Category Archives: Property rights

Why T.J. Deserves a Place in Our Pantheon of Heroes

TJ-statueby James A. Bacon

Students at the College of William & Mary have carried on a long tradition of festooning the campus statue of Thomas Jefferson with accouterments ranging from woolen scarfs to party hats. The latest fad is to append the effigy with sticky notes denouncing the founding father as a slave holder, a racist and a rapist. The activity imitates a similar movement on the University of Missouri campus, which has been coupled with a petition to remove a Jefferson statue on the grounds that it was offensive to idealize someone who owned and raped slaves. I don’t know if the anti-Jefferson movement will gain the same momentum at William & Mary, a public university in a state where Jefferson is revered like no other historical figure. But, given the tenor of the times, some kind of debate is inevitable.

TJI find the negative sentiments expressed in the sticky notes to be indisputably true at one level and profoundly misinformed at another. True, by today’s standards, Jefferson’s views and behaviors were reprehensible. He did own slaves. He did sell slaves and break up slave families. He most likely (though not indisputably) did keep a slave woman as a concubine. He did believe blacks to be inferior to whites. It is not unreasonable to ask why, for all his brilliance as an author of the Declaration of Independence, a United States president, an architect, the founder of the University of Virginia, and all-around polymath, we should continue to hold him in such high esteem (or, for that matter, why we should esteem any member of Virginia’s slave-holding aristocracy).

The case I would make for Jefferson (along with James Madison, George Washington, Patrick Henry and George Mason) is not that they reflected 21st-century sensibilities, which they clearly did not, but that they articulated values and principles for the first time in history that laid the foundation for the values we hold today. We could not have gotten to where we are today had Jefferson & Company not laid the groundwork.

Colonial America imported its institutions and mental constructs from a Europe that was emerging from the Middle Ages. Collective entities such as towns, cities, guilds, social classes and ethnicities — not individuals — were imbued with rights. When Nathaniel Bacon led a revolt against the autocratic Governor Berkeley of Virginia in 1676, leading a rag-tag band of impoverished farmers and freed slaves, he called for a restoration of the “rights of Englishmen.” Virginians were entitled to rights and privileges, embodied in the Magna Carta and common law that their ancestors had fought for and won. But those rights were not regarded as universal; they were peculiar to Englishmen and derived from English institutions. Jefferson’s great contribution was to draw from Enlightenment-era principles to argue that all men were endowed by their creator with inalienable rights, including life, liberty and the pursuit of happiness. Essentially, he reinterpreted the rights of Englishmen as rights applied universally to everyone. In Jefferson’s formulation, rights did not belong to collective entities; they belonged to individuals, and they were intrinsic to a person’s existence as a human being — the core principle of 21st-century political thought.

What is perhaps most remarkable about Jefferson is that he articulated principles in direct conflict with his own material self interest as a slave holder. While Jefferson indisputably failed to live up to his own principles, it is intellectually facile and lazy to end the discussion there. It is a truism (and one of Karl Marx’s few useful insights) that economic and social classes, both the rulers and the oppressed, create ideologies that support their material self interest. One must ask: How many ruling elites in the history of mankind have ever developed a governing philosophy that undercut their material self interest? How many ruling elites in history have wrestled with the dichotomy between those principles and the way they actually lived their lives, as Jefferson, Madison, Washington and others did? The answer: precious few. Indeed, I cannot off-hand think of any other ruling elite in the history of mankind that has done such a thing.

Jefferson articulated principles that most Americans, including the people who now despise him, hold dear today. We should revere him for making the leap from rights rooted in collective entities to rights applying to all. We should respect him for making that leap in contravention of his own material self interest, and appreciate the fact that the contradiction haunted him until his dying day, even if he failed to free all his slaves and impoverish himself in the process. The journey to equal rights for all Americans certainly did not end with Jefferson, but it started with him, and he rightly deserves a place in our pantheon of heroes.

“Cultural Attachment” the Latest Barrier to Infrastructure Projects?


