Virginia Governor Bob McDonnell signed into law last week a number of green energy bills passed by the General Assembly this session. Among the measures receiving the Governor's signature was his legislation to provide a $500 tax credit for each green job created in the Commonwealth; a measure establishing the Universities Clean Energy Development and Economic Stimulus Foundation; the creation of the Virginia Offshore Wind Development Authority; and legislation rewarding investor-owned electric utilities for using wind energy. The Governor also signed legislation to authorize investor-owned natural gas utilities to petition the State Corporation Commission to implement a separate rider that will allow for recovery of certain costs associated with eligible infrastructure replacement projects; to add improvement of infrastructure such as refueling stations to the Alternative Fuels Revolving Fund; and to give localities the authority to, in order to secure loans for the initial acquisition and installation of clean energy improvements, place liens equal in value to the loan against any property where such clean energy systems are being installed.

The bill signing took place just two days after Virginia was given federal approval to become the first state on the East Coast to explore for and produce oil and natural gas offshore. Through a policy proposal promoted by the Governor, 20% of future revenues received by the state from this offshore energy development will go to green energy research and development at the Virginia Coastal Energy Research Consortium on ODU's campus. Both the offshore announcement and today's bill signing advance Governor McDonnell's pledge to make Virginia "The Energy Capital of the East Coast."

Governor McDonnell spoke about the bill signing, noting "Currently, Virginia is the second largest importer of electricity in America, trailing only California. We need to take immediate steps to produce more energy right here, and to do so in a comprehensive manner. We need more oil, coal and natural gas, but we also need more wind, solar, biomass and nuclear production as well. When I came to Old Dominion University almost exactly one year ago, I pledged to take a comprehensive approach to make Virginia 'The Energy Capital of the East Coast.' With the recent news that Virginia will be the first state on the East Coast to produce energy offshore, and this bill signing event today, we are making significant progress in this effort, and doing it in a bipartisan manner."

The Governor continued, "Our green job tax credit will encourage more alternative energy entrepreneurs to make Virginia their home. If you invest in creating quality green jobs for Virginia workers, the Commonwealth will invest in you. The creation of the Virginia Universities Clean Energy Development and Economic Stimulus Foundation will focus our efforts to promote green energy research and development in the state, and make our universities and colleges national leaders in this growing industry. With the creation of the Virginia Offshore Wind Development Authority we are taking important steps to make wind energy a reality in Virginia's coastal waters. All the bills signed today represent bipartisan cooperation in the effort to bring green energy innovation and generation to the Commonwealth. Working across party lines we are making Virginia "The Energy Capital of the East Coast."

Joining the Governor at the bill signing were a number of Democratic and Republican legislators. Attending from the Senate were Frank Wagner (R-Virginia Beach),Don McEachin (D-Richmond), Jeff McWaters (R-Virginia Beach). From the House of Delegates, the Governor was joined by Mark Keam (D-Vienna), Chris Stolle (R-Virginia Beach), Ron Villanueva (R-Virginia Beach), John Cosgrove (R-Chesapeake), Paula Miller (D-Norfolk), Bob Purkey (R-Virginia Beach) and Matthew James (D-Portsmouth). Virginia Secretary of Natural Resources Doug Domenech also spoke at the bill signing. In addition to the public officials in attendance, a number of environmental and energy industry organizations were in attendance. Representatives from the Virginia Offshore Wind (VOW) Coalition, Virginia Natural Gas, Washington Gas, Dominion Power, the Virginia Electric Cooperatives, and the VA Alternative & Renewable Energy Association took part in the event. Finally, representatives of the Virginia Coastal Energy Research Consortium, which is part of Old Dominion University and will receive state funding derived from future offshore energy proceeds, and Norfolk State University, also participated in the bill signing.

Speaking about his green jobs tax credit bill, Delegate Charles Poindexter (R-Rocky Mount), who was unable to attend the bill signing, remarked, "We know that green jobs are the jobs of the future, and we are ready to start bringing those jobs to Virginia today. I want to thank Delegates David Englin and Mark Keam for their great work on this issue, and Senator Emmett Hanger for carrying this measure in the State Senate. Providing tax credits to businesses that create green jobs is smart for our environment and our economy."

