In a win for customers, Commission rejects utility proposals and sets higher energy efficiency standards

CHARLOTTESVILLE, Va. — Earlier this month, the Virginia State Corporation Commission published two orders that will require Dominion Energy and Appalachian Power Company to maintain and expand their energy efficiency programs from 2026 to 2028. These targets update energy efficiency goals set by the General Assembly for each utility from 2022 to 2025. If either utility meets or exceeds these targets, it may request a monetary bonus; conversely, if the utility fails to achieve the target, the law narrows the pathway for the utility to construct new carbon-emitting power plants. By setting reasonably ambitious targets, the Commission has indicated that utilities must deliver additional energy efficiency benefits to customers.

Peter Anderson, Director of State Energy Policy at Appalachian Voices, applauded the Commission’s order,“Using less energy in the first place is the cheapest, cleanest way to meet demand and protect the environment. Unfortunately, utility shareholders are more incentivized to build new resources than save energy. This is precisely why it’s so important to have these energy efficiency policies and a Commission looking out for ratepayer interests.”

In contrast to the Commission-approved targets, each utility proposed unreasonably low targets. Dominion, which has failed to meet energy efficiency targets established under the law so far, based its proposal on historically poor performance during the COVID-19 pandemic that would have been a significant step down from the 2025 target. Appalachian Power Company, despite recent energy efficiency success, proposed even lower targets—so low, that the utility could have essentially suspended its programs and met the target.

“The utilities’ low targets would have essentially provided them with a bonus for doing less energy efficiency—it would have been a windfall,” said Senior Attorney Nate Benforado. “But the Commission’s final orders prevented that outcome. These higher energy efficiency targets will not only drive system-wide cost savings, they’ll also mean more opportunities for individual households to reduce their monthly energy bills.”