is a big solar developer ... would come in and say ‘we’ll put the solar panels on your roof; we’ll own the panels and then we’ll do an agreement so we more or less share in the electrical output of those solar panels.’ ”

Agreements like this are fairly common around the country, Van Nostrand said, and are a way to make solar more accessible and affordable for people.

Besides the economic growth and business development potential, on-site PPAs would benefit tax-exempt entities through reduced energy costs and stabilized budgets.

“It allows institutions like our schools, governments and churches to go solar without a large up-front capital investments,” she said. “We think that would be a really good first step.”

Read the full report here.

Ask lawmakers to support SB 611 and #PPAs4WV with an email or a phone call.