Category Archives: Federal

More Coal Industry Propaganda

coal woman By Peter Galuszka

If you read a blog posting just below this (the one with the coal miner with an intense look on his grit-covered face), you will see how hyperbole, confusion, misunderstanding, ignorance and one-sided arguments twist something very important to all Virginians – how to deal with carbon dioxide and climate change – into a swamp of disinformation..

The news is that the State Corporation Commission has responded to the federal government’s proposed rules that carbon emissions be cut 30 percent below 2005 levels by 2030 by complaining that it would cost ratepayers up to $6 billion.

This is because Virginia utilities may have to shut down 2,851 megawatts worth of electrical generation with only 351 megawatts (at present) of “unreliable” wind power to replace it.

The image one gets from the presentation of the blog post is that it is “The EPA’s War on Virginia” with the haggard-looking miner thrown in, we are given the impression that it is more of the “War on Coal” that the coal industry has been promoting in recent years to blunt much-needed mine safety laws and moves to police highly destructive mountaintop removal practices.

The author does not address any of this. But since he’s handing us the “War on Coal” propaganda line, let’s take his arguments apart. This won’t take too long.

  • The author fails to note part of the Richmond Times Dispatch story upon which he bases his opinions. There is a very important comment: “It appears the staff has misread the rule,” said Cale Jaffe, director of the Southern Environmental Law Center’s Virginia office. “Analyses that we have reviewed show that Virginia is already 80 percent of the way to meeting Virginia’s carbon pollution target under the Clean Power Plan. “Almost all of those reductions are coming from coal plant retirements and natural gas conversions that the utilities put in place long before the Clean Power Plan was even released,” Jaffe said.
  • That said, let’s take a look at coal-fired plants in the state which are the biggest carbon offenders. For starters let’s look at Dominion Virginia Power, the state’s largest utility. It has already converted three coal-fired plants – Altavista, Southampton and Bremo Bluff – to biomass. The 50-plus-year-old Yorktown plant (335 megawatts) is due to retire in 2015. Another aging plant – Chesapeake (609) megawatts — is also due to retire by 2015. The point here is that these plants are being closed because Dominion realizes that it is just too hard to keep 50 or 60 year plants operating efficiently and cheaply. It would be like keeping that 1960 Corvair because you don’t want to put oil workers out of work.
  • Dominion’s biggest problem and the biggest single air polluter in the state is the Chesterfield station with 1380 megawatts. Yes, it does need more controls. Then there’s Clover (882 megawatts) and Mecklenburg (138 megawatts). That brings us up to 2400 megawatts that might need upgrades. Let’s see. The two nuclear units at North Anna put out a little more than 1,700 megawatts just so we get some scale here. Dominon also has Virginia City (585 megawatts) which just opened, uses coal and biomass and has advanced fluidized bed burning methods.
  • Out west, Appalachian Power has 705 megawatts at Clinch River and 430 megawatts at Glen Lyn. Two of those three units there were built in (my God!) 1944 so I guess the blog author wants to keep those great granddaddies running to save miners’ jobs. Actually they are so unneeded that they have been on extended startups.Besides these Cogentrix has a couple small, modern plants in Portsmouth and Hopewell.
  • One reason there so little renewable generation (6 percent) is that the utilities do not have mandatory renewable portfolio standards to force them into wind and solar, etc. Virginia’s neighbors do.

All of this gets back to Jaffe’s point that the blog author so easily ignores. A lot of the carbon cuts are going to come from plants that are aging and are going to be closed anyway.

The SCC may complain about the $6 billion but guess what, you beleaguered electricity users? If Dominion puts a third nuke at North Anna, that’s easily $10 billion. Is that going to raise rates sky high? Where’s the outcry? It’s almost double what helping save the planet from carbon dioxide will cost.

The blog author’s hyperbole about the poor coal industry shows his ignorance of the topic. Virginia’s rather small coal industry (No. 12 in production) reached its peak in 1991. Natural gas has displaced a lot of expensive coal. Gas prices would have to triple to make Central Appalachian coal competitive again. There’s lots of metallurgical coal for steel, but the Asian economic slump has dropped prices maybe 60 percent.

