                                 CODE OF VIRGINIA

SCHEDULE FOR TRANSITION TO RETAIL COMPETITION; COMMISSION AUTHORITY; EXEMPTIONS;
PILOT PROGRAMS (§ 56-577)

A. Retail competition for the purchase and sale of electric energy shall be
subject to the following provisions:

   1. Each incumbent electric utility owning, operating, controlling, or having
   an entitlement to transmission capacity shall join or establish a regional
   transmission entity, which entity may be an independent system operator, to
   which such utility shall transfer the management and control of its
   transmission system, subject to the provisions of &#xA7; 56-579.

   2. The generation of electric energy shall be subject to regulation as
   specified in this chapter.

   3. Subject to the provisions of subdivisions 4 and 5, only individual retail
   customers of electric energy within the Commonwealth, regardless of customer
   class, whose demand during the most recent calendar year exceeded five
   megawatts but did not exceed one percent of the customer&#8217;s incumbent
   electric utility&#8217;s peak load during the most recent calendar year unless
   such customer had noncoincident peak demand in excess of 90 megawatts in
   calendar year 2006 or any year thereafter, shall be permitted to purchase
   electric energy from any supplier of electric energy licensed to sell retail
   electric energy within the Commonwealth, except for any incumbent electric
   utility other than the incumbent electric utility serving the exclusive
   service territory in which such a customer is located, subject to the
   following conditions:
   				a. If such customer does not purchase electric energy from licensed
   suppliers, such customer shall purchase electric energy from its incumbent
   electric utility.
   				b. Except as provided in subdivision 4, the demands of individual retail
   customers may not be aggregated or combined for the purpose of meeting the
   demand limitations of this provision, any other provision of this chapter to
   the contrary notwithstanding. For the purposes of this section, each
   noncontiguous site will nevertheless constitute an individual retail customer
   even though one or more such sites may be under common ownership of a single
   person.
   				c. If such customer does purchase electric energy from licensed suppliers
   after the expiration or termination of capped rates, it shall not thereafter
   be entitled to purchase electric energy from the incumbent electric utility
   without giving five years&#8217; advance written notice of such intention to
   such utility, except where such customer demonstrates to the Commission, after
   notice and opportunity for hearing, through clear and convincing evidence that
   its supplier has failed to perform, or has anticipatorily breached its duty to
   perform, or otherwise is about to fail to perform, through no fault of the
   customer, and that such customer is unable to obtain service at reasonable
   rates from an alternative supplier. If, as a result of such proceeding, the
   Commission finds it in the public interest to grant an exemption from the
   five-year notice requirement, such customer may thereafter purchase electric
   energy at the costs of such utility, as determined by the Commission pursuant
   to subdivision 3 d hereof, for the remainder of the five-year notice period,
   after which point the customer may purchase electric energy from the utility
   under rates, terms and conditions determined pursuant to &#xA7; 56-585.1.
   However, such customer shall be allowed to individually purchase electric
   energy from the utility under rates, terms, and conditions determined pursuant
   to &#xA7; 56-585.1 if, upon application by such customer, the Commission finds
   that neither such customer&#8217;s incumbent electric utility nor retail
   customers of such utility that do not choose to obtain electric energy from
   alternate suppliers will be adversely affected in a manner contrary to the
   public interest by granting such petition. In making such determination, the
   Commission shall take into consideration, without limitation, the impact and
   effect of any and all other previously approved petitions of like type with
   respect to such incumbent electric utility. Any customer that returns to
   purchase electric energy from its incumbent electric utility, before or after
   expiration of the five-year notice period, shall be subject to minimum stay
   periods equal to those prescribed by the Commission pursuant to subdivision C
   1.
   				d. The costs of serving a customer that has received an exemption from the
   five-year notice requirement under subdivision 3 c hereof shall be the
   market-based costs of the utility, including (i) the actual expenses of
   procuring such electric energy from the market, (ii) additional administrative
   and transaction costs associated with procuring such energy, including, but
   not limited to, costs of transmission, transmission line losses, and ancillary
   services, and (iii) a reasonable margin as determined pursuant to the
   provisions of subdivision A 2 of &#xA7; 56-585.1. The methodology established
   by the Commission for determining such costs shall ensure that neither
   utilities nor other retail customers are adversely affected in a manner
   contrary to the public interest.