Take me home, country roads…

by James A. Bacon

Landowner and environmentalist groups have advanced a number of arguments against building more gas pipelines (see previous post), but among the more novel is the idea that the proposed Atlantic Coast Pipeline (ACP) will disrupt the “cultural attachment” rural landowners feel for the land that would be traversed. What foes are contending here is that construction of a pipeline will do far more than hurt property values. It will damage peoples’ culture in ways that cannot be mitigated.

Most arguments against the Virginia pipelines are familiar in the sense that they appeal to widely (if not universally) recognized principles of economics and environmental stewardship. The “cultural attachment”gambit  is not like anything I have seen before.

Here’s how a letter to the Federal Energy Regulatory Commission from some 30 environmental and landowner groups makes the case:

The proposed route of the Atlantic Coast Pipeline will cross primarily rural landscapes where agriculture and forestry are the dominant land uses. The communities that would be affected by the ACP have deep roots in and strong cultural identification with the land and its rural character. In addition to adverse effects associated with the use of eminent domain, construction and right-of-way maintenance … the ACP will have significant adverse effects on the character of these currently non-industrialized areas.

The adverse effects of the taking and alteration of private property … must be assessed in light of the affected communities’ “cultural attachment” to the land. Cultural attachment is the “cumulative effect over time of a collection of traditions, attitudes, practices, and stories that ties a person to the land, to physical place, and kinship patterns.” Much of the land that would be affected by the ACP has been held in families for generations and people’s reliance on the land for survival and prosperity has resulted in high levels of cultural attachment. Rural Appalachian communities have historically suffered from significant intrusions, such as railroad highway constructions, that have “undercut the cultural patterns that had developed through people’s relation to the land, physical place, and kin.

As the U.S. Forest Service recognized in a 1996 Draft Environmental Impact Statement for an Appalachian Power Co. project in rural West Virginia and Virginia:

Substantial outside-generated intrusions (such as highways, railroads, and transmission lines) that breach the boundary of a high cultural attachment area may have significant adverse impacts to the sustainability of the local culture. … The permanence of the intrusions is a symbol of the imposed dominance of commerce and economic interests. … Permanent and elongate linear intrusions tend to bifurcate previously existing cultural units into new units. This tends to fracture informal support systems and create new boundary areas. Boundary areas created by intrusion are often abandoned by area residents from cultural management, thereby increasing the likelihood of additional intrusions.

Bacon’s bottom line: It strikes me that this argument is getting at something real. Some people feel an attachment to the land so strong that it transcends the monetary value of the land. Disruption to these ties cannot be measured by any conventional means, thus they cannot be compensated.

If the Virginia Department of Transportation wanted to run a highway through my home in western Henrico where I have lived for 13 years, I would be plenty unhappy. But I wouldn’t be devastated. My personal identity is not tied up in the house. I have no ancestral ties here, no spiritual ties. Leaving the house would have no impact on my network of kin and friends. I fully expect to sell the house when I retire and I’m ready to downsize. The house is a commodity in a way that property is not for people with strong attachments to the land.

I sympathize with those who fear the loss of something that can never be retrieved. But I have concerns. The idea of “cultural attachment” is so vague and hard to define that it could be applied to almost anything. There is no way to measure cultural attachment, and there is no way to ascertain the sincerity of the people who claim to have it. If this new doctrine were given legal force, it could be invoked to block any infrastructure project that ran through a rural area, that is to say, almost every road, highway, rail line, transmission line or pipeline ever proposed.

The idea has been around at least 20 years (since the 1996 U.S. Forest Service report at least). It doesn’t appear to have gained much traction since then. It will be interesting to see if FERC gives it any credence.

The Rule of Firsties

Statue of Captain John Smith overlooking the James River

Statue of Captain John Smith overlooking the James River

by James A. Bacon

I was chatting the other day with a friend, a William & Mary professor living in Williamsburg, about the Surry-Skiffes Creek transmission line project (see “An Intractable Dilemma“). Despite the high stakes involved, he said, he hadn’t paid much attention to the controversy, finding it hard to generate sympathy for a bunch of rich retirees in Kingsmill Resort raising a ruckus about their viewsheds.

