Category Archives: Energy

Why Doesn’t Virginia Have More Wind Power?

Map credit: National Renewable Energy Lab

Map credit: National Renewable Energy Lab

Why hasn’t Virginia made more progress in generating energy from wind power? This map from the National Renewable Energy Lab highlights the problems we face. Unlike the plains states, where almost every square mile is wind blown, Virginia has few suitable locations. Wind power is practical only offshore and on scattered mountain ridges.

Putting windmills on mountaintop ridges poses a problem because it disrupts viewsheds. Every mountain-ridge wind project proposed in Virginia has generated opposition from the surrounding population. In several instances, local governing bodies have used their zoning powers to thwart the projects. Of the half-dozen wind farms proposed over the past decade, not one has been built. As long as (a) people believe they have a right to exercise veto power over land uses for aesthetic reasons, such as protecting viewsheds, and (b) local governments have the power to restrict land uses based upon aesthetic impact, wind power projects likely will be blocked at the local level.

Building wind power projects off-shore avoids the viewshed issue because  turbines can be placed far enough at sea that they won’t be visible from the shore. However, offshore wind power on the East Coast of the U.S. faces a chicken-or-egg problem. Wind power is incredibly expensive because the supporting maritime infrastructure is not available on the East Coast; specialized ships and equipment must be brought in from Europe at great cost. But the wind-power industry is not willing to invest in establishing an East Coast presence until there is sufficient volume of business to support it.

It might be possible to overcome the chicken-or-egg problem if enough players committed to enough wind projects within a relatively narrow time frame to make it financially worthwhile for the wind industry to make that commitment. So far, no one has undertaken such an effort. Offshore wind initiatives remain frustratingly piecemeal.

Perhaps one thing the McAuliffe administration could do to advance wind power in Virginia and the East Coast would be to convene a meeting of every East Coast state with an interest in wind power along with major wind industry players to build the necessary critical mass. Hampton Roads, with its large existing shipbuilding fabrication industry and central East Coast location, is the logical location for the wind industry to be situated. We have the most to gain, so we should take the lead.

— JAB

Apex Encounters Headwinds in Botetourt Wind Project

by James A. Bacon

An interesting player is emerging in the Virginia renewable energy scene — Apex Clean Energy. The Charlottesville-based company has announced that it has erected two test towers for a proposed wind farm in Botetourt County to gather data about wind strength and frequency. The company has proposed constructing up to 25 wind turbines on a ridgeline about five miles east of Eagle Rock, according to news reports.

But the Rocky Forge project is encountering legal headwinds. A lawsuit filed a month ago sought to block the project on the grounds that “industrial turbines are known to catch fire, to collapse, emit audible and low frequency noise, cause shadow flicker and to throw ice from spinning blades in the wintertime,” reported the Roanoke Times. The lawsuit also noted that turbines kill birds and bats and destroy their habitat.

Dominion Virginia Power is running into similar obstacles in Tazewell County, where the energy giant faces stiff local opposition. The Tazewell County has proposed a zoning plan that would classify solar panels and wind turbines with other undesirable developments such as medical waste facilities that require a special permit.

For Apex Clean Energy, Rocky Forge is one of two wind power projects in Virginia. The facility would have a capacity of 80 megawatts, enough to power 20,000 houses. The expected completion date is 2017-2018, according to the company website. Another project, Pinewood Wind in Pulaski County, would have a capacity of 180 megawatts, enough to power 50,000 houses. All told, the company lists 53 projects in its portfolio, with the greatest concentration in the plains states of Texas and Oklahoma.

The company was founded in 2009 with the mission of building “a new kind of energy company.” The founders, who had sold their previous company, Greenlight Energy, to BP Alternative Energy, assembled a team of wind and solar energy professionals with skill sets that could originate projects, finance them, build them and manage them.

