RICHMOND, Va. (AP) — Virginia Gov. Terry McAuliffe announced Wednesday plans for the state to buy electricity produced from a proposed Dominion Virginia Power 20 MW solar plant, with Microsoft offsetting the extra costs associated with the plan.
McAuliffe said at a Capitol news conference that the project will serve as a symbol of Virginia's embrace of solar power as well as a public-private model for other states looking to boost their renewable energy generation.
"Nothing like this, to be honest with you, is being done anywhere else in the country," the governor said.
Sean Gallagher, vice president of state affairs for the Solar Energy Industries Association, said Wednesday's announcement shows a growing appetite for creative ways of financing solar energy production.
"Whether other states can copy this specific model is less than clear, but it's emblematic that companies are finding really interesting ways to get around existing barriers for solar," Gallagher said.
Environmentalists said Wednesday's announcement was little more than symbolic gesture, saying Virginia needs to move faster in developing solar energy in order to keep up with neighboring states.
"It's good to be moving forward but we're not moving fast enough," said Glen Besa, head of the Virginia chapter of the Sierra Club.
The proposed plant would produce the equivalent of enough power to serve 5,000 homes, and 20 MW is just a tiny fraction of Dominion's overall electric generation in Virginia.
But McAuliffe and Dominion officials say it is a positive step forward in a state that's had next to zero solar power.
Under the proposal, Dominion will build the solar plant on land it owns next to its natural-gas fired Remington Power Station in Fauquier County in Northern Virginia. The state's largest electric utility will then sell the power to the state, with Microsoft offsetting the cost by purchasing renewable energy credits associated with the project "to meet its corporate sustainability goals," the governor said.
Microsoft, which has a large data center in southern Virginia, is one of several large corporations that have committed to obtaining all their power needs from renewable energy.
State regulators denied Dominion approval to build a solar energy facility at the Remington site last year. Regulators said the company had not demonstrated that it was a prudent and cost-effective move for its customers and should have better considered cheaper third-party alternatives to produce solar power.
Dominion CEO Tom Farrell said the company will apply for a new permit in May. The company estimates the new project will cost about $47 million to build.
Microsoft representative Jim Hanna declined to say how much the company is paying to offset the cost of the project, but said his company is willing to pay a premium for clean energy.
"Companies that are making this 100 percent commitment to renewable energy for business reasons are absolutely willing to pay that," Hanna said.
Solar growth in Virginia is being driven by deep-pocketed, environmentally conscious companies that have self-imposed rules on where they get their power.
After Amazon announced last year it planned to buy energy from a proposed 80 MW solar facility in Accomack County, Dominion purchased the project in November.