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. (To be fair, the Greensville plant will likely run at more like 75-80% capacity. But it follows three other new gas plants Dominion built this decade. Together the four plants add a total of  4,862 MW. And those are nowhere near all the gas plants Dominion operates.)

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.

11 thoughts on “For Dominion, the answer to every problem is more gas

  1. Solar can also be balanced using variable pricing. For example, I would air condition my house with abundant, low-priced solar power during the day rather than use higher-priced fossil power at night.

  2. Will, peak consumption tonight in California (and most other locations in the U.S.) will be 8:30 PM, hours after the sun has gone down.

    It would be wonderful if everyone could schedule their energy consumption for when the sun is shining or the wind is blowing, but most can’t afford that luxury. The only reason Dominion needs to burn gas is to balance the variable input of renewable sources. Otherwise, carbon-free nuclear is perfectly capable of following customer demand.

  3. 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.

  4. Lots of great points .. but I particularly like the “question Dominion seems to be answering is how to create a need for the ACP.”
    and regarding peak power demand … the best solution for now for all but a piece of summer peak in VA is offshore wind. A NY Prof says that summer peak can be met with the synergy of solar combined with offshore wind … charted and all. Besides stoprage will be cost competitive in a few years.

  5. Jane, each day Virginia consumes an average of 12.14 GWh of electrical energy.
    Using Lazard’s estimate for the capital cost of integrating a lithium-ion storage system ($652/kWh), it would cost $7.91 billion to integrate one day’s worth of storage – then the lights go out.

    Obviously, we need more than that — occasionally, there might be a week or more of cloudy or windless weather. A week of storage would cost $55 billion – more than the state’s annual budget, and it would need to be replaced every 7-10 years. Is one week enough? Can there ever be enough?

    When ideals collide with reality, it becomes obvious that intermittent renewable generation + storage will never be cheap enough to compete with natural gas and/or coal. That means continued reliance on fossil fuels – and that’s not good enough.

  6. Bob, regarding “there is no possible way solar PV, in Virginia, can make a meaningful difference in the fight against climate change.” NREL disagrees.
    In 2012 VA used 113,806 GWhrs of electricity. Quoting the NREL “technical potential numbers, VA could produce almost 50,000 GWhrs of electricity from rooftop and utility scale urban PV. However, the major PV opportunity for VA is the 1,882,467 GWhrs the state could potentially generate from utility scale rural PV.
    Even a fraction of that potential will make a difference.

  7. Jane, yearly figures for generation are irrelevant.

    Let’s assume we can cover the entire state of Virginia with solar panels, as NREL suggests. Has cloudy weather ever lasted over the state for more than one day (if I’m not mistaken, that happened several times last summer/fall)? We’re back where we started – $55 billion to store what Virginians consume during one week of cloudy weather. That will never, ever happen. Again – there is no possible way solar PV, in Virginia, can make a meaningful difference in the fight against climate change.

  8. Bob … A week of storage? GEEZ! Virginia is not an island. The larger interconnections of PJM take care of some intermittency and importantly according to Scott Sklar, President of the Stella Group, “now that battery storage has come down in cost 65% and expected to call another 22%, along with pumped hydropower, can make variable wind and solar photovoltaics dispatchable.” Our Bath County hydro is the largest hydro facility in the country.

    Like it or not storage is coming east before too long …
    “The Arizona Corporation Commission told the state’s largest investor-owned utilities that their future plans relied too heavily on natural gas and should include more renewables, electricity storage and energy efficiency.”
    “Power companies in California also recently abandoned plans to build two gas plants, a result of the state’s preference for batteries, wind farms and solar panels” and the “California Public Utilities Commission directed the state’s largest utility, Pacific Gas & Electric Co. PCG, to solicit bids for renewable energy and storage projects to replace three costly gas plant.”

  9. Jane, so if I understand correctly – when solar comes up short in Virginia, you will gladly accept electricity from over-the-border coal plants like Belews Creek, Sutton, or Marshall in North Carolina? Apparently you believe having non-functioning solar panels in one state justifies polluting in another – “out of state, out of mind”. That’s straight out of the playbook of California, where PacifiCorp is fighting tooth and nail for the right to import Wyoming coal-fired electricity, so California can conveniently export its emissions. We know all about how that works.

