Dominion (NYSE:D) will soon be bringing online a new combined-cycle natural gas plant in northwest Virginia while it moves ahead with other new gas-fueled generation and gas pipeline projects, the company CEO told financial analysts during an earnings call Oct. 31.
“Construction of the Warren County Power Station is nearly complete and Brunswick County Power Station is 35 percent complete and continues on time and on budget,” said Dominion Chairman, President and CEO Thomas F. Farrell II.
At Warren County, all of the units have completed “first fire,” Farrell said. The 1,300 MW Warren County plant near, Va., is expected to go online by the end of the year. The Brunswick County gas plant is expected to come online in mid-2016.
Dominion is also starting to do licensing work on a proposed combined-cycle gas plant targeted for commercial operation in 2019. Dominion expects to file a certificate of public need application with the state in mid-2015, the company said. The company has not publicly announced a location for the latest proposed combined-cycle project.
“Construction is also on schedule for seven solar projects, all of which are expected to reach commercial operation later this year,” Farrell said. The solar projects are being developed in locales such as Tennessee and California.
Dominion has “a lot of ideas on solar,” both inside and outside its service territory, Farrell said. The company will discuss that further in 2015, he added.
As for existing generation, Farrell said the nuclear fleet continues to perform well. Dominion’s six nuclear units had a net capacity of more than 94% during the first nine months of 2014. There have already been a couple of refueling outages done at Dominion nuclear units already in 2014, the CEO said.
A refueling outage for the Millstone 3 nuclear plant in Connecticut should conclude during the fourth quarter of this year, the company said.
“The company’s service territory experienced one of its mildest summers in the past 30 years,” Farrell said.
The financial release also noted that during the past nine months Dominion has seen a $219m charge associated with Virginia legislation enacted in April that permits Virginia Power to recover 70% of the costs previously deferred or capitalized through Dec. 31, 2013 relating to the development of a third nuclear unit located at North Anna and offshore wind facilities as part of the 2013 and 2014 base rates.
Dominion is a growing player in the natural gas industry. The company just started construction of its Cove Point liquefied natural gas (LNG) export facility in Maryland. Cove Point is scheduled to enter service in late 2017.
Likewise, subsidiaries of Dominion and Duke Energy (NYSE:DUK) own 45% and 40% respectively of the proposed Atlantic Coast Pipeline. The gas pipeline, which will stress through North Carolina and Virginia and into West Virginia, is already 90% subscribed, Dominion officials said.
The pipeline will serve new natural gas plants being developed by Dominion and Duke in the region, along with other potential customers. Dominion hopes construction can start in late 2016 with the pipeline entering service in late 2018.
The Dominion CEO noted in summer 2015 the Environmental Protection Agency (EPA) is expected to issue its final version of the Clean Power Plan to cut carbon dioxide. That development, followed by filing of state implementation plans, should ensure more “clarity” on CO2 policy by the time the Atlantic pipeline is deployed, Farrell said.
When asked by a financial analyst, Farrell said there was significant potential for natural gas pipeline expansion. Farrell, however, doubts Dominion would pursue pipeline business in the Northeast market.
Dominion announced unaudited reported earnings determined in accordance with Generally Accepted Accounting Principles (GAAP) for the three months ended Sept. 30, of $529m (90 cents per share), compared with earnings of $569m (98 cents) for the same period in 2013.
Operating earnings for the three months ended Sept. 30, amounted to $545m (93 cents per share), compared to operating earnings of $583m ($1.00 per share) for the same period in 2013. Operating earnings are defined as reported (GAAP) earnings adjusted for certain items.