Pipelines and Property Lines

Pipelines and Property Lines

The Atlantic Coast Pipeline wants to inspect land along a proposed 550-mile route. Legal challenges from landowners could re-write a 2004 law governing property rights in utility surveys.

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Salvaging Wind Power in Virginia

Salvaging Wind Power in Virginia

Dominion thinks $400 million is too much to pay for two experimental offshore wind turbines. The utility is exploring ways to drive the cost down.

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Cutting CO2 One Refrigerator at a Time

Cutting CO2 One Refrigerator at a Time

Energy efficiency is everybody's favorite strategy for reducing carbon-dioxide emissions. But conservation programs are not always economical.

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Shining Sunlight on the Accomack Solar Project

Shining Sunlight on the Accomack Solar Project

Amazon's giant solar power plant will lighten the environmental footprint of the company's growing cluster of Northern Virginia data centers. It won't do much to lighten the tax burden of Accomack County.

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Grid Pro Quo

Grid Pro Quo

The EPA wants to restructure Virginia’s electric grid. Skeptics argue that slashing CO2 emissions will drive electric bills higher. Environmentalists disagree. Who’s right?

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Grid Optimization: More Software, Less Hardware

power_line

by James A. Bacon

Dominion Voltage, Inc., a subsidiary of Dominion Resources, has announced the deployment of its electric grid optimization platform to the Duck River Electric Membership Corporation served by the Tennessee Valley Authority. Duck River expects to generate energy savings of 2% to 4% annually and says the technology will accelerate the deployment of Advanced Metering Infrastructure, which should enable even greater energy conservation.

Dominion Voltage’s EDGE platform “leverages the smart grid network for Volt/VAR optimization and voltage stabilization, which leads to a more efficient grid,” stated Executive Director Todd Headlee in a press release today.

The most concise explanation of “voltage optimization” that I’ve seen comes from Dick Munson, director of the Environmental Defense Fund’s Midwest Clean Energy initiative, writing a week ago for the EDF blog:

Many appliances, including incandescent lighting, work just as effectively, yet consume less energy, when the flow of electricity to them is reduced. Put another way, higher voltages generally make individuals and businesses needlessly use more energy, driving up electricity bills and air pollution. Therefore, if voltage was “right-sized,” residents would get enough power to run their appliances efficiently, but not so much that they use more electricity than needed.

According to Munson, recent study by Commonwealth Edison Company (ConEd)  concluded that voltage optimization could reduce the need for almost 20,000 gigawatt hours of electricity yearly across its system, enough to power 180,000 homes, at the incredibly low cost of 2 cents per kilowatt-hour.

Bacon’s bottom line: Grid optimization technologies are a sub-set of a larger cluster of technologies including microprocessor controls, sensors and software algorithms collectively referred to as “smart grid” technologies that hold out the potential to improve energy efficiency and integrate variable power sources like wind and solar into the grid.

Richmond-based Dominion Resources is investing in some of these technologies through unregulated subsidiaries like Dominion Voltage. That makes an interesting business story. What makes it a Virginia public policy story is whether Dominion is applying these same technologies in its regulated subsidiary, Dominion Virginia Power. If not, why not. What are the hold-ups? Or has the story simply gone unnoticed?

If there’s one thing that rate payers, environmentalists, electric utilities, the Commonwealth of Virginia and just about everyone else should be able to agree upon, it’s that reducing energy consumption at the cost of 2 cents per kilowatt hour is a win-win for everyone. I will pursue this line of questioning as I have time.

The New Wave of Wealth Creation: SNL

Reid Nagle, circa 2007. Photo credit: The Hook.

Reid Nagle, circa 2007. Photo credit: The Hook.

by James A. Bacon

When most Virginians hear the letters “SNL,” they think Saturday Night Live. Perhaps in the future, they’ll think SNL Financial, the Charlottesville-based market research firm just purchased by McGraw Hill Financial for $2.225 billion.