I won’t comment on the author’s lame and misunderstood point about climate change not happening.

The blog author may want to blame that on Obama and the EPA but that would be almost as ridiculous as his blog post. I decline to name him because I don’t want to embarrass him.

The EPA’s War on Virginia

How to have it both ways: Destroy coal mining jobs with environmental  regulations.... and then blame "capitalism" for growing income inequality.

How to have it both ways: Destroy coal mining jobs with environmental regulations…. and then blame “capitalism” for growing income inequality.

James A. Bacon

Complying with proposed Environmental Protection Agency rules on carbon emissions would cost Dominion Virginia Power customers an extra $5.5 billion to $6 billion, according to the State Corporation Commission staff — and that doesn’t include the cost to Virginia’s smaller utilities, which are even more reliant than Dominion upon coal.

The EPA plan calls for cutting carbon emissions from existing power plants 30% below 2005 levels by 2030 in an effort to fight climate change, improve public health and provide “affordable energy,” reports the Richmond Times-Dispatch. Writes Peter Bacque:

The EPA’s own model predicts that Virginia utilities will have to shut down fossil-fuel power plants reliably producing 2,851 megawatts of electricity, and replace that generation with just 351 megawatts of unreliable land-based wind power. This raises alarming regional reliability concerns, the staff said.

The power plants involved today ensure reliable service to Virginia customers, have years of useful life remaining, and cannot be replaced overnight or without regard for impacts on the electric systems. …

Even if the operational concerns of replacing dependable fossil-fuel generation with variable, intermittent and “nondispatchable” — unreliable — wind and solar energy could be managed, the staff said, “there is still zero probability that wind and solar resources can be developed in the time and on the scale necessary to accommodate the zero-carbon generation levels needed” to meet the EPA’s mandatory carbon-reduction goal for 2020.

This massive and expensive transformation of Virginia’s electrical generation system is a huge, huge issue. Once upon a time, Virginians could reconcile themselves to tighter environmental regulations on the grounds that they got cleaner air in return. There was a tangible payoff to air cleansed of particulates, sulfur dioxide and mercury. There is no tangible payoff (except to the alternate fuels industry) from the EPA rules. The whole purpose is to reduce CO2 emissions in order to save the globe from the catastrophic consequences of global warming.

The administration seeks to transform America’s energy economy despite the fact that, even as CO2 levels in the atmosphere have increased dramatically, global temperatures have remained stable for 18 years now — contradicting the forecasts of virtually every major climate model ever cited by the Intergovernmental Panel on Climate Change. While the Global Warming hysterics maintain their prattle that the “science is settled” and “97% of all climate scientists agree,” the science is most assuredly unsettled. Warmist scientists who pay attention to the reality that temperatures are not rising are desperately concocting ex-post-facto explanations of why their predictions went wrong and why, despite all appearances to the contrary, the world is still doomed unless we abandon fossil fuels now.

That’s not to say that alternate fuels are a bad thing. At some point, the technologies will improve to the point where they will be competitive with fossil fuels and it will be prudent to add them to the fuel mix. Energy conservation is always a good idea. Building automation offers a high economic return on investment. More compact, walkable human settlement patterns can save energy and offer tangible health and lifestyle benefits in the bargain. There are lots of ways to reduce CO2 emissions (if that’s a goal you really care about) without saddling Virginia’s economy with an unnecessary burden of $6 billion or more.

This is bad, bad policy, and Virginians need to fight back. Voters need to ask Virginia’s congressional candidates — most prominently Senatorial candidates Mark Warmer and Ed Gillespie — what they think of the EPA mandates and what they, as congressmen, can do to mitigate the impact on Virginia ratepayers.

The Forbidden City Comes to Virginia

forbidden cityBy Peter Galuszka

The Forbidden City has come to Virginia and it’s definitely worth a look.

Rarely-seen works from the Palace Museum in Beijing’s Forbidden City, the imperial residence of Chinese emperors from the Ming to the end of the Qing Dynasty (roughly from about 1406 to 1912) go on display tomorrow at the Virginia Museum of Fine Art in Richmond.

