— Virginia is poised to become the first state to charge consumers to use natural gas and electric power.
Ralph Northam’s office said Tuesday that the fee would be set at a rate of 1.5 cents per kilowatt hour (kWh) and apply to residential and commercial electric bills starting Jan. 1.
The fee would also be waived for electric vehicles.
The state estimates the fee will generate $9.7 million a year, enough to pay for the state’s electric grid, a $1 billion program to rebuild and modernize schools and schools infrastructure, and a $3.7 billion fund for infrastructure improvements.
Virginia already charges consumers $3 per kWh for electric power and gas for other uses, and many have said they don’t see the point.
Critics say the fee doesn’t do enough to help the struggling electric utility, but the governor said he wants to “do something that helps the people of Virginia and the state of Virginia.”
Virginia was among several states to levy the fee last year, and Gov.
Terry McAuliffe, a Democrat, signed a bill that raised the fee in January.
The fee applies to electric, natural gas or gas-fired power plants that produce more than 50,000 megawatt hours of electricity or less.
The bill will apply to power plants in all 50 states, the District of Columbia and Puerto Rico, and the U.S. Virgin Islands, which already have the largest gas and natural gas usage in the country.
Some states already have similar fees.
In Virginia, the fee applies only to electricity generated by utilities and is not tax.
The state estimates that charging consumers will generate about $8.5 million annually, or more than half of the $6.6 billion it is expected to spend on electricity and related programs.
Virginia will not charge residential consumers a fee until next year, according to the state.
Northam said in a statement that the bill will provide incentives for residential and small business owners to invest in electric energy and the environment.
“The goal is to encourage and create the economic opportunity for all Virginians, regardless of income, race, ethnicity, religion or national origin,” Northam said.
“Our goal is clear: This tax will help create jobs, build and expand our economy, and improve our quality of life.”