Category Archives: Economy

ACP Threatens “Alcohol Alley”

An article in the July 3, 2018, Belt Magazine discusses how “Alcohol Alley” merchants say the Atlantic Coast Pipeline threatens their industry.

“Whether it’s a glass of estate Chardonnay on the grounds of Afton Mountain Winery or a Full Nelson IPA on Blue Mountain Brewery’s sprawling patio, the breathtaking Shenandoah views are a common ingredient in the region’s various alcoholic beverages. Terrific views sell booze, and many of Nelson County’s producers have capitalized on the landscape to power on-site appeal at their facilities. Virginia doesn’t track tap room & tasting room sales volumes across categories of alcoholic beverage, and besides, it’d be impossible to extrapolate how much of that revenue was directly due to the scenery. But on-site sales are a crucial source of revenue for small alcohol producers across the country, and the ACP’s impending construction in the Rockfish Valley may threaten that.”

The article discusses the importance of unspoiled scenery to Nelson County’s alcoholic beverage industry, which employs some 425 locals directly, and helped to bring in almost $200 million in tourism expenditures in 2016 (the most recent year for which data is available). All this would be threatened by Dominion’s Atlantic Coast Pipeline.

Why Utilities Shouldn’t Build New Gas Plants

And shouldn’t build pipelines either?

A May 21, 2018, press release from Rocky Mountain Institute says, “US electricity generators may be committing their customers and investors to as much as $1 trillion in future investment and fuel costs through 2030 as they rush to build new gas-fired power plants. Yet advances in renewable energy and distributed energy resources (DERs) offer lower rates and emissions-free energy while delivering all the grid reliability services that new power plants can, according to a new Rocky Mountain Institute (RMI) report, The Economics of Clean Energy Portfolios. According to the analysis, in addition to beating proposed gas-fired power plants on a levelized cost basis, ‘clean energy portfolios’ of renewables and DERs will also increasingly threaten the profitability of existing gas plants.”

Writing in Power for the People VA on June 5, 2018, Ivy Main asks, “Dominion won’t build new baseload gas plants. So why is it still building the Atlantic Coast Pipeline?” She points out that, “Utility giant Dominion Energy and gas turbine maker General Electric reportedly agree on a startling fact: there is no market for new baseload gas plants,” and notes that new combined cycle plants are noticeably absent from Dominion Energy Virginia’s Integrated Resource Plan this year. She discusses RMI’s report, and says that, “as early as 2026, cost declines for wind and solar will make it more expensive to operate natural gas infrastructure than to abandon it and replace it with new wind and solar facilities. When that happens, gas plant owners will be left with stranded assets. Even in today’s market, RMI concludes gas is a risky investment.” The RMI report’s conclusions are “very bad news for the Atlantic Coast Pipeline.”

She concludes, “The problem for Dominion Energy is that the ACP is the only big trick it has now, after the failure of its own ambitions for new nuclear. Dominion doubled down on natural gas in 2016 when it paid 4.4 billion dollars for natural gas distribution company Questar, paying a 23% premium on the deal. It can’t back down from gas now. Either it has to spend 6 billion dollars (and rising) on this new pipeline, or admit its entire growth plan was based on a serious mistake. Abandoning the ACP could make Dominion’s stock price tumble, giving it something else in common with GE. But as the saying goes, if you find yourself in a hole, you should really stop digging. In this case, literally.”

Read Ivy Main’s Power for the People VA article (article was reproduced in The Daily Kos and in Blue Virginia)

Read Utility Dive’s article commenting on the Rocky Mountain Institute report.

Read the Rocky Mountain Institute press release on the report .

Report: The Economics of Clean Energy Portfolios.

“Typical Millennial” Writes Open Letter to Northam

In An Open Letter to Gov. Northam on the Mountain Valley Pipeline, published in RVA Magazine in May 7, 2018, Margeau Graybill, who lives near Bent Mountain, writes, “I guess you could say that I am a fairly typical 27-year-old millennial.”

Graybill writes of getting her degree from VCU, working hard, and trying to save to buy a place of her own in the area she loves, “to marry and have children, a house, and a dog on a quiet, pristine piece of land in my own corner of Virginia.” But what she wants is threatened by the MVP, and she asks, “Why would I want to even stay in Virginia and settle down if this is the reality of how the Commonwealth protects its natural environment?” She says, “I can’t imagine that you would want young families moving out of the Commonwealth, but a lot of my friends have already done so because of these kinds of policies.”

And she says, “Many people my age voted against you in the primary because we know building these pipelines are not the way forward. Fracked gas pipelines are not the future of energy and will do nothing but make a few people rich, destroy waterways, leak into our precious ground, and make Virginia look like it doesn’t care about the future of the planet or our children. How can you have a platform that wants to preserve the Chesapeake Bay from off-shore drilling, but not our streams and waterways from fracked gas? I could provide you some studies of what a project like this does to land and water, but this letter is more from the soul. The soul of a heart-broken voter who believed when you said all environmental laws would be followed and all studies would be done before beginning these project. As I’m sure you know, nothing like this pipeline has ever even been attempted before in Virginia. Why risk this now? Who does it benefit, really?”

