Dominion Resources (NYSE: D) said April 26 that it has nearly completed construction of a 585-MW coal-fired power plant in southwestern Virginia and has started building a combined-cycle natural gas plant in the northern part of the state.
The Dominion first-quarter earnings call updated Wall Street analysts on its new power plant construction plans and its plans for a natural gas export facility in Maryland. Dominion also said it was keeping its options open for both a new nuclear plant and a major offshore wind energy project.
“In Dominion Generation, the 585-MW Virginia City Hybrid Energy [plant] is more than 98% complete and on schedule for operation in the middle of this year,” said Dominion CEO Thomas F. Farrell II. “Construction is proceeding on the 1,329-MW, gas-fired power station in Warren County, Va., following approval of the Virginia State Corporation Commission (SCC) and is scheduled for commercial operation in late 2014.”
He added: “Moreover, we announced that Brunswick County, Va., has been selected as the site for our next gas-fired generating facility, another 3-on-1 combined cycle plant. We expect to file regulatory applications later this year to build the station, which is expected to produce more than 1,300 MW of electricity.”
The Virginia City Hybrid plant in Wise County, which will burn both coal and biomass, had its first fire on coal earlier this year. It was first synchronized to the grid in the first quarter and should start commercial operation in the middle of this year.
The Warren County combined-cycle plant received its final approval from the SCC in the first quarter and construction is starting on the plant near Front Royal.
Dominion is currently soliciting bids for an engineering, procurement and construction vendor for the Brunswick County combined-cycle gas plant. Look for Dominion to file a certificate of public convenience and necessity application later this year.
Dominion Virginia Power will also file for state certification later this year for its plans to convert some small coal units to biomass.
The company’s unregulated power arm has also recently closed its State Line coal plant in Indiana.
Gas export facility won’t preclude new nuclear plant
Much of the earnings call was devoted to Dominion’s announcement that it will go forward with its Cove Point Liquefaction project. Dominion plans to export domestically produced liquefied natural gas from a terminal in Calvert County, Md.
At the end of March, Dominion signed binding precedent agreements with two companies, one of which is Sumitomo Corp., a major Japanese corporation with significant global energy operations. Japan has been importing more fossil fuels after much of its domestic nuclear fleet was idled following the 2011 Fukushima disaster.
Dominion’s Farrell said that development of this costly capital infrastructure project will not preclude Dominion’s Virginia Electric and Power (VEPCO) utility subsidiary from building a third power reactor at its North Anna station in Louisa County, Va.
“I believe North Anna 3 will be built,” Farrell said in response to a question from an analyst. When that will happen is a different question, the CEO said.
Dominion currently expects to get its combined construction and operating license, or COL, from the Nuclear Regulatory Commission in 2015. The company also expects NRC approval of its new reactor design around that same time.
Farrell said Dominion’s many nuclear units are a primary reason that its Virginia customers have some of the lowest power rates on the East Coast.
Dominion has also filed a lease request with the federal government in hopes of eventually establishing an offshore wind power enterprise that could produce between 1,500 MW and 2,000 MW. Dominion officials, however, cautioned that offshore wind could still be many years down the road given uncertainty surrounding government procedures for such projects.
The modernization project for Dominion Virginia Power’s Mount Storm-to-Doubs transmission line, a major 500-kV line serving Virginia, West Virginia and Maryland, is well under way. Completion of that project is now expected by the end of 2014.
Like other power companies, Dominion said its earnings were affected by mild winter weather. Dominion announced unaudited reported earnings determined in accordance with Generally Accepted Accounting Principles (GAAP) for the three months ended March 31, 2012, of $494m ($0.86 per share), compared with reported earnings of $479m ($0.82 per share) for the same period in 2011.