Category Archives: Business and Economy

Virginia Slides Lower in ALEC Economic Rankings

American Legislative Exchange Council rated Virginia 30th out of 50 states using these three measures of economic performance over ten years. Click for larger view.

by Steve Haner

First published earlier today by the Thomas Jefferson Institute for Public Policy.

As measured by the American Legislative Exchange Council (ALEC), Virginia’s economic outlook has continued its precipitous drop and now barely ranks in the top half among the American states, 24th out of 50. A decade ago it was in the top five, ranking third in 2011 and 2012 and fifth in 2013.

Using three direct measures of actual economic performance, gross domestic product and job growth and population out migration, ALEC placed Virginia 30th among the 50 states over the past decade. Neighboring North Carolina, on the other hand, ranked 12th in recent economic performance and second in economic outlook.

Virginia’s number 24 ranking in the annual “Rich States, Poor States” outlook comparison will be dismissed by some as less important than other indicators of competitiveness, including the ultimate bragging point of being number one in the last CNBC ranking of best states for business. But the downward trend is dramatic, Virginia having ranked 17th last year and dropping seven places in this survey. Continue reading

SCC Asked for Hearing on Secret Renewables Costs

by Steve Haner

Appalachian Power Company has asked the State Corporation Commission to schedule a separate hearing on Attorney General Jason Miyares’ motion to break the seal on exhibits in its application for new renewable energy sources.

Miyares’ April 6 motion was first reported by Bacon’s Rebellion, in a story on Appalachian’s pending application for approval of the projects and of its overall plan for complying with the Virginia Clean Economy Act (VCEA). Appalachian’s response motion was filed April 13, claiming irreparable harm to its stockholders if the actual line-by-line project cost projections were revealed to its customers.

Although some of these discrete items may appear innocuous on their own, collectively they would enable a savvy party to discern the price paid for the facility, which is competitively sensitive.

What do they say in swanky restaurants? If you have to ask the price, you cannot afford it. Revelations could be politically sensitive, as well, given the partisan divide on the VCEA itself. Continue reading

Virginia’s COVID Performance Rates a D

Source: The Committee to Unleash Prosperity

by James A. Bacon

Virginia performed worse than 35 other states during the COVID-19 recession, based on an analysis that encompasses mortality rates, economic performance and educational performance. The Commonwealth fared better than average in health outcomes, worse than average in economic performance, and near the bottom in school closures. The overall ranking: D.

Nationally, there was little correlation, however, between the stringency of economic and school-related COVID lockdowns and health outcomes, finds the study, “A Final Report Card on the States’ Response to COVID-19,” published by the National Bureau of Economic Research. The authors were Phil Kerpen, Stephen Moore, and Casey B. Mulligan, all well-known free-market economists.

Former Governor Ralph Northam, a physician, can take some comfort in the fact that Virginia under his watch performed better than most other states in the COVID-related mortality rate when adjustments were made for age and the prevalence of obesity and diabetes risk factors in the population — 10th best in the nation.

However, when the perspective shifts to “all cause excess deaths,” which captures the mortality effects of lockdown policies such as higher drug and alcohol deaths, suicides, and foregone medical treatments, Virginia’s national ranking falls to 19th. Continue reading

SCC Staff: Dominion May Exceed Wind Cost Cap

A schematic from the application for the proposed 14.7 megawatt turbines for the CVOW, with measurements. Click for larger view.

by Steve Haner

A similar article was published this morning by the Thomas Jefferson Institute for Public Policy.

Testimony filed by the State Corporation Commission staff on April 8 opened a slight possibility that the Commission could reject Dominion Energy Virginia’s proposed $10 billion Coastal Virginia Offshore Wind project off Virginia Beach. It all depends on how the SCC decides to calculate the CVOW’s levelized cost of energy (LCOE), the dollar cost of every megawatt hour of electricity it produces plus the transmission costs.

When the 2020 General Assembly adopted the Virginia Clean Economy Act and related legislation, it set a cap on that key LCOE measure, which is used to compare the costs of various methods of making electricity.

If the utility failed to stay under the LCOE cap, the SCC would have the authority to reject the proposal as imprudent and unreasonable. If the project remains below the cap, legislators mandated approval by the SCC, despite any other doubts about its prudence and without considering less expensive alternatives.

The cap set was $125 per megawatt hour, after deducting the value of the very large tax credits granted for wind projects under federal law. In the application it filed late last year to build the facility, Dominion estimated the LCOE (after the tax credits) at about $83 per megawatt hour. But Katya Kuleshova of the SCC’s Division of Public Utility Regulation challenged several of the assumptions in her testimony and noted that if the assumptions prove wrong, that number rises substantially. Continue reading

A Bag Of Oranges and Gas Tax Posturing

by Steve Haner

The bag of mandarin oranges that was $4.99 last week was $5.99 this morning. Fruit trees aren’t getting raises – that is the impact of fuel prices, the cost to ship them to Virginia.