It’s not clear from the company website or news reports what the business model is for the Virginia wind farms. Among the possibilities: Purchase Power Agreements, in which a customer signs a contract to purchase a specified amount of energy from a project; project ownership in which Apex delivers a turn-key facility along with asset-management services over to a buyer; and a Structured Purchase Agreement, a long-term price agreement that allow companies to hedge against volatile fuel prices. Or Apex simply may sell electricity into the PJM electric bid, which supports a market for green energy.

Circuit Court Judge Upholds Pipelines’ Right to Survey

pipelineA circuit court judge in Montgomery County dealt a setback to foes of the Mountain Valley Pipeline yesterday by finding constitutional a controversial state law allowing natural gas companies to survey private property without an owner’s permission. Turk said that the Virginia law allows a natural gas company to enter private property for surveying even if its owner has denied permission, reports the Roanoke Times.

Temporary access to a landowner’s property for purposes of conducting a survey does not represent an unconstitutional “taking” of property without compensation, Turk ruled. “There’s no transfer of property,”  he said. The law in question “takes away the criminal aspect of trespass, something the Virginia legislature has the right to do.”

Turk’s ruling in the Giles County case could have implications for lawsuits filed by landowners in the path of both the proposed Mountain Valley Pipeline (MVP) and the Atlantic Coast Pipeline (ACP), who say that the activity of survey teams on private property can impose costs for which they are not compensated.

Attorneys representing landowners said that they intend to file lawsuits in other counties where clients could be impacted by the proposed pipelines. They will challenge state law on the grounds that MVP does not meet the criteria of a public service corporation. Pipeline foes have advanced the argument that there is no “public necessity” for either the MVP or the ACP, despite the fact that both pipeline companies have signed contracts for most of the pipelines’ capacity. Foes argue that existing pipelines could handle much, if not all, of the volume of natural gas required by the shift from coal- to gas-fired utilities and growth in the economy, and that there is no justification for acquiring rights of way through their land through eminent domain.

— JAB

Yes, Virginia, the EPA Is Still Cracking Down on You

EPA_CPP_and_Vaby Bill Tracy

Many folks are trying to interpret the Environmental Protection Agency’s final Clean Power Plan (CPP) and its impact on Virginia. The EPA, along with its August 3 rule announcement, released a large volume of on-line support material including the popular State-at-a-Glance Summary sheets.

Unfortunately, Virginia’s state summary sheet is misleading. EPA made relatively large adjustments to Virginia’s 2012 Base Case, not shown on the state summary sheet. The adjustments were necessary to account for natural gas power plants that were already under construction. The 2030 final targets for Virginia do not seem logical unless you compare them against EPA’s adjusted 2012 base numbers.

Fortunately, EPA does give us enough source data in the State Goal Visualizer spreadsheet to allow me to calculate the adjusted 2012 base, shown below, according to my math:

Carbon intensity (pounds of CO2 emission per megawatt/hour of electricity):
2012 lbs CO2/MWhr: 1,477
2012 lbs CO2/MWhr: 1,366 (EPA Adjusted 2012 Base)
2030 lbs CO2/MWhr: 934

Total CO2 emissions permitted:
2012 CO2 Short Tons Mass: 27,365,439
2012 CO2 Short Tons Mass: 35,733,501 (EPA Adjusted 2012 Base)
2030 CO2 Short Tons Mass: 27,433,111

Now we can see that Virginia’s mass CO2 reduction target (23.2%) makes a lot more sense. The actual degree-of-difficulty is better described by the carbon intensity data (CO2 per MWhr), and Virginia’s 934 lbs target works out to a 31.6% CO2 reduction mandate.

To see how Virginia compares, I’ve hand-entered the data for all 50 states and plotted them up (see the graph above). The first conclusion that jumps out is how well Virginia (in purple) is doing, already operating at relatively low CO2 emission rates. The second conclusion is that Virginia does indeed seem to fall above the trend line, with our 31.6% CO2 reduction target. A bit lower target (27.5% reduction) would appear more equitable, assuming my trend line is correct. Virginia’s final carbon intensity mandate (934 lbs CO2/MWhr) could have been closer to a more manageable 1,000 lbs CO2/MWhr.

