The Big Gamble

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by Bill O’Keefe

Virginia’s Clean Economy act requires Dominion to provide a 100% carbon-free grid by 2045. This law represents a big gamble that Dominion embraced with a “balls to the wall” enthusiasm because the $9 billion cost, which will most likely be higher, will be provided by rate payers, not share owners. To quote a truism, nobody spends someone else’s money like their own. This legislation proves it.

Dominion’s confidence in achieving the General Assembly’s mandate is unrealistic. Given technological uncertainties, it is the height of folly to accept a mandate that establishes a goal and the date by which it is must be achieved. The history of technology-forcing mandates is a sorry one.

Dominion has touted the recent tests of two offshore turbines as reason for optimism for the planned project of 180 to 220 turbines located 27 miles offshore will cover 112,800 acres. That represents 176 square miles, roughly the size of King George County and more than three times as large as Norfolk. And the turbines will stand 600 feet about the surface.

The technology for building large turbine platforms and wind turbines is not new but the combined engineering challenges are significant. The area of the Atlantic where these turbines will be built could be called “hurricane alley” according to one analysis. As such, the wind towers and blades have to be engineered to withstand category five hurricanes—sustained wind speeds of more than 150 miles per hour with gusts of 200 miles per hour. No wind tower has been built to do that. Indeed, the Energy Information Administration (EIA) has a research program to determine if hurricane proof tower designs are possible. Research is also necessary to determine the best floating turbine to install and how to anchor it to the sea floor. The long blades and turbine engines present other engineering challenges. Blades are subject to serious corrosion from salt water and the constant exposure to wind, both of which reduce their efficiency. Since the turbines can run 24 hours a day, seven days a week, they require precision manufacturing. A Forbes article stated that “running a wind turbine for 20 years is analogous to getting 3 million miles from a car engine.” The transmission cables will be buried and have to safely cover more than 27 miles from their location to Dominion’s load centers.

Since production capacity of offshore turbines is 50%-58% according to EIA, Dominion will also have to invest in storage batteries on a scale that does not now exist. Dominion is experimenting with lithium-ion batteries as part of a program to understand this emerging technology but lithium-ion batteries have known limitations and should be old technology in 25 years.

While the General Assembly and Dominion pledge to control rate payer costs, that promise is a triumph of hope over experience. European experience over the past decade has demonstrated that performance of offshore turbines degrades rapidly, which increases maintenance costs. A review of Dominion’s plan by the State Corporation Commission led to the conclusion that Dominion’s own analysis had found that “a larger full-scale offshore wind generation facility, which the [pilot] project is intended to demonstrate, is not expected to be economically competitive with other options for the next 25 years under any scenario studied.” This was confirmed by EIA which has estimated that the cost of offshore wind will be three times greater than the benefits produced. It also concluded that the cost pf gas-fired combined cycle units will be half that of offshore wind generated electricity.

There are only two reasons why the General Assembly would mandate such a costly boondoggle — ideology and a disregard for the economic interests of the Commonwealth’s citizens. It’s not too late for the General Assembly to change course and introduce a dose of realism into our energy policy.

Over 50 years ago, the late James Schlesinger — former secretary of energy and defense, and director of the CIA — wrote an insightful article on planning in which he addressed the degree of confidence that can be assigned to a forecast of the future. He distinguished between two types of planning. One he called “Cook’s tour” planning, which is based on the assumption that the future is sufficiently well known to allow planning a precise course years into the future. The General Assembly and Dominion have adopted this model. The other approach is called “Lewis and Clark” planning, which acknowledges that there are alternative courses of action but the precise character or timing cannot be known with certainty. This approach prepares for uncertainty by identifying alternatives, learning with experience and then acting along the way.

If the General Assembly had used the Lewis-and-Clark model, it would have set interim goals to move towards zero emissions and then let Dominion figure out the most cost-effective approach to achieving it with interim progress reviews. A combined cycle natural gas unit uses both a gas and a steam turbine together to produce up to 50 percent more electricity from the same fuel than a traditional simple-cycle plant. Natural gas in a combined-cycle power plant provides the least CO 2 emissions per kWh of any fossil-fuel fired power plant, around 0.4 tons of CO 2 per megawatt-hour. However, new processes are being developed and tested that involve burning fossil fuel with oxygen instead of air to produce electricity without producing carbon dioxide (CO2) emissions.

Dominion is aware of this but is more concerned about its profits and the goodwill of the General Assembly and the environmental community. Science, economics, and common sense are buried when ideology rules as it did with the Clean Economy Act. But actions have consequences and when these become more obvious, the legislative ideologues will be looking for new employment and Dominion will change course as rapidly as it can.

William O’Keefe, a Midlothian resident, is founder of Solutions Consulting and former EVP American Petroleum Institute.