    “Storage has come down 65%, then it will come down 22%, then it will come down 240%…” Nonsense. Who is “Scott Sklar and Stella Group” but another company profiting off the sale of renewable pipe dreams? I’ve been hearing those empty promises for half a century.

    I harbor no special preferences for generation technology, just generation that’s clean and works. And the numbers say it all: renewables don’t work very well in California, and they don’t work at all in Virginia (in 2017, solar provided less than one-half of one percent of Virginia electricity). The only purpose they’re serving is to extend reliance on methane, aka “natural gas”, and coal.

    Enough is enough – no more time to waste.

  10. I hope you used that extra time to get more up to date… maybe you could read up on PJM, the regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia, including Virginia, or maybe you could figure out exactly what is ‘clean’ about burning fossil fuels.

    You might be right that PacifiCorp is fighting, understandably, to sell power to CA from Wyoming. The company has 2 business units. One sells power to CA and OR customers and the other is Rocky Mountain Power. PacifiCorp is owned by Berkshire Hathaway, which I recall was planning to ship Wyoming coal to China awhile back. That plan didn’t work out for lots of reasons.

    You say “the numbers say it all: renewables don’t work very well in California, and they don’t work at all in Virginia.” Really?
    In March CA solar an all-time peak percentage of demand served, a record 49.95 percent at 12:58 p.m. CAISO’s fourth-quarter 2017 report on the EIM showed benefits of $33.46 million for its participants, bringing the total benefit to $288.44 million since the real-time market launched in 2014. All that solar saved money!

    Looks like renewables are working out. in fact so well that “California regulators push energy storage to edge out peaker plants. California regulators just approved a requirement for PG&E, the state’s largest utility, to use batteries or other non-fossil fuel resources to meet peak electricity demand. Typically, utilities rely on natural gas-fired “peaker” plants, which are fired up during peak demand. But large volumes of solar power and the declining cost of energy storage is making it possible for clean energy to meet peak demand.”

    “California is one of a few markets where energy storage is competitive with gas-fired peaker plants today. But that’s changing. Current lithium-ion battery and balance-of-system costs are low enough to compete with simple-cycle combustion turbine peaker plants in select markets today, and will be broadly competitive by turn of the decade”
    (GTM Research)

  11. Jane, your comments illustrate a common misunderstanding of intermittent renewable energy – that a 49.95% contribution, at 12:58PM on one day of the year, represents a substantial improvement in a source’s overall contribution. Solar, from 6PM of that day until 6AM of the next, contributed 0%. Natural gas (or coal generation from out-of-state) was required to provide power to anyone who couldn’t afford to be at the mercy of California’s other sources of renewable energy, or nuclear. So yes, “really” – solar doesn’t work very well in California. Solar City went bankrupt in 2016: they had to learn it the hard way.

    Your condescension aside, I understand quite a bit about PJM and the Western Imbalance Market, and I understand there’s nothing clean about burning fossil fuel. Here in California, 22% of our clean energy comes from one source, occupying less than one square mile of land – Diablo Canyon (nuclear) Power Plant. Like North Anna or Surry, Diablo Canyon’s clean energy is available any time of the day or night, whether it’s windy or calm. No fossil fuel “backup” necessary.

    Another common misunderstanding is that profits of EIM participants are entirely attributable to sales of renewable energy. One of the largest beneficiaries of the Western EIM has been PacifiCorp, and there is no way for CAISO to ascertain where or how PacifiCorp’s electricity was generated. No oversight. Sierra Club recently took on the Southwest Power Pool, where producers are “over-operating” coal plants instead of taking advantage of supposedly lower-cost renewable energy. Why they would deliberately lose money is anyone’s guess; maybe they aren’t.

    Click to access Backdoor-Coal-Subsidies.pdf

    Similarly, Warren Buffett, Berkshire-Hathaway’s CEO, has big plans for windfarms in Wyoming – but not because they generate any significant quantity of green energy, or are even profitable. In 2014 he admitted, “On wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”

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