Putting the exhibits together took lots of work and diplomacy, VMFA Alex Nygeres told guests and the news media Wednesday at a morning event. There were plenty of visits back and forth and there are plans for the VMFA to reciprocate by sending its famed Faberge Egg exhibit from the Russian Romanov era to China. The Ambassador from the People’s Republic of China to the U.S. attended a gala, $10,000 a table event the evening of Oct. 14.

I’m no expert of Chinese art, but the exhibit was highly impressive. The many works included court paintings, religious artifacts and costumes, including an early form of body armor for soldiers which consisted of layers of tough cloth protecting vital organs and appendages.

The exhibit opens at a time of unsettled relations between the U.S. and the People’s Republic. China has been torn by pro-democracy protests in Hong Kong. Workers’ expectations are rising as China’s economy is slowing. Beijing is becoming more aggressive as a regional military power and its efforts to censor Web-based information and launch cyber spying are worrisome.

Another issue is that given the tough, expansionist diplomacy of Russia’s Vladimir Putin and the negative reaction from the West, Moscow is looking for more links with China. Relations between the two have always been up and down. Not that long ago, experts believed that if there were a nuclear weapons attacks, it might occur between those two countries. Now, peace has returned and both may be able to exploit their close geography and relative strengths in energy and population in a way based on economics and not Communist ideology.

On the bright side, China does have money and is fast developing expertise. China’s Shandong Tranlin paper company is investing $2 billion in a modern paper plant in eastern Chesterfield County that will employ 2,000. It won’t use trees, but leftovers from farm fields and is supposed to be less polluting than paper mills most Americans are familiar with. What’s more, Gov. Terry McAuliffe is off on a trade mission to China in a few days.

In any event, the Forbidden City is worth a look. It runs until Jan. 11.

Why We’re Being Railroaded On “STEM”

 csx engineBy Peter Galuszka

When it comes to education, a constant mantra chanted by the Virginia chattering class is “STEM.”

How many times have you heard that our students are far behind in “STEM” (Science Technology Engineering and Mathematics)? We have to drain funding from more traditional areas of study (that actually might make them better human beings like literature, art or history) and give it to STEM. The two types of popular STEM are, of course, computer science (we’re all “illiterate” claims one journalist-turned computer science advocate) and biotechnology.

But how important is STEM, really? And if Virginia joins the STEM parade and puts all of its eggs in that basket, will the jobs actually be there?

The fact of the matter is that we don’t know what jobs will be around in the future and like the famous generals planning for the last war, we may be stuck planning for the digital explosion of Bill Gates and Steve Jobs that is like, so, 25 years ago.

To get an idea where markets may be, look at today’s news. Canadian Pacific is making a play for CSX railroad (headquartered in Richmond not that long ago) because of the unexpected explosion in fracked oil.

CP handles a lot of freight in the western part of Canada and U.S. where some of the most impressive new fracked shale oil are, namely the Bakken fields of North Dakota and Alberta. CP wants access to eastern U.S. refineries and transshipping points, such as a transloading spot at the mouth of the York River. CSX is stuck with dirty old coal where production and exports are down, although it has an extensive rail network in the Old Dominion.

The combined market value of the two firms is $62 billion — a far bigger potential deal than the $26 billion Warren Buffett paid for Burlington Northern Sante Fe in 2010. There are problems, to be sure. CSX isn’t interested and the Surface Transportation Board, a federal entity, nixed a matchup of Canadian National and Burlington a little while back.

But this isn’t really the point. The point is that the Old Steel Rail pushed by new sources of oil and to some extent natural gas has surprisingly turned domestic economics upside down. Many of the new oil fields are in places where there are not pipelines, so rail is the only answer. In 2008, according to the Wall Street Journal, six or so American railroads generated $25.8 million in hauling crude oil. Last year that shot up to $2.15 billion.

So, what does that mean for students? A lot actually, especially when we blather on about old-style STEM that might have them inventing yet another cell-phone app that has a half-life of maybe a few months. Doesn’t matter, every Virginia legislator, economic development official and education advocate seems to be hypnotized by the STEM genie.