   4. Two or more individual nonresidential retail customers of electric energy
   within the Commonwealth, whose individual demand during the most recent
   calendar year did not exceed five megawatts, may petition the Commission for
   permission to aggregate or combine their demands, for the purpose of meeting
   the demand limitations of subdivision 3, so as to become qualified to purchase
   electric energy from any supplier of electric energy licensed to sell retail
   electric energy within the Commonwealth under the conditions specified in
   subdivision 3. The Commission may, after notice and opportunity for hearing,
   approve such petition if it finds that:
   				a. Neither such customers&#8217; incumbent electric utility nor retail
   customers of such utility that do not choose to obtain electric energy from
   alternate suppliers will be adversely affected in a manner contrary to the
   public interest by granting such petition. In making such determination, the
   Commission shall take into consideration, without limitation, the impact and
   effect of any and all other previously approved petitions of like type with
   respect to such incumbent electric utility; and
   				b. Approval of such petition is consistent with the public interest.
   				If such petition is approved, all customers whose load has been aggregated
   or combined shall thereafter be subject in all respects to the provisions of
   subdivision 3 and shall be treated as a single, individual customer for the
   purposes of said subdivision. In addition, the Commission shall impose
   reasonable periodic monitoring and reporting obligations on such customers to
   demonstrate that they continue, as a group, to meet the demand limitations of
   subdivision 3. If the Commission finds, after notice and opportunity for
   hearing, that such group of customers no longer meets the above demand
   limitations, the Commission may revoke its previous approval of the petition,
   or take such other actions as may be consistent with the public interest.

   5. Individual retail customers of electric energy within the Commonwealth,
   regardless of customer class, shall be permitted:
   				a. To purchase electric energy provided 100 percent from renewable energy
   from any supplier of electric energy licensed to sell retail electric energy
   within the Commonwealth, other than any incumbent electric utility that is not
   the incumbent electric utility serving the exclusive service territory in
   which such a customer is located, if the incumbent electric utility serving
   the exclusive service territory does not offer an approved tariff for electric
   energy provided 100 percent from renewable energy; and
   				b. To continue purchasing renewable energy pursuant to the terms of a
   power purchase agreement in effect on the date there is filed with the
   Commission a tariff for the incumbent electric utility that serves the
   exclusive service territory in which the customer is located to offer electric
   energy provided 100 percent from renewable energy, for the duration of such
   agreement.

   6. To the extent that an incumbent electric utility has elected as of February
   1, 2019, the Fixed Resource Requirement alternative as a Load Serving Entity
   in the PJM Region and continues to make such election and is therefore
   required to obtain capacity for all load and expected load growth in its
   service area, any customer of a utility subject to that requirement that
   purchases energy pursuant to subdivision 3 or 4 from a supplier licensed to
   sell retail electric energy within the Commonwealth shall continue to pay its
   incumbent electric utility for the non-fuel generation capacity and
   transmission related costs incurred by the incumbent electric utility in order
   to meet the customer&#8217;s capacity obligations, pursuant to the incumbent
   electric utility&#8217;s standard tariff that has been approved by and is on
   file with the Commission. In the case of such customer, the advance written
   notice period established in subdivisions 3 c and d shall be three years. This
   subdivision shall not apply to the customers of licensed suppliers that (i)
   had an agreement with a licensed supplier entered into before February 1,
   2019, or (ii) had aggregation petitions pending before the Commission prior to
   January 1, 2019, unless and until any customer referenced in clause (i) or
   (ii) has returned to purchase electric energy from its incumbent electric
   utility, pursuant to the provisions of subdivision 3 or 4, and is receiving
   electric energy from such incumbent electric utility.

