coal woman By Peter Galuszka

If you read a blog posting just below this (the one with the coal miner with an intense look on his grit-covered face), you will see how hyperbole, confusion, misunderstanding, ignorance and one-sided arguments twist something very important to all Virginians – how to deal with carbon dioxide and climate change – into a swamp of disinformation..

The news is that the State Corporation Commission has responded to the federal government’s proposed rules that carbon emissions be cut 30 percent below 2005 levels by 2030 by complaining that it would cost ratepayers up to $6 billion.

This is because Virginia utilities may have to shut down 2,851 megawatts worth of electrical generation with only 351 megawatts (at present) of “unreliable” wind power to replace it.

The image one gets from the presentation of the blog post is that it is “The EPA’s War on Virginia” with the haggard-looking miner thrown in, we are given the impression that it is more of the “War on Coal” that the coal industry has been promoting in recent years to blunt much-needed mine safety laws and moves to police highly destructive mountaintop removal practices.

The author does not address any of this. But since he’s handing us the “War on Coal” propaganda line, let’s take his arguments apart. This won’t take too long.

  • The author fails to note part of the Richmond Times Dispatch story upon which he bases his opinions. There is a very important comment: “It appears the staff has misread the rule,” said Cale Jaffe, director of the Southern Environmental Law Center’s Virginia office. “Analyses that we have reviewed show that Virginia is already 80 percent of the way to meeting Virginia’s carbon pollution target under the Clean Power Plan. “Almost all of those reductions are coming from coal plant retirements and natural gas conversions that the utilities put in place long before the Clean Power Plan was even released,” Jaffe said.
  • That said, let’s take a look at coal-fired plants in the state which are the biggest carbon offenders. For starters let’s look at Dominion Virginia Power, the state’s largest utility. It has already converted three coal-fired plants – Altavista, Southampton and Bremo Bluff – to biomass. The 50-plus-year-old Yorktown plant (335 megawatts) is due to retire in 2015. Another aging plant – Chesapeake (609) megawatts — is also due to retire by 2015. The point here is that these plants are being closed because Dominion realizes that it is just too hard to keep 50 or 60 year plants operating efficiently and cheaply. It would be like keeping that 1960 Corvair because you don’t want to put oil workers out of work.
  • Dominion’s biggest problem and the biggest single air polluter in the state is the Chesterfield station with 1380 megawatts. Yes, it does need more controls. Then there’s Clover (882 megawatts) and Mecklenburg (138 megawatts). That brings us up to 2400 megawatts that might need upgrades. Let’s see. The two nuclear units at North Anna put out a little more than 1,700 megawatts just so we get some scale here. Dominon also has Virginia City (585 megawatts) which just opened, uses coal and biomass and has advanced fluidized bed burning methods.
  • Out west, Appalachian Power has 705 megawatts at Clinch River and 430 megawatts at Glen Lyn. Two of those three units there were built in (my God!) 1944 so I guess the blog author wants to keep those great granddaddies running to save miners’ jobs. Actually they are so unneeded that they have been on extended startups.Besides these Cogentrix has a couple small, modern plants in Portsmouth and Hopewell.
  • One reason there so little renewable generation (6 percent) is that the utilities do not have mandatory renewable portfolio standards to force them into wind and solar, etc. Virginia’s neighbors do.

All of this gets back to Jaffe’s point that the blog author so easily ignores. A lot of the carbon cuts are going to come from plants that are aging and are going to be closed anyway.

The SCC may complain about the $6 billion but guess what, you beleaguered electricity users? If Dominion puts a third nuke at North Anna, that’s easily $10 billion. Is that going to raise rates sky high? Where’s the outcry? It’s almost double what helping save the planet from carbon dioxide will cost.

The blog author’s hyperbole about the poor coal industry shows his ignorance of the topic. Virginia’s rather small coal industry (No. 12 in production) reached its peak in 1991. Natural gas has displaced a lot of expensive coal. Gas prices would have to triple to make Central Appalachian coal competitive again. There’s lots of metallurgical coal for steel, but the Asian economic slump has dropped prices maybe 60 percent.

I won’t comment on the author’s lame and misunderstood point about climate change not happening.

The blog author may want to blame that on Obama and the EPA but that would be almost as ridiculous as his blog post. I decline to name him because I don’t want to embarrass him.


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30 responses to “More Coal Industry Propaganda”

  1. ” The SCC staff said it made an “indicative cost analysis” of the incremental cost for Dominion Virginia Power to achieve the EPA’s carbon reduction goals. The Richmond-based power company is the state’s largest electric utility, serving two-thirds of Virginia electricity customers.”

    I wonder where this “analysis” is… or who actually produced it?

    is there a link to it?

    by the way – I am NOT a solar/wind – build it no matter the economics” kind of guy…

    but I do take exception and umbrage to state employees carrying water for Dominion Power and getting it “planted” in the RTD…

    Is RTD so hard over that they are willing to shill for the right wing energy lobby?