A piece I just did for the up-and-coming Chesterfield Observer on vocation education in that county:

“The recent push to educate students in so-called STEM (Science, Technology, Engineering and Mathematics) may be case in point. The goal is to churn out bright, highly trained young people able to compete in the global economy with their counterparts from foreign lands.

“A subset of this area of concentration is computer science, which goes beyond knowing the basics and gets into the nitty-gritty of learning code and writing computer languages. By some accounts, such skills will be necessary to fill more than 2 million jobs expected to become open in the state by 2020.

“Critics question, however, if overspecialization in technology at earlier ages prevents students from exploring studies such as art and literature that might make them better rounded adults. And, specialization often assumes that jobs will be waiting after high school and college when they might not be.

“Peter Cappelli, a professor of management at the Wharton School of the University of Pennsylvania, has written about such problems of academic overspecialization in national publications such as The Wall Street Journal. He recently responded to questions from the Chesterfield Observer via email.”

“Not many science grads are getting jobs in their field,” Cappelli says. “The evidence suggests that about two thirds of the IT (information technology) grads got jobs in their fields, about the same for engineering. There is no guarantee in those fields. It’s all about hitting the appropriate subspecialty that happens to be hot. There are still lots of unemployed engineers and IT people.”

So there you have it. In my opinion, the over-emphasis on STEM training has the unfortunate effect of producing young adults who have one goal in mind – getting a job and making money, not helping humankind. And, if you insist on STEM, why not branch into something where there are actually jobs namely petroleum engineering, geology and transportation engineering.

I’ll leave the dangers of added petroleum cargoes in trains to another post.

Burbs Beware: Office Jobs Moving Back to D.C.

dc_office_spaceNot only are Millennials migrating to the Washington metropolitan region’s urban core, it seems that businesses are, too, in a reversal of the decades-long trend of businesses moving out of the central city to outlying counties.

Vacancy rates have risen in Washington, D.C., due to the contraction of legal services and government contracting tied to federal government spending. But according to commercial real estate firm JLL, private-sector tenants from Maryland and Washington accounted for 300,000 square feet of new leasing activity in the District. Reports Virginia Business magazine:

Doug Mueller, a senior vice president at JLL, noted that the migration is heavily populated by associations, technology companies and professional services firms. “The quality and location of office space with easy access to mass transit, abundant amenities and housing options also has a visible and tangible impact on attracting and retaining top talent,” he said in a statement.

According to JLL’s Office Insight report for the third quarter, since the start of 2014, a total of 21,200 private-sector office jobs have been added to the metro D.C. economy.

In an office market with tens of millions of square feet of space, 300,000 square feet is a rounding error. What’s significant is not the volume of space being occupied — although 21,200 office jobs is nothing to sneeze at — but the trend: jobs migrating back to the urban core. For decades, Virginia enjoyed a huge competitive advantage over the District with its dysfunctional government, poverty, crime and decaying neighborhoods. Now, despite bad schools, high taxes and expensive real estate, D.C. has something that educated Millennials and the businesses that employ them are looking for — walkable urbanism.

Next question: Is this trend unique in Virginia to the Washington metropolitan region or is it occurring in Hampton Roads, Richmond and the smaller metros as well?

– JAB

Good Ruling on Congressional Redistricting

The 3rd Congressional District

The 3rd Congressional District

 By Peter Galuszka

A panel of federal judges in Richmond has scrambled the carefully laid plans of legislators, most of them Republicans, to pack African-American voters into one congressional district to give the GOP an advantage in some of the  state’s 10 other districts.

The panel of U.S. District Court judges decreed that the General Assembly’s 2012 decision to draw new boundaries in the 3rd Congressional District stretching from Richmond east to several Tidewater cities was in error.

The state has until next April to redraw the 3rd District, now represented by U.S. Rep. Robert C. “Bobby” Scott, a Democrat who is the state’s only African American congressman.

That will undoubtedly impact other districts represented by white Republicans including U.S. Rep. Randy Forbes of the 4th District, U.S. Rep. Scott Ringell of the 2nd District and Robert J. Whitman of the 1st District.