Those familiar with these numbers will recognize that 934 lbs CO2/MWhr is the approximate CO2 yield of a clean natural gas power plant. In others words, Virginia probably cannot operate many coal plants and still meet their 2030 CO2 target. In fact, EPA seems to be assuming that Virginia will shut down all but one coal plant by 2020, before CPP even kicks in. I’ve asked EPA to check their numbers to see if there is an error on the Virginia state summary sheet data for 2020.

Bottom line for me is that the Virginia CO2 targets appear very challenging. But somebody needs to check my numbers, and preferably EPA should show their adjusted 2012 base numbers on the State-at-a-Glance summary sheets. Meanwhile please be advised that most of the Virginia CPP information out there on the Web is using our non-adjusted 2012 base data.

Bill Tracy is a retired engineer, concerned citizen, and grandfather residing in Burke, Virginia.  

Charging Rate Payers for What?

appalachian_school_of_pharmacy

The Appalachian School of Pharmacy… located in Appalachian Power Co. service territory.

by James A. Bacon

In 2012 Dominion Virginia Power donated $10,000 to the Appalachian College of Pharmacy in Buchanan County, far outside the company’s service territory. It so happens that Del. Terry Kilgore, R-Gate City, head of the House Commerce and Labor Committee, has been a salaried fundraiser for the school, according to the Associated Press. It also so happens that Kilgore played an important role ushering legislation through the General Assembly this year that suspends until 2022 biennial reviews of Dominion’s base rates. Of the $10,000 Dominion donated, $4,000 was recouped from Dominion ratepayers, the AP says.

It’s one thing for Dominion shareholders to donate to charitable causes, even if the donation is politically motivated. Dominion should be entitled to the same right to participate in the political process as any business. But it’s quite another thing for the giant utility (and sponsor of Bacon’s Rebellion) to charge such donations to rate payers.

“Why should captive ratepayers, who have no option to get electricity from another company, be compelled to fund the charitable choices of a company?” AP quotes former Attorney General Ken Cuccinelli as asking. “Leave the ratepayers their money, and let them make their own charitable choices.”

We’re not talking about a tremendous amount of money here. According to the AP, Dominion included $1.37 million of donations in the cost of service it charged to customers in 2o11 and 2012. State Corporation Commission staff recently filed testimony saying that Dominion should not be able to pass along $3.3 million in donations from 2013 and 2014. Dominion spokesman David Botkins says the company will file a detailed rebuttal later this month.

Many of those donations may be entirely legitimate, tied at least tangentially to the business of generating, distributing and conserving electric power. I can’t get exercised about the $7,500 donation  to the Peninsular Council for Workforce Development, cited in the AP article, even if CEO Matthew James also serves as a Portsmouth delegate to the General Assembly. As a major employer, Dominion has as much a stake in workforce development as any company in Virginia. (Although I would be interested to know if Dominion donated to other workforce councils in its service territory.) And, frankly, from the rate payer perspective, we’re talking chump change here. There are much bigger issues to worry about, like how rapidly to phase in renewable energy sources, where to build electric transmission lines, whether or not to build a nuclear power plant, and so on.

But the controversy isn’t about the impact on ratepayers. It’s about the political clout of the most influential corporation in Virginia politics. Dominion shouldn’t charge ratepayers for actions designed to influence legislation effecting ratepayers.

Katherine Bond, director of public policy for Dominion, told the AP that the company feels it “is important to support the communities in which we do business.” But the Appalachian School of Pharmacy, located in Oakwood, Va., is not a community served by Dominion. The company’s motive in donating the money might have been pure as the driven snow — but no one is going to believe it.

Dominion would do itself a big favor by tightening its guidelines for billing ratepayers. Limiting donations to communities within the company’s service area would be one place to start. If the company doesn’t police itself, legislators might be tempted to draft a law limiting such donations — and those limits could well be stricter than any limits the company would want.