    Maybe so.. would not be the first time – but as Glen Besa said for the SCC –

    ” “The SCC staff analysis is just plain wrong,” said Glen Besa, director of the Sierra Club’s Virginia Chapter. “They’re playing politics with climate change science and they have no business doing that, and they’re bringing discredit on the commission.””

    and indeed they have. The SCC has joined the ranks of the politicized and the sad part is – it’s probably one or two idiot zealots who have now damaged the reputation of the agency – of many who just do their jobs and try to do it well.

    The SCC has one chance here and that is for the head of the agency to come out and apologize for the inappropriate comments from some ignorant fools inside the agency…

    What’s really ironic here is that Dominion Power is now requesting approval from the SCC to – build a nat gas pipeline… that’s right..

    and why:

    ” Increasing the availability of natural gas supplies in West Virginia, Virginia and North Carolina is important to the economy and environment of the region. It can mean more jobs, lower prices to heat and power homes and businesses, and cleaner air.

    To meet that need, Dominion and its partners are proceeding to build a new natural gas pipeline. The Atlantic Coast Pipeline (ACP), formerly known as the Southeast Reliability Project, would originate in Harrison County, W.Va., run to Greensville County, Va., and then south into eastern North Carolina. A lateral extension is planned from the Virginia-North Carolina border to Hampton Roads.”

    is this the same Dominion Power that the SCC says is closing down perfectly good coal plants to build nat gas plants that will increase costs and make the grid more unreliable?

    which is it?

  2. Steve Haner Avatar
    Steve Haner

    https://gallery.mailchimp.com/a8970db37d2569f1a2b65e59d/files/Virginia_SCC_Staff_Comments_on_Clean_Power_Plan.pdf

    I’m not much good at the techie stuff but perhaps that link above will work. Might have to cut and paste. I’m sure the letter is on the SCC’s website.

    The SCC staff is charged by law in rate matters to represent the consumer point of view. I’m sure the utilities are cheering them on this occasion, which warms my heart — because of course on other occasions the utilities sneer at the SCC staff analysis. I don’t always agree with them, either, but in general they know their stuff and I would not expect them to carry water for the utility. They are thinking about individual and business consumers. And only an absolute fool believes that these regs can go into effect as written without damaging the national economy and the personal financial well being of most individuals. I don’t accept the underlying premise that The World Will End unless we eliminate CO2 emissions, but I agree the environment benefits from a move away from coal. That said, these EPA proposed regs go off the deep end and defy rational explanation.

    And Peter G, North Anna 3 would/will cost far north of $10 billion. The figure is secret and Dominion has fought like the dickens to keep it secret in recent SCC proceedings. With 25-30 year of financing costs recovered in the rates, it will be far more than $10 billion. Now, the SCC staff knows the figure. Perhaps that is the footnote that is missing from their analysis, because building NA3 is one way to achieve these emissions goals.

    1. I think it is curious where this memo is located… that you post.

      you say you are “sure” it is on the SCC website.

      if it is why is there not a Press Release and what it it not where other correspondence is archived?

      and WHERE is this “analysis” it references: ” 6 Technical Support Document, Regulatory Impact Analysis at 3-32; Resource Adequacy and Reliability Analysis at 3, 5.”

      Who are the staff that wrote this?

      Why is it not signed – by the Commissioners ?

      I have no problem with the debate on climate and people’s individual views of what the EPA proposes or not – as there is a long, long history of push-back on EPA rules whether it be water or air – from non-attainment to the Chesapeake Bay cleanup to TMDLs, etc… There are ongoing lawsuits right now on the Chesapeake Bay cleanup – supported by some of Virginia’s own Congressmen and the Virginia Farm Bureau.

      That’s FINE – but these folks OWN their comments and do provide the materials to support their argument – whereas this does not appear at all to be a legitimate work product of the SCC – but instead something written by rogue staff.

      and that’s a problem.

      what’s NOT FINE is two individuals using and politicizing the office of the SCC to promote their own personal views.

      this is unprofessional, inappropriate and just plain wrong but it demonstrates the lengths that those who disagree with the EPA will go to such extremes as to try to attribute their views to be the official views of the SCC. A check of the SCC website shows that they do not “own” these comments.. there is no mention of them .. no press release, no analysis, no set of signatures on the document other than this one guy who says he represents “staff”.

      so we’ve damaged the SCC – from this point on – I will take with a grain of salt – anything that has their name on it – and others should also.

      they have crossed the line here – either they should own the document or they should clearly dissociate themselves from it.

  3. ” MISSION
    The State Corporation Commission will strive to
    apply law and regulation to balance the interests
    of businesses and citizens in regulating Virginia’s
    business and economic concerns and work continually
    to improve the regulatory and administrative
    processes.”

    A cursory search of the SCC site shows not a single prior memo to the EPA on any subject…

    and this memo is not there either…

    as I said – I have no problem with the debate over climate and EPA emission rules. I do have an opinion but I’m certainly fine with the debate – as long as it is carried on by people and organizations that own their individual views and not portray them as the comments of organizations.

    Environmental groups have had this problem in varying degrees and been damaged as a result. Some think tanks and opinion organizations have trouble distinguishing between what is the official view of the organization and what are the individual views of folks who work there or write there.

    so I do not fully trust any advocacy organization for that reason.. left or right.

    but I have a big problem with individuals using the SCC to advance their own political views on energy policy…. it’s one thing to not fully trust the Sierra Club or the Reason Foundation – it’s a whole other problem when it’s a govt organization and especially so one whose mission is primarily regulatory and to strike a balance between consumers and industry – regardless of what national or state energy policy and politics are or are not.