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15 responses to “The Big Gamble

  1. More blackouts in California. Many customers switch to fossil fuel generators. ://www.wcvb.com/article/big-power-shutoffs-in-california-as-winds-boost-fire-danger/34480964#

  2. I hate to be the Pollyanna here, but have you read of recent progress in the fusion reactor area? MIT has built a reactor which they believe will reach fusion mass within two years.
    https://news.mit.edu/2020/physics-fusion-studies-0929
    If that ever happens, everything changes.

  3. Fusion is the wave of the future, and probably the only realistic replacement for fossil fuels which can generate enough electricity to run our economy. Unfortunately it has been a decade away from being practical (a sustained reaction that produces more power than it takes to initiate it) for the past 50 or 60 years. One day they will succeed, but who knows how long that will take?

  4. We’ll start with the usual… Government choosing winners and losers..

    OK,,, you can make electricity… storage is still a problem and will continue to be…
    Imagine you’re a farmer with several of those multi hundred horsepower tractors, harvesters, combines…. you’re up against the weather,,, first.. it takes a lot of juice to crank out 300hp,,, and 2nd, taking hours to charge a battery when you can on load a 100gallons of diesel in 5 minutes… no contest their….
    Or a logger out in the woods with a giant skidder and tree feller and knuckle boom loader… again multi hundred hp diesels… you can’t be waiting around for a recharge, and thats assuming their is a power line nearby..

    • Not a problem. We’ll just ban that type of equipment altogether. Farming and logging are overall bad for the environment, and they contribute to global climate change, so we need to learn to live without them.

      I mean, after all, do we really NEED food and houses?

  5. Baconator with extra cheese

    Can’t wait to see how Tesla replaces tug boats, cruise ships, trawlers, etc….
    But screw it we’ll be green…. even though China will be burning coal until the very last piece of dust is available to run our economy into the group.
    How do you say “Yes Master” in Mandarin anyway?

  6. How big a battery does it take, and what does it weigh, to power a BOEING 747 or equivalent on a non stop flight from LA to say Japan..

    Maverick to flight this is Blue Leader 117, I have to disengage, my battery is running low…. .
    Will in flight refueling involve a jumper cable hanging out of the back of a BC (Battery Charger) 130 recharging plane, can we do a 3 hour recharging???
    A lot of battery stupid out there

  7. As long as we continue to not even measure the methane losses from the pipeline transmission and delivery systems, we’re going to continue to underestimate the quantity of greenhouse gases emitted by natural gas systems. The Trump Administration removed the requirement to finally measure those losses. We pretend that anything not measured doesn’t exist. Thus the answer is always wrong.

    It’s time to change the model so that the monopoly utility is not in charge and motivated to earn as much as possible for its shareholders. We will never include energy efficiency or new ideas that do not guarantee the monopoly utility big rewards. They have become used to large returns for little risk and to dictating what happens.

    We need to look at more distributed generation/management of the grid. We need to allow citizens to make more of the decisions about what energy is used instead of just the monopoly utility deciding.

    It’s time for change

    • REALLY,,, Methane losses… do you think these companies just let these things leak without a care in the world.. RIDICULOUS. ..
      Aside from the profit loss from leaks this stuff burns and explodes,,, a serious safety hazard…. Do you think engineers are so lazy that they don’t care if their stuff leaks,, also true for manufacturers of components,,, can anyone say sue happy lawyer!!!
      How many homes in your neighborhood have leaking natural gas,,, how about the distribution piping….
      Word of advice,, if you smell natural gas,,, move,,, get out,, it’s not a safe place to be….

    • “We need to allow citizens to make more of the decisions about what energy is used instead of just the monopoly utility deciding.”

      There is no Energy Monopoly….
      You vote for natural gas every time you use it…. If you don’t like clean, inexpensive natural gas to cook then go get some camel dung and use that for a hear source,,,, as a consumer ever time you use a particular energy choice you are voting for it use,,, don’t like it don’t use it,,,
      And then you are a citizen making the decision…. A free country, free to choose,,, ain’t it great…

  8. Sorry Bill, I did not see this.
    I am curious why the offshore wind project in South Jersey seems to have slowed down (my old stomping grounds). I am thinking maybe they needed to relocate the planned manufacturing site.

    You reference European projects measuring the loss of performance due to erosion of the offshore wind blades. Here that kind of info will probably be considered treason…I will be pleasantly surprised if we hear any truths.

  9. Here is an update from South Jersey…sounds like not all roses. Think I knew some of the elected officials, before they were elected officials.

    https://www.njspotlight.com/2020/09/nj-offshore-wind-orsted-plans-lawmakers-doubt-raise-jobs-costs-concerns/

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