Category Archives: Water-waste water

Chesterfield Confronts Cost of Addressing Storm Water Runoff

Virginia Tech bioretention project

Virginia Tech bioretention project

by James A. Bacon

Chesterfield County businesses could wind up paying $308 per year on average to fund the county’s $35 million stormwater utility program, while single-family households could be tagged with $24 per year, reports the Richmond Times-Dispatch.

Needless to say, a lot of people are unhappy with the prospect of a new fee. “It is very unfair that we have to deal with it,” said Steve A. Elswick, board chairman. But noncompliance is not an option. “There have been questions about what if we just don’t do it. Unfortunately we’ll be faced with civil liabilities and criminal charges against the county administrator.” Public hearings on the plan are scheduled in March.

As Bacon’s Rebellion readers know, I’m not a fan of new taxes and government-mandated fees that look and feel like taxes. I believe in smaller, less intrusive government. But if a new tax or fee is justified, the stormwater utility program probably is it.

First off, the burden of establishing a serious stormwater management plan has been working its way through the legislative and regulatory system for a decade or longer. Every local government has known it was coming and has had years to prepare. The fact is, stormwater runoff  imposes significant economic costs. It causes erosion and puts sediment into rivers and streams, it picks up nitrogen and phosphates which contribute to destructive algae blooms, and it carries toxic chemicals from roads and parking lots into the watershed. The end result is significant environmental degradation to Virginia’s streams, rivers and Chesapeake Bay, which causes economic harm to the recreation and fishing industries (to say nothing of the harm done to the wildlife).

Second, the most appropriate way to pay for mitigating stormwater runoff is with a user fee. People should pay in direct proportion to the harm they cause, as measured by the square footage of impermeable surface on their property such as roof tops, driveways, patios and parking areas. That means large retailers with sprawling parking lots would pay the most, as appears to be the case in the Chesterfield plan. Insofar as county roads contribute to runoff, it may be justifiable for a proportionate share of program costs to come from general county funds.

How much will the program cost businesses? Many will pay less than the $308 average, Scott Smedley, director of Environmental Engineering, told the board of directors. And some will pay a lot more. “There is a small percentage on top, large facilities, that have really high bill, so that kind of skews that average.”

I haven’t seen the Chesterfield plan, so I don’t know the details of how the fees are structured. But in an ideal world (ideal from my perspective, at least), businesses should be rewarded through a reduction in fees if they reduce the square footage of impervious surface. One thing the county could do is to relax minimum parking mandates that compel businesses to maintain more parking spaces than they need or want. Indeed, every jurisdiction in Virginia should repeal their parking minimums.

Meanwhile, in General Assembly action, funding for stormwater runoff has become a budgetary issue. The McAuliffe administration’s proposed budget would cut the Stormwater Local Assistance Fund, which provides matching funds to local stormwater-cleanup initiatives, to zero. The Chesapeake Bay Foundation is backing budget amendments that would provide $50 million over each of the next two years. A separate measure would streamline statutory programs to help localities better manage their runoff programs.

Cleaning up the Chesapeake Bay is an environmental and economic imperative. While some may be impatient at the slow pace of progress, the Bay ecology is improving. It took decades to ruin the Bay and it will decades to restore its full potential. Virginia is pursuing a reasonable, slow-but-steady approach that is fiscally and politically sustainable.

Carbon Cuts: Why PJM Has a Better Idea

pjm-region-1024x657By Peter Galuszka

Amidst all the gnashing of teeth in Virginia about complying with proposed federal carbon dioxide rules, there seems to be one very large part of the debate that’s missing.

Several recent analytical reports explore using regional, carbon marketplaces to help comply with proposed federal Clean Power Plan rules that would cut carbon emissions by 2030. They conclude that the carbon goals can be attained more cheaply and efficiently by using a regional approach.

The lead study is by the PJM Interconnection, a grid that involves all or parts of 13 states including most of Virginia. Its March 2 report states that “state by state compliance options – compared to regional compliance options – likely would result in higher compliance costs for most PJM states because there are fewer low-cost options available within state boundaries than across the entire region.”

The same conclusion was made by another report by the Washington-based consulting firm Analysis Group on March 16. It states: “PJM’s analysis of compliance options demonstrates that regional, market-based approaches can meet Clean Power Plan goals across PJM states at lowest cost, with retirements likely spread out over a number of years.”

PJM set off in its analysis by setting a price per ton of carbon dioxide emissions with an eye towards the entities being exchanged among PJM-member utilities in a new market. The PJM report shows that electricity generation varies greatly among members. Some are farther along with renewables while others are greatly reliant upon coal.