As I’m fuming and pushing my cart to the next inflated item, the phone pings to announce an email. Could relief for gas prices be on the way? is the teaser headline from Virginia Mercury, with its lead story this morning a straight-faced discussion of the truly comedic proposal yesterday by House Democrats. They offer Virginia car owners a one-time $50 payment ($100 for a two-car family) in lieu of actually lowering the fuel taxes, as Governor Glenn Youngkin has proposed. Continue reading

Another Try for Natural Gas to Hampton Roads

Existing 12″ natural gas pipelines proposed for replacement with new 24″ lines. Click for larger view.

by Steve Haner

Natural gas pipeline companies have applied to federal regulators with another proposal to enhance supply into Virginia’s Hampton Roads region, despite the earlier failures of two similar high profile efforts.

Columbia Gas Transmission, part of TC Energy which is best known for the recently-rejected Keystone XL pipeline, is proposing to replace 48 miles of existing, 1950s-era, 12-inch diameter pipe with new 24-inch pipe. Compressor stations and other facilities would also be modernized. This proposal is being marketed as the Virginia Reliability Project and stays within existing right of way from Sussex County to Chesapeake.

Transcontinental (Transco), in a separate application to the Federal Energy Regulatory Commission, wants to add a 6.35-mile loop of new 24-inch pipe in Brunswick and Greensville counties, and improve a compressor there, allowing it to supply an additional 105,000 dekatherms per day to points east and south. It has been named the Commonwealth Energy Connector Project.

From the S&P Global story linked in the adjacent paragraph. Click for larger view.

To some writing for the energy trade press, the combined projects look like an effort to make up for the loss of the Atlantic Coast Pipeline, abandoned by Dominion Energy. It was to provide substantial new supply to regional retailer Virginia Natural Gas. Following that retreat in the face of environmental opposition and a change in attitude by elected Virginia leaders, the VNG Header project was also abandoned. Will this third proposal fare better? Continue reading

Richmond’s Reaganesque Time for Choosing

Chris Braunlich

by Chris Braunlich

Richmond, like Washington, has always been a place where an “insider’s game” is played – not in a pejorative sense, but simply as the way things are done.

Relationships are paramount, people speak in the arcane language of lawmaking, agendas are confusing for outsiders, and the activities of a subcommittee for an obscure commission are followed in detail because those in the know understand that what happens there will end up as a new regulation. Continue reading

Moran’s Green Energy Ties Ignored by Media

Matt Moran
Photo credit: Creative Direct

by Steve Haner

If the Commonwealth of Virginia was not paying Matthew Moran to serve as Governor Glenn Youngkin’s deputy chief of staff and point person with the General Assembly, as recently revealed, who was? Based on the websites for his employers, mainly the renewable energy industry.

For example, Moran is identified as on the Virginia advisory board of an advocacy group called Conservatives for Clean Energy, strong supporters of the push to eliminate fossil fuel use in the state and replace it with solar and wind-driven electricity. Continue reading

Wind Case Spinning Up; Your Comments Sought

Yes, it is that big. Click for larger view, and note the on-shore transmission expansions.

by Steve Haner

In the coming weeks, Virginia’s State Corporation Commission takes up one of the largest utility investments ever undertaken in the Commonwealth, where the cost and the risk will rest squarely on Virginia’s citizens: Dominion Energy Virginia’s $10 billion Coastal Virginia Offshore Wind project.

In applications and appendices filed late last year, probably running to hundreds of thousands of words and hundreds of technical drawings, Dominion outlined its request to build the project 27 statute miles (24 nautical miles) off the mouth of Hampton Roads. The project area covers 176 square miles of seabed. It uses about one square mile for each of the planned 176 turbine towers. Continue reading

Secrecy Also Hides Key Solar Energy Data

The well-shaded weeds and untilled earth under a Dominion solar facility. Dominion photo.

by Steve Haner

Perhaps issuing its ruling on the Ides of March by design, Virginia’s State Corporation Commission last week approved another major wave of requests from Dominion Energy Virginia for solar plants it will own, solar plants it will contract with, and a smattering of battery storage facilities added to provide some public relations cover.

In reviewing the massive case file that built up between July and February, without even diving into the long December hearing transcript, some key takeaways appear quickly.

  • The utility proposal received strong pushback from the SCC staff in its analysis, from the Office of the Attorney General on questions of cost, accounting and necessity, and even from the environmental advocates who helped write the controlling Virginia Clean Economy Act. Each might rate an individual report.
  • All the legal brilliance and accounting work were largely in vain, as the Commission has been reduced by law to merely checking boxes on the VCEA approval criteria list Dominion wrote for itself.
  • Secrecy continues to rule, especially on the key issue of the levelized cost of energy (LCOE) used to compare and choose generation sources and related storage. The Cone of Silence was not broken in this case and the utility will fight like a banshee to keep it in place in the pending debate over its offshore wind proposal.
  • While the overall LCOE numbers are secret, the utility is putting two huge thumbs on the scale by including 1) a high social cost of carbon as a financial benefit to offset the consumer cost of the projects and 2) a claimed “avoided cost” because it is meeting its clean energy goals and thus avoiding a VCEA financial penalty for failure. Dominion invents the fine, $45 per megawatt, then counts it as a boon to consumers that it doesn’t have to pay.
  • The opponents did extract a possibly useful stipulation from the utility for future cases, and a careful read opens up the possibility that the VCEA’s rigid dictates may bend after all. I was not imagining things months ago when I sensed pending flexibility, just looking in the wrong place.