New Mountain Capital, the New York-based private equity firm that purchased 60% of the company in 2011, will grab the lion’s share of that sum. But founder Reid Nagle other senior managers will take much of the rest — about $890 million. That’s a lot of wealth creation for a company that few Virginians had ever heard of.

SNL is a new-era enterprise that deploys Big Data to create massive wealth. The company provides reports on seven key business sectors, drawing upon a global workforce of 3,000 in 23 offices in 10 companies. Four hundred employees are located in the Charlottesville headquarters and another 50 in the Innsbrook Office Park in Richmond. CEO Mike Chinn described SNL’s business model to the Wall Street Journal this way:

We’ve developed a pretty efficient machine for both gathering and selling information. How you collect that information is the same whether it’s a bank branch or a coal mine or a power plant.

Nagle founded the company in 1987 because he couldn’t get a job after working as CFO for the notorious corporate takeover artist Ivan Boesky, who was convicted for insider trading. After two years in New Jersey, Nagle moved the company to Charlottesville, according to a 2007 profile in The Hook. It was not the kind of company that would catch the attention of economic developers. Around that time Nagle nearly ran out of money. “I wasn’t going to make payroll,” he told The Hook. An unsolicited $100,000 infusion saved the day, and he was able to raise another $300,000.

SNL officials told the Daily Progress that revenues had increased every year since its founding in 1987. Launched with a focus on the Savings & Loan industry, the company branched out to other business sectors, aided by acquisitions of boutique research firms. Nagle said in 2011 he would use the cash infusion from New Mountain Capital to continue growth, product development and “provide liquidity to existing shareholders.” It’s not clear from published reports what percentage of the non-New Mountain Capital shares were owned by Nagle, Chinn and other Virginia-based SNL executives, but it was likely a significant number. In 2011 Nagle had described himself as the “second largest shareholder” after New Mountain.

Bacon’s bottom line: Much of Virginia’s wealth creation is invisible to the media and public policy makers. No one would have targeted SNL for corporate recruitment in 1989 when the company was living hand-to-mouth. When asked in 2007 why he located the business in Charlottesville, did Nagle cite Virginia’s, ports, highways, low taxes or business incentives? No. He replied: “Quality of life and access to bright people from PVCC, Eastern Mennonite, UVA, JMU, W&M, Virginia Tech, and other Virginia colleges and universities.”

Remember that: Quality of life and human capital drive SNL-style wealth creation.

So Long, Bacon’s Rebellion

Galuszka on Thom Hartmann show, 2012

Here I am discussing my book on the Thom Hartmann show in Washington in  2012

 By Peter Galuszka

For that past six (or is it seven or eight?) years, I’m been pleased to pound away posting my peculiar views on Bacons Rebellion.

My stance has typically been that of a liberal or progressive albeit one of the near and not the far left. My opinions have been honed by 41 years of experience as a journalist in Virginia, in other states and abroad.

Now it’s time to sign off, at least on Bacons Rebellion. I’ll be moving over to Style Weekly, where I have been writing for the past six years.

I have a close relationship with the Style staff whom I respect tremendously. In fact, it was a Style story on coal giant Massey Energy in 2009 that morphed into my first book, “Thunder on the Mountain: Death at Massey and the Dirty Secrets Behind Big Coal” that was published in hardback by St. Martin’s Press in 2012 and then in paperback by West Virginia University Press in 2014. In a way, it’s like going home since Style is owned by The Virginian-Pilot, where I first starting working in 1973 when I was 20 years old.

I also have tremendous respect for Jim Bacon, with whom I have been working on and off since 2000. While Jim and I share very different views on most topics, he and I share one common idea – that the free press and deeply reported and analyzed stories are essential if Virginia and the country are to protect individual liberty and have flourishing economies.

Over the years, Jim and I have chewed over such issues as land use and the environment; ethics and energy. We’ve been through such colorful figures as Ken Cuccinelli and the rise and fall of Bob McDonnell, the Confederate flag and health care.