This is indeed an interesting start to what could end up being a messy line of dominoes falling. And it shows just how wrongheaded politicians are when they tinker with voters by race by packing people of color in one district so races in other ones will be decidedly less competitive.

It also raises other questions about ways the GOP is doing its best to minimize the influence of young and non-white voters through the use of voter identification cards and other means.

To get an idea of how nuts the 3rd District is, look at a map. Moving west to east, it goes through eastern Richmond and Henrico County, swoops down the James River peninsula, and hop-scotches parts of the 1st District to include heavily African-American parts of Newport News and Hampton. Then, the District crosses Hampton Roads to include heavily black parts of Norfolk and Portsmouth and then heads west again to take also-black parts of counties on the south shore of the James River.

Scott is Virginia's only African-American Congressman

Scott is Virginia’s only African-American Congressman

This scheme packs African-Americans into one unit while mostly-white parts of Virginia Beach, Norfolk and Chesapeake and Williamsburg are covered in the 1st, 2nd and 4th Districts, all represented by white Republicans. Mostly-black Petersburg, a city of 32,000, was taken out of the 4th District and put in Scott’s 3rd District, giving white Republican Forbes of the 4th District an advantage.

Democrats such as State Sen. Mamie Locke have long complained about schemes that hop-scotch geography to give white candidates an advantage. They want tighter, more contiguous districts.

One can tell just how serious this is when Del. William Howell, the Republican House Speaker, had nothing to say about the court’s decision. He will have to somehow help navigate drawing up new district plans.

He’s really under the gun. He can’t just set up a road block as he did with Medicaid expansion and tell Democratic Gov. Terry McAuliffe where to stick it. If Howell shuns a bipartisan effort, then McAuliffe would likely veto whatever he and his colleagues come up with. Then it would go back to the judges to decide.

It is in Virginia’s interest to make sure all of its districts and not just ones for Congress are shaped to allow for more competitive races. Very few elections for state positions are contested. This, in turn, ruins bipartisan consensus and makes the primaries, usually for Republicans, more consequential than the races themselves. The results are either legislative gridlock or laws that have little to do with the wishes of many voters.

Another issue that needs to be addressed is what Mother Jones magazine has identified as a large-scale, national effort, mostly by Republicans, to make it harder for minorities and young people to vote. They tend to vote Democratic and helped Barack Obama win the presidency in 2008 and in 2012.

Since 2012, 22 states have passed new voting restriction laws that shorten voting hours or require a government-issued identification card or proof of citizenship. North Carolina has perhaps the worst of such measures. There are shorter hours and no more same-day registration to vote. It even gives the nod to “poll watchers” who can stand around outside polling places and hassle voters about their eligibility to vote. I guess that means if you look black or Hispanic or youthful, you get rousted by vigilantes. The odd part is that states, including Virginia, went for more restriction when there wasn’t much evidence of voter fraud.

To be sure, Virginia’s redistricting efforts were begun by federal initiatives such as the Voting Rights Act which gave Bobby Scott an opportunity to win as an African-American in the early 1990s. The Voting Rights Act was meant to ensure that minorities were represented but that concept has been cynically morphed into a Frankenstein that keeps minorities “packed” in a district or districts so whites maintain their hold on most of the other districts in a state.

The court’s decision is most welcome. Let’s hope it grows into a movement to return democratic competition and ends undemocratic restrictions like demanding extra and unnecessary pieces of identification for qualified voters.

 

McAuliffe Dodges Mandatory Renewable Energy

coal plant burnsBy Peter Galuszka

It seems like two steps forward and one step back. That’s about the best I can come up with for Governor Terry McAuliffe’s new energy plan for Virginia.

On the two steps forward side, McAuliffe is pushing for more wind power and relaxing regulations to make it easier to back solar, such as allowing towns to create their own solar panel farms near their city limits.

The one step back is the usual commitment to energy sources of days before, such as a nuclear, offshore drilling for oil, coal and natural gas. That’s what former Governo Bob McDonnell wanted with his pipe dream of making Virginia “The Energy Capital of the East Coast.”