Continue reading

Key Data on Dominion Wind Project Still Secret

Cover page blocking public access to the engineering and cost details for Dominion’s proposed $10 billion plus Coastal Virginia Offshore Wind project.

By David Wojick

A previous article published by Bacon’s Rebellion and the Committee for a Constructive Tomorrow challenged the notion that Dominion Energy Virginia can build a huge amount of wind and solar generating capacity and retire all of its fossil-fueled generators with almost none of the enormous storage capacity that is required to make the renewables viable.

This proposed long-term plan does not work and Dominion knows that, but in the short run it can make billions in profit by building the unreliable wind and solar. The disastrous unreliability shows up only in the long run.   Continue reading

A Low Solar Minimum Bill Ups Yours, By Design

by Steve Haner

Virtue signaling can be fun.  It can also be profitable if you can shift the overall cost onto somebody else. That is what is going on in the battle over a proposed “minimum bill” for Dominion Energy Virginia customers who seek to partially escape the utility by signing on with a separate shared solar provider.

Everybody who signs up for the outside service will still expect full power on cloudy days, or anytime some other circumstance reduces the flow from the solar panels owned by the third party. They just don’t want to pay the full freight for that back-up service, and would rather pass the bill on to you.  Continue reading

Another Reliable Energy Provider Abandons VA

Artist rendering of now-terminated Chickahominy Power. Click for larger view.

By Steve Haner

First published this morning by the Thomas Jefferson Institute for Public Policy.

A long-embattled plan to build a natural gas-fueled generating plant not owned by Dominion Energy has become the latest victim of Virginia’s patent hostility toward fossil fuels.  Environmental opponents and the incumbent utility will probably join in popping the corks.

Chickahominy Power in Charles City County has posted a notice on its website that the project, once scheduled to start construction in 2019 and begin operation in 2022, is terminated.   Investors are seeking a location in Ohio or West Virginia, and the scope of the project has grown.

Irfan Ali of Herndon, who uses the title managing member and who is the principal investor, now plans to develop data centers to use power from the plant, which is also designed to use hydrogen for fuel if that becomes available and economical.  He also plans to couple it with a carbon capture and storage system.

“And I would have done that in Virginia, so Virginia is losing out in a big way,” Ali said. Continue reading

Virginia Remains a Green New Deal Mecca

by Steve Haner

The elections of a Republican Virginia governor and a new Republican majority in the House of Delegates have not changed Virginia’s status as one of the greenest of Green New Deal states in the country.  Every effort to reverse the course set during the previous period of Democratic hegemony has failed at the 2022 General Assembly.

The massive construction plans for ratepayer-funded solar, wind and battery facilities dictated by the 2020 Virginia Clean Economy Act remain on track. A bill to repeal VCEA failed in the majority-Democratic Virginia Senate. So did a simpler bill that merely restored the ability of the State Corporation Commission to review those construction plans for prudence, reasonableness and cost.

If California moves to ban the sales of new internal combustion engine cars and other vehicles starting with the 2035 model year, as expected, Virginia is still positioned to automatically follow suit. Until then, a growing percentage of all new car sales must be electric starting in 2025. A bill to revisit that 2021 legislation, and do a proper regulatory adoption process, also died in the Senate.

Legislative efforts to remove Virginia from the Regional Greenhouse Gas Initiative regional compact all failed. A regulatory reversal may still be possible without legislation, but in the meantime the carbon tax remains on every Dominion Energy Virginia bill and works its way into everything touched by electricity costs. Continue reading

We Need to Help That Poor Billionaire Out

by Dick Hall-Sizemore

With all the huffing and puffing about CRT, face masks, and “wokeism” at UVa, Bacon’s Rebellion has ignored what could be the biggest scam in the General Assembly: the subsidization of an ultrarich guy and his plan to build a football stadium and surrounding “mini-city” in Northern Virginia.

The General Assembly is now in the midst of one of its periodic quests to lure a professional sports team to Virginia. This time it is the Washington Commanders, the team formerly known as the Redskins.

Two bills have passed their respective houses in the General Assembly related to this issue: HB 1353 (Knight, R-Virginia Beach) and SB 727 (Saslaw, D-Fairfax).  Both would create an authority that would have the power to issue bonds to finance a portion of the cost of the project. It is estimated that the stadium would cost about $1 billion. The bonds would be financed with a mechanism commonly used with such projects: tax increment financing. Briefly, that would involve a portion of the increased tax revenue resulting from the project being dedicated to the debt service on the bonds. Continue reading