Update: Dominion has issued a response to the AP story. Here’s the  meat of it: “Some perspective about the source of funding for those investments is important. In 2014, our company donated $18.5 million to charitable causes; the vast majority of these funds were provided directly by shareholders. In fact, in our latest filing with the Virginia State Corporation Commission (SCC), we stated that only about $740,000 of these donations were supported by rates collected from our Dominion Virginia Power electric customers in the Commonwealth. That’s just 4 percent of the total.”

I have posted the full response in the comments and highlighted it in yellow.

It’s the Buzzard Talking

Buzzards on a power line -- no telling what might case an outage.

Buzzards on a power line — no telling what might cause an outage.

If you want to understand why Dominion Virginia Power does what it does, visit the Henrico County operations center where the company manages 6,400 miles of electric transmission line.

by James A. Bacon

Electric power companies have spent tens of billions of dollars hardening their electric transmission grids and building redundant systems to guard against the varied threats that nature, mankind and animals throw against them. Tornadoes, hurricanes and ice storms pose a frequent danger. Then there are the ditch diggers who cut underground lines, the loggers who drop trees onto above-ground lines and the barges that run into river-spanning towers.

And let’s not forget the vultures. There have been documented instances of large birds knocking out power lines. A buzzard perched on a power line in a sub-station might take flight, releasing what Kevin Curtis, director of transmission planning for Dominion Virginia Power, politely refers to as a “streamer.” The material creates a connection between a conductor and a tower, and kaboom! Says Curtis: “It’s not uncommon on a landfill [near a power station] to find a dead buzzard on the ground.”

It’s Curtis’ job to preserve the reliability of Dominion’s electric grid, which serves roughly five million Virginians and a not inconsiderable number of North Carolinians in the face of fluctuating temperatures, power surges, foreseeable threats like storms and hurricanes, and crazy stuff like an uncontrolled emission of buzzard poop that no one can predict.

The good news is that the electric grid is more robust than it was on August 14, 2003, around 2 p.m., when a high voltage power line in northern Ohio became overloaded, heated up, drooped, brushed against some overgrown trees and shut down. The voltage in the system found alternate routes and overloaded new lines, three of which shut off. A cascade of failures ripped through southeastern Canada and eight northeastern states. Fifty million people lost power for up to two days in the worst blackout in North American history.

As disruptive as the infamous 2003 Northeast Blackout was for electricity customers — it contributed to at least 11 deaths and cost an estimated $6 billion — it was traumatic for the electric power industry, which has since re-engineered the North American grid to ensure, hopefully, that nothing similar happens again.

The bad news is that new threats to the grid, what some have called the world’s largest and most complex machine, are emerging: an electro-magnetic pulse from nuclear weapon, cyber-attacks, terrorist sabotage and, more prosaically, a re-structuring of the grid for environmental purposes that entails shuttering stable, reliable coal-fired power plants and plugging in intermittent power sources such as solar and wind power. The utility has a host of critics who maintain that it’s moving too slowly on reducing CO2 emissions, it’s too stodgy about implementing new smart grid technology, it’s insensitive to landowner rights, its transmission lines are blasting through Virginia’s cultural heritage. And they all have a point. But, then, it’s not the critics’ job to keep the lights on. It’s Dominion’s. And the stakes are very high.

As part of my coverage of energy and environmental issues (sponsored by Dominion), I determined that I needed to learn a lot more about how the electric grid works — not the distribution lines that run through our neighborhoods but the backbone of the system, the high-voltage transmission lines that transport electricity from power plants to sub-stations where the voltage is stepped down to levels for transfer to the distribution lines. I asked David Botkins, director of media relations, for a tour of the Dominion Operation Center in Henrico County. Not only did he agree, he lined up Kevin Curtis, director of transmission planning, as the tour guide.