The biggest problem with the McAuliffe plan is that it dodges the issue of making Virginia’s Renewable Portfolio Standards (RPS) mandatory. I asked Brian Coy, his press spokesman about this, and he said that the governor sees that as something for the future.

Maybe better late than never, but the fact that Virginia has always bowed to the power of Big Energy and declined to make mandatory the conversion of a certain amount of electricity generation to renewable sources such as wind, solar, geothermal and hydroelectric.

Plain and simple, that is why Virginia gets an embarrassingly low six percent of its power from renewables and is far behind states like Maryland and North Carolina that have mandatory standards. One wonders why Virginia seems so exceptional. The only answer that I can come up with is that Old Energy firms such as utility Dominion and coal baron Alpha Natural Resources are huge contributors to political candidates of both stripes.

Dominion praised the governor’s efforts and the Sierra Club had lukewarm approval.

The problem with shifting to renewables is that not making it mandatory by law gives Big Fossil and Nuclear an immediate price advantage. Coal is deadly, messy and is a major contributor to climate change. A few years ago, there might have been a greater push towards wind and solar to replace it. But hydraulic fracking came along, bringing a big boost to natural gas from hard-to-reach geologic formations.

Thus, gas pushed out coal (although conservative Big Fossil types claim it is Barack Obama’s over-regulation but that just ain’t so) on economic terms. It has probably delayed advanced nuclear technology and most certainly has delayed solar and wind. They are expensive now but won’t be in the future, so fracked gas’s great advantages won’t last forever.

Don’t believe me? Check out historical data on gas prices.

McAuliffe, meanwhile, is pushing such dubious projects as a 550-mile-long gas pipeline running over the tops of pristine and sensitive mountaintops and through lots of small towns that don’t have big corporate clout to change pipeline routes.

One more step back.

Good Luck With McAuliffe’s Ethics Panel

Image: Verdict Reached In Corruption Trial Of Former Virginia Governor McDonnell And His WifeBy Peter Galuszka

Despite the obvious need, Virginia still has done very little to address its monumental problems with ethics reform. The latest endeavor was announced yesterday by Gov. Terry McAuliffe, but it seems too much like just another panel.

And panel it is. McAuliffe has created the 10-member Commission to Ensure Integrity and Public Confidence in State Government. The good news is that it is bipartisan and seems filled with reasonable people, including Christopher Howard, president of Hampden-Sydney College and Sharon Bulova, chairwoman of the Fairfax County Board of Supervisors.

Leading it will be for Lt .Gov. Bill Bolling, a Republican who has shown good sense in recent years and got screwed over by party hardliners who maneuvered to get former Atty. Gen. Kenneth Cuccinelli, a wild man, to run and lose in the 2013 governor’s race. His Democratic counterpart will be Rick Boucher, a former legislator from southwest Virginia.

The plan is to present a package of reforms that will deal with gift-giving and donations to politicians, and redistricting, or possibly redesigning some districts away from the madness that some, and mostly Republican legislators have created.

The impetus, naturally, is the first-ever conviction of a governor for corruption. Three weeks ago, a federal jury gave a resounding “guilty” on felony charges against Robert F. McDonnell and his wife Maureen. The U.S. Justice Department stepped in because Virginia’s state ethics laws were so ridiculously lax no one could ever have made the case. There had been lots of “gee, I don’t see a smoking gun” jabber on this blog and elsewhere, but, hey, why not poll the jury?

Just as the McDonnells were being indicted last January, the 2014 General Assembly considered ethics reform but did squat. It made accepting more than $250 in gifts verboten and expanded disclosure requirements to immediate family but the Republican-led led legislature left in a pile of loopholes. “Intangible” gifts, such as African safaris or trips to the Masters golf tournament are A-OK.

What’s needed is a real ethics commission with subpoena power. McAuliffe’s action was quickly derided by such leading lights of ethics reform as House Speaker Bill Howell and Senate Majority Leader Thomas K. Norment. These two Ayatollahs of the Status Quo claimed that McAuliffe was a “latecomer” to an issue that they obviously have done nothing to improve despite their many years in office.