By exchanging carbon units, some coal plants might actually be kept in service longer while overall goals are still achieved. EnergyWire, an industry news service, quotes Michael Kormos, PJM’s executive vice president for operations, as saying that the market-based carbon exchange, somewhat counterintuitively, might keep coal plants running longer.

“With the renewables and nuclear coming in as basically carbon free, we’re actually able run those coal resources more because they are getting credit from renewables and the nuclear as zero carbon.”

In December, PJM had 183,694 megawatts of generation. Some 67,749 megawatts are from coal-fired units.

Kormos says that a number of coal-fired units are going to be retired in the 2015 to 2030 timeframe regardless of what happens with the Clean Power Plan, whose final rules will be prepared by the U.S. Environmental Protection Agency later this year. The retirements of older coal plants are expected to involve a minimum of 6,000 megawatts of power.

It is curious that very little of this report is being heard in the vigorous debate in Virginia about complying with the Clean Power Plan. What you hear is a bunch of humping and grumping from Dominion Virginia Power and its acolytes in the General Assembly, the State Corporation Commission and the media.

This is not a new concept. Carbon trading is active in Europe and has worked here to lessen acid rain.

It is amazing that one hears nothing about it these days. It is shouted down by alarmists who claim that Virginia ratepayers will be stuck with $6 billion in extra bills and that there’s an Obama-led  “War on Coal.” The New York Times has a front-pager this morning about how Kentucky’s Mitch McConnell is taking the rare step of actually leading the “War on Coal” propaganda campaign.

Also strange, if not bizarre, is that this approach is precisely market-based which so many commentators on the blog claim to worship. Where are they on the PJM idea? Has anyone asked Dominion, which is running the show in this debate?

Interview: McAuliffe’s Economic Goals

 maurice jonesBy Peter Galuszka

For a glimpse of where the administration of Gov. Terry McAuliffe is heading, here’s an interview I did with Maurice Jones, the secretary of commerce and trade that was published in Richmond’s Style Weekly.

Jones, a graduate of Hampden-Sydney College and University of Virginia law, is a former Rhodes Scholar who had been a deputy secretary of the U.S. Department of Housing and Urban Development under President Barack Obama. Before that, he was publisher of The Virginian-Pilot, which owns Style.

According to Jones, McAuliffe is big on jobs creation, corporate recruitment and upgrading education, especially at the community college and jobs-training levels. Virginia is doing poorly in economic growth, coming in recently at No. 48, ahead of only Maryland and the District of Columbia which, like Virginia have been hit hard by federal spending cuts.

Jones says he’s been traveling overseas a lot in his first year in office. Doing so helped land the $2 billion paper with Shandong Tranlin in Chesterfield County. The project, which will create 2,000 jobs, is the largest single investment by the Chinese in the U.S. McAuliffe also backs the highly controversial $5 billion Atlantic Coast Pipeline planned by Dominion because its natural gas should spawn badly-needed industrial growth in poor counties near the North Carolina border.

Read more, read here.

(Note: I have a new business blog going at Style Weekly called “The Deal.” Find it on Style’s webpage —   www.styleweekly.com)

A Free-Market Approach to Protecting Our Water Supplies

Lynchburg train derailment. Image credit: CNN.

Lynchburg train derailment. Image credit: CNN.

by James A. Bacon

Writing in the Times-Dispatch today, my friend Noah Sachs highlights a systemic risk in our society: the threat of chemical leaks and spills to our water supply. Last year the release of toxic chemicals into the Elk River disrupted the drinking supply of 300,000 inhabitants of Charleston, W.Va. Closer to home, a Duke Power plant in North Carolina dumped coal ash into the Dan River. And a train derailment in Lynchburg sent three railroad cars into the James River.

“The accidents in 2014 are a stark reminder of the vulnerability of our drinking water, and we can’t fix the problem by imposing new requirements on water systems alone,” writes Sachs, a professor of environmental law at the University of Richmond. “We have to look upstream to the real source of the problem. Industries that store toxic chemicals near our waterways are putting Virginians at risk.”

The threat is real, and I credit Sachs for bringing attention to it. The question is how best to address the risk. Do we, as he suggests, need to impose a new set of regulations? Or are there potential private-sector remedies that could ameliorate the risk at less cost?

Sachs proposes three guiding principles for Virginia regulation:

  • Businesses that store large volumes of toxic chemicals “should be subject to some public oversight.”
  • There should be “minimum standards” for construction, inspection and maintenance of chemical storage tanks. Setbacks and secondary containment of requirements should be imposed for tanks near water sources.
  • Tank owners should prepare public communications and response plans in the event of an incident.