The operation center in Innsbrook takes security seriously. Visitors are not allowed admittance to the main operations room itself but to a viewing room, with movie theater-style seating, a locked door and a retractable screen that is kept closed except for scheduled viewings. No photography was allowed. I was only the third journalist granted admittance to the viewing room in 11 years. The others were a reporter from NPR and a reporter for the Richmond Times-Dispatch. I wasn’t sure whether to be flattered or whether the subject was just so esoteric that most journalists never think to ask.

The viewing room opens onto a much larger room — the brain of Dominion’s electric grid — with about a half dozen work stations and a massive wall board. The wall schematic displays the 6,400 lines of transmission line in the Dominion system: 500 kv lines in green, 230 kv lines in blue, and 115 kv lines in red. Bulbs light up at critical junctures like power plants, sub-stations and other important nodes to indicate an “abnormal” condition.

In Curtis’ ideal world, the board is blank — no lights. That means everything is functioning entirely normally. (Ironically, everything being normal would be an abnormal situation; there is always something going on.) A light is not necessarily a cause for alarm: Often it simply means that a facility is down for planned maintenance, as was the case for a Pentagon City substation that lit up like a Christmas tree the morning I visited. But every light makes the job of keeping the grid stable just a little more complicated.

Dominion runs a computer program every three minutes to check for trouble in the system. As a double check, PJM Interconnection, the regional transmission organization of which Dominion is a part, also runs a computer program. There is zero tolerance for allowing a situation that might lead to a melt-down. The standard set by the North American Electric Reliability Council (NERC) is to keep at least “two contingencies” away from a crisis. In other words, the system must maintain enough redundancy to accommodate two unplanned outages in extreme conditions. All it takes to shed load, says Curtis, is “a one in a million chance of a breakdown.” Continue reading

A Plethora of Pipelines

pipeline_constructionFour companies are talking about building gas pipelines through Virginia. How many are needed — and who decides?

by James A. Bacon

How many natural gas pipelines does Virginia need? A lot of people are asking that question as two projects — the Atlantic Coast Pipeline and the Mountain Valley Pipeline — are actively developing routes between the Marcellus shale gas fields to the northwest and fast-growing markets to the south. Meanwhile, the Williams Companies, owner of the giant Transco pipeline, is talking up the Appalachian Connector, and Columbia Gas Transmission says it might upgrade an existing pipeline terminating in Northern Virginia.

All told, the four projects would add a capacity of 6.8 billion cubic feet per day, or roughly 200 billion cubic feet monthly. While much, if not most, of that gas would be destined for markets outside Virginia, that’s still a tremendous amount of capacity. By way of comparison, existing pipelines deliver to Virginia between 20 billion and 60 billion billion cubic feet monthly, depending on the time of year.

The question of how much is too much has become an urgent one as landowners in the path of the proposed pipelines resist survey crews from entering their property and vow to resist acquisition of their land by eminent domain. To acquire right of way using eminent domain, they say, companies must articulate a compelling public need to the Federal Energy Regulatory Commission (FERC). While there may be a need for some new pipeline capacity, they contend, it’s hard to justify all four projects.

“We’ve got a big infrastructure build-out proposed,” says Greg Buppert, staff attorney for the Southern Environmental Law Center (SELC), who is tracking the issue. “My suspicion is that some but not all of this capacity is needed. There is even a possibility that existing infrastructure can meet the need.”

But some say the market is self-limiting. Pipeline companies won’t spend billions of dollars adding new capacity unless they get enough long-term contracts to ensure they can pay for a project. If there is insufficient demand to support all four pipeline projects, all four pipelines will not get built.

For decades, Virginia has relied mainly upon two companies, the Williams Companies and Columbia Gas, to deliver gas to the state. Williams operates the high-capacity Transco pipeline — energy journalist Housley Carr refers to it as “the gas-transportation equivalent of an eight-lane highway”– connecting the Gulf of Mexico gas fields with New York by way of Virginia and other Atlantic Coast states. Columbia Gas runs a parallel pipeline highway west of the Appalachias, which serves a multi-state distribution system that feeds into Virginia via West Virginia.