GOP Party Boss Pat Mullins took an irrelevant swipe at McAuliffe’s perceived ethics problems long before he was even governor.

Redistricting is just as important as ethics and I’m glad it is being addressed. Many Virginia districts have been gerrymandered to keep a particular party in office in ways that  protect the status quo and prevent change. Of 100 House of Delegates races in 2013, “only 12 to 14 were competitive,” notes Leigh Middleditch Jr., a Charlottesville lawyer and a founder of the Sorenson Institute for Political Leadership at the University of Virginia, told me earlier this year.

Stephen Farnsworth, a political analyst at the University of Mary Washington, has studied gerrymandering for years and believes it negates general elections in favor of party primaries where a handful of hard right radicals can dominate.

This is especially true in some rural districts where tiny cadres of activists, again mostly Republicans, dominate the picks for primaries. It doesn’t matter what the general public thinks or wants. A narrow minority worms its way in power and becomes beholden not necessarily to the party overall, but a little slice of it.

That is why so little gets done.

The very fact that leaders like Howell and Norment are in place and the primary system will make McAuliffe’s efforts very difficult. One wonders if you could go outside the diseased legislative system and forced change through the courts.

It worked before against such Virginia travesties as Massive Resistance. Something to consider.

The Huge Controversy Over Gas Pipelines

atlantic coast pipeline demonstratorsBy Peter Galuszka

Just a few years ago, Gov. Terry McAuliffe seemed to be a reasonable advocate of a healthy mix of energy sources. He boosted renewables and opposed offshore oil and gas drilling. He was suspicious of dangerous, dirty coal.

Then he started to change. During the campaign last year, he suddenly found offshore drilling OK, which got the green community worried. But there’s no doubt about his shifts with his wholehearted approval of the 550-mile Atlantic Coast Pipeline proposed by Duke Energy, Piedmont Natural Gas and AGL Resources, along with Richmond-based Dominion, one of McAuliffe’s biggest campaign donors.

The $5 billion Atlantic Coast Pipeline is part of a new phenomenon – bringing natural gas from the booming Marcellus Shale fields of Pennsylvania, Ohio and northern West Virginia towards busy utility markets in the Upper South states of Virginia, North Carolina and parts ones even farther south. Utilities like gas because it is cheap, easy to use, releases about half the carbon dioxide as coal, which is notorious for labor fatalities, disease, injuries and global warming.

The Atlantic Coast Pipeline would originate at Clarksburg, W.Va. (one of my home towns) and shoot southeast over the Appalachians, reaching heights of 4,000 feet among rare mountain plants in the George Washington National Forest, and then scoot through Nelson, Buckingham Nottoway Counties to North Carolina. At the border, one leg would move east to Portsmouth and the Tidewater port complex perhaps for export (although no one has mentioned that yet). The main line would then jog into Carolina roughly following the path of Interstate 95.

It’s not the only pipeline McAuliffe likes. An even newer proposal is the Mountain Valley Pipeline that would originate in southern West Virginia and move south of Roanoke to Chatham County. It also faces strong local opposition.

atlantic_coast_pipeline mapThe proposals have blindsided many in the environmental community who have shifted some of their efforts from opposing coal and mountaintop removal to going after hydraulic fracking which uses chemicals under high pressure and horizontal drilling to get previously inaccessible gas from shale formations. The Marcellus formation in Pennsylvania, New York, Ohio and West Virginia, the birthplace of the American oil and gas industry, has been a treasure trove of new gas.

The fracked gas boom has been a huge benefit to the U.S. economy. It is making the country energy independent and has jump started older industries in steel, pipe making and the like. By replacing coal, it is making coal’s contribution to the national energy mix drop from about 50 percent to less than 40 percent and is cutting carbon dioxide emissions that help make for climate change.

That at least, is what the industry proponents will tell you and much of it is accurate. But there are big problems with natural gas (I’ll get to the pipelines later). Here’s Bill McKibben, a Middlebury College professor and nationally known environmentalist writing in Mother Jones:

Methane—CH4—is a rarer gas, but it’s even more effective at trapping heat. And methane is another word for natural gas. So: When you frack, some of that gas leaks out into the atmosphere. If enough of it leaks out before you can get it to a power plant and burn it, then it’s no better, in climate terms, than burning coal. If enough of it leaks, America’s substitution of gas for coal is in fact not slowing global warming.

