Racial Bean Counting for Dominion’s Offshore Wind Project?

by James A. Bacon

Dominion Energy  expects to create 900 construction jobs and support 1,100 employees in ongoing operations for its proposed $9.8 billion offshore wind farm. Hundreds more jobs could be created if, as hoped, companies in the wind power industry begin manufacturing components and providing ancillary services in Hampton Roads.

As part of its wind farm initiative, the utility has created an economic development plan for maximizing investment and job creation in Virginia and ensuring that the benefits are shared broadly, including with veterans and “workers from historically economically disadvantaged communities.” The plan says the company will engage with economic development authorities, business trade organizations, workforce development groups, and “minority civic and business organizations.” It even plans to collect data on the number of women, veterans and minorities employed by suppliers with contracts over $500,000 in value.

But that’s not good enough for the Virginia Chapter of the Sierra Club. “Dominion’s Plan is not sufficient to meet the diversity, equity, and inclusion targets” outlined in the state code, says Mark Little, co-founder of CREATE in State Corporation Commission testimony on behalf of the Sierra Club.

Little wants Dominion to set “ambitious, progressive targets” on the number and percentage of employees to be hired by sex, race/ethnicity, and veteran status, collect detailed statistics on the demographic composition of the hires, and publish updates every six months. Furthermore, Little says Dominion needs to make “structural changes” such as hiring Diversity, Equity, and Inclusion officers to execute its vision.

I have no idea how the SCC will respond to calls for compelling Dominion to embrace an energy policy that is not only environmentally sustainable but “socially just.” But Little’s testimony provides insight into how the environmental and social-justice movements are fusing and the kinds of policies that could be in store for Virginia if woke environmentalists get their way.

While almost everyone would wish that the benefits of a massive economic stimulus like the wind farm would be shared widely, Little pays zero heed to the realities of labor markets in Hampton Roads and Virginia. A long-term goal, says Little, should be for employment to “reflect the demographics of the Hampton Roads region” — making no allowance for the specific skills required by the wind farm industry and its suppliers, or whether all demographic groups possess the educational credentials needed to acquire those competencies. Little never uses the “Q” word, but his testimony comes very close to calling for racial quotas and set-asides.

The Sierra Club has more than 800,000 dues-paying members nationally and 20,000 in Virginia. The organization now defines itself as a “diverse, inclusive movement that addresses the environmental and social justice issues in the United States.” With a “strong emphasis on environmental justice principles,” Sierra Club wants to ensure that offshore wind is developed in a way that is “fair, equitable, and beneficial to all Virginians.”

The Sierra Club hired Little, who is co-founder of the Chapel Hill, N.C.-based CREATE center, which articulates strategies for “building new wealth in distressed communities.” He also is a policy fellow at the E Pluribus Unum Fund, an organization that focuses on “advancing equity and addressing systemic racism in the American South.”

The Coastal Virginia Offshore Wind Project (CVOW) and potential economic spin-offs from wind-power manufacturers and suppliers setting up shop in Hampton Roads represent a tremendous economic opportunity. (I defer discussion of the cost to ratepayers and impact on grid reliability for later posts.)

In its early stages the U.S. East Coast wind industry will be supported by Europe-based suppliers. To reach DEI goals in its economic development plan, says Little, Dominion needs to include “an ambitious timeline for a transition from EU-based Tier 2/3 suppliers to Virginia-based suppliers with preferences for veteran, local, and historically economic disadvantaged ownership.”

Clear, progressive, ambitious, annual targets for the construction and operational phases of the project should be set for the number of firms and total value of spend in each demographic category of contractors and suppliers. Targets for percentages of employees by demographic category should apply to the Company and to the entire supply chain for the CVOW Project.

Little’s testimony contains no acknowledgement that there is tremendous competition between states for wind-industry investment, that Virginia has no lock on the business, or what impact there might be on the site-location decisions of suppliers should racial quotas (call them what you will) be applied.

For the Sierra Club, the moral imperative of achieving “equity” — in this instance, employment parity and supplier-ownership parity by racial classification — is paramount. As Little testifies:

The Commonwealth of Virginia and the United States have a well-documented history of subjugation and extermination of Indigenous peoples, enslavement of Africans, and legal discrimination against Asians. Just by nature of its long history as [a] Virginia-based company, Dominion Energy’s own history is intertwined with this past. The CVOW Project is an opportunity to help address these historical injustices in a very direct way.

Little cites no specific examples of how Dominion may have discriminated against any minority group with regard to employment. According to the company’s website, the company has raised its “diverse” hiring rate from 28% in 2013 to 50% in 2020. Rather he says the company uses vague terminology that tells us nothing about hiring of specific racial/ethnic groups.

“I highly encourage the use of people’s racial and ethnic identities rather than “minority” or “diverse” which are ambiguous, misleading and nonfactual groupings with which no one actually identifies,” says Little. He wants Dominion to collect the geographic area (by zip code) and salaries of the veteran status, race/ethnicity, address, and salary of Dominion employees. He wants to collect data on recruitment, retention and promotion by race/ethnicity. He wants to track DEI training for managers and employees. And he wants to track the “cultural competence” of senior leaders and managers. For suppliers, he wants to know the value of contracts awarded and even the racial “ownership demographics” of companies invited to bid.

Little expresses hope that a “robust plan with vision, metrics, targets and clearly articulate strategies” is an opportunity for Dominion to create a “model of practice” to define the future of offshore wind in the United States.”

(Hat tip to Steve Haner for spotting Little’s testimony and forwarding it to me.)