Traditionally, most gas from both pipelines has come from the Gulf of Mexico. But fracking has turned North American energy economics topsy turvy. Gas fields tapping the Marcellus and Utica shale deposits in West Virginia, western Pennsylvania and Ohio are reputed to contain as much natural gas as Saudi Arabia. Marcellus gas is abundant and cheap, and gas pipeline companies have been scrambling to develop new markets, mostly in the U.S., but also for foreign markets by means of Liquefied Natural Gas.

The explosion in supply coincides with a surge in demand, especially from electric power companies. In two major waves of regulation in recent years the Environmental Protection Agency (EPA) has mandated power companies to reduce their toxic emissions from coal-fired power plants and then, with final rules issued early August, to reduce emissions of carbon dioxide by 32% nationally. In both cases, utilities are shifting en masse from coal to natural gas. While renewable sources such as solar and wind power are expected to gain electricity market share, industry officials say they must be backed up by gas generators to take up the slack when the sun doesn’t shine and the wind doesn’t blow, so demand growth for renewables actually supports demand growth for natural gas. Meanwhile, gas companies foresee a kick in long-term demand from a growing population and economy, especially among manufacturing operations seeking to tap some of the world’s lowest cost energy and chemical feedstock.

“Virginia is in need of new natural gas transmission that can get these new reserves to the parts of Virginia that need it the most,” says Christina Nuckols, deputy communications director for Governor Terry McAuliffe. “Hampton Roads is considered an energy cul-de-sac where natural gas capacity constraint has been an issue for years.  Particular counties in central and southern Virginia also have reported on numerous occasions that they lose out on manufacturing-related economic development opportunities almost immediately because they cannot provide access to natural gas.

“With any new market opportunity, there are going to be a number of companies looking to find success,” she says. “All of these proposed pipeline projects are recognition that Virginia is in need of additional natural gas capacity and the infrastructure to provide it.  It remains to be seen which projects will get approval from the appropriate entities.”

Here are the major projects proposed for Virginia: Continue reading

More Questions about Virginia’s Solar Energy Policy

Solar panel harness energy of the sun

by James A. Bacon

I’ve been covering business in Virginia four nearly four decades now, and I have to say, the electric power industry may be the most complex and difficult to understand. I freely admit that I have a steep learning curve ahead of me, and it’s pretty clear that other Virginia journalists do, too. But at least the Richmond Times-Dispatch appears to be trying. The latest case in point is a front-page feature story about solar energy published Sunday.  The article by John Ramsey omitted some critical pieces of the debate but he did surface some valuable perspectives. In itself, the story was incomplete. (The same can be said of my coverage.) But if seen as part of an ongoing dialogue in which the Virginia public builds a workable knowledge of the issues, it makes a worthwhile contribution.

The thesis of Ramsey’s story is that Virginia lags neighboring Maryland and North Carolina in the installation of solar energy and is missing a major economic opportunity as a result. The Old Dominion ranks 30th nationally in installed solar capacity, with only 14 megawatts installed, compared to 242 megawatts in Maryland and 1,011 megawatts in North Carolina. Admittedly, that gap will diminish if Dominion Virginia Power makes good on plans to install 400 megawatts by 2020, and as merchant providers such as Amazon Web Services, which has announced plans to build an 80-megawatt facility on the Eastern Shore, start coming on line.

The unstated assumption of the article is that large-scale installation of solar power is a desirable thing, that it would create thousands of construction jobs, and that it should be expedited by state policy. Nowhere in the article, however, does Ramsey acknowledge the  inherent variability of solar: Panels don’t generate electricity at night and output plummets when it’s cloudy. Intermittent production creates huge challenges for the reliability and stability of the electric grid, and companies must maintain expensive backup capacity to fill in when solar output is deficient. To my mind, it is impossible to discuss intelligently the benefits of solar without acknowledging these challenges.