    The agency has effectively been politicized … and damaged in it’s core mission of striking a regulatory balance between industry and consumers.

    when did they get involved in the politics of national or even state energy policy, much less take a position?

    some folks in today’s corrosive political climate, would gladly politicize every agency in the state – to be whatever the elected chose to use them for.

    in other words – government is just another weapon for the partisan.

  4. Peter Galuszka Avatar
    Peter Galuszka

    Larry,
    I got a pDF of the document and am going through it. It wasn’t issued with an SCC press release. You might also be able to find it on EPA’s website:

    U.S. Environmental Protection Agency
    Docket ID No. EPA-HQ-OAR-2013-0602

    A cursory read of the 57 page report shows that it is clearly staff only. No commissioners weighed in. I can’t find a list showing exactly of the plants that will be impacted. It lists only Chesterfield and Clover and, get this, two in West Virginia. Am I reading this right? If so, why stop at West Virginia — why not figure the nation’s coal-fired plants.

    As for North Anna III costing more than $10 billion I said at least that much and understand it could be much, much more. I have visited North Anna a couple times in recent years and Dominion won’t give much of a price range. I guess they don’t want to scare people off with gas so cheap and they are certainly on top of that.

    Lastly, one commenter paid the point that the goal of the SCC is to protect the consumer. If one looks at that as pushing for the cheapest power possible, it is true. In fact, such concerns have killed some promising but expensive projects that allow the use of coal in much cleaner ways in other states. It’s moot now give the explosion of gas and oil.

    I’ll probably file again when I study the report and ask some questions of the SCC. I simply can’t see where they are getting their data for their robust opinions.

    1. Peter when is the last time you heard the Va SCC complain about the costs of non-attainment or removal of nitrogen and phosphorous from wastewater or regulations that affect the price of propane and fuel oil or natural gas pipelines?

      how many cost-benefit analyses has the SCC done to support their view of what the price of something should be relative to the cost of regulation?

      Cost-benefit has actually been done for air quality – separate from the carbon – and when did the SCC weigh in on health costs versus electricity costs? Where is that analysis?

      I would expect the SCC as an entity to own the work-product and to release it – along with the underlying analysis – to the media.

      so they did not do a Press Release at all and one paper ends up with it and does not reference the document and analysis at the SCC website?

      this is bogus and it damages the SCC – and it should.

  5. This is a terrific entry by Peter. One could, of course have added compelling information about the utter devastation of mountain top mining. But two notes to add:
    A few years ago citizens in W. Va, Va, and Md all worked to fight the 765 PATH transmission line from the old (1972) John Amos coal power plant in W. Va. and ultimately to bring power to N.J. They united around the fact that the demand for this power simply wasn’t there, and the SCC, and later the utilities own transmission consortium finally agreed. So, good for the SCC.

    But the sad fact is that we citizens got no help from either Va. Senator, despite many appeals, because, we supposed, they preferred not to alienate their coal and utility interests. The PATH line, after all, only would have affected a limited population in the very northern parts of VA.

  6. This is a good article on the matter …

    http://www.npr.org/2014/06/02/318261777/will-epas-new-emission-rules-boost-your-power-bill-it-depends

    Several important quotes:

    “Also, roughly half of states, including Mississippi and Missouri, are regulated. That means utility companies are guaranteed a rate of return and costs are therefore more likely to pass directly to consumers. But energy markets in states like Michigan and Maryland are deregulated, so companies set their prices and it’s harder to say how much will pass through.”

    As usual our state government has sold out the citizens in favor of crony corporate interests.

    “But because states will have a lot of leeway in how they meet the new standards, much of what electricity will cost will be shaped by what state policymakers eventually decide.”

    Gosh, I wonder if the General Assembly will support Dominion or the citizens of Virginia?

  7. Virginia ranks as #41 in solar power among all US states, DC and Puerto Rico.

    California generated 1.893 MW of electricity via solar in 2013.

    https://openpv.nrel.gov/rankings

  8. Guess which group pushed the Georgia state government to add more solar power?

    The Tea Party!

    How much is Georgia Power paying to buy electricity from solar power providers?

    6.5 cents per kWh

    In Georgia conservatives want competition and consumer choice. In Virginia the phony conservatives want crony capitalism for favored Richmond corporations.

    http://theenergycollective.com/stephenlacey/2144606/georgia-latest-state-procure-dirt-cheap-solar-power

  9. Ohio State chemists have a breakthrough that will lower the costs of solar panels by 25%.

    http://io9.com/a-single-breakthrough-that-could-cut-costs-on-solar-ene-1647903109

    Trust me – neither the SCC nor Dominion gives a rat’s ass about the coal industry or the environment. They are scared to death of distributed solar electricity generation. They like Dominion’s status as both a monopoly and the hand inside the sock puppets we call a General Assembly.

