Legal & Regulatory

More Gas, Renewables in Dominion’s Future

Dominion Energy plans to build eight new natural gas-fired power plants and speed the pace of its renewable energy efforts, according to the utility’s integrated resource plan (IRP) filed with Virginia regulators on May 1.

The company also said its future plans focus on regulations on carbon emissions in part because Virginia is considering joining the cap-and-trade Regional Greenhouse Gas Initiative (RGGI), which currently includes nine states in the Northeast. Dominion in a statement Tuesday said new carbon emissions rules are “virtually assured in the future” and laid out what it thinks joining the RGGI would cost customers in its service territory.

“Dominion Energy Virginia remains committed to its longstanding goal of responsible operations; a diverse, balanced generation fleet that avoids over-reliance on a single fuel type or technology; and providing reliable and affordable energy to its customers,” said Paul Koonce, CEO of Dominion Energy Power Generation Group, in a May 1 news release. “These goals guided development of the 2018 Plan and will guide the company in the future.” The IRP represents the company’s forecast of power generation to meet customer demand, and comply with expected regulations, in the next 15 years.

Dominion said its four nuclear units will remain in service even as it adds more gas-fired and renewable power generation. Though the utility’s IRP said its solar fleet “could expand by at least 4,720 megawatts of capacity in the next 15 years,” environmental groups quickly criticized the plan, particularly the addition of new gas plants.

“There is no question that Dominion puts shareholders first. Right now it is standing with one foot in the past to benefit its shareholders, and one foot in the future, because it knows renewable is our best cheapest energy option,” Will Cleveland, an attorney with the Southern Environmental Law Center (SELC), said in a May 2 statement. “If we expect change from Dominion they are going to have to be forced into it.”

Dominion said its potential solar additions represent about a 50% jump over its 2017 forecast of an additional 3,200 MW of solar generation. It said its eight new gas plants, all planned to be in service by 2033, would have 3,664 MW of generation capacity. The company also said its forecast scenarios include energy efficiency programs that could cut peak demand by 304 MW by 2033, and overall annual energy usage by 805 GWh.

Dominion’s plan also includes construction of the Coastal Virginia Offshore Wind demonstration project, a 12-MW facility that would be the first such project off the Mid-Atlantic coast. Dominion said it would be in service by 2021.

Dominion in its news release said its IRP has five alternatives that envision compliance with federal or state carbon emissions rules, including options should Virginia join the RGGI. It said “zero-carbon nuclear generation remains the backbone of the Dominion Energy Virginia fuel mix,” noting about one-third of the utility’s generation came from nuclear in 2017. The company said all its options in the IRP include 20-year operating license extensions for the two reactors at Surry Power Station and the two at North Anna Power Station.

“The Surry and North Anna nuclear units continue to be the largest source of zero-emissions generation for the company by far, with their operation avoiding the release of approximately 22 million tons of CO2per year,” the company said. “Through the license extensions, the units will continue to produce power into the second half of the 21st century. More than 100,000 acres of solar photovoltaic facilities would be needed to match the nuclear units’ annual power output.”

Dominion also said “Clean-burning, low-emission natural gas also plays a critical role, both in meeting the energy needs of the company’s customers and backing up units powered by renewable resources when they are unable to operate.” Dominion is one of four energy companies behind the Atlantic Coast Pipeline (ACP) Project, a 600-mile interstate natural gas transmission pipeline that would serve Virginia and North Carolina. Environmentalists have argued against the pipeline; the SELC has said Dominion is inflating its load growth forecasts to justify the project.

“These misleading projections used as the justification for spending customer money on the Atlantic Coast Pipeline will come back to haunt us,” said Greg Buppert, a senior attorney with the SELC. “If Virginia fails to force Dominion to plan around true projections we can expect this modeling to lead to more unneeded projects that will cost Virginians money, their water, land, and air quality.”

Dominion said a measure pushing Virginia into the RGGI “would encourage customers able to competitively shop to purchase higher-carbon intensive generation outside of the Commonwealth while also increasing the utility’s need to purchase out-of-state power to meet its obligations to serve Virginia customers. While this would reduce carbon emissions in Virginia, the reductions would be more than offset by increased emissions elsewhere in the Eastern United States. Compliance with carbon regulation could, unless mitigated by other public policies, lead to an increase of between $2.23 and $5.81 in 2018 dollars in the typical residential customer’s monthly electric bills by 2030.”

A recent report from a consulting group, which included input from utilities including ConEdison, Exelon, and Calpine, said that while states in the RGGI have higher prices for electricity, the program designed to cap power plant emissions has generated $4 billion in net economic activityin the region.

Dominion also addressed Virginia’s Grid Transformation and Security Act of 2018, which will become law on July 1. The company said its IRP “does not yet reflect the emphasis placed on energy conservation,” and said it “will directly address this significant expansion of energy conservation programming in future filings with the [State Corporation Commission] and the reports and stakeholder processes required by the Grid Transformation and Security Act.”

The utility also said the IRP addresses plans the company announced earlier this year to put units at some of its Virginia power plants in “cold reserve” by year-end. Said Dominion in Tuesday’s release: “All generation retirements presented … should be considered tentative, with the company’s final decision being made at a future date.”

Darrell Proctor is a POWER associate editor (@DarrellProctor1, @POWERmagazine)

 

SHARE this article