But these high scores conceal more worrying ones. Virginia is ranked 35th in the nation on cost of doing business and 32nd in cost of living, and it fails to break into the top of the pack in key categories such as economy and access to capital, as well as technology and innovation. If we wish to continue leading the country as a business-friendly state, we need to attract the industries of the future while also lowering the cost to live and work in our commonwealth.
The key to this lies in reforming our energy economy.
It is impossible to talk about the high cost of living and operating a business in Virginia without talking about our energy bills, which are much higher than the national average. According to federal standards, about 75 percent of households in Virginia have an unaffordable energy burden (the percentage of household income spent on energy costs). Virginia’s cities are among the top 10 in the nation in eviction rates and, given that 1 out of 10 evictions in Virginia is for delinquencies of less than $340, it is not a stretch to link high energy bills to this crisis. As communities of color disproportionately make serious sacrifices to afford utility bills, this burden exacerbates systemic racial inequities in Virginia’s housing market, inequities inherited from our state’s shameful legacy of redlining.
The high cost of electricity also harms Virginia’s businesses. Many of our state’s largest employers — including Costco, Walmart, Kroger and Cox Communications — have complained to the State Corporation Commission (SCC) that Virginia gives Dominion Energy, our major utility monopoly, outsize power to raise electricity rates and earn excessive profits. The commission found their complaints to be legitimate.
While Virginia’s workers and businesses struggle to pay their bills, Dominion has claimed excess profits of $1.3 billion since 2015, according to SCC reports. Historically, the SCC could have compelled Dominion to refund this money to customers and lower rates, but recent measure stripped the commission of that authority.
Our bloated utility system is not just needlessly expensive; but also is rife with perverse incentive structures that have caused us to fall behind in renewable-energy production despite strong demand and increasing affordability. North Carolina produces eight times more solar energy than Virginia and, with no turbines yet in operation, our state is last in the country in wind-energy production. (In recognition of this unsustainable position, Dominion recently announced intentions to build a large offshore wind farm.) Apple, Amazon and other leading tech companies with large data centers in Virginia recently criticized Dominion for building expensive fossil fuel projects rather than investing seriously in renewable energy. (Amazon founder and chief executive Jeff Bezos owns The Post.) Many of Virginia’s companies have made public commitments to 100 percent renewable power, commitments that currently cannot be met by Dominion’s energy portfolio.
Gov. Ralph Northam’s (D) recent pledge to move Virginia’s energy portfolio to 30 percent renewable by 2030 and 100 percent carbon-free by 2050 is a promising first step to solving this problem and, if properly carried out, will be a huge boon to our state’s economy. Currently, advanced energy businesses in Virginia employ more than 100,000 people — more than all Virginia hospitals combined — and this represents only a fraction of what is possible. If Northam’s order is responsibly implemented, we are poised to attract a large number of new, well-paying jobs in a booming industry while reducing the cost of electricity bills for everyone.
But we cannot take this outcome for granted. For too long, Virginia’s energy decisions have been overwhelmingly dictated by our monopoly utilities, resulting in laws that too often favor utility profit at the expense of the public interest. To fix this, we must do more than just aggressively invest in renewable energy. We also need to reform our energy sector to stop the exploitation of Virginians and our businesses. The General Assembly must restore the SCC’s oversight authority to lower energy bills; pass legislation to increase energy efficiency and renewable-energy production; and seriously consider restructuring our energy market to remove barriers to entry, foster innovation and meet the demands of the 21st-century energy economy.
We must ensure that all Virginians, particularly those most burdened by the status quo, have the opportunity to profit in a democratized energy system. It’s time Virginia becomes first in leading the transition to this 21st-century energy economy.