  10. Steve Haner Avatar
    Steve Haner

    Yes, Larry, I pulled the link out of Speaker Howell’s news release but only because it was handy. The SCC website is not very search friendly. I hope they will post all the documents you want to see in a prominent place.

    I’ve seen several presentations on this proposed set of regulations and I very much doubt they are going to stand. For one thing the way they set various targets for the states, and the disparate impact those targets are going to create, creating huge winners and losers, are ripe for federal review. The complaint that the target for Virginia ignores our existing nuclear generation, and ignores earlier efforts to move away from coal, has great validity. My prediction — EPA is going to back down quite a bit on the final regulations. My second prediction — what remains will still have a major cost impact on businesses and individual consumers unless they go to great lengths and capital expense to reduce demand or build wind and solar, which of course is the real goal in the first place.

    1. ” Yes, Larry, I pulled the link out of Speaker Howell’s news release but only because it was handy. The SCC website is not very search friendly. I hope they will post all the documents you want to see in a prominent place.”

      thanks for admitting that. Now tell me where Speaker Howell got it if it is not on the SCC website. I found their site to be acceptably friendly. There is a separate page for news releases and a document archive …

      “I’ve seen several presentations on this proposed set of regulations and I very much doubt they are going to stand. For one thing the way they set various targets for the states, and the disparate impact those targets are going to create, creating huge winners and losers, are ripe for federal review.”

      isn’t that how they did acid rain targets.. cap and trade, etc?

      ” The complaint that the target for Virginia ignores our existing nuclear generation, and ignores earlier efforts to move away from coal, has great validity. ”

      Why do they ignore what is going on with Nat Gas power generation and it’s ability to meld with wind/solar much better than coal baseload?

      “My prediction — EPA is going to back down quite a bit on the final regulations. My second prediction — what remains will still have a major cost impact on businesses and individual consumers unless they go to great lengths and capital expense to reduce demand or build wind and solar, which of course is the real goal in the first place.”

      and I do not disagree with all of what you say but I ask you – is this the mission of the SCC?

      should the SCC be weighing in on matters of policy? Should they be involved in non-attainment or phosphorous/nitrogen or ethanol or exporting Nat Gas or the price of propane of fuel oil?

      and if SCC IS going to be involved…

      1. – shouldn’t they do cost-benefits analyses and make them available for comment on their website?

      2. – shouldn’t they release these analyses to ALL news media via press release?

      3. – should the directors of the Agency release the info as recommended by staff – as opposed to staff doing it without their signatures?

      I don’t have a problem with the debate – and I agree – it won’t be the first nor the last time that the EPA pushes the envelope. All hell broke loose when they push hard on acid rain.. and all hell is breaking loose right now on the TMDL Chesapeake Bay cleanup – but again I ask you – is this the purview of the SCC or it’s staff?

      doesn’t this damage their credibility and reputation if people feel they are involving themselves in a political issue?

  11. and let’s go back to DonB’s contention about solar. DonB is not exactly known as a flaming environmentalist on these pages. He’s also no big fan of Obama and the EPA.

    what exactly does the SCC say about the POTENTIAL of solar combined with Natural Gas to not only reduce the need for new coal plants but to allow the retirement of the dirtiest older plants and to replace them natural gas and whatever we can get out of solar and wind ?

    Is DonB correct in that this is a big smokescreen from Dominion to fight a credible threat from every advancing solar?

    where is the credible analysis from the SCC on these issues – beyond their ardent defense of Dominion and big coal?

    Don’t you find it just a tad bit disingenuous that the SCC analysis completely ignores this potential that apparently is very real and has been described by none other than the Wall Street Journal as a potential death spiral for big utilities that fight solar and try to hang on to coal?

    where is the objective analysis from the SCC – with respect to the potential effect of solar combined with natural gas – on consumers and a more reliable, more diverse, more robust grid?

    doesn’t their actions come across as single-minded reaction against what they perceive as rules for carbon while they totally ignore the other ongoing changes to the energy world?

    This does not strike me as the SCC looking out for consumers at all but rather more of the partisan obsession with climate science politics.

    why get themselves involved at that level to begin with when we are in the midst of a revolution with regard to nat gas (and fracking) and advances in solar (as well as nuke?).

    If McAuliffe were to remove the 3 big-coal SCC commissioners and replaced them with Glen Besa and similar – the squeals could be heard from here to Kookamunga.

    So why do this and risk partisan push back?

    why not stick to the basic mission of the SCC and pursue dispassionate, objective, non-partisan paths to energy benefits to Virginians and forget big coal and forget Dominion Power and focus on what energy sources are available and how they might benefit Virginians now and into the future?

    This is like the SCC swallowed a partisan stupid pill… damaged their own reputation and can’t seem to understand what their real mission is.

  12. It’s amazing to me all this talk of hidden SCC Staff analyses and unavailable reports. Come on now, Peter: I got the same report in .pdf format that Steve Haner did, and I got the link from page 1 of the “Power for the People” newsletter Larryg provided in his very first comments on Jim’s blog entry “The EPA’s War on Virginia.” Thanks, Larry G. Incidentally, Larry, did you read the last 6 pages of those comments? They contain a detailed summary of the Staff’s “indicative cost analysis” that you’ve been saying over and over was unavailable.