Recently, however, Jim has accepted a sponsorship from Dominion Resources, whom I have covered and written about critically since the mid-1970s. Although Dominion has had absolutely no impact on my recent postings, I am uncomfortable with continuing on a blog that embraces stories that do seem, in some cases, to be push Dominion’s interests in ways that are far too one-sided. This is not healthy given the gravity of such issues as global warming, renewable energy, coal, natural gas, the rights of landowners who decline to let Dominion survey their property for a pipeline route and so on.

Another reason for my decision to leave is that a venomous gas seems to be suddenly choking the Rebellion. Rather than arguing my points with wit and facts, as I have been enjoying for years, some of the more recent commenters have resorted to snark and bitter personal assaults. I have donated thousands of hours of my time for free on this blog. Commenters might not agree with me, but now some seem not to respect my efforts at all. So, I say goodbye and good luck to them.

If you want to find me in the future, look for me at styleweekly.com and at The Washington Post, where I will continue to contribute to the All Opinions Are Local section and to other parts of the paper. I will still be free lancing for various outlets.

I hope you will continue to read and support Bacons Rebellion. It is fantastic resource that has served as much-needed forum for information, ideas, debate and analysis as journalism continues to undergo the tremors caused by the Internet.

All the best to Jim!

Something to Think About

Last week I was reading in the New York Times an article on Jeb Bush’s plans for the economy. One of his talking points was to reduce the federal workforce by 10%. For a state as dependent on the Feds as Virginia, this could have serious financial implications. Already, in the CNBC rankings as the best state for doing business, Virginia has dropped from at or near the top to 12th in the most recent poll.  One of the reasons given was the decrease in federal spending. We can debate whether the government spends,  but such a cut in Northern Virginia and the Norfolk area could have significant impact.

— Les Schreiber

Will Virginia COPN Study Group Ask the Critical Questions?

Data source: Virginia Department of Health

Data source: Virginia Department of Health

by James A. Bacon

State Certificate of Public Need (COPN) programs come in many shapes and sizes across the United States. Fourteen states have abolished the health-care regulatory program entirely, while states that continue to regulate capital investments in health care facilities and high-end equipment vary widely in what they regulate.

Among states with COPN, Virginia regulates about 19 of 30 categories of medical services, placing it in the middle of the pack for regulatory intensity, according to a state-by-state comparison presented to Virginia’s COPN work group earlier this month. Virginia’s application fees are relatively modest, but the review process, at 190 days, is the longest in the country.

The work group is studying Virginia’s COPN law to determine if it needs reform, in light of the enactment of the Affordable Care Act and other changes in the medical marketplace. The justification for COPN when it was instituted nationally in Virginia in 1973 was that normal competitive processes did not work in health care. When hospitals and other providers added hospital beds and purchased high-tech equipment, they supposedly made sure that patients utilized them, which added to the run-up in health care costs.

However, critics of COPN argue that the cost-plus system for reimbursing providers, which created financial incentives for providers to over-diagnose and over-treat patients, is no longer prevalent. The primary justification cited now for COPN is that by restricting competition, it shores up hospital profits and guarantees as a condition of receiving a certificate that hospitals will provide charity care for thousands of Virginians lacking insurance.

Virginia Secretary of Health and Human Resources Bill Hazel explained the logic of the national survey this way: “Do we know anything about … what actually happens in states where there has been deregulation?” (See the Richmond Times-Dispatch coverage here.)

Those are worthwhile questions to start with, but the study group needs to delve a lot deeper. One question I would ask is this: Does Virginia’s COPN really accomplish anything? The chart above, based upon Virginia Department of Health data, shows the dollar value of COPN applications approved and denied. Virginia approves the overwhelming majority of applications, a trend that has become especially evident since 2009. If the COPN reviews are just rubber-stamping applications, what’s the point in reviewing them at all? Alternatively, does the COPN process discourage entrepreneurs from even submitting proposals to a process they deemed to be rigged in favor of established players?