   7. A tariff for one or more classes of residential customers filed with the
   Commission for approval by a cooperative on or after July 1, 2010, shall be
   deemed to offer a tariff for electric energy provided 100 percent from
   renewable energy if it provides undifferentiated electric energy and the
   cooperative retires a quantity of renewable energy certificates equal to 100
   percent of the electric energy provided pursuant to such tariff. A tariff for
   one or more classes of nonresidential customers filed with the Commission for
   approval by a cooperative on or after July 1, 2012, shall be deemed to offer a
   tariff for electric energy provided 100 percent from renewable energy if it
   provides undifferentiated electric energy and the cooperative retires a
   quantity of renewable energy certificates equal to 100 percent of the electric
   energy provided pursuant to such tariff. For purposes of this section,
   &#8220;renewable energy certificate&#8221; means, with respect to
   cooperatives, a tradable commodity or instrument issued by a regional
   transmission entity or affiliate or successor thereof in the United States
   that validates the generation of electricity from renewable energy sources or
   that is certified under a generally recognized renewable energy certificate
   standard. One renewable energy certificate equals 1,000 kWh or one MWh of
   electricity generated from renewable energy. A cooperative offering electric
   energy provided 100 percent from renewable energy pursuant to this subdivision
   that involves the retirement of renewable energy certificates shall disclose
   to its retail customers who express an interest in purchasing energy pursuant
   to such tariff (i) that the renewable energy is comprised of the retirement of
   renewable energy certificates, (ii) the identity of the entity providing the
   renewable energy certificates, and (iii) the sources of renewable energy being
   offered.

B. The Commission shall promulgate such rules and regulations as may be
necessary to implement the provisions of this section.

C. 1. By January 1, 2002, the Commission shall promulgate regulations
establishing whether and, if so, for what minimum periods, customers who request
service from an incumbent electric utility pursuant to subsection D of § 56-582
or a default service provider, after a period of receiving service from other
suppliers of electric energy, shall be required to use such service from such
incumbent electric utility or default service provider, as determined to be in
the public interest by the Commission.

   2. Subject to (i) the availability of capped rate service under &#xA7; 56-582,
   and (ii) the transfer of the management and control of an incumbent electric
   utility&#8217;s transmission assets to a regional transmission entity after
   approval of such transfer by the Commission under &#xA7; 56-579, retail
   customers of such utility (a) purchasing such energy from licensed suppliers
   and (b) otherwise subject to minimum stay periods prescribed by the Commission
   pursuant to subdivision 1, shall nevertheless be exempt from any such minimum
   stay obligations by agreeing to purchase electric energy at the market-based
   costs of such utility or default providers after a period of obtaining
   electric energy from another supplier. Such costs shall include (i) the actual
   expenses of procuring such electric energy from the market, (ii) additional
   administrative and transaction costs associated with procuring such energy,
   including, but not limited to, costs of transmission, transmission line
   losses, and ancillary services, and (iii) a reasonable margin. The methodology
   of ascertaining such costs shall be determined and approved by the Commission
   after notice and opportunity for hearing and after review of any plan filed by
   such utility to procure electric energy to serve such customers. The
   methodology established by the Commission for determining such costs shall be
   consistent with the goals of (a) promoting the development of effective
   competition and economic development within the Commonwealth as provided in
   subsection A of &#xA7; 56-596, and (b) ensuring that neither incumbent
   utilities nor retail customers that do not choose to obtain electric energy
   from alternate suppliers are adversely affected.

   3. Notwithstanding the provisions of subsection D of &#xA7; 56-582 and
   subsection C of &#xA7; 56-585, however, any such customers exempted from any
   applicable minimum stay periods as provided in subdivision 2 shall not be
   entitled to purchase retail electric energy thereafter from their incumbent
   electric utilities, or from any distributor required to provide default
   service under subsection B of &#xA7; 56-585, at the capped rates established
   under &#xA7; 56-582, unless such customers agree to satisfy any minimum stay
   period then applicable while obtaining retail electric energy at capped rates.

   4. The Commission shall promulgate such rules and regulations as may be
   necessary to implement the provisions of this subsection, which rules and
   regulations shall include provisions specifying the commencement date of such
   minimum stay exemption program.

HISTORY: 1999, c. 411; 2001, c. 748; 2003, cc. 795, 990; 2004, c. 827; 2007, cc.
888, 933; 2010, cc. 326, 397; 2019, c. 833.