In this day and time, when the Environmental Protection Agency has taken upon itself to rewrite the Clean Air Act in order to regulate carbon dioxide emissions and shut down much of the coal industry, these standards do not sound especially unreasonable or onerous. But that’s hardly the criteria we should use when enacting new regulations. We should also seek to minimize the impact on industry consistent with our obligation to protect the public.

The red flag is Sachs’ suggestion that “minimum standards” should apply to everyone. Invariably, there will be instances in which the minimum standards are irrelevant, inappropriate or represent regulatory overkill. The problem is inherent with one-size-fits-all government regulations — they cannot take all unique circumstances into account.

What alternative is there to regulation? The tort system. Corporations should be held accountable for the harm they cause others. If a company spills chemicals into the water, it should be liable for the cost of the clean-up and compensation to those who suffer harm. Government should impose one rule only: As a condition of storing and transporting toxic chemicals, companies should be required to buy insurance. Insurance companies then would serve the risk-mitigation role. The insurers’ own inspectors would assess the level of risk and premiums would be adjusted accordingly. Companies could buy down those premiums by implementing measures such as those Sachs describes or perhaps by devising other solutions unique to their operations.

Regulators apply standard remedies and discourage innovative approaches, especially in situations when there may be idiosyncratic, site-specific solutions. Instead of telling industry how to do its job, perhaps Virginia should simply tell industry that the commonwealth will hold polluters liable for clean-up and damages — and let industry figure out how best to tackle the challenge.

Virginia’s Top Stories in 2014

mcd convictedBy Peter Galuszka

The Year 2014 was quite eventful if unsettling. It represented some major turning points for the Old Dominion.

Here are my picks for the top stories:

  • Robert F. McDonnell becomes the highest-ranking former or serving state official to be convicted of corruption. The six-week-long trial from July to September of the Republican former governor and his wife, Maureen, was international news. In terms of trash, it offered everything – greed, tackiness, a dysfunctional marriage, a relationship “triangle,” and an inner glimpse of how things work at the state capital.  More importantly, it ends forever the conceit that there is a “Virginia Way” in which politicians are gentlemen above reproach, the status quo prevails and ordinary voters should be kept as far away from the political process as possible. It also shows the unfinished job of reforming ethics. The hidden heroes are honest state bureaucrats who resisted top-down pushes to vet dubious vitamin pills plus the State Police who did their investigative duty.
  • Eric Cantor loses. Cantor, another Republican, had been riding high as the 7th District Congressman and House Majority Leader. A wunderkind of the Richmond business elite, Cantor was positioned to be House Speaker and was considered invulnerable, at least until David Brat, an unknown college economics professor and populist libertarian, exploited fractures in the state GOP to win a stunning primary upset. Cantor immediately landed in a high-paying lobbying job for a financial house.
  • Terry McAuliffe takes over. The Democrat Washington insider and Clinton crony beat hard-right fanatic Kenneth Cuccinelli in a tight 2013 race. He bet almost everything on getting the GOP-run General Assembly to expand Medicaid benefits to 400,000 low income Virginians. He lost and will try again. He’s done a pretty good job at snaring new business, notably the $2 billion Shandong-Tralin paper mill from China for Chesterfield County. It will employ 2,000.
  • Roads projects blow up. Leftover highway messes such as the bypass of U.S. 29 in Charlottesville finally got spiked for now. Big questions remain about what happened to the $400 million or so that the McDonnell Administration spent on the unwanted U.S. 460 road to nowhere in southeastern Virginia.
  • Gay marriage becomes legal. A U.S. District Judge in Norfolk found Virginia’s ban on gay marriage unconstitutional and the U.S. Supreme Court pushed opening gay marriage farther. The rulings helped turn the page on the state’s prejudicial past, such as the ban on interracial marriage that lasted until the late 1960s.
  • Fracking changes state energy picture. A flood of natural gas from West Virginia and Pennsylvania has utilities like Dominion Resources pushing gas projects. It’s been nixing coal plants and delaying new nukes and renewables. Dominion is also shaking things up by pitching a $5 billion, 550-mile-long pipeline through some of the state’s most picturesque areas – just one of several pipelines being pitched. The EPA has stirred things up with complex new rules in cutting carbon emissions and the state’s business community and their buddies at the State Corporation Commission have organized a massive opposition campaign. McAuliffe, meanwhile, has issued his “everything” energy plan that looks remarkably like former governor McDonnell’s.
  • State struggles with budget gaps. Sequestration of federal spending and defense cuts have sent officials scrambling to plug a $2.4 billion gap in the biennial budget. It is back to the same old smoke and mirrors to raise taxes while not seeming to. Obvious solutions – such as raising taxes on gasoline and tobacco – remain off limits.
  • College rape became a hot issue after Rolling Stone printed a flawed story about an alleged gang rape of a female student at the prestigious University of Virginia in 2012. Progressives pushed for raising awareness while conservatives took full advantage of the reporter’s reporting gaps to pretend that sex abuse is not really an issue.
  • Poverty is on the radar screen, especially in Richmond which has poverty rate of 27 percent (70 percent in some neighborhoods) and other spots such as Newport News. Richmond Mayor Dwight Jones got a lot of national press attention for his campaign to eradicate poverty but it is really hard to understand what he’s actually doing or whether it is successful. The real attention in Richmond is on such essentials as replacing the Diamond baseball stadium, justifying a training camp for the Washington Redskins and giving big subsidies for a rich San Diego brewer of craft beer.
  • Day care regulation. Virginia has a horrible reputation for allowing small, home day care centers to operate without regulation. Dozens have children have died over the past few years at them. This year there were deaths at centers in Midlothian and Lynchburg.
  • The continued madness of the Virginia Tobacco Indemnification and Community Revitalization Commission. This out-of-control slush fund in the tobacco belt continued its waywardness by talking with Democratic State Sen. Phil Pucket about a six-figure job just as Puckett was to resign and deny a swing vote in the senate in favor of expanding Medicaid. The commission also drew attention for inside plays by the politically powerful Kilgore family and giving $30 million in an unsolicited grant to utility Dominion.