The chart raises another question: What accounts for the dramatic fall-off in health care-related capital spending in Virginia since 2009? We can’t blame it on the 2007-2009 recession, a period during which hospital spending actually peaked. Arguably, spending tanked as a reaction to uncertainty created by the enactment in 2010 of the Affordable Care Act (Obamacare). But even that explanation begs another question: Why has capital spending remained so low in subsequent years when regulations have been written, the law applied and uncertainty is less prevalent? Have Obamacare or changes in the commercial health insurance market created incentives to restrain capital spending? And, if so, why would we still need COPN?

I would add an even more fundamental set of questions: What impact has COPN had on health care productivity in Virginia? The health care sector is notorious for its low level of productivity growth, an underlying cause of escalating health care costs. There are two schools of thought. The first is that maximizing utilization of a restricted supply of beds and equipment, which COPN is designed to do, will lift productivity. The countervailing theory is that the path to greater productivity lies in embracing new processes, which often entail redesigning the physical layout of hospital floors or even building specialized, dedicated facilities. COPN would slow such changes. Which school of thought is right? Without more evidence, we don’t know.

The debate over U.S. health care focuses overwhelmingly on who pays. It’s a zero-sum game of slicing up a fixed pie so that some get bigger pieces and others get smaller pieces. The only way out of this morass, to borrow a hoary cliche, is to grow the pie — to make more health care available at more affordable prices for all. One way to do that is to overhaul the way health care is delivered: to evolve from a system dominated by general-purpose hospitals that provide a wide range of services to one that includes focused factories specializing at performing a narrow range of procedures exceptionally well and exceptionally efficiently.

That’s not happening. Rather than encouraging entrepreneurial specialization and experimentation, the health care industry is consolidating. Both the insurance and hospital sectors are becoming cartels, and they’re absorbing independent physician practices. The causes are bigger than COPN alone. But COPN may contribute to the trend. The big-picture question Virginia policy makers need to ask is this: Do we want cartels or entrepreneurs to dominate state health care? I don’t hear anyone asking that question.

Hospital Rankings and Economic Development

VCU Medical Center complex in downtown Richmond, a driver of the regional economy.

VCU Medical Center complex in downtown Richmond.

by James A. Bacon

U.S. News & World-Report has issued its 2015-2016 ranking of the nation’s “best hospitals,” and Virginia has four hospitals with at least one adult specialty receiving a “national” ranking. The online publishing company bills the ranking as a tool to help patients select hospitals that can best treat complex illnesses. But it also prompts questions about the role of hospitals as agents of economic development.

Hospitals are major employers and generators of economic activity in every community they serve. While some hospitals cater to local markets exclusively, some have such a reputation for excellence in certain specialty practices, from cancer to heart disease, that they draw patients from around the state, the nation or even the world. To the extent that a hospital draws patients from elsewhere, it can be said to be “exporting” services and making a contribution to local jobs and economic activity.

Thus, Massachusetts General, rated the best hospital this year, excels in everyone of the 16 specialties covered by U.S. News & World-Report and three pediatric specialties. The hospital employs 2,889 doctors, many of whom are highly compensated specialists, not to mention a host of nurses, technicians, administrators and others. Its reputation as one of the best research hospitals in the world brings in “thousands” of international patients — so many that the hospital maintains a dedicated “international patient center.” No wonder that Mass General is an anchor of the Boston regional economy.

Accepting the proposition that hospitals can be big contributors to regional economies over and above their contribution to public health, how do Virginia’s hospitals shake up? Here’s the score:

Virginia Commonwealth University Medical Center
National ranking in 3 adult specialties, one pediatric specialty
Doctors: 454

Sentara Norfolk General
National ranking in 2 adult specialties
Doctors: 694

Inova Fairfax
National ranking in 1 adult specialty, two pediatric specialties
Doctors: 1,689

University of Virginia Medical Center
National ranking in 1 adult specialty, 4 pediatric specialties
Doctors: 609

Sentara_Norfolk_General

Sentara Norfolk General Hospital

How significant are those rankings? That’s hard to say. There are nearly 5,000 hospitals across the United States. U.S. News & World-Report uses a methodology that combines metrics such as hospital volume and risk-adjusted survival rates for complex cases and supplements them with a physician survey of hospital reputations. To be awarded a “national” ranking, a hospital must score within the top 50. In other words, that puts VCU in the top 1% for three adult specialties and one pediatric specialty. The publication does not publish the numbers behind the scores, so there is no way to tell if VCU’s specialties rank No. 1 in the country or No. 50.