Delegate Rob Bell (R-Charlottesville), also unable to attend the event, carried the Universities Clean Energy Development and Economic Stimulus Foundation bill in the House of Delegates and remarked, "Virginia's colleges and universities are known worldwide as incubators of innovation. By making schools like Old Dominion, the University of Virginia and Virginia Tech into green energy research centers we put our institutions of higher learning at the center of the industries of the future. Our students and professors will develop the breakthrough energy solutions of tomorrow and green businesses will locate near the schools involved in the research today. The result will be more energy and more jobs for Virginians."

A description of the legislation is below.

SB623 (Hanger)/ HB803 (Poindexter ) - Green Jobs tax credit

• Allows a $500 tax credit for the creation of "green" jobs for taxable years beginning on and after January 1, 2010.
• Each taxpayer is allowed a credit for up to 350 new green jobs and may qualify for the Enterprise Zone Grant program if the job is located in an enterprise zone.
• Incorporates HB268 (Englin) and HB1132 (Keam)

HB928 (Bell) –Universities Clean Energy Development and Economic Stimulus Foundation

• Creates the Virginia Universities Clean Energy Development and Economic Stimulus Foundation as a body corporate and a political subdivision of the Commonwealth.
• The Foundation shall identify, obtain, disburse, and administer funding for (i) research and development of alternative fuels, clean energy production, and related technologies; (ii) support of economic development projects in disadvantaged rural areas; and (iii) the provision of assistance in the commercialization of alternative fuels and clean energy technologies.
• Funding shall be awarded only to those proposed projects that best meet the established criteria and purposes of this act.

SB577 (McEachin)/ HB389 (Janis) - Virginia Offshore Wind Development Authority

• SB 393 (Wagner) is incorporated
• Creates the Virginia Offshore Wind Development Authority to facilitate and support the development of the offshore wind industry and wind-powered electric energy facilities located off the coast of the Commonwealth beyond the Commonwealth's three-mile jurisdictional limit.
• The Authority is charged with, among other tasks, (i) identifying existing state and regulatory or administrative barriers to the development of the offshore wind industry, (ii) collecting environmental data, (iii) upgrading port facilities to accommodate the manufacturing and assembly of project components and vessels that will support such projects, and (iv) applying to the U.S. Department of Energy for loan guarantees for such projects.

HB1022 (Hugo) - RPS program

• Provides that an investor-owned electric utility will receive triple credit toward meeting the goals of the renewable energy portfolio standard program for energy derived from offshore wind.

HB533 (Nixon)/ SB112 (Petersen) – SAVE Act

• Authorizes investor-owned natural gas utilities to petition the State Corporation Commission to implement a separate rider that will allow for recovery of certain costs associated with eligible infrastructure replacement projects.
• Eligible infrastructure replacement projects are projects that: (i) enhance safety or reliability by reducing system integrity risks associated with customer outages, corrosion, equipment failures, material failures, natural forces, or other outside force damage; (ii) do not increase revenues by directly connecting the infrastructure replacement to new customers; (iii) reduce greenhouse gas emissions; (iv) are not included in the natural gas utility's rate base in its most recent rate case; and (v) are commenced on or after January 1, 2010.
• The costs recoverable from an eligible infrastructure replacement project include a return on the investment, a revenue conversion factor, depreciation, property taxes, and carrying costs on the over- or under- recovery of the eligible infrastructure replacement costs.
• A SAVE plan shall be allocated and charged so as to avoid undue cross-subsidization between rate classes.

HB806 (Poindexter) - Alternative Fuels Revolving Fund

• Adds improvement of infrastructure such as refueling stations as a goal of the Alternative Fuels Revolving Fund.
• Requires that the Commissioner aggressively pursue grants and other sources of funding for the Fund.

SB 110 (Petersen) - Clean energy financing; localities authorized to place liens against any property

• Gives localities the authority to, in order to secure loans for the initial acquisition and installation of clean energy improvements, place liens equal in value to the loan against any property where such clean energy systems are being installed.
• Further allows the locality to bundle the loans for transfer to private lenders in such a manner that would allow the liens to remain in full force to secure the loans.