Engineers and constructors adapt to serve an industry in transition.
Michael T. Burr, Public Utilities Fortnightly
From gas pipelines to PV arrays, the nation’s contractors are seeing growth in utility infrastructure. Fortnightly talks with executives at engineering and construction firms to learn what kinds of projects are moving forward, where they’re located, and what lies over the horizon.
Reports of coal’s demise are exaggerated. This summer, Dominion cleared the regulatory gauntlet to start up a new coal plant. Whether the example can be replicated might hinge on state incentives—and the forward price of natural gas.
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Coping with Carbon at Virginia City
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The Virginia City Hybrid Energy Center was already under construction when EPA issued its proposed rule regulating carbon dioxide at new sources, and therefore it isn’t subject to those restrictions. This facility is, however, well situated to deal with its carbon dioxide emissions, and the station’s owner, Dominion Resources, has supported research to establish a viable means of capturing and storing CO2.
While plans for the power station were proceeding and the permitting process was underway, carbon sequestration research funded in part by the U.S. Department of Energy was being undertaken near the Virginia City site. This work was conducted by the Virginia Center for Coal & Energy Research at Virginia Tech, and led by the Center’s Director Dr. Michael Karmis. It was coordinated by Southern States Energy Board and was part of the Southeastern Carbon Sequestration Partnership (SECARB). Dominion Resources provided matching funds for the investigation.
Karmis and his team succeeded in establishing the feasibility of sequestering carbon dioxide in un-mineable coal seams in central Appalachia. Estimated capacity of nearby seams to sequester carbon dioxide far exceeds the production of this gas over the lifetime of the Virginia City facility. The Virginia Tech team now is working to demonstrate using CO2 injection to enhance production of coal-bed methane from the area, while also sequestering the carbon dioxide.
Carbon capture technologies haven’t yet been tested at the Virginia City site. But to position the facility to take advantage of its proximity to coal seams that have proven suitable for sequestration, Dominion designed the plant with carbon capture in mind, and space has been set aside for installation of such equipment when it becomes commercially available—and upon approval by the Virginia State Corporation Commission.–HW
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Herbert Wheary (haggiscat@live.com) is a private consultant on energy policy in Richmond, Va. The opinions in this article are the author’s and not necessarily those of the Commonwealth of Virginia or Dominion Resources.
Gas-fired generators and suppliers alike can each share risk and reward from historic low prices with contracts that blend market and fixed prices
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Energy Risk & Markets
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Presuming Prudence
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In 2010, Colorado Gov. Bill Ritter signed the Clean Air-Clean Jobs Act, which, among other things, explicitly encouraged long-term gas supply contracts. The law specified procedures for commission approval and discouraged subsequent look-back by future commissions.
In April 2012, the Oklahoma Corporation Commission approved a competitive procurement rule that created new opportunities to enter long-term contracts for natural gas and other fuels. The rule created “an open, transparent, fair, and nondiscriminatory competitive bidding process” that would enable Oklahoma utilities to obtain a presumption of prudency for approved agreements.3
A report recently released by the National Regulatory Research Institute noted the proactive measures taken by Colorado, Oklahoma, and Oregon to promote long-term natural gas contracts, while the majority of state commissions provide little guidance.4 – GS and PB
Ongoing litigation over EPA rules raises compliance risks and costs. North Carolina utilities, however, benefited from the state’s forward thinking.
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Op Ed
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David Hoppock (david.hoppock@duke.edu) is a research analyst and Sarah Adair (sarah.adair@duke.edu) is an associate in research at Duke University’s Nicholas Institute for Environmental Policy Solutions in Durham, N.C.
Renewable portfolio standards and other green energy rules put a price on environmental benefits. Calculating this price can help clarify the social value of GHG reductions.
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Business & Money
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Philip Q Hanser is a principal with The Brattle Group, and Mariko Geronimo is an associate with the firm. The views in this article are theirs and not those of The Brattle Group or its clients.
The Republican nominee’s energy plan doesn’t say much about electricity or natural gas. But what it does say should sound familiar to anyone who’s followed energy policy for more than four years.
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Frontlines
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Michael T. Burr is Fortnightly’s editor-in-chief. Email him at burr@pur.com