U.S. News and World-Report focuses on 16 adult specialties. With 50 hospitals recognized for each specialty, a total of 800 total hospital specialties are recognized. Only seven of those are located in Virginia. To put that in perspective, Virginia has 2.6% of the nation’s population, 3.3% of its GDP but only 0.9% of its nationally ranked hospital specialties.

These are very rough numbers that are undoubtedly subject to criticism. But they suggest to me that Virginia’s hospitals are an under-performing economic sector. If hospitals achieved a level of excellence commensurate with Virginia’s population and GDP, there would be far more centers of excellence in the state, along with more highly compensated doctors, nurses and technicians employed.

That’s not meant to be a put-down of Virginia’s hospitals. The ability to expertly handle highly complex medical cases does not tell us much about the ability to handle routine cases. It doesn’t tell us how much the hospitals charge for their services or whether they’re providing value for the dollar. It doesn’t mean that Virginia hospitals aren’t serving their community. What the numbers mean is that Virginia is missing out on an economic development opportunity to provide services outside the community.

What U.S. News & World-Report does not tell us, and I don’t know, is what it takes to become a national-class hospital. I suspect that it takes a long time to build a top oncology or heart program, so longevity is probably a requirement. It also helps to live in a community that can afford to pay the high salaries of top medical talent. And it probably helps to have wealthy philanthropists willing to endow new buildings, medical school professorships and R&D. Undoubtedly, there are other factors of which I am unaware. I think it would be interesting to know what the key drivers are, and whether building institutions known for their medical excellence is something that communities can influence through government policy and/or philanthropic endeavors.

Virginians still think of economic development either as big game hunting for corporate investments or venture capital-driven business creation. But economic development comes in many forms, and hospitals are one. It strikes me that this is an area that warrants more attention here in the Old Dominion.

Alpha Natural Resources: Running Wrong

Alpha miners in Southwest Virginia (Photo by Scott Elmquist)

Alpha miners in Southwest Virginia
(Photo by Scott Elmquist)

 By Peter Galuszka

Four years ago, coal titan Alpha Natural Resources, one of Virginia’s biggest political donors, was riding high.

It was spending $7.1 billion to buy Massey Energy, a renegade coal firm based in Richmond that had compiled an extraordinary record for safety and environmental violations and fines. Its management practices culminated in a huge mine blast on April 5, 2010 that killed 29 miners in West Virginia, according to three investigations.

Bristol-based Alpha, founded in 2002, had coveted Massey’s rich troves of metallurgical and steam coal as the industry was undergoing a boom phase. It would get about 1,400 Massey workers to add to its workforce of 6,600 but would have to retrain them in safety procedures through Alpha’s “Running Right” program.

Now, four years later, Alpha is in a fight for its life. Its stock – trading at a paltry 55 cents per share — has been delisted by the New York Stock Exchange. After months of layoffs, the firm is preparing for a bankruptcy filing. It is negotiating with its loan holders and senior bondholders to help restructure its debt.

Alpha is the victim of a severe downturn in the coal industry as cheap natural gas from hydraulic fracturing drilling has flooded the market and become a favorite of electric utilities. Alpha had banked on Masset’s huge reserves of met coal to sustain it, but global economic strife, especially in China, has dramatically cut demand for steel. Some claim there is a “War on Coal” in the form of tough new regulations, although others claim the real reason is that coal can’t face competition from other fuel sources.

Alpha’s big fall has big implications for Virginia in several arenas:

(1) Alpha is one of the largest political donors in the state, favoring Republicans. In recent years, it has spent $2,256,617 on GOP politicians and PACS, notably on such influential politicians and Jerry Kilgore and Tommy Norment, according to the Virginia Public Access Project. It also has spent $626,558 on Democrats.

