Virginia GOP, big utilities back pumped storage hydropower
The Republican-led General Assembly is advancing legislation to make it easier for utilities to build pumped storage systems, powered by solar or wind energy, in Virginia's coalfield region
RICHMOND, Va. (AP) — Republican lawmakers in Virginia have maintained a go-slow approach to renewable energy for years, saying a conservative path has helped keep electricity costs under control as the state figures out how best to harness solar or wind power.
"We're going to take small steps and not large steps," said Del. Terry Kilgore, the GOP leader of the powerful House Commerce and Labor Committee, said at a recent news conference where Republicans touted their green energy record compared to other states.
But at the same news conference, GOP lawmakers said they want Virginia to be a leader in a kind of renewable energy system that requires massive construction projects with unknown costs and technical challenges. Large utilities like them, but environmentalists and some businesses are puzzled and worried.
The Republican-led General Assembly is advancing legislation to make it easier for utilities to build pumped storage systems, powered by solar or wind energy, in Virginia's coalfield region. These systems use huge amounts of water as giant batteries, pumping it uphill and then letting it flow down to power turbines.
In Virginia, supporters say, the new systems could be built using abandoned coal mines or reservoirs in the state's economically depressed southwest corner.
"Difficult times require us to take opportunities that otherwise we wouldn't take," said Kilgore.
The legislation has near-unanimous support in both chambers and from the state's leading electric utilities. That includes Dominion Resources, which also is the biggest corporate donor to political campaigns in Virginia.
But much uncertainty remains. Nowhere in the United States has an underground coal mine been utilized as a pumped storage system, and technical as well as environmental challenges would have to be overcome.
Jim Besha runs a company developing a pumped storage system using clean groundwater in an abandoned iron mine in New York. He's a big booster of the technology, but doubts coal mines are feasible because any water inside them would be acidic, damaging generators and possibly seeping out to damage other water sources.
Virginia Department of Mines, Minerals and Energy officials believe that acidity may not be an issue in some Virginia coal mines and have requested federal grant money to study the issue.
That uncertainly has led state environmentalists, who have urged lawmakers for years to be more supportive of renewable energy, to keep the legislation at arm's length until they get more specifics and can determine potential environmental impacts.
"This is not what cautious people do," said Ivy Main, an environmental advocate, said of Republicans sponsoring the legislation.
Pumped storage systems have been around for decades. Dominion already manages one in Bath County, Virginia, that was completed in the 1980s at a cost of more than $1 billion. It uses two reservoirs and is one of the biggest in the world.
The Department of Energy has called for a big increase in pumped storage capacity by 2050 to make renewable energy sources more reliable and consistent. Solar and wind energy can fluctuate rapidly, and pumped storage systems can respond quickly in turn. They smooth out surges in the generation and price of electricity by using surplus energy to move water uphill. When demand spikes, they let the water flow back down, spinning turbines to feed more power to the grid.
Just how much a renewable-powered pumped storage system would cost in Virginia is unclear. The legislation lacks specifics about exactly where and how they would be built. It instructs the State Corporation Commission to consider such proposed facilities in the coalfields as in "the public interest," making it easier for such projects to get approved.
Dominion and Virginia's next-largest utility, Appalachian Power, are state-regulated monopolies, and Virginia law guarantees their profits on regulator-approved construction projects. Depending on the price tags, that could leave consumers with significantly higher bills.
Kilgore has estimated that a new pumped storage system could cost between $300 million and $500 million, though a Dominion spokesman said it was "way too premature" to put a price tag on any potential project, since no site has been selected.
Neither would a Republican supporter of the legislation venture a guess during debate on the Senate floor.
"I am not prepared to make a guess at what the cost of this facility will be," said Sen. Ben Chafin. He said state regulators would have to ensure each project's costs are reasonable.
That uncertainty has some businesses worried about rising electric bills.
"We're a little nervous about it," said Brett Vassey, president of the Virginia Manufacturing Association.
Supporters dismiss cost concerns as premature, saying the legislation only gets the ball rolling on potential projects. But electric rates are already a touchy subject in Virginia politics.
A 2015 law, backed by Dominion, bars regulators from lowering base rates — the majority of a customer's bill — for several years even in the event of excessive utility profits.
Dominion says its rates are not excessive, but regulators say its base rates give the company about $280 million a year more than is reasonable. That translates to about 5 percent extra on a typical residential customer's bill, according to one expert's calculations.
Democratic Sen. Chap Petersen said with potential excessive profits locked in, lawmakers should be weary of approving legislation that enables expensive new projects.
"We're going to keep adding to our customers' bills without even knowing what we're doing," Petersen said.