Dominion poised to bring new Va. City coal plant online this spring

Construction is 97% complete on the 585-MW Virginia City Hybrid coal plant that Dominion Resources (NYSE:D) expects to bring online this spring.

During a Feb. 24 tour of the baseload project in Wise County, Va., Dominion officials told GenerationHub they expect the plant to enter commercial operation by early June.

Dominion officials say the project has plenty going for it. The plant is located on old strip-mined land and is being built with the help of legislative incentives to construct a power plant in the Virginia coalfields. In addition to being less polluting than existing coal plants, Dominion officials tout Virginia City’s ability to burn waste coal and wood chips. Company officials also note that Virginia City won’t rely on a rail carrier to deliver its fuel supply.

Commissioning is in sight, officials said. There are 800 workers on-site now compared to more than 2,000 a few months ago when ago.

During the winter Dominion fired the boiler for the first time. In late February, Dominion was preparing to do its first test burns with coal, said Dominion’s Director of Generation Projects Mark Mitchell.

Plant can burn ‘gob’ and wood chips

New coal plants are a rarity these days, but the technology and fuel flexibility at the $1.8bn station should ensure it will be competitive, Dominion officials said.

In addition to coal mined within driving distance, the power plant will also be able to use various local “opportunity fuels,” such as waste coal and biomass, Mitchell said.

This includes biomass wood chips as well as waste coal – “or what we call ‘gob,’” said Virginia City plant manager Preston Sloane. The ability to burn this coal waste in the circulating fluidized bed (CFB) plant is a major environmental selling point, Sloane said.

A blend of “run-of-mine” coal and the coal wastes are what Dominion will be burning in the early months of operation. Within a few years, however, Virginia City plans to increase its ratio of wood chip fuel to 10%, officials said. The plant will have the ability to use up to 20% biomass, officials said.

The commissioning of the project culminates a 2004 effort by the Virginia General Assembly to encourage electric utilities in the state to build a coal plant in Virginia’s coal mining region and bolster the area’s economy. American Electric Power (NYSE:AEP) participated in some of the early studies alongside Dominion.

The state legislature eliminated the hurdle of having to make a public-interest case to the State Corporation Commission. The law also provided for the recovery of costs during construction, said Dominion spokesperson Greg Edwards.

Sprawling site was once surface mine; CCS is planned

Numerous sites were considered before Richmond, Va.,-based Dominion settled on the current 1,700-acre site that was once a strip-mine property owned by a Duke Energy (NYSE:DUK) affiliate. The size and relatively flat terrain in the mountainous county, along with its proximity to a four-lane highway and 138-kV transmission line, are among the factors that Dominion found appealing.

After the plant was licensed, construction started in 2008 with the work being overseen by the Shaw Group (NYSE:SHAW).

While a Norfolk Southern (NYSE:NS) rail line passes within eyesight of the new power plant, Dominion plans to rely entirely on regional coal hauled in by truck. Dominion will be receiving about 600 trucks per day at the site delivering both the fuel feedstock as well as limestone used for environmental controls, a Dominion spokesperson said.

Depending on the rate of biomass consumed, Virginia City is expected to use anywhere from 2.8 million to more than 3 million tons of coal annually.

CO2 emissions at Virginia City will be roughly 4.8 million tons per year when burning 10% biomass. Dominion has also committed to installing carbon-capture and storage technology at the station – when CCS becomes commercially available. The Virginia Tech-based Virginia Center for Coal and Energy Research has applied for federal research money for a CCS project at Virginia City.

Virginia City will also employ “dry storage” of coal ash, something environmental groups have sought after the failure of a wet coal ash impoundment at the Tennessee Valley Authority‘s Kingston power plant a few years ago.

As a provision of the coal plant’s air permit, Dominion agreed to further offset the plant’s emissions by converting the Bremo plant in Fluvanna County from coal to natural gas, officials said.

The new plant is expected to have a very small emissions footprint – even compared to CFB units from the 1990s. For example, Virginia City is expected to emit only 604 tons of SO2 annually. That compares to more than 6,700 tons/year from a 1990s CFB and more than 56,000 tons from a 1970s-vintage pulverized coal plant. In addition, Virginia City should emit only 5 tons of mercury annually. That compares to 50 tons for a 1990s CFB and 107 tons for a 1970s-era pulverized coal plant.

Plant is already receiving coal

Mitchell said Dominion has already signed coal supply contracts with producers in Virginia and neighboring southern West Virginia and eastern Kentucky. But the Dominion official said he was not at liberty to disclose the names of suppliers. The plant should create 350 additional mining jobs in the region, Dominion has said.

The plant will be part of Dominion’s regulated subsidiary Virginia Electric Power Co. The generation facility can utilize a 138-kV line to serve the PJM market, Mitchell said. Even in today’s power market dominated by cheap gas, “we should be economically dispatched at a pretty good rate,” Sloane said.

Virginia City is one of just a handful of CFB units in the nation, Sloane said. It is a sister plant to a Cleco (NYSE:CNL) CFB project in Louisiana that burns petcoke, he noted. The CFB will emit fewer emissions in the boiler process – making it less reliant on back-end pollution controls. At the same time, Virginia City is equipped with a full set of environmental technology including a SO2 scrubber system, baghouses and selective non-catalytic reduction equipment.

The plant will have one of the largest air cooled condensers in the nation. This will allow the plant to use roughly 1 million gallons of water per year compared to 10 million gallons for coal plants of similar size, Dominion officials said.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.