His response amused me, for the controversy whirling around Dominion Virginia Power’s proposed construction of a 500 kV transmission line across a historic stretch of the James River is a lot more consequential than the views enjoyed by a few rich guys living on the river. The transmission line, designed to head off rolling blackouts for some 500,000 people living on the Virginia Peninsula, would traverse the closest thing that many Virginians have to sacred ground — “Virginia’s founding river,” as one foe described it to me.

I totally understand the concerns of the transmission line foes — even those of millionaires sipping martinis on the patios of their mansions as they soak up the river views. Plutocrats are people, too. But after several years of writing about controversial infrastructure projects in Virginia — highways, gas pipelines, transmission lines — I worry whether we have created institutional gridlock. At the rate we’re going, it will be impossible to build almost anything anymore.

The U.S. 460 Connector project was done in by wetlands. The U.S 29 Bypass ran into a buzzsaw of opposition engendered in part by fears that automobile exhaust would harm the health of children in nearby schools. (For what it’s worth, I was highly skeptical of both projects on economic grounds.) Now two proposed gas pipelines are being contested on a variety of grounds, the most potent of which is that, even though the pipelines are underground, landowners can’t abide the grassy right-of-way above ground. Businesses can’t even build wind turbines in the state because they’ll ruin the natural beauty of mountain ridges.

Think of all the project disqualifiers out there: wetlands, archaeological sites, old burial grounds, rivers, streams, wells, eagles’ nests, sturgeon breeding grounds, Indian tribal territories, schools, historical sites, and mountain ridge lines — and that’s just off the top of my head. Making the problem immeasurably worse for anyone wanting to build infrastructure, everyone’s got a viewshed and everyone wants to keep it as pristine as possible on the not-unreasonable grounds that the intrusion of ugly industrial infrastructure will hurt their property values. If eagles’ nests and burial grounds put thousands of acres off limits to development, view sheds rope off thousands of square miles.

There’s a philosophical issue worth exploring here. Whose viewshed matters? When Captain John Smith set foot upon Jamestown Island, Virginia was pristine. Waves of settlers descended upon the colony and chopped down much of the forest. No one objected (other than the Indians, and the least of their problems was the loss of picturesque views). Then came railroads and industry, but no one protested the loss of viewsheds. Then came roads and highways, and no one objected to them either. It wasn’t until the development of zoning codes and the growth of the environmental and conservation movements that viewsheds became a matter of concern. In the past few decades a new definition of property rights has come into play — the right to a view, asserted by the guy who got there first, over other peoples’ property. Call it the Rule of Firsties.

I’m far more sympathetic to property owners who want to preserve view sheds on their own land from disruption caused by utilities requiring easements, as is typically the case with property owners fighting the Mountain Valley and Atlantic Coast Pipelines. These people should be compensated for their loss of property values. I’m less sympathetic to those who assert a right to views of other people’s property. (In the case of the Surry-Skiffes Creek transmission line, the controversy is mainly over the view shed of the river, a commons.)

That reminds me of a story about the hamlet of Waterford, a community in Loudoun County that had preserved its character intact since the days of its founding by Quakers in the 18th century. The houses fronted on charming small-town streets; the back yards looked upon bucolic farmland. Several years ago, a developer acquired (or threatened to acquire) a neighboring farm and proposed developing a subdivision there. Talk about disrupting a viewshed! What made Waterford residents different from others is that they didn’t sue to deprive the developer his right to build on his property. If I recall the story rightly, they raised money to buy out his property and set up a trust to preserve their viewshed in perpetuity.

Waterford did not invoke the Rule of Firsties. But across Virginia, other people are doing so. As long as Virginia’s population and economy continue growing, we will need new roads, pipelines, transmission lines and other infrastructure. We have to find a way to build these things. At the same time, Virginia is a state that values history and property rights. We do not achieve progress by trampling historic sites or property rights. Finding the right balance will be difficult. It helps to remember that the tension between property owners and utilities is built into the nature of things. There are no angels or demons here, just people trying to do the right thing.

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.


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.


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

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

Renewable Energy: A Tale of Two Virginias

Apologies to Mr. Dickens

Apologies to Mr. Dickens

By Peter Galuszka

Call it a tale of two Virginias – at least when it comes to renewable energy.

One is the state’s traditional political and business elite, including Dominion Resources and large manufacturers, the State Corporation Commission and others.