In 2014-2015, it was the ninth largest donor in the state. Dominion was ahead among corporations, but Alpha beat out such top drawer bankrollers as Altria, Comcast and Verizon. The question now is whether a bankruptcy trustee will allow Alpha to continue its funding efforts.

(2) How will Alpha handle its pension and other benefits for its workers? If it goes bankrupt, it will be in the same company as Patriot Coal which is in bankruptcy for the second time in the past several years. Patriot was spun off by Peabody, the nation’s largest coal producer, which wanted to get out of the troubled Central Appalachian market to concentrate on more profitable coalfields in Wyoming’s Powder River Basin and the Midwest.

Critics say that Patriot was a shell firm set up by Peabody so it could skip out of paying health, pension and other benefits to the retired workers it used to employ. The United Mine Workers of America has criticized a Patriot plan to pay its top five executives $6.4 million as it reorganizes its finances.

(3) Coal firms that have large surface mines, as Alpha does, may not be able to meet the financial requirements to clean up the pits as required by law. Alpha has used mountaintop removal practices in the Appalachians in which hundreds of feet of mountains are ripped apart by explosives and huge drag lines to get at coal. They also have mines in Wyoming that also involve removing millions of tons of overburden.

Like many coal firms, Alpha has used “self-bonding” practices to guarantee mine reclamation. In this, the companies use their finances as insurance that they will clean up. If not, they must post cash. Wyoming has given Alpha until Aug. 24 to prove it has $411 million for reclamation.

(4) The health problems of coalfield residents continue unabated. According to a Newsweek report, Kentucky has more cancer rates than any other state. Tobacco smoking as a lot to do with it, but so does exposure to carcinogenic compounds that are released into the environment by mountaintop removal. This also affects people living in Virginia and West Virginia. In 2014, Alpha was fined $27.5 million by federal regulators for illegal discharges of toxic materials into hundreds of streams. It also must pay $200 million to clean up the streams.

The trials of coal companies mean bad news for Virginia and its sister states whose residents living near shut-down mines will still be at risk from them. As more go bust or bankrupt, the bill for their destructive practices will have to borne by someone else.

After digging out the Appalachians for about 150 years, the coal firms have never left coalfield residents well off. Despite its coal riches, Kentucky ranks 45th in the country for wealth. King Coal could have helped alleviate that earlier, but is in a much more difficult position to do much now. Everyday folks with be the ones paying for their legacy.

Pipelines and Property Lines

Charlotte Rea. Photo credit: All Pain, No Gain

Charlotte Rea. Photo credit: All Pain, No Gain

The Atlantic Coast Pipeline wants to inspect land along a proposed 550-mile route. Legal challenges from landowners could re-write a 2004 law governing property rights in utility surveys.

by James A. Bacon

Charlotte Rea decided when she retired that she wanted to live near where she grew up near Charlottesville. She found “a little piece of heaven” in Nelson County: a 29-acre spread on the north fork of the Rockfish River. With her retirement savings, she purchased the land with the idea of keeping it undeveloped if things worked out but selling two lots if she needed the cash. “All of my money is in the land,” Rea says. “It’s my long-term care insurance.”

She never imagined that someone would want her land for industrial purposes. But her homestead, as it turns out, came to be situated on the proposed route of the Atlantic Coast Pipeline (ACP) linking the natural gas fields of West Virginia with markets in Virginia and North Carolina. The 125-foot pipeline right-of-way would cut a swath across the river and through forested wetlands on her property that host a species of rare orchid. An ag-forestal district designation restricts development and prohibits industrial uses, she says. “Except it appears Dominion can industrialize it by running a pipeline through it. My property  will become an underground natural gas storage site.”

Since announcing its original plans, ACP has redrawn its proposed route, leaving her property untouched. But Rea doesn’t consider the new route to be definitive, and she is little reassured. “My future is totally blown up, not knowing what’s happening to my property. No one wants to buy land with a natural gas pipeline going through the middle of the view shed. I stand to lose $50,000 in property value. I couldn’t sleep at night worrying about the darn thing coming through.” 