Read her full letter here.

Gas Generation Declines

Dominion says we need more fracked gas infrastructure.  BUT….

Utility Dive for March 20, 2018, reported on major shifts in the US energy generation, including the battle between coal and natural gas and the rise of renewables. The decline in gas generation was three times as steep as coal’s:

  • Changes to the United States’ power generation mix last year reflected fuel price fluctuations and the growth of renewable energy, though overall demand fell. According to the U.S. Energy Information Administration, total U.S. net generation fell by 1.5% in 2017, compared with the year before.
  • Natural gas generation fell most steeply by 105,443 Gwh, or 7.7%, and coal generation declined 31,248 GWh, or 2.5%. More than 11 GW of capacity retired last year, with most of that being coal.
  • Both wind and utility-scale solar cracked new records, according to EIA’s Electric Power Monthly. Wind accounted for 6.3% of total net generation, and utility-scale solar made up 1.3%.

Natural Gas Is Bad for Virginia

In a Letter to the Editor of the Roanoke Times, Jennifer Sims summarizes the “ruinous public policy described in the Jan. 26 commentary ‘Expanding access to natural gas is smart public policy.'” She points out that:

  • Instead of carbon, liquid natural gas (LNG) emits methane, a dangerous heat-producing greenhouse gas, and that the MVP and ACP “would produce the equivalent of 20+ coal plants in terms of greenhouse gases.”
  • The fracked natural gas in the MVP and ACP will NOT be available to anyone in the 20 counties through which the pipelines pass, but is destined for existing and new export contracts.
  • The fracked natural gas is NOT “safe, clean, reliable, affordable and abundant,” as the January 26 opinion piece claimed. Distribution pipelines have about 150 incidents or accidents each year; “ratepayers will be forced to foot the construction bill, business and landowners along both paths will have their private property seized and devalued and we will see a significant loss in tourism revenue.”

She concludes, “it is not a good public policy to introduce 1,000 miles of sediment dumps and herbicides into waterways, miles of mountaintop removal, abuse of eminent domain, loss of tourism revenue and pollution-emitting compressor stations into our Commonwealth.”

Cold Wave Does NOT Show Pipeline Need

Thomas Hadwin (now living in Waynesboro) served as an executive for electric and gas utilities in Michigan and New York. Writing in the Roanoke Times on February 7, 2018, Hadwin says “Dominion Energy recently claimed — in several news stories and in an op-ed … that the ‘recent cold spell demonstrated a need for new pipeline infrastructure in Virginia.’ This misrepresents what really happened and proposes a solution that is wholly unnecessary and very expensive for the people of Virginia…. Dominion made it sound as if we had gas shortages throughout Virginia. What really happened was that 10 industrial customers of Virginia Natural Gas volunteered to cut back on some of their gas usage in exchange for lower rates. This voluntary curtailment involved 90 fewer industrial customers than during the polar vortex in 2013-2014. Virginia Natural Gas is owned by Southern Company, an owner of the Atlantic Coast Pipeline (ACP).

“Transco, the nation’s largest pipeline, runs through our state. During this winter’s severe cold, Dominion said it relied on Transco for about 75 percent of its gas supply, including service to its newest power plant in Southside Virginia. Public utilities in North Carolina relied on the Transco system for 100 percent of the state’s supply during the cold spell, according to Dominion. Chris Stockton, a spokesman for the owners of the Transco system, said their pipelines ‘performed remarkably’ during the cold weather. ‘It’s an incredible accomplishment. It’s a testament to the system that we have,’ he said.”

Hadwin points out that:

  • “Transco intends to add more than the capacity of Dominion’s proposed ACP to its existing system before the end of this year. And Columbia Gas, a pipeline that has reliably served Virginia for decades, will add almost as much capacity as the ACP in West Virginia and Virginia this year.”
  • “Families and businesses throughout our state, including those in southeastern Virginia, can have access to all of the gas they need by tapping into the abundant supplies from these existing pipelines, and at a cheaper cost.”
  • “In September 2017, an industry expert testified to Virginia regulators that using the ACP instead of existing pipelines could cost Dominion’s customers $1.6 billion to $2.3 billion more over the 20-year term of the contract with the ACP.”
  • “PJM [the organization that coordinates electricity generation over a 13-state region that includes Virginia] has a surplus of generating capacity that is 75 percent more than it needs for normal reserves. Moreover, PJM expects the growth in electricity use to be relatively flat in Virginia over the next 15 years.”

The bottom line? “Paying more for an unnecessary new pipeline doesn’t make sense. Virginians have all the gas we need at a lower price using the existing pipelines and planned expansions without the need for new pipelines.”