Why the Controversy over Burying Electric Lines?

Dominion says burying electric lines prone to outages will reduce repair costs and restore juice to customers quickly.

Dominion says burying electric lines prone to outages will reduce repair costs and restore juice to customers more rapidly. But will undergrounding programs pay for themselves?

The Senate Commerce and Labor Committee voted unanimously yesterday to approve a bill, SB 1473, that would declare that burying electric lines lines is “in the public interest.” The bill would apply to local distribution lines, or “tap” lines, that have a 10-year average of nine or more unplanned outages per mile. Dominion Virginia Power says it has 4,000 miles of such lines.

About a year and a half ago, the SCC nixed a Dominion plan to bury 526 miles of distribution lines and recoup about $700 million from customers over 40 years on the grounds that the cost-effectiveness was unproven. The commission approved instead a pilot project that would provide an empirical base for evaluating the economics of burying outage-prone electric lines.

It’s not clear from the Richmond Times-Dispatch reporting exactly what effect the law would have on State Corporation Commission (SCC) decision making.

Dominion spokesman David Botkins said that the bill is not intended to circumvent the SCC ruling. “Clearly, it doesn’t do that,” he said. “The SCC retains the ultimate authority as they review and approve and deny every application going forward.”

The company has argued that burying the most vulnerable lines would reduce electric outages and speed recovery from storms and other disruptive events. “What we’re looking to do,” said Alan Bradshaw, director of the underground program, “is eliminate work.”

Bacon’s bottom line: I don’t understand why burying electric lines has become so controversial. The logic seems fairly straightforward. Outages occur with predictable frequency along some 4,000 miles of local distribution lines in Dominion’s system. It costs a predictable amount in manpower, equipment and supplies to restore those electric lines under routine weather conditions, plus an unpredictable amount stemming from major storms. Dominion should be able to put a dollar value on the cost of burying the lines, and it should be able to put a dollar value on the cost of restoring the lines over, say, a 10-year or 20-year period of time. If the cost of burying a given mile of line, amortized over 40 years, exceeds the average annual cost of restoring the power, then it’s a poor deal for ratepayers. Conversely, if the cost of burial is lower than the cost of restoration, ratepayers save money. Go for it!

If we want to delve a little deeper, we also could assign a “cost” to electrical customers for going without electricity. That cost is trivial if the outage lasts only an hour or two, but it could mount exponentially if the disruption lasts for days, food is ruined, work (for those who work at home) is disrupted, and families seek shelter in motels or the homes of family and friends. I don’t know how to calculate such a number, and I don’t know if the SCC took such intangible costs into account when ruling on Dominion’s tap line-burial request. If there is a reasonable way to assign a cost, it should be included.

Dominion now has more than a year of experience under the pilot project — experience that includes the massive outages caused by Hurricane Matthew. Surely we have enough data to make the requisite calculations to devise a cost-effective solution.

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6 responses to “Why the Controversy over Burying Electric Lines?

  1. Oh come on. Everyone knows that when legislation says something for a utility is in the public interest, etc. etc. that it is code for the SCC to do what the legislation says and that the utility will interpret it for the SCC during the case. A case will be heard at the SCC but the legislation DOES take away the SCC’s authority. Every time it happens it means decisions are made by legislators based on sound bites from lobbyists instead of by the SCC based on hard data. Businesses persuaded the General Assembly that the SCC has a hard time doing its bidding and it needs to show its power over the SCC some years ago and so this happens regularly even though it is dead wrong.

    Dominion has screamed that putting line underground is too expensive and tried to avoid doing it, yet people, especially in NOVA, like not having to see the lines. This legislation guarantees Dominion makes money on it and that it happens. The cost is high enough that it will affect rates but the SCC is not allowed to consider that once this legislation is signed.

    This is business as usual at the Virginia General Assembly. Some consumers will be happy – they get line underground – all consumers will pay. For some consumers, the cost of taking care of others in this way will be more than they can afford, but the SCC cannot consider their situations once the legislation declares it in the public interest. It IS a big deal.

  2. I’m sure Dominion doesnt get why people are pissed off at them for buying politicians and legislation for themselves either …

  3. http://leg1.state.va.us/cgi-bin/legp504.exe?171+ful+SB1473E

    Here’s the bill. Everybody should read 56-585.1. The ultimate example of sausage in the Code of Virginia. About has much fun to read as Heidegger in the original German. I’ve been reading it for eleven sessions in a row now…and this is just one of the bills advancing which amend that section. The original bill went much further than stating that the underground lines are in the public interest. As it stands now it creates a “rebuttable presumption” that all these costs are reasonable and prudent. I asked an SCC staffer just how a rebuttable presumption works in an SCC hearing, and he smiled and said “We’ll find out!” I think all it does is shift the burden of proof. The classic example is the innocence of every accused person is a rebuttable presumption.

  4. No question that the VaGA is inappropriately substituting it’s judgement and authority over the SCC but I don’t think I truly understand some of the decisions that the SCC makes – it’s truly one of those faceless bureaucracies that are not transparent nor accountable for their actions.

    You’d think the ROI economics for burying lines was cut an dried and that the SCC documentation on the issue – easily available and easily readable so that average folks could read and understand but nope…. it’s as inscrutable as the VaGa “sausage” and I actually see the GA as so rigid and inflexible that even reasonable things that Dominion could do to adapt to 21st century technology like solar – is routinely nixed and thus invites others to try to do end runs via the VaGa which in some ways in akin to “bureaucracy.
    shopping”.

    I could be wrong and if so would actually appreciate Steve or others to “school” me on this but in my defence – whenever I go to the SCC website to try to increasing my understanding of an issue under their purview it’s a little like Alice in Wonderland so at this point, for me, the choice between the SCC and the VaGa is like between cancer an heart disease…. No wonder citizens think that “elites” run things!

  5. errata: ” I actually see the SCC (not the GA) as so rigid and inflexible that even reasonable things that Dominion could do to adapt to 21st century technology like solar”

    and addendum: back during the CPP kerfuffle – we had the SCC cite a clearly bogus VaTech study on the CPP and within hours Bill Howell and others were citing the SCC statement and Tech study as “proof” the CPP was evil and required massive resistance… what happened to a measured and informative analysis that actually yielded objective and non-partisan information. When that happened – I was not surprised that Howell and company did what they did – what surprised me was how the SCC went rogue and my faith in it’s “process” and deliberative nature plummeted.

    I no longer see them as independent and objective.. just another player in the swamp … as their fellow swamp-dwellers, the VaGa seem to feel also..with legislative attempts to “direct” regulation.

    to be fair – regulation IS promulgated from legislation which sets the broad parameters and then turns it over to regulators to tweak and implement. The legislature ALWAYS retains the authority to change the law including the regulations that they want changed.

  6. Agreed. The SCC website is not terribly user-friendly unless you are a regular on the site and know the case number of what you are looking for. But I know a new system is in the works.

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