Dominion making progress on new, converted and to-be-shut shut capacity

Since 2008, Virginia Electric and Power d/b/a Dominion Virginia Power has added, or is in the process of adding, over 3,200 MW of new generation capacity to its portfolio.

These new resources encompass a broad array of fuel sources including clean coal, natural gas, nuclear and fossil uprates, biomass and other renewables, said Dominion officials in March 28 rate testimony filed at the Virginia State Corporation Commission. Virginia Electric and Power is a unit of Dominion Resources (NYSE: D), which has lately been divesting its non-utility operations to focus on its utility subsidiary.

The two projects most recently completed are the 590-MW, gas-fired Bear Garden Generating  Station and the 600-MW, coal- and biomass-fired Virginia City Hybrid Energy Center (VCHEC). “Both projects were safely completed on-time and on-budget and are important additions to our balanced, diverse energy mix that has kept rates reasonable for our customers,” said David Christian, the President and Chief Operating Officer of Virginia Electric and Power. “Bear Garden, a natural gas and oil-fired combined-cycle facility located in central Virginia, became fully operational on May 23, 2011. VCHEC, a clean coal facility that is designed to be carbon capture compatible when carbon capture technology is commercially viable and proven, became operational on July 10, 2012 and is located in southwest Virginia. This plant is also capable of using 20% biomass as a fuel source.”

Two projects that are currently under construction are the Warren County Generation Facility and the conversion of three of the company’s facilities – Altavista, Southampton and Hopewell – from coal to biomass (collectively referred to as “Biomass Conversions”).

“Warren County is an approximately 1,300 MW combined-cycle natural gas powered station with an expected cost of approximately $1 .1 billion.,” Christian noted. “Work is continuing, and it is expected to be fully operational in late 2014. … The Biomass Conversions, expected to cost approximately $157 million, will preserve approximately 153 MW of baseload generation by using renewable biomass as a fuel source. The conversions are underway at all three sites and all are expected to be on-line by December 2013.”

Coal-to-gas conversion, new gas plant currently up for commission approval

Pending before the Virginia commission for approval are an application for a Certificate of Public Convenience and Necessity (CPCN) to convert the Bremo Power Station Units 3 and 4 from coal to natural gas preserving 227 MW (net) of needed capacity, and a CPCN to construct and operate the proposed Brunswick County Power Station, a 1,358 MW natural gas-fired combined-cycle plant.

“We are awaiting Commission action on the Bremo project, while a hearing is scheduled for the Brunswick County project on April 24, 2013,” Christian noted. “Development efforts continue on both projects in order to be prepared to begin construction so as to meet the targeted commercial operation dates, assuming approval by the Commission. Bremo is projected to be operational in the spring of 2014 with an approximate cost of $53 million, excluding financing costs. The Brunswick project is expected to be fully operational mid-2016 and is expected to cost approximately $1.27 billion, excluding financing costs.”

Also in the planning stages of development is North Anna Unit 3, a third nuclear unit at the company’s North Anna Power Station. If constructed, North Anna Unit 3 will provide more than 1,400 MW of essentially carbon-free incremental nuclear-fueled baseload generation.

“Although the Company has not committed to building North Anna Unit 3, the Company is proceeding with licensing, permitting, site separation and certain development work,” Christian reported. “In October 2010, the Company announced its decision to slow the development of the potential third reactor because of  the cumulative capital required for other new generation, pending environmental compliance, and electric transmission upgrades. The Company continues to pursue a Combined Operating License (‘COL’) which requires approval by the Nuclear Regulatory Commission (‘NRC’). Prior to the NRC approving the Company’s COL, the NRC must first review and issue the Design Certification Document (‘DCD’) for the selected technology. The DCD certification and the COL issuance dates are currently expected no earlier than the first half of 2016 . Following DCD certification and when the COL is issued, we will determine our next step toward the construction of a third unit at North Anna.”

Efficiency upgrades, including at Mt. Storm, net some extra capacity

Dominion has completed efficiency and turbine uprates at several of its coal-fired, combined-cycle, and nuclear units, and will continue to evaluate opportunities for future uprates on existing units as a cost-effective means of increasing generating capacity and improving system efficiency and reliability, Christian testified. Since 2009 the company’s investment in its existing generation fleet has yielded net capacity uprates of about 267 MW.

Since the beginning of 2011, the company has added 1,190 MW from new construction and 102 MW of additional capacity through uprates for a total of 1,292 MW. An estimated 30 MW of incremental generating capacity, primarily from an uprate project at the coal-fired Mt. Storm facility in West Virginia, is planned to be operational by the end of 2013.

Dominion’s environmental control projects have achieved significant reductions of SO2, mercury and NOx emissions through the effective operation of existing and recently completed flue gas desulfurization (FGD) and selective catalytic reduction (SCR) systems. Since 1998, the company has spent approximately $1.8bn through 2012 to retrofit existing units with these air emission control technologies, including the FGD project at the Chesterfield Power Station which was completed at the end of 2011.

Over the next three years, the company intends to spend approximately $251m on environmental capital expenditures.

In some cases the best decision for customers has been to retire certain generating units. Among the new environmental requirements were new EPA Mercury and Air Toxic Standards (MATS) regulations, which were finalized in December of 2011. “These new regulations would require a significant capital investment in order to meet strict new standards for the control of mercury emissions from coal- and oil-fired steam generating units,” Christian wrote. “As a result, it was determined that early retirement for all four coal-fired generating units at the Chesapeake Power Station and two coal-fired generating units at the Yorktown Power Station was the most economic choice for our customers. In addition, the North Branch Power Station was permanently retired on September 1, 2012 in connection with the air permit process for the Warren County Power Facility.”

The units to be retired by the April 2015 MATS compliance deadline include the Chesapeake Energy Center Unit 1 (111 MW), Unit 2 (111 MW), Unit 3 (156 MW) and Unit 4 (217 MW), and Yorktown Unit 1 (159 MW) and Unit 2 (164 MW).

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.