They insist that the state must stick with big, base-loaded electricity generating plants like nuclear and natural gas – not so much solar and wind –to ensure that prices for business are kept low. Without this, recruiting firms may be difficult.

The other is a collection of huge, Web-based firms that state recruiters would give an eyetooth to snag. They include Amazon, Google, Facebook and others that tend to have roots on the West Coast where thinking about energy is a bit different.

Besides the Internet, what they have in common is that they all vow to use 100 per cent of their electricity from renewable sources. What’s more, to achieve this goal, all are investing millions in their own renewable power plants. They are bypassing traditional utilities like Dominion which have been sluggish in moving to wind and solar.

So, you have a strange dichotomy. Older business groups are saying that the proposed federal Clean Power Plan should be throttled because it would rely on expensive renewables that would drive away new business. Meanwhile, the most successful and younger Web-based firms obviously aren’t buying that argument.

I have a story about this in this week’s Style Weekly.

In Virginia, the trend is evidenced by Amazon Web Services, which sells time on its cloud-computing network to other firms. It is joining a Spanish company, Iberdola Renewables LLC, in building a 208-megawatt wind farm on 22,000 acres in northeastern North Carolina, just as few miles from the Virginia border. Three weeks earlier, on June 18, Amazon announced it plans a 170-megawatt solar farm in Accomack County on the Eastern Shore.

Dominion, which has renewable projects in California, Utah and Indiana and the beginnings of some small ones in Virginia, says it is not part of the projects. It could possibly get electricity indirectly from them. Amazon’s power will be sold on regional power grids to business and utilities.

When they complete such sales, the Net-focused firms will get renewable energy certificates that can be used to show that they have put as much renewable energy into the electricity grid as they have used, says Glen Besa, director of the Virginia chapter of the Sierra Club.

This will be especially important in Northern Virginia where there are masses of computer server farms used by Amazon and others. These centers used 500 megawatts of power in 2012 and demand is expected to double by 2017. Also, for years, the region has hosted such a large Internet infrastructure that at least half, perhaps 70 percent, of the Net’s traffic goes through there.

Part of the back story of this remarkable and utility-free push for renewables is that environmental groups are shaming modern, forward-looking firms like Amazon to do it.

Amazon Web Services was the target of criticism last year when Greenpeace surveyed how firms were embracing renewable energy. The report stated that the firm “provides the infrastructure for much of the Internet” but “remains among the dirtiest and least transparent companies” that is “far behind its major competitors.”

Dominion also got bashed in the report. Greenpeace says, “Unfortunately, Dominion’s generation mix is composed of almost entirely dirty energy sources.” Coal, nuclear and natural gas make up the vast majority of its power sources.

Its efforts to move to renewable sources have been modest at best. In regulatory filings, Dominion officials have complained that renewable energy, especially wind, is costly and unreliable although they include it in their long-term planning.

Dominion has plans for 20-megawatt solar farm near Remington in Fauquier County and is working on a wind farm on 2,600 acres the utility owns in southwestern Virginia. It has renewable projects out-of-state in California, Utah and Indiana. The output is a fraction of what Amazon plans in the region.

In a pilot offshore wind project, Dominion had planned on building two wind turbines capable of producing 12 megawatts of power in the waters of Virginia Beach. It later shut down the project, saying new studies revealed it would cost too much. It says it might continue with a scaled down project if it got extra funding, such as federal subsidies.

The utility says it must build more natural gas plants and perhaps build a third nuclear unit at its North Anna power plant to make sure that affordable electricity is always available for its customers.

As Amazon announced its new renewal projects, Greenpeace has changed its attitude about the company. Now it praises Amazon for its initiatives in Virginia and North Carolina. “I would like to think we have pushed Amazon in the right direction,” says David Pomerantz, a Greenpeace spokesman and analyst. He adds that Amazon has some work to do in making its energy policies “more transparent.”

One unresolved issue is that two neighboring states, North Carolina and Maryland, have “renewable portfolio standards” that require that set percentages of power produced there come from renewables. West Virginia had such a standard but has dropped it. In Virginia, the standard is voluntary, meaning that Dominion is under no legal obligation to move to solar or wind. It also gives the SCC, the power rate regulator, authority to nix new power proposals because they might cost consumers too much, providing Dominion with a handy excuse to move slowly on renewables.