The 63-year-old career Air Force veteran decided to fight back, signing up as co-chair of the “All Pain No Gain” group opposing the pipeline. Not only does Rea not want to see the pipeline built, she objects to ACP or its contractors even coming onto private property to survey the land. And she is just one of dozens of landowners who view the pipeline the same way.

Dominion Transmission, ACP’s managing partner, filed suit this spring in local courts against more than 100 property in order to gain access to their land. Many, like Rea, were clustered near the Blue Ridge mountains in Augusta and Nelson Counties. A local judge ruled that the notice letters had been improperly issued by Dominion Transmission, so the pipeline company withdrew the pending cases and started re-filing lawsuits as ACP. As of early July, says Rea, she knew of 27 re-filed lawsuits. Meanwhile, pipeline foes have filed two of their own lawsuits in federal court challenging the constitutionality of the state law.

The lawsuits are shaping up as the Old Dominon’s biggest battle over property rights in years. The courts will be called upon to define the balance between landowners like Rea who wish to be left alone and utilities like the four corporate partners of the $5 billion Atlantic Coast Pipeline — including Virginia energy giant Dominion, Duke Energy, AGL Resources and Piedmont Natural Gas — who argue that there is a compelling public need to build more gas pipelines as electric utilities replace coal with gas in their fuel mix. The legal outcome could influence other pipeline projects as well. Three groups besides ACP have expressed possible interest in building pipelines from the West Virginia shale fields to markets in Virginia and points south.

Pipeline foes make two overarching arguments. First, the Federal Energy Regulatory Commission (FERC) has not yet issued a certificate declaring the ACP project to be in the public interest, says Joe Lovett, an attorney with Appalachian Mountain Advocates. Because ACP cannot yet argue that the pipeline is for “public use,” it has no right to survey land without the consent of property owners.

Second, pipeline foes say, landowners deserve compensation for survey crews tramping over their property. The right to exclude others from entering your property “is one of the most important rights in the bundle of property rights,” says Josh Baker, an attorney with Waldo & Lyle, one of the preeminent landowner rights firms in Virginia. When multiple survey teams — ACP lists five different categories of crews — enter the property, they can cause considerable inconvenience. While the Virginia code allows for “actual damages” resulting from a survey, it allows nothing for inconvenience.

Dominion asserts that it is fully within its rights to conduct the surveys as long as it complies with requirements to request permission in writing to inspect the land and then provide a notice of intent to enter. Obtaining a certificate of public convenience and necessity from FERC is necessary to acquire land through eminent domain authority but not to survey land, says Jim Norvelle, director media relations for Dominion Energy. Surveys are governed by state law.

As for land surveys constituting a “taking,” there is plenty of legal precedent to support ACP’s position, Norvelle says. “We do not expect to damage anyone’s property when surveying. In the unlikely event there is some damage, we will reimburse the landowner.”

A half century ago, pipelines in Virginia were either intrastate pipelines under State Corporation Commission jurisdiction or they were segments of interstate pipelines built and “stitched together over time,” says Jim Kibler, who was active in eminent domain litigation in Virginia before joining Atlanta-based AGL Resources as senior vice president-external affairs. Local public utility commissions, including Virginia’s SCC, provided most regulatory oversight. Continue reading

Sorry, We Have No Solar Today

sunpower hqBy Peter Galuszka

If you are a homeowner in Virginia interested in installing solar panels at your house, you might consider moving to New Jersey.

Why?

Because a subsidiary of your very own utility, Dominion Energy Solutions, is partnering with SunPower, a California-based company that makes solar systems for the home, to move into the New Jersey market.

“New Jersey is one of the fastest growing solar markets in the U.S. To serve that demand, we’re pleased to offer high-efficiency SunPower solar power systems to qualified homeowners in the state,” said Mary Doswell, senior vice president of Dominion Energy Solutions in a press release. “With financing options including lease, loan or cash purchase, this program makes it easy for homeowners to go solar, maximizing electricity cost savings while reducing the family’s carbon footprint.”