Big Energy’s Conspiracy with Attorneys General

Former Va. Atty. Gen. Miller --toady for Big Energy

Former Va. Atty. Gen. Miller –toady for Big Energy

By Peter Galuszka

What seems to be strong opposition to a host of initiatives by President Barack Obama and the U.S. Environmental Protection Agency to curtail carbon and other forms of pollution is no mere coincidence.

According to a deeply reported story in Sunday’s New York Times, some state attorneys general, most of them Republicans, are part of what seems to be a covert conspiracy to oppose carbon containment rules in letters ghost-written by energy firms.

And, there’s a big Virginia connection in former Democratic Atty. Gen. Andrew P. Miller and George Mason University which have been bankrolled by conservative and Big Energy money for years.

The cabal has drawn its modus operandi from the American Legislative Exchange Council, funded by the ultra-right, oil-rich Koch Brothers of Kansas. In that case, ALEC prepares “templates” of nearly identical legislation that fits the laissez-faire market and anti-government and regulation principles held dear by the energy and other big industries. Many marquee-name corporations such as Pepsi, McDonald’s and Procter & Gamble have dropped their ALEC membership  after public outcries.

In the case of the attorneys general, big petroleum firms like Devon Energy Corporation of Oklahoma draft letters opposing proposals that might hurt their profits such as ones to regulate methane, which can be a dangerous and polluting result of hydraulic fracking for natural gas. The Times notes that Oklahoma Atty. Gen. E. Scott Pruitt then took Devon’s letter and, almost-word-for-word, submitted it in his “comments” opposing EPA’s proposed rules on regulating fracking and methane.

The secretive group involves a great deal of interplay involving the Republican Governor’s Association which, of course, helps channel big bucks campaign contribution to acceptable, pro-business attorneys general. In 2006 and 2010, Greg Abbott of Texas got more than $2.4 million from the group. Former Virginia Atty. Gen. Kenneth Cuccinelli got $174,5638 during his 2009 campaign.

One not-so-strange bedfellow is former Virginia Atty. Gen. Andrew P. Miller who was in office from 1970 to 1977 and is now 82 years-old. He’s been very business promoting energy firms. As the Times writes:

Andrew P. Miller, a former attorney general of Virginia, has in the years since he left office built a practice representing major energy companies before state attorneys general, including Southern Company and TransCanada, the entity behind the proposed Keystone XL pipeline. The New York Times collected emails Mr. Miller sent to attorneys general in several states.

“Mr. Miller approached Attorney General Scott Pruitt of Oklahoma in April 2012, with the goal of helping to encourage Mr. Pruitt, who then had been in office about 18 months, to take an even greater role in serving as a national leader of the effort to block Obama administration environmental regulations.