Ramsey does raise one interesting issue, however. “Dominion’s incentive to build and own its solar farms at the expense of private developers,” he writes, “could continue to stifle the market in Virginia, even in the face of the new federal law requiring power companies to reduce carbon emissions with clean energy.” He quotes Francis Hodsoll, president of the Virginia Advanced Energy Industries Association (VAEIA), as saying, “Here in Virginia, [solar] hasn’t really been allowed to grow. Our policies don’t support it. Now we have a situation where Virginia wants to see solar being built and our utility wants to build it themselves.” Building its own solar plants, Hodnoll contends, is more lucrative than buying production from independent power producers because Dominion can generate a 10% return on equity on its own facilities, which it can’t do when it buys power from someone else.

Does Dominion suppress independent solar power production in order to maximize its own profit? Dominion is a profit-making institution, so it would surprise no one if it pursues policies designed to maximize its profitability. But is that, in fact, what it is doing? Could Dominion be shaping its actions to obtain regulatory approval from the State Corporation Commission, whose job it is to juggle the priorities of electric rates, grid reliability and green energy?

Another factor to consider: Independent producers do not require SCC or Dominion approval to build solar plants in Virginia. They can, as Amazon Web Services proposes to do, sell into the PJM wholesale energy market, of which Dominion is a part. PJM maintains a separate market for green energy, which sells for a price premium over non-green energy. If an independent power company wants to sell green kilowatts into the wholesale market, there is nothing to stop it. I confess, I do not fully understand how the wholesale markets function. But any discussion of solar policy in Virginia is incomplete without such knowledge.

More questions that need asking… During a July General Assembly hearing, Dominion announced that it was issuing a Request for Proposal for third parties to generate up to 20 megawatts of solar power to come online by 2016 or 2017. Hodsoll’s response on the VAEIA blog:

While Dominion’s announcement appears to provide the remedy sought by the industry, Dominion’s description of the process raised concerns about unreasonable deadlines and the complete lack of transparency.

Is Dominion stacking the deck in its own favor? Is this RFP a token gesture to appease greenies and other critics? Or is Dominion genuinely seeking to diversify its solar sourcing? Fair-minded journalists cannot presuppose answers either way. I would dig into this issue if I wasn’t already up to my neck in other unanswered questions. Perhaps the Times-Dispatch will go the extra mile and follow up on the questions arising from its article.

Next Step for Offshore Wind

Alstom wind turbine like that contemplated for installation off Virginia Beach.

Alstom wind turbine like that contemplated for installation off Virginia Beach.

Earlier this year Dominion Virginia Power received a bid for building two experimental offshore wind turbines that exceeded internal cost projections by more than half, making the proposed project unlikely to win State Corporation Commission approval. In a July stakeholder meeting, DVP executives laid out their analysis of what went wrong. Now stakeholders will convene in three “problem solving cohorts” to determine how to bring down the cost of the project.

According to Nancy Lowe, with the Virginia Center for Consensus Building, which Dominion has engaged to lead the process, the groups will be broken down as follows:

  1. “Contract process and logistics – horizontal vs. vertical contracting, how to cut costs and balance risk through implementation and execution strategies, including multiple contracts versus a single contract, etc.
  2. Technology – focus on  balancing the cost issue with the amount of innovative technology to be developed and explore other technology issues.
  3. Policy Issues – determine the laws or regulations that could be changed to improve the chances of success. Determine the likelihood of being successful in achieving the modification noted, identify and quantify benefits to Virginia ratepayers.”

The stakeholders will not address the issue of cost sharing. Finding other groups to help shoulder the cost of funding the project, which would demonstrate the efficacy of new technologies benefiting the wind power industry broadly, would best be pursued by “the facilitator,” i.e. DVP, wrote Lowe in a communication to stakeholders.