    1. where is the PRess Release on the SCC website?

      where is the analysis referenced in the comments to the EPA:

      6 Technical Support Document, Regulatory Impact Analysis at 3-32; Resource Adequacy and Reliability Analysis at 3, 5.

      where is this?

      and things like this are in the last 6 pages:

      ” The effect of environmental dispatch or permit limits on the operation of
      generating units that emit carbon would extend well beyond those units. To replace a unit’s economic energy during restricted periods, other supply resources would have to be able and available to increase energy production (during peak and non-peak periods). For example, this dynamic, if feasible in an area, could occur through re-dispatch of additional natural gas to replace coal, as contemplated by the Proposed Regulation”

      but tell me what period of time encmpasses the 5.5-6 billion and how much does it add up to on a per month basis…?

      who is the author of this analysis? is it the legal counsel of the SCC – Chambliss?

      who did this analysis?

      this is totally bogus. it’s unprofessional and essentially a hit piece generated anonymously in the SCC then planted in the RTD.

      this is not the way ANY agency in Va should operate.

      the SCC is now owned and operated by partisan hacks.

  13. If DonB is correct, this may really be about Dominions stranded costs in coal plants that will become the burden of ratepayers – and those plants may well be doomed by solar and natural gas rather than carbon “rules”.

    so is this a smokescreen to justify making ratepayers pay for these plants that will become obsolete – anyhow ?

    The Wall Street Journal seems to think so:

    Lights Flicker for Utilities

    http://online.wsj.com/news/articles/SB10001424052702304773104579270362739732266

    so let’s ask the question. what happens if Solar ends up as cheap as coal?

    what then? Blame it on climate science and carbon rules?

  14. As suggested by some commenters – I have begun reading the 57 pages – page by page and I urge others to do the same to see what a sorry and biased product this is.

    it makes one unsupported assertion after another .. there is almost no substantiating data to support the wild assed assertions that seemingly are the uneducated words of the legal counsel.. rather than engineering professionals – as there are no listed authors nor their credentials for performing such an analysis.

    He then blathers on about putting new requirements on existing plans as if they are like automobiles rather than fixed infrastructure than can be – and is upgraded over the decades it does exist.

    He talks like an adolescent who does not understand that buildings and infrastructure are upgraded and retrofitted – all the time

    He calls this “inequitable and irrational”.. as if – for instance, the EPA cannot order municipal water treatment plants to upgrade their processes or power plants are unable to retrofit improved scrubbers on older plants or buildings can’t replace HVAC systems or power plants put in updated scrubbers.

    they talk about “space limitations” on some plants.. WTF? really?

    ” There is no legal or rational basis to set Virginia’s Mandatory Goals for existing units below the standards required for new units. This is arbitrary and capricious regulation at its plainest.”

    basically – this is 56 pages of excuses and statements that “we cannot do this”.

    another example:

    ” Virginia with the sole, risky option of retiring all its coal-fired power plants, at a significant stranded cost replaced by new natural gas infrastructure (for which there is not currently pipeline capacity to supply the necessary fuel) and energy efficiency goals that are overly ambitious and beyond the scope of the Clean Air Act.34″

    We can’t put new gas turbine plants where pipelines DO exist – which is most every major city in the state?

    what kind of asinine logic is being used here?

    more:

    the footnotes reference:

    33 See Section III.C.
    34 See Sections III.E, F.

    where are they? they’re not in the document.

    more idiotic blather:

    ” The Proposed Regulation’s claim that overall customer bills will go down is
    contrary to experience implementing energy efficiency programs in Virginia. In fact, this claim could only be accurate if the costs of reducing CO2 emissions through energy efficiency programs are less than the variable operating costs (primarily dispatch costs) that would be avoided by the compliance action since compliance requires the displacement of existing generation.48 This expectation is not reasonable in Virginia or perhaps anywhere else. The Virginia SCC Staff is unaware of any electric energy efficiency resource deployable in Virginia that both: 1) has a cost less than its associated avoided variable operating costs, and 2) is scalable to a level that would meet the Proposed Regulation. While energy efficiency may possibly be a least cost measure for addressing some portion of the Proposed Regulation, it is extremely unlikely that energy efficiency can both reduce aggregate bills and produce compliance given the Mandatory
    Goals proposed for Virginia.”

    read the above and tell me how the words actually provide real data to refute the proposal’s claim that higher prices will engender more conservation with bills staying the same.

    If you increase the cost of electricity, like with gasoline, people will reduce their consumption. They will buy more efficient appliances, light bulbs, smart thermostats, etc… Smart Meters that charge dynamically like Hot Lanes would cut demand at peak hour.

    we now use less and less gasoline because people are buying more and more efficient cars. Why does that not work for electricity?

    where is the actual analysis on this that refutes the idea of higher prices causing higher conservation?

    it’s HARD to read this document because it’s totally filled with unsupported assertionis and really just plain dumb claims.. not fitting of a State agency or a professional engineer and now we know why this document was not released on the website via a news release to all media. If they had – this document would become a national laughing stock.. even by those who are opposed to the EPA rules.

    It reads like a 10th grader wrote it.