“Mr. Miller worked closely with Mr. Pruitt, and representatives from an industry-funded program at George Mason, to organize a summit meeting in Oklahoma City that would assemble energy industry lobbyists, lawyers and executives to have closed-door discussions with attorneys general. The companies that were invited, such as Devon Energy, were in most cases also major campaign donors to the Republican Attorneys General Association.

“Mr. Miller asked [West Virginia Attorney General Patrick Morrisey] to help push legislation opposing an Obama administration plan to regulate carbon emissions from existing coal-burning power plants. Legislation nearly identical to what Mr. Miller proposed was introduced in the West Virginia Legislature and then passed. Mr. Morrisey disputed any suggestion that he played a role.”

Not only that, but George Mason has an energy study center that is bankrolled by Big Energy and tends to produce policy studies of what the energy firms want. It also has the Mercatus Center, a right-wing think tank bankrolled by the Koch Brothers.

So, when you see what seems to be a tremendous outcry against badly needed regulations to curb carbon emissions and make sure that fracking is safe, it may not be an accident. And, it comes from attorneys general who should be protecting the interests of average residents in their states instead of being toadies for Big Energy.

Suddenly, It’s Raining Gas Projects and Tax Breaks

Anti-Pipeline By Peter Galuszka

Suddenly it seems to be raining natural gas pipelines and snowing millions of dollars in tax breaks and incentives for rich electric utilities.

Dominion Resources, the powerful and politically well-connected Richmond-based utility, apparently is getting $30 million in public money from the Virginia Tobacco Indemnification and Revitalization Commission without apparently asking for it to help build a new natural gas-fired generating plant in Brunswick County. The information was broken by the Associated Press.

Largesse for Dominion stretches to the other side of the Potomac River as well. The Washington Post reported Sunday that Calvert County Md., where Dominion has approval to convert a liquefied natural gas facility to handle natural gas exports, is going to give the utility about $560 million in tax credits.

And, back in Virginia, controversial is growing over the $5 billion natural pipeline that Virginia and three other southern utilities are planning to take natural gas drilled by hydraulic fracking methods from West Virginia to Virginia and North Carolina.

The Atlantic Coast Pipeline has drawn criticism from environmentalists who fear that gas is not the cleaner panacea to coal that many think. Landowners complain that Dominion and its powerful Richmond law firm, McGuireWoods, are using strong arm methods to force their way on their land to survey possible routes.

mountain valley pipelineYet another pipeline – this one doesn’t involve Dominion – is drawing concern in southwestern Virginia. The $3.5 billion Mountain Valley Pipeline that would likewise begin in the fracked gaslands of northern West Virginia and head south west of Roanoke and then cut to the small town of Chatham.

The complaints are the same as the Atlantic Coast Pipeline – green concerns about leaking methane and the threat of bulldozing bucolic private land by companies using eminent domain.

The Mountain Valley project is being spearheaded by EQT Corp. of Pittsburgh and NextEra Energy of Florida.

So what gives? Utilities like Dominion are using more gas, namely at its new Brunswick County natural gas plant and at an older coal-fired station that’s been converted at Bremo Bluffs on the James River. But how much gas does it actually need?

In the case of Cove Point, Dominion notes that the plant has been importing LNG from places like Northern Africa and Scandinavia for decades although imports have come to a spot given the glut of cheap, domestic gas.

Dominion, which bought the facility about a decade ago, can get gas from an older pipeline that for years has linked the Chesapeake Bay area with gasfields in Pennsylvania where some of the fracking for new product is occurring. Dominion can also tap gas from the venerable Transco Pipeline that for decades has transported gas the traditional way – from the Gulf State processing stations to the northeast.

Dominion says it already has contracts to export gas – from where it comes domestically – to utilities in Japan and India. But when one looks at the spaghetti-like twirl of all of the proposed new pipelines, one wonders what the game really is.

The Atlantic Coast Pipeline has a leg that bounds over to Hampton Roads from near the North Carolina border. Dominion says that this one will help supply one of its pipeline partners with gas because it serves South Hampton Roads. Ok, fine, but it might also serve another new LNG export facility in that area that has perfect deep water conditions for such a facility.

And, as some environmentalists and property owners wonder, why couldn’t the energy companies tap rights of way near existing pipelines? Why can’t existing pipelines be expanded? Go back to the utilities and they say they don’t know exactly where the pipelines will go.

That is very curious. While they don’t know where mega-billion project projects are going to go, they seem to be getting tens, if not hundreds, of billions of dollars in public funds and tax breaks to help them proceed with the Brave New World of natural gas.