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For Dominion, the Answer to Every Problem is More Gas

Dominion Energy Virginia just released its 2018 Integrated Resource Plan (IRP), and the message it conveys could not be clearer: no matter what happens, the utility plans to build more fracked gas generation.

The IRP lays out five scenarios for meeting electric demand over the next 15 years, each one responding to a different set of assumptions. Yet weirdly, no matter which assumptions you choose, Dominion’s plan involves building a little bit of solar and a lot more gas.

Dominion Energy Virginia IRP; table showing alternatives considered

Dominion’s “Alternative Plans” (from page 24 of the IRP) prove to be very short on actual alternatives.

Everywhere you see “CT” in the table, that’s another gas plant–and they show up in every “alternative.” Assume no carbon tax? Great, Dominion will build gas. What if Virginia follows through on plans to cut carbon by joining the Regional Greenhouse Gas Initiative (RGGI)? No problem, Dominion will build gas. How about if the Feds impose a national carbon plan? Alrighty then, Dominion will build gas!

Seriously folks, if fracked gas is always the answer, somebody isn’t asking the right question.

The question we’d like to see addressed is how the utility intends to help Virginia transition to a clean energy economy. The question Dominion seems to be answering is how to create a need for the Atlantic Coast Pipeline.

This isn’t a surprise; Dominion’s parent company, Dominion Energy, is the majority partner in the pipeline, and the pipeline’s approval was premised on the utility “needing” the pipeline to serve its gas plants. It’s a blatant conflict of interest that the SCC should have addressed by now, but it declined to do so. (The Sierra Club has taken the SCC to court over this dereliction of duty.)

Dominion would prefer we talk about its plans for more solar. It is true the 2018 IRP proposes more solar generation than the 2017 IRP did. Last year’s IRP revealed that solar had become the lowest-cost energy in Virginia, but it forecast only 240 MW per year. This year’s IRP shows solar increasing over the next few years to a maximum of 480 MW per year beginning in 2022 (about half of what North Carolina installed in 2016). To put that in perspective, Microsoft recently announced it was contracting for 350 MW of Virginia solar to be built in one fell swoop, to serve just its own operations.

Meanwhile, the IRP notes that Dominion’s newest combined-cycle gas plant, the 1,585 MW Greensville behemoth, will enter service next year. Running at full capacity, it would provide the equivalent amount of electricity to 13 years’ worth of planned solar construction, since the expected output of a solar farm is about 25% of its “nameplate” capacity.

The fact that all of Dominion’s IRP scenarios look alike and rely heavily on gas seems to be intended to send a message not to the SCC but to Governor Northam. Dominion doesn’t like the carbon reduction rulemaking now underway at the Department of Environmental Quality, which aims to lower emissions from Virginia power plants by 30% between 2020 and 2030. So the IRP “assumes” Dominion will comply by purchasing dirtier power from states not subject to regulation, actually driving up both cost and carbon emissions. Meanwhile, it’s going to build gas no matter what.

Welcome to Dominion’s game of hardball, Governor Northam.

Of course, the IRP is only a planning document. The SCC may approve it but still reject a proposed facility when the utility asks for permission to build it. Market watchers will question whether Dominion will be able to justify all—or any—of the 8 proposed gas combustion turbine facilities in hearings before the SCC. Virginia has too little solar now to need combustion turbines for back-up, and by the time there is enough to challenge the capabilities of the grid, experts predict battery storage will be the better and cheaper choice.

But never mind that; for Dominion, what matters now is justifying the Atlantic Coast Pipeline.

Photo Credit: Gillian Thomas via Flickr

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Content Discussion

Matt Chester's picture
Matt Chester on May 7, 2018

I fully expect that it is true that natural gas will be a part of the equation for the next few decades, the question is always how much. So you bring up a fair point in shining a light on the financial conflict Dominion has in wanting natural gas, and thus their pipeline, to succeed. I’ll be interested to see if this talking point becomes a part of the larger conversation people have with respect to Dominion.

Bob Meinetz's picture
Bob Meinetz on May 7, 2018

Ivy, you write “the expected output of a solar farm is about 25% of its ‘nameplate’ capacity.” That’s the average capacity factor for solar facilities in the U.S. In Virginia, solar can be counted on to produce only 10% of its rated capacity:

442 GWh (total 2017 VA generation)
4432 GWh (theoretical generation at full installed capacity)
442 / 4432 = 9.97% (capacity factor)

Due to limited sunshine in VA, solar contributed .48% of the state’s electricity in 2017.

With your good intentions duly noted, there is no possible way solar PV, in Virginia, can make a meaningful difference in the fight against climate change.

Bob Meinetz's picture
Bob Meinetz on May 7, 2018

Matt, like other energy concerns across the U.S., Dominion is able to exploit “affiliate transactions” between its subsidiaries to bill customers for both electricityand the natural gas used to generate it.

Why can’t Dominion do the same with uranium at their North Anna and Surry nuclear plants? They can. But fuel costs for $3.90/MWh for uranium and $110/MWh for natural gas. With the same markup added to both, the profit potential of natural gas is 2800% better than uranium.

As I’ve pointed out here before, nuclear is uneconomic from a utility’s perspective not because its fuel is expensive, but because it doesn’t cost enough.

Joe Deely's picture
Joe Deely on May 8, 2018

Bob,
We’ve talked about how you do your solar calculations before but you seem to ignore proper methodology because you want to get results that match your preconceptions.

Let me show you again how it should be done. First of all – since we are talking about solar “farms” – let’s stick with utility scale solar.

Virginia started out 2017 with 103.7MW of solar and ended the year with 369.3.MW. But as in previously discussed scenarios a large chunk of that capacity was added late in the year. This can be seen in Table 6.3 from EIA Monthly Electricity report. Note how much of the capacity was added in Nov and Dec.

The other chart below show Capacity Factor calculations using this monthly information. Total CF for solar Virginia for 2017 was 28.0%. This matches pretty closely with Dominion’s own expectations of 26% CF for solar.

You made this same mistake a couple of years ago regarding North Carolina. I called you on it but you repeated it again here. Let’s see how long before you try this again.

Virginia has the potential to follow its neighbor North Carolina and within a few years generate 10TWh annually from solar. This would effectively eliminate the remaining in-state coal generation in Virginia.

Bob Meinetz's picture
Bob Meinetz on May 8, 2018

Joe, where’s Eastern Shore, Scott Solar Farm, Whitehouse, and Woodland? Does your idea of “proper methodology” include leaving out 136MW of capacity – all of Dominion’s utility solar – to help cook Virginia’s CF? You’re quite the expert at getting results to match your preconceptions.

Though that’s hardly how calculating capacity factor “should be done”, I hear there’s a job opening for a qualified number-cooker at the California Public Utilities Commission. Your skill at substituting capacity factor for generation could land you a high-paying job, helping California’s natural gas industry cover its tracks!

Joe Deely's picture
Joe Deely on May 9, 2018

Bob you said:

Joe, where’s Eastern Shore, Scott Solar Farm, Whitehouse, and Woodland? Does your idea of “proper methodology” include leaving out 136MW of capacity – all of Dominion’s utility solar – to help cook Virginia’s CF? You’re quite the expert at getting results to match your preconceptions.

All of these plants went live before 2017 and therefore would be included in the 103.6MW figure for January. See below from EIA table.

So my calculations stand.

Bring on the solar Virginia. Time to catch up with your neighbor NC.
Microsoft adds 315 megawatts of new solar power in Virginia in largest corporate solar agreement in the United States.

The Pleinmont projects are part of a larger 500-MW solar development…