  15. The SCC (Staff) filed comments in the federal proceeding triggered by the EPA’s proposed federal rule requiring reduced carbon emissions (the oxymoronic “Mandatory Goals”). You can bet the SCC Commissioners knew about Staff’s position before they were filed, but the comments do not appear to be the result of any formal hearing process in Virginia so it’s appropriate they were signed only by the Staff. The fact that they were filed in this formal public federal rulemaking docket was not the sort of event that usually, or even rarely, calls for an SCC Press Release. They were, and are now, a public document at the EPA, which I’m guessing is where Virginia Energy Sense found them. So let’s not go off the deep end on conspiracy theories about how they came to be.
    That said, what they say is, the EPA rule as written would cost Virginians a huge amount of money. I think Jim is right to say, if true that’s important to us and will greatly affect the local economy. It’s a very different question whether the reported cost to Virginians is overstated because a large chunk of that money would have to be raised anyway (e.g. for retirements due to obsolete or inefficient generation), or whether that money should be raised anyway in pursuit of other goals (e.g. renewables and carbon reduction) that some think are worth it, or whether every other State is spending ratepayer money for those reasons already (so Virginia won’t lose a competitive advantage as a low-energy-cost State if it goes along with the trend).
    I don’t want to re-argue global warming with/against Jim except to observe, if ever there was a subject that ought to be dealt with broadly by the federal government and internationally, not severally by the States, it’s dictating energy policies and costs to limit carbon emissions.
    DonR, LarryG, I do have a bone to pick with you over solar power. When solar (and wind) work, the power they produce is cheap, and getting cheaper. Economies of scale will bring the cost down even further if more of both of them is built, which is a good reason to support renewable – to an extent. But it’s not that simple; the fact that solar and wind are not available on demand (what the industry calls “dispatchable”) but only when it’s sunny or windy, means, you have to have other, fast-start generators out there on the electric grid to fill in when the sun goes behind a cloud or the wind calms. So, the real cost to the ratepayer of “solar power” is the combined cost of that solar panel plus the cost of maintaining that backup generator that sits there just-in-case, ditto for wind. It is apples-to-oranges to compare different kinds of generation costs without looking at the whole cost to use and rely on each kind. Solar panels makes terrific sense when used, for example, to heat domestic hot water (as is common in Israel), or for distributed generation to offset a home’s electric consumption, but it’s not as valuable to the grid operator as a good-old fast-start fossil-fueled generator. That’s a fact.

    1. I would ask how many times the SCC has made a comment to an EPA proposal in this way.

      there is no conspiracy theory here. It’s a simple matter of process where documents apparently written by SCC folks do not appear on their own website and were not released to the media via a press release but apparently found their way to one reporter – who cannot even provide a reference to where the document came from.

      that’s not a conspiracy – that’s bad policy.

      I do NOT think it is appropriate for a legal counsel for the SCC to make a technical argument that requires scientific expertise in energy.

      the technical comments need an author with the proper credentials but more than that – most of the 56 pages are basically unsupported and unsubstantiated assertions – not a true analysis.

      re: ” That said, what they say is, the EPA rule as written would cost Virginians a huge amount of money.”

      no – this is not supported. it’s just wild assertions. where is the data to show this? how much will electricity go up per month for the average user of electricity?

      what you’re talking about is stranded plant costs and who will pay for them.

      Most all of Europe and Asia pay higher prices for electricity and gasoline and they use about 1/2 what we do. water heaters in those countries are “on demand” not storage tanks kept at temperature.

      People in California pay about twice what we pay -and they use about 1/2 what we do.

      there is a clear connection between the price of electricity (and gasoline) and conservation measures taken by people.

      so none of the stuff in the document rings true if they performed an honest analysis.. of costs..

      they make the point – over and over – that it’s not just the costs to consumers – it’s the stranded costs in the older infrastructure .. and they make totally bogus claims that natural gas is not possible because we lack pipelines or that existing plants cannot be upgraded…

      this is not a substantive analysis. It has not identified author other than the legal counsel who surely lacks expertise .. the references embedded in it – are not provided.

      this is wrong. it’s not the way to do this – even if they are 100% correct (and they are not).

      there is a right way to do this – and they chose to not do it… and it reflects on the agency itself.

      heads should roll.

      this is ready made for partisan hackery as evidenced by the speaker of the House who has a copy of it – and it’s not on the SCC website. Where did he get it? How did he know that the document had been written and sent to the EPA?

    2. re: ” DonR, LarryG, I do have a bone to pick with you over solar power. When solar (and wind) work, the power they produce is cheap, and getting cheaper. Economies of scale will bring the cost down even further if more of both of them is built, which is a good reason to support renewable – to an extent. But it’s not that simple; the fact that solar and wind are not available on demand (what the industry calls “dispatchable”) but only when it’s sunny or windy, means, you have to have other, fast-start generators out there on the electric grid to fill in when the sun goes behind a cloud or the wind calms.”

      that might be true if there was no such thing as Natural Gas Turbines which do exist and are readily built.

      what keeps those plants from being built throughout Va between now and 2024?

      this is the problem – with the opponents who ignore this but it’s even worse when you are the SCC supposedly making a reasoned argument about what is feasible and what is not – and you claim that building nat gas turbines is not feasible because of a lack of pipelines… really?

      this is not a reasonable analysis and it’s not written by a credentialed professional using honest real world data.

