                                 CODE OF VIRGINIA

PILOT PROGRAM FOR UNDERGROUND TRANSMISSION LINES (§ 56-585.1:5)

A. There is hereby established a pilot program to further the understanding of
underground electric transmission lines in regard to electric reliability,
construction methods and related cost and timeline estimating, the probability
of meeting such projections, and the benefits of undergrounding existing
electric transmission lines to promote economic development within the
Commonwealth. The pilot program shall consist of the approval to construct
qualifying electrical transmission lines of 230 kilovolts or less (but greater
than 69 kilovolts) in whole or in part underground. Such pilot program shall
consist of a total of two qualifying electrical transmission line projects,
constructed in whole or in part underground, as specified and set forth in this
section.

B. Notwithstanding any other law to the contrary, as a part of the pilot program
established pursuant to this section, the Commission shall approve as a
qualifying project a transmission line of 230 kilovolts or less that is pending
final approval of a certificate of public convenience and necessity from the
Commission as of December 31, 2017, for the construction of an electrical
transmission line approximately 5.3 miles in length utilizing both overhead and
underground transmission facilities, of which the underground portion shall be
approximately 3.1 miles in length, which has been previously proposed for
construction within or immediately adjacent to the right-of-way of an interstate
highway. Once the Commission has affirmed the project need through an order, the
project shall be constructed in part underground, and the underground portion
shall consist of a double circuit.
			The Commission shall approve such underground construction within 30 days of
receipt of the written request of the public utility to participate in the pilot
program pursuant to this section. The Commission shall not require the
submission of additional technical and cost analyses as a condition of its
approval but may request such analyses for its review. The Commission shall
approve the underground construction of one contiguous segment of the
transmission line that is approximately 3.1 miles in length that was previously
proposed for construction within or immediately adjacent to the right-of-way of
the interstate highway, for which, by resolution, the locality has indicated
general community support. The remainder of the construction for the
transmission line shall be aboveground. The Commission shall not be required to
perform any further analysis as to the impacts of this route, including
environmental impacts or impacts upon historical resources.
			The electric utility may proceed to acquire right-of-way and take such other
actions as it deems appropriate in furtherance of the construction of the
approved transmission line, including acquiring the cables necessary for the
underground installation.

C. In reviewing applications submitted by public utilities for certificates of
public convenience and necessity for the construction of electrical transmission
lines of 230 kilovolts or less filed between July 1, 2018, and October 1, 2020,
the Commission shall approve, consistent with the requirements of subsection D,
one additional application as a qualifying project to be constructed in whole or
in part underground, as a part of this pilot program. The one qualifying project
shall be in addition to the qualifying project described in subsection B and
shall be the relocation or conversion of an existing 230-kilovolt overhead line
to an underground line.

D. For purposes of subsection C, a project shall be qualified to be placed
underground, in whole or in part, if it meets all of the following criteria: (i)
an engineering analysis demonstrates that it is technically feasible to place
the proposed line, in whole or in part, underground; (ii) the governing body of
each locality in which a portion of the proposed line will be placed underground
indicates, by resolution, general community support for the project and that it
supports the transmission line to be placed underground; (iii) a project has
been filed with the Commission or is pending issuance of a certificate of public
convenience and necessity by October 1, 2020; (iv) the estimated additional cost
of placing the proposed line, in whole or in part, underground does not exceed
$40 million or, if greater than $40 million, the cost does not exceed 2.5 times
the cost of placing the same line overhead, assuming accepted industry standards
for undergrounding to ensure safety and reliability; if the public utility, the
affected localities, and the Commission agree, a proposed underground line whose
cost exceeds 2.5 times the cost of placing the line overhead may also be
accepted into the pilot program; (v) the public utility requests that the
project be considered as a qualifying project under this section; and (vi) the
primary need of the project shall be for purposes of grid reliability, grid
resiliency, or to support economic development priorities of the Commonwealth,
including the economic development priorities and the comprehensive plan of the
governing body of the locality in which at least a portion of line will be
placed, and shall not be to address aging assets that would have otherwise been
replaced in due course.

E. A transmission line project that is found to meet the criteria of subsection
D shall be deemed to satisfy the requirements of subsection B of &#xA7; 56-46.1
with respect to a finding of the Commission that the line is needed.

F. Approval of a transmission line pursuant to this section for inclusion in the
pilot program shall be deemed to satisfy the requirements of &#xA7; 15.2-2232
and local zoning ordinances with respect to such transmission line and any
associated facilities, such as stations, substations, transition stations and
locations, and switchyards or stations, that may be required.

G. The Commission shall report annually to the Commission on Electric Utility
Restructuring, the Joint Commission on Technology and Science, and the Governor
on the progress of the pilot program by no later than December 1 of each year
that this section is in effect. The Commission shall submit a final report to
the Commission on Electric Utility Restructuring, the Joint Commission on
Technology and Science, and the Governor no later than December 1, 2024,
analyzing the entire program and making recommendations about the continued
placement of transmission lines underground in the Commonwealth. The
Commission&#8217;s final report shall include analysis and findings of the costs
of underground construction and historical and future consumer rate effects of
such costs, effect of underground transmission lines on grid reliability,
operability (including operating voltage), probability of meeting cost and
construction timeline estimates of such underground transmission lines, and
economic development, aesthetic or other benefits attendant to the placement of
transmission lines underground.

H. For the qualifying projects chosen pursuant to this section and not fully
recoverable as charges for new transmission facilities pursuant to subdivision A
4 of &#xA7; 56-585.1, the Commission shall approve a rate adjustment clause. The
rate adjustment clause shall provide for the full and timely recovery of any
portion of the cost of such project not recoverable under applicable rates,
terms, and conditions approved by the Federal Energy Regulatory Commission and
shall include the use of the fair return on common equity most recently approved
in a State Corporation Commission proceeding for such utility. Such costs shall
be entirely assigned to the utility&#8217;s Virginia jurisdictional customers.
The Commission&#8217;s final order regarding any petition filed pursuant to this
subsection shall be entered not more than three months after the filing of such
petition.

I. The provisions of this section shall not be construed to limit the ability of
the Commission to approve additional applications for placement of transmission
lines underground. Approval by the Commission of a transmission line for
inclusion in the program pursuant to subsection B shall preclude the placement
of future overhead electrical transmission lines of at least 69 kilovolts in the
same right-of-way as described in subsection B for a period of 10 years from
July 1, 2018, but shall not preclude the placement of (i) any underground
transmission lines in such right-of-way or (ii) any electrical distribution
lines in such right-of-way.

J. If two applications are not submitted to the Commission that meet the
requirements of this section, the Commission shall document the failure of the
projects to qualify for the pilot program in order to justify approving fewer
than two projects to be placed underground, in whole or in part.

K. Insofar as the provisions of this section are inconsistent with the
provisions of any other law or local ordinance, the provisions of this section
shall be controlling.

HISTORY: 2018, c. 296; 2020, cc. 164, 165, 797.