Another matter, says Pomerantz, is whether Virginia’s legislators will enact “renewable energy friendly policies” or watch hundreds of millions of dollars in renewable project investments go to other states, such as North Carolina.

So, you have a separate reality. Traditionalists are saying that expensive renewables are driving away new business, while the most attractive new businesses are so unimpressed with traditionalist thinking that they are making big investments to promote renewable energy independently.

It isn’t the first like this has happened.

Why Can’t Dominion Do Big Wind Projects?

A wind farm in Texas

A wind farm in Texas

 By Peter Galuszka

Down in the swamplands and farmlands of northeastern North Carolina, construction has begun on a huge new wind farm that will be the largest so far in the southeastern U.S.

Iberdrola Renewables LLC, a Spanish firm, has begun construction on the long-awaited $600 million project with financial help from Amazon, which also plans a solar farm on Virginia’s Eastern Shore. The Tar Heel project will stretch on 22,000 acres and could generate about 204 megawatts of power.

The curious part of this is that the farm is only about 12 miles of the Virginia line northwest of Elizabeth City, N.C.

That’s not far at all from the Old Dominion. But Dominion Resources, Virginia’s leading utility, has been sluggish in pushing ahead with wind, citing concerns about cost. It pulled the plug on an offshore pilot project involving only two wind turbines that would have a relatively tiny power output off of Virginia Beach.

So why were renewable energy firm executives and public officials celebrating yesterday in North Carolina and not Virginia?

That’s an easy one. North Carolina has a renewable portfolio standard that requires utilities to produce at least 12.5 percent of their power from renewables. Virginia has a similar plan, but being a “pro-business” state, Virginia has made it voluntary. So, Dominion doesn’t really have to do anything at the moment to push to wind, solar or other renewable.

It might have more incentive to do so when the U.S. Environmental Protection Agency finalizes rules on its Clean Power Plan later this year, but no one really knows what the final form will be.

Nonetheless, Dominion has marshaled its money and its lobbyists to change how regulators over see it in this regard. The General Assembly, some of whose members get huge contributions from Dominion, hurriedly passed a bill this session changing the rules in ways that Dominion wants.

To be sure, Dominion has some wind farms in other states. But here in Virginia, it is pitching the old saw that wind power is too expensive and unreliable and so on.

It may have been at one time. When Iberdrola pitched the plan to put 102 wind turbines on 22,000 acres in N .C., the common wisdom was that the southeast just doesn’t have the natural wind power. The winds are too light, usually.

But this changed when new technology allowed wind turbines to go from about 260 feet into the air to more than 460 feet or almost as much as the Washington Monument. Once that happened, the Carolina wind farm became a go. Of course, critics say that wind turbines have negatives such as their capacity to slice apart birds and be an eyesore.

What’s better for humanity, however? Coal or even natural gas plants or ones that have no pollution, especially carbon, footprint?

Another interesting aspect of this story is how Amazon is getting involved. The retailing giant is becoming an electric renewable utility in its own right. It wants to have renewable power run the massive servers that it relies upon to do business. But instead of screwing around with hidebound, traditional utilities like Dominion that are often reluctant to warmly embrace renewable energy, Amazon is doing it itself.

Amazon is also putting in a 170 megawatt solar farm in Virginia’s Accomack County which has terrain similar that of Perquimans and Pasquotank Counties in North Carolina that will host the wind farm.

To be fair to Dominion, the utility has a legal responsibility to supply its customers with electricity on a 24/7 basis. It needs a diverse energy mix to be able to do that.

But one wonders why Dominion keeps pushing this bugaboo about wind. Its sister utilities have raised the same cry. That could be why wind represents only 5 per cent of the electrical mix in the U.S., even though there are wind farms in 36 states.

It’s different in other countries. Denmark gets 28 percent of its power from wind. Spain, Portugal and Ireland each get 16 percent from wind.

Isn’t it time for Dominion to get off the dime and do more with wind, rather than using its deep pockets to get paid-for Virginia politicians to do its bidding and change regulatory rules at its whim?