    3. re: ” … but it’s not as valuable to the grid operator as a good-old fast-start fossil-fueled generator. That’s a fact.”

      it is. Now tell me what happens if a whole bunch of people install it and they all ramp up demand on the grid when it gets cloudy.

      how do you stop people from buying and installing solar if it saves them money? coal baseload is worthless in that scenario. What are you going to do – have the SCC make a rule that people cannot buy solar or that those with solar will still have to pay for electricity as if they did not have solar?

      where is this in the analysis that basically advocates the status quo on coal plants?

      it the SCC analysis a comprehensive one that deals with these issues or it it a one-dimensional political reaction to an EPA proposal?

      I see it as the later and virtually worthless at looking at the future in Va with regard to electricity.

  16. To repeat a comment I added to my original post:

    “No lectures about the coal industry, please. I understand that the current woes of the coal industry stem in large measure from coal’s loss of competitiveness to natural gas as a fuel and to cyclical movements in the market for metallurgical coal (used by the steel industry). However, the Appalachian coal industry still produces a lot of steam coal for power plants, and the EPA rules would destroy much of that market. Clearly, the EPA rules, which are not yet in effect, have not yet destroyed a single coal-mining job. Come back to me in 2020 and it will be a very different story.”

    — JAB

  17. Peter says there’s no war on coal. Then he proceeds to list a whole bunch of coal plants he’d like to shut down. This post, by the way, comes from an author who eviscerates the coal industry for its environmental offenses every chance he gets. To be sure, there are legitimate environmental issues with coal. So, logically, you may Peter may say state that his war on coal is entirely justified. But please let’s stop the charade that there is no war on coal!!!

  18. Don, As for that solar energy in Georgia being so cheap… if Virginia can build solar energy for cheaper than coal, gas and nuclear, let’s go for it! … Just remember, though, solar is an intermittent fuel and requires expensive backup (usually natural gas) and transmission capacity to fill in when it gets cloudy and generation lags. Don, surely you’re aware of what the over-commitment to solar and wind has done to the German electric grid.

    Indeed, one might say that the Germans have pursued the Peter Galuszka energy policy of phasing out coal and nuclear while promoting wind and solar — and look at the result!!!! Electricity prices are soaring and energy-intensive industries are relocating to the U.S.!

    But Peter has a ready answer for the destructive impact of his insanely expensive regulatory policies. When job creation and wages lag, just blame the capitalist system for income inequality. The answer to the devastation wrought by excessive taxation and regulations is always more… taxation and regulation!

    1. “when it gets cloudy”

      yes… it’s a government conspiracy to screw up Dominion’s coal-based business!

      what happens when solar gets cheap enough that it’s less expensive to use it rather than grid power then ratepayers will just rely on grid power when it gets cloudy and at night?

      doesn’t Dominion still get the cloudy day/night problem imposed on their grid – anyhow – regardless of what the EPA does with respect to carbon?

      they’re arguing through the SCC that there will be stranded costs if power plants are closed – and that if solar is part of the replacement power – it will make the coal-dependent grid less reliable – so .. we can’t get rid of coal.

      My question is – what keeps SOLAR grom getting more and more efficient in the next 20, even 5-10 years – anyhow – and people install it – anyhow – and the baseload coal plants cannot react to a grid where demand varies by clouds and nightfall – anyhow?

      I think part of what this is all about – is an argument that there are stranded costs for the coal plants and that ratepayers are going to pay for those costs – vice investors – and so much for the SCC’s role for striking a balance and protecting consumers – this paper pretty much aligns the SCC with Dominion’s interests.

      Jim gets himself in these fixes when he almost instinctively aligns himself with any argument against the EPA, carbon and climate but essentially what is going on – is Dominion wants to keep the status quo – when the market is going to “disrupt” it so they want to have the SCC inoculate them against stranded costs – by blaming the EPA.

      This shows to what extent Dominion owns politics in Va when they not only influence elections but they have undue influence over the regulators also.

  19. Peter Galuszka Avatar
    Peter Galuszka

    Jim,

    Where did I say this?

    Peter Galuszka energy policy of phasing out coal and nuclear while promoting wind and solar — and look at the result!!!!

    As far as the “Galuszka War On Coal”: I do think you need to get beyond your typical richmond/Virginia provincialism. A few points on the industry:

    (1) Fracking has dropped coal’s contribution from electricity generation nationally from roughly 50 percent to the high to mid 30 percent level.

    (2) Half of the nation’s coal comes from the Powder Rive Basin of Wyoming and Montana. As demand for it has dropped thanks to fracking gas deposits, a lot has been shipped to Asia. Last year, production increased 1.1. percent. The Illinois Basin, formerly a high sulfur deposit, has likewise seen a bump in production.

    (3) You obviously have no deep understanding of coal’s global picture. You define it by a few counties in southwest Virginia that have been on the decline for three decades. That’s because all you k ow first hand about coal are a few series you wrote about it back at the Roanoke Times 30 years ago.

