Dominion Power is ignoring global warming, consumer costs in proposal for Wise County coal plant, experts say

Dominion Virginia Power has failed to reveal the full potential costs for building and operating a proposed coal-fired power plant in Wise County to the State Corporation Commission – costs its customers would ultimately have to pay. The company’s estimate of $1.62 billion for the 585-megawatt plant does not factor in the rapid escalation of power plant construction around the world, sometimes by as much as 60%, according to expert testimony recently submitted to the SCC. And Dominion has ignored the future cost of controlling greenhouse gases – upwards of $106 million a year – as well as the cost-effectiveness of energy efficiency measures to meet future demand.

Further, despite Dominion’s claims in the media, the proposed facility is not “carbon capture compatible.” The experts found that Dominion has invested no resources or money to design or engineer a plant that could one day capture and store its greenhouse gas pollution. The extent of the utility's effort is to set aside some land at the Virginia City site for a potential carbon-capture facility.

Dominion has applied to the SCC for a “Certificate of Public Convenience and Necessity” for the plant, and must consider all options for meeting demand and select the lowest cost alternative. The utility must also justify its plans to get SCC approval to raise customer rates. According to testimony filed with the commission by three expert witnesses on November 2, Dominion has done none of the above.

“Dominion has low-balled the price of building the plant, disregarded the cost of controlling carbon emissions, and, perhaps most appalling, completely ignored the cheapest, cleanest, quickest solution – energy efficiency and conservation,” said Cale Jaffe, staff attorney with the Southern Environmental Law Center which filed the testimony on behalf of the Wise Energy for Virginia Coalition.

David Schlissel has degrees in engineering and law from Stanford and M.I.T. Since 1983 he has been retained by governmental bodies, publicly owned utilities, and private organizations in 28 states to prepare expert testimony and analyses on engineering and economic issues related to electric utilities.

• “There is no evidence that the Company has considered any greenhouse gas regulation costs in any economic analysis of the proposed Wise County Plant.” (p. 5)
• “The Company has projected that the Wise County Plant will emit 5,368,678 tons of CO2 annually. … The range of the … cost to the Company and its ratepayers from greenhouse gas regulations would be [$44 million to $169 million].” (p. 43)
• “The costs of building power plants have soared in recent years as a result of the worldwide demand for power plant design and construction resources and commodities. … A large number of projects have announced significant construction cost increases over the past few years. … For example, … the estimated cost of the Big Stone II coal-fired power plant project in South Dakota has increased by about 60 percent since the project was first announced.” (pp. 43-46)

Philip Mosenthal is the founding partner in Optimal Energy, Inc., which specializes in energy efficiency and utility planning. He holds an M.S. in Energy Management and Policy from the University of Pennsylvania. He has 24 years of experience in designing and evaluating residential, commercial and industrial energy-efficiency programs throughout North America, in Europe and China.

• “Electric energy efficiency programs are typically very cost-effective. … [T]ypical total costs have been in the 2-4 cents/kWh range. .. Dominion Virginia Power estimates the ‘all in’ cost for the Wise County plant at an average of 8.9 cents/kWh over its useful life … or roughly 2 to 5 times the cost of efficiency resources.” (pp. 23-24)
• “It is likely that with effective energy efficiency programs, the coal plant would never be needed.” (p. 18)
• “[E]fficiency investments will lower total costs and electric bills for consumers in Dominion Virginia Power’s service territory.” (p. 8)

Douglas Cortez holds chemical engineering degrees from UC Berkeley and M.I.T. He has 36 years experience in the electric power, petroleum and petrochemical, and related energy industries in research and development, project development and financing, and engineering and construction.

• “According to documents Dominion provided, Dominion states the CFB project is carbon-capture compatible. They justify this statement on the fact that the plant plot plan contains space to add carbon capture equipment in the future. Other than identifying the plot space, Dominion provides no other information on this feature of the plant.” (p. 17)
• “In order to be truly carbon capture compatible, it would be necessary to develop a conceptual design of the carbon capture and CO2 compression equipment and prepare an equipment arrangement drawing. … Simply leaving plot area for a hypothetical carbon capture and compression plant does not make the plant carbon capture compatible.” (p. 17)