A BILL to amend the Code of Virginia by adding a section numbered 56-585.1:17, relating to electric utilities; virtual power plant pilot program; Phase I Utilities.
HB617 would require each Phase I electric utility in Virginia to seek approval from the State Corporation Commission for a virtual power plant pilot program by December 1, 2026. The pilot would test ways to reduce peak demand and provide grid services by aggregating distributed energy resources such as battery storage, smart thermostats, managed electric vehicle charging, and other customer-sited technologies. The bill defines key terms like aggregator, distributed energy resource, grid event, and virtual power plant, and it allows participation either directly with the utility or through third-party aggregators.
The pilot program would be capped at up to 150 megawatts per Phase I utility and must include resources from multiple geographic regions of the Commonwealth. Utilities would be required to evaluate stakeholder input, customer incentives, opt-out rules, performance standards, and tariff design, including pay-for-performance compensation. The bill also directs utilities to consider federal funding opportunities and to propose at least 5 megawatts of incentives for residential battery storage purchases, with the Commission able to require competitive solicitation for utility-owned and non-utility-owned resources. By November 15, 2027, utilities would need to file a tariff or tariff variations allowing residential, commercial, and industrial customers to enroll directly or through an aggregator.
The bill would affect Virginia utility regulation by adding a new section to Title 56 and creating a structured pathway for virtual power plant programs under SCC oversight. It would expand the role of distributed energy resources in grid planning and compensation, and it would require the Commission to review pilot results by July 1, 2029 and begin a proceeding to establish a permanent program with procurement targets and performance metrics. The measure also ties the pilot to broader regional and federal policy developments, including FERC Order No. 2222 and PJM implementation.
The available context suggests the bill was not advanced out of committee and was left in Labor and Commerce, with no recorded votes or transcript discussion provided. That indicates the proposal may have been viewed as exploratory or still in need of further policy development rather than having broad momentum at this stage. Because there are no committee transcripts or votes, the public record here does not show explicit support or opposition, only that the bill did not move forward in the committee process.
The main points of potential contention are likely to be the scope and cost of the pilot, the requirement that utilities develop tariffs and incentives, and the extent of Commission oversight versus utility discretion. Utilities may be concerned about administrative burden, procurement mandates, and performance obligations, while supporters would likely emphasize grid reliability, peak-shaving, customer participation, and expanded use of clean distributed energy resources. The bill also raises policy questions about how to compensate aggregators and customers, how to protect customer data, and how to ensure benefits reach historically economically disadvantaged communities.
HB617 would add a new Code of Virginia section, § 56-585.1:17, creating a regulatory framework for virtual power plant pilot programs for Phase I utilities under State Corporation Commission oversight. It would require utilities to file pilot petitions, develop tariffs, evaluate distributed energy resource participation, and later seek permanent program approval with procurement targets and performance metrics. The bill would directly affect electric utilities, customer aggregators, residential and commercial customers, and the SCC, while also influencing how battery storage, smart thermostats, and managed EV charging are integrated into utility demand-response and grid-service programs.
The bill appears to have been treated as a policy proposal with technical and regulatory complexity rather than a broadly contested partisan measure. No votes or committee transcript excerpts are available, but the bill was left in Labor and Commerce, suggesting limited advancement and possibly unresolved concerns about implementation. Overall, the concept aligns with modern grid-management and clean-energy planning, but the absence of movement indicates the proposal did not generate enough consensus to proceed in the available session context.
Likely areas of contention include whether Phase I utilities should be required to launch a pilot of this size, how much authority the SCC should have over tariff design and procurement, and whether utilities should be compelled to offer incentives for customer-owned storage and other devices. Another possible point of dispute is the role of third-party aggregators and access to customer and grid data, which the bill requires to be nondiscriminatory. Stakeholders may also differ on the bill’s treatment of utility-owned versus non-utility-owned resources, the cost recovery implications, and whether the mandated focus on historically economically disadvantaged communities is sufficient or too prescriptive.