    The fact remains that Central Appalachian coal, despite its fine qualities as far as coal goes, is just too expensive to mine and provide sustainable jobs.

    Meanwhile, the coal industry has done nothing to upgrade much needed mine safety laws after Massey’s Upper Big Branch disaster that I wrote a book about. Miners keep dying.

    Jim, it would help if you showed some understanding of the global picture before you make preposterous comments that show little other than parochialism..

    1. There’s an important phrase in the Virginia Constitution that justifies the sole existence of the SCC – which by the way – has 3 powers, legislative, administrative and judicial.

      the phrase is ‘just and reasonable”, and the SCC uses it – inappropriately in their filing with the EPA.

      “The term “regulate” with respect to rates is defined explicitly in
      sections 56-234 and 56-235′ of the Code of Virginia, which provide
      that public utility rates must be “just and reasonable.” As the
      Supreme Court of Virginia has recognized, “rates fixed by the Commission
      should be just and reasonable to the consumers whose rates
      are fixed.” In other words, the rates should be fixed “in relation to
      the Company’s costs of serving” the consumers.’ “Cost of serving”
      utility customers in Virginia is defined as the sum of: (a) all operating
      expenses, (b) interest charges on all debt, and (c) a fair return
      on equity investment. Therefore, for a rate to be “just and reasonable,”
      it must generate enough revenues to cover (a) and (b) and have
      net earnings equal to (c). If the net earnings fail to equal or exceed
      (c), the rates are not “just and reasonable.”‘

      http://scholarship.law.wm.edu/cgi/viewcontent.cgi?article=2420&context=wmlr

      keep in mind that nowhere in these words are a definition or designation of authority with regard to what is “just and reasonable” if such activities damage the environment or people’s health.

      In other words, an SCC- regulated company could (and have) polluted the hell out of the environment and harmed people’s health – and still met the “just and reasonable” standard because it’s a fiscal standard devoid of environmental considerations. Strictly following that standard – a company could actually engage in harmful activities as long as their rates were “just and reasonable”.

      so if you read the misguided rationale in the SCC’s filing with the EPA -they are using the “just and reasonable” standard with regard to environmental regulation by claiming that environmental regulation if it affects the price calculation – must adhere to a fiscal “just and reasonable” standard but not an environmental one.

      On could ask – legitimately – how or why the SCC would have the expertise, power or authority to extend that standard to include both the fiscal and environmental aspects of any regulated activity.

      and if you think about this – when, in prior cases, has the SCC weighed in on environmental rules for coal plants or hydro power or natural gas or ethanol or gasoline, etc, ANY regulated activity?

      If you follow their logic, they would want the ability to be both the SCC and DEQ.

      but further than that – how does the SCC have the power to decide winners and losers, in favor of coal and against Solar or natural gas or any other way of providing power?

      are all of these different sources of power judged according the the lowest priced of the choices even if the lowest choice is the dirtiest and most environmentally damaging?

      have they ever done this before? Have they ever consulted or argued with Virginia’s own DEQ on water/sewer rates verses environmental regulations for the removal of contaminants and pollutants?

      If the EPA did with coal – what they’ve done with toxics – could they essentially force carbon reductions by including the same toxic rules for mercury as they have for other toxics and VOCs? Indeed the Supreme Court has agreed – that the EPA – DOES have that authority. Why does mercury have an exemption?

      so what exactly is the SCC doing that is within their legal authority, if they are essentially asserting that if the cost of a any environmental regulation, in their judgement, violates the “just and reasonable” standard they would rule against it?

      Not buying it… and neither should anyone else – even if you are a climate skeptic or hate the EPA.. what the SCC is doing – ultimately favors SOME preferred but dirty industry over the right of consumers to have access to cleaner power even if it costs more. The SCC should not have that power but that’s exactly what they are asserting to the EPA.

  20. Peter Galuszka Avatar
    Peter Galuszka

    FYI,
    Here’s a file from Ken Ward Jr. of the Charleston Gazette — one of the best coal journalists in the nation. Note how he, and lots of true Appalachians, see coal’s future clearly and are trying to deal with a tremendous transition.

    If you read the guy from Richmond, it’s like reading someone from 30 years ago.

    Here’s Ken’s file:

    http://blogs.wvgazette.com/coaltattoo/2014/10/15/appalachian-transition-why-coalfield-residents-need-to-help-themselves-diversify-their-economy/

    1. One of the more thoughtful journalistic pieces I’ve read with regard to the environment vs jobs conundrum.

      and yes – one of my frustrations with ideological environmentalism – of which there is a mirror image also – for those who are blinded to environmental threats and blame environmentalists for “global warming” – that it’s not real and it’s a bogus concept promoted by ideological environmentalists.

      A POX on BOTH of them!

      Coal has the same problem that Southside Va has with textiles and furniture and yet we seem incapable of helping them… economically – and we dismiss the only real way out – a 21st century education for the kids so they can leave and go to where the jobs are in the knowledge economy.

      but what do we do about the people who cannot get a better education and leave – if the food on their table and the heat in their home depends on coal?

      a “clean” environment where people suffer is not a noble goal – either.

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