Howarth’s (He is a biogeochemist) question, then, was: How much methane does escape? ‘It’s a hard physical task to keep it from leaking—that was my starting point,’ he says. ‘Gas is inherently slippery stuff. I’ve done a lot of gas chromatography over the years, where we compress hydrogen and other gases to run the equipment, and it’s just plain impossible to suppress all the leaks. And my wife, who was the supervisor of our little town here, figured out that 20 percent of the town’s water was leaking away through various holes. It turns out that’s true of most towns. That’s because fluids are hard to keep under control, and gases are leakier than water by a large margin.

Continue reading

Richmond’s Tech Star in Kickback Scheme?

HDL LogoBy Peter Galuszka

Critics of the American healthcare system have long cited hidden charges as one reason why costs are so high and why reform is needed.

So, it is disturbing to read a report on the front page of today’s Wall Street Journal that Health Diagnostic Laboratory, arguably the most successful of the biotechnology firms to come out of a much-touted research park in Richmond, is implicated in a possible scheme to pay kickbacks to doctors who use its blood testing services.

The Journal reports:

Until late June, HDL paid $20 per blood sample to most doctors ordering its tests — more than other labs paid. For some physician practices, payments totaled several thousand dollars a week, says a former company employee.

HDL says it stopped those payments after a Special Fraud Alert on June 25 from the Department of Health and Human Services, which warned that such remittances presented “substantial risk of fraud and abuse under the anti-kickback statute.

HDL Chief Executive Tonya Mallory told the Journal that her firm “rejects any assertion” that the company grew as fast as it did “as a result of anything other than proper business practices.”

Meanwhile, HDL has sent Bacon Rebellion this updated response.

Others say that paying doctors fees sets up the chances for fraud, especially in Medicare, one of HDL’s biggest markets, the Journal reports. Other testing firms, the Journal reports, pay doctors nothing for using their services.

This is bad news for what was Richmond’s Poster Child of successful high tech startups after years of flops at the Virginia Biotechnology Research Park. Founded in 2008 under Mallory’s leadership, HDL zipped up to $383 million in revenues with 41 percent of that coming from Medicare,” the Journal says.

Much of the issue seems to be related to how accurately and fairly to define what is merely drawing a patient’s blood and how much goes for “P&H” or processing and handling. A problem is that Medicare doesn’t pay any more than $3 for merely drawing blood. HDL has estimated that the “P&H” part is worth about $17. The firm claims it has special proprietary methods that give it an edge.

According to Virginia Business magazine, which named Mallory its person of the year last year:

Mallory, 48, founded HDL in the summer of 2009. Since then, it has grown from a kitchen-table business plan to a corporation earning more than $420 million in annual revenue, employing 750 people, processing 4,000 lab samples and running more than 60,000 lab tests each day. HDL has driven near constant construction at its home in downtown Richmond’s Virginia BioTechnology Research Park, where a $68.5 million expansion soon will triple the company’s footprint to 280,000 square feet.

Last year Mallory received the Ernst & Young National Entrepreneur of the Year award in the Emerging Company category. One of the country’s most prestigious business awards for entrepreneurs, it recognizes leaders who demonstrate innovation, financial success and personal commitment as they build their businesses.

The Journal, however, quotes several disgruntled employees and notes that Mallory had worked for a California firm called “Berkeley Heart Lab Inc,.” which began using tests called “biomarkers” which can predict future health problems by analyzing blood.

Mallory, who was raised in Hanover County and attended Virginia Commonwealth University, was senior lab-operations manager at Berkeley until she left for Richmond in 2008, the Journal says. Two Berkeley sales executives went with her and formed a company that ended up marketing HDL’s products.
Berkeley sued HDL, accusing it of stealing its business. HDL denied the allegations. HDL settled one case for $7 million, the Journal says, but other cases are pending.