Sounds great! But why not in Virginia?

To find out, I called SunPower and asked them if they had a similar program with Dominion In Virginia. The lady didn’t seem to know, but added, “Wait, give me your zip code and I’ll see if we have an installer in your area.”

“23838,” I said.

“Sorry, but it doesn’t appear that we have anyone there, but keep looking, we should be there some day,” she said.

Hat tip: Glen Besa

The Huntington-Ingalls Model of Higher Ed

apprentice_school2

The Apprentice School in Newport News. Not shabby.

by James A. Bacon

The Apprentice School in Newport News is arguably the most under-rated institution of post-secondary education in Virginia. It lacks some of the attributes that many colleges and universities take for granted — no NCAA-affiliated basketball teams, no frat parties and no dormitory high jinks. But consider this: If you’re lucky enough to attend — with a ratio of 230 spots for 4,000 applicants yearly, the school is more selective than Harvard — you get a free ride, graduate debt-free and are guaranteed employment with a major area company at a starting salary of $54,000 a year. That’s $10,000 more than the average college graduate earns.

The hitch? You don’t earn a Bachelor’s degree. Instead, you master one of 17 skilled trades — pipefitting, welding, electrical work — and you get on-the-job experience at Newport News Shipbuilding helping build atomic-powered submarines and aircraft carriers.

As American industries grapple with a shortage of workers in the skilled trades, sure to grow worse as skilled, blue-collar Baby Boomers retire, and as American students grow increasingly skeptical of the value of over-priced college degrees that no longer offer any surety of employment, institutions like the Apprentice School are looking better and better. As noted in a recent New York Times article profiling the school, political enthusiasm for apprenticeships transcends partisan and ideological lines. Writes the Times:

“We know this works,” said Thomas E. Perez, [the U.S. Secretary of Labor], describing how big companies have long trained young people in Germany, which has 40 apprentices for 1,000 workers, compared to about three per 1,000 in the United States. “It’s not hard to figure out why the Germans have a youth unemployment rate that is half what it is here.”

It’s hard to find anyone who objects to apprenticeships. The problem is that they can’t seem to get traction in the United States. Between 2007 and 2013, the number of active apprentices in the United States fell from about 451,000 to 2888,000, according to Labor Department data. That number increased for the first time since the recession, the Times reports, rising by 27,000.

One problem is that apprenticeships can be expensive to support. At the Apprentice School, the U.S. gold standard, they’re really expensive. The training costs $270,000 per apprentice. That’s beyond the reach of most companies. Another difficulty may be a cultural bias in the U.S. against “blue collar” occupations, which are seen as less prestigious, even though earnings are competitive with many professions requiring a college degree.

The Apprentice School addresses the prestige problem by collaborating with Thomas Nelson Community College and Old Dominion University to provide pathways for students to earn Associates and Bachelor’s degrees. That may help explain why a school that most of us have never heard of is so incredibly popular.

Bacon’s bottom line: Virginia is blessed to have what is arguably the top apprenticeship program in the United States. The school business model may not be readily replicated — not many enterprises have the scale of Newport News Shipbuilding. But the shipbuilding company and its corporate parent, Huntington Ingalls Industries, are public-spirited companies and, I’m confident, would be willing to advise others on what it takes to build a world-class program.

As a matter of public policy, Virginia gives enormous attention to its system of higher education, including a fine system of community colleges. But apprenticeships, as measured by budgetary commitment, fall between the cracks. The Virginia Department of Labor and Industry does support the Virginia Registered Apprenticeship system providing a search of apprenticeship opportunities with 2,000 participating Virginia employer-sponsors. That program supports two “apprenticeship consultants” in the Richmond office. And the state does provide a Virginia’s Worker Retraining Tax Credit. But that seems to be the sum total.

If the state is willing to support college students majoring in English, sociology and history (my degree, and look where it landed me!) to the tune of thousands of dollars per student per year, surely it should be willing to support apprenticeship programs as well.

(Hat tip: Reed Fawell.)