Among the critical technologies to be demonstrated in this proposed pilot test are adaptations to the kind of hurricane-force winds that turbines are likely to encounter in the Atlantic Ocean. Without that technology, investing billions of dollars in an offshore wind farm might be too risky to win regulatory approval.

— JAB

Clean Power Plan: What Comes Next?

by James A. Bacon

I may be like the proverbial three-year-old playing with matches with this blog post, but as I decipher the Clean Power Plan, Virginia’s final CO2 emission goals should be fairly easy to attain — far easier than anyone was anticipating based upon the draft goals published last year.

According to the EPA’s “State at a Glance” document for Virginia, the Old Dominion can pick from one of two ways to determine its CO2 emission goals — pounds of CO2 emitted per megawatt of electric power generated or total tons of CO2 released by the electric power system. Let’s look at each in turn.

First, pounds of CO2 emissions per megawatt of energy produced:

virginia_co2_goals

Virginia is already on track for major CO2 reductions thanks to the retirement of several coal- and oil-fired power plants implemented in response to the EPA’s previous mandated reductions of toxic emissions. As the EPA “State at a Glance” profile of Virginia indicates, the state is projected to cut CO2 emissions from 1,477 pounds in 2012 to 959 pounds per megawatt-hour generated in 2020. That reduction exceeds EPA goals through 2029, and it falls short of the final 2030 goal by only 25 pounds, or 2.6%!

In other words, assuming they stay on their current course, Virginia’s power companies will have another ten years to devise a 2.6% reduction in carbon intensity over what they’re already planning.

Second, total CO2 emissions (in short tons):

co2_short_tons2

These goals would not require Virginia to make any changes at all. Indeed, the final 2030 goal for CO2 emissions is the same as the 2012 level! If Virginia’s power companies hew to current projections, they will exceed the final 2030 goal without any changes! If Virginia adopts this metric, the state won’t have to modify its electricity policy at all. So much for pushing through scads of new solar and wind plants!

I think it’s safe to say that a lot of key players in the Virginia debate got caught flat-footed. An hour after President Obama formally rolled out the plan, General Assembly Republicans issued a statement citing a $6 billion State Corporation Commission cost estimate, based upon the cost of achieving the far tougher draft goals,  in criticism of the plan. Stated House Speaker William J. Howell, R-Stafford:

The E.P.A. rule released today is not only another example of an overreaching federal government, but more importantly it will drive up energy costs for hardworking Virginians and further damage our already struggling economy.

Oh, really?

Environmentalists seemed to be caught equally off guard. The Southern Environmental Law Center issued a press release just before Obama’s speech praising the plan for forcing CO2 cuts nationally. Senior Attorney Frank Rambo, leader of the organization’s Clean Energy and Air program, released the following statement regarding the regional impact:

The release of the Clean Power Plan today is a milestone event for the country, but for states in the Southeast the real work now begins. We need to make smart choices about how we can meet these targets, which will improve public health by reducing pollution while also providing the opportunity for new jobs through clean energy investments.

Real work? What real work?

Even today, environmentalists had not absorbed the significance of the new target. In a fund-raising letter, the League of Conservation Voters referred to the Clean Air Act as “good news here in Virginia.”

I can’t imagine that Virginia environmentalists will be happy when it sinks in that modified targets lock the status quo into place.

The big question at this point is which metric does Virginia choose? I’m not sure who does the choosing, but I would expect environmental groups to lobby for the “rate” metric, which requires at least modicum of additional tightening for Virginia, and I would expect the McAuliffe administration, which has a stated goal of fighting climate change, to go along because it will cause little economic pain. However, unless closer analysis by the experts finds otherwise — and I’m totally open to the possibility that I may be overlooking something — it appears that Virginia  has enacted nearly all of the changes it needs.

Update: I stand corrected. The final CO2 emission targets represent a 37% reduction for Virginia. For details, see “Yes, Virginia, the EPA Is Still Cracking Down on You.” I also take back the snarky things I said about Bill Howell’s quote and Frank Rambo’s quote. Sorry, guys, I was wrong.