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WV Governor Issues Stay At Home

WV Governor Issues Stay At Home

West Virginia governor Jim Justice Monday, March, 23, 2020, issued a stay at home order, effective 8 p.m. Tuesday from his office in the WV State Capitol in Charleston, W. Va. Orders all non-essential businesses closed. (Kenny Kemp/Charleston Gazette-Mail)

The Brooke County Power plant project, nearly four years in the making, was set to clear one of its final pre-construction hurdles.

The West Virginia Economic Development Authority was scheduled to vote on the approval of a $5.5 million loan guarantee for the facility during its Aug. 20 board meeting, until the topic was pulled from the agenda without explanation. Members of the trades union, oil and gas industry and public, lawmakers and county commissioners were left scratching their heads.

Construction is projected to infuse $1.25 billion into the local economy. The facility’s annual economic impact is expected to top $440 million.

The facility has pledged $1 million to Brooke County once the plant is built and would contribute $600,000 annually to the county commission and board of education.

More than 1,000 construction workers are needed to build the plant. Officials estimate the project will create 1,164 jobs related to maintenance, supplies and other services once it’s built. The plant will require 30 full-time workers.

These numbers are derived from an independent economic analysis conducted by West Virginia University’s former chief economist Tom Witt. The facility would be West Virginia’s first natural gas-fired power plant, capable of powering the equivalent of 700,000 homes.

All that was needed to make it happen was state backing through the Economic Development Authority. So what happened?

Department of Commerce Secretary Ed Gaunch said he did not know why the agenda item was pulled. The authority is not a Commerce agency but its chairperson also serves as the executive director of the state development office.

Gov. Jim Justice said during Monday’s COVID-19 briefing he had directed Gaunch to have the development authority review the project’s application again. A special meeting is scheduled for 10 a.m. Wednesday when board members are expected vote on the loan guarantee. Justice said he will honor the authority’s decision.

Gaunch said he supports the project because of the economic activity it will generate in northern West Virginia.

“There’s all kinds of good reasons that I’m excited about the project, and [I’m] hopeful it moves forward,” Gaunch said.

Stakeholders worry that $5.5 million will derail the project.

Gaunch said the amount “is pretty insignificant in terms of the total project” and that West Virginia might not even be on the hook for those millions if the facility is built without complications.

“It’s not a loan, it’s a loan guarantee, so we’re basically guaranteeing to Huntington Bank who will make the loan that we will make them whole in the event that something bad happens,” he said.

‘The 800-pound gorilla’

In November 2015, an obscure group called the Ohio Valley Jobs Alliance filed a legal challenge to a key permit for construction of the Moundsville Power project, a proposed natural gas-fired plant in Marshall County. The company behind the Brooke County project, Energy Solutions Consortium, also backed the Moundsville project.

But the legal challenge wasn’t brought by citizens. Rather, it was bankrolled by one of the nation’s largest coal producers, Murray Energy Corp., a leader of the alliance later said in a deposition. A Murray Energy attorney declined to comment for this story.

A 2018 Charleston Gazette-Mail and ProPublica article detailed how Murray Energy, founded by billionaire coal baron Robert E. Murray, quietly funded the alliance’s litigation aimed at disrupting the creation of natural gas-fired power plants.

The jobs alliance effectively tanked the Moundsville plant through incessant legal challenges. The group filed a similar legal challenge against a natural gas plant proposal in Harrison County in 2018.

The West Virginia Supreme Court affirmed the state Public Service Commission’s approval of the Brooke plant. The Harrison project remains in its early stages.

“The [Brooke project’s] delays have been wholly because of challenges from people like Bob Murray and his nonprofit group,” Brooke County Commissioner A.J. Thomas said, referring to Murray Energy’s founder.

Steve White, director of the Affiliated Construction Trades Foundation, a coalition of construction unions whose members would build the Brooke County plant, describes the coal industry as “the 800-pound gorilla in the room” as the Brooke County proposal nears its final stages.

Justice, whom the West Virginia Coal Association endorsed Aug. 20 for reelection, inherited a coal mining business from his father, grew it into a business empire and is now the state’s only billionaire.

Asked to comment, the governor’s office referred a reporter to Justice’s remarks on the project during two recent COVID-19 briefings.

On Aug. 26, an Ogden Newspapers reporter asked where the Brooke County project stood after the authority pulled the loan guarantee from the agenda.

Justice said he still had concerns about the project.

“I want everybody to really pay attention to these numbers because I’m the numbers guy,” Justice said.

He said the project had been in the works “for eight years or so.” The time period is closer to four years. He said the plant would create “20 [full-time] jobs a year; that’s it.” Estimates are the plant will create 30 full-time jobs on-site and more than a thousand related jobs.

Justice said that while he views natural gas as the future of West Virginia “in many ways,” there are lingering questions about the Brooke project.

One was whether three-fourths of construction workers would be required to be from West Virginia. That was resolved long ago, White said. The trades association had an agreement with Energy Solutions Consortium before the Moundsville project was scrapped, and that deal was extended when the Brooke County project was announced.

“Since the beginning, we’ve had strong commitment, written agreements, about using local union workers, good wages, good benefits, great opportunities, big payrolls — these are just great projects for us,” White said.

The construction payroll is projected to reach $98 million.

“I challenge anybody to point to where that kind of payroll can be dumped into our economy,” White said.

Justice likened the company requesting a loan guarantee to seeking free property.

“He called it a no-money-down real estate deal,” White said. “I mean, [that’s] totally untrue. These developers have put millions of dollars of their own money into these projects … It’s almost embarrassing that they’re getting beat up.”

Justice also said, “The gas has gotta come from West Virginia.”

“Now, if I didn’t have the right to ask those questions then I must not be much of a governor.”

All his questions were answered long ago, White said.

“The questions about gas, the questions about local workers, the questions about the project — that’s all part of the Public Service Commission’s siting certificate,” White said. “There’s public hearings. There’s evidentiary formal hearings. There’s a permit that’s issued — all that data is part of that process, and [the PSC must] make a determination that it would be a benefit to the state.”

The earliest Public Service Commission filings on the Brooke County project date to January 2017. The commission approved the project Feb. 20, 2018. The coal-backed jobs alliance filed the legal challenge two days later.

Justice’s coal connections raise other questions like those sparked last year, when in the midst of a special legislative session called for resolving public education issues, Justice added legislation extending a $60 million tax break over five years to the Pleasants County Power Station, a coal-fired plant owned by FirstEnergy subsidy FirstEnergy Solutions.

After the bill passed, it was revealed FirstEnergy had a $3.1 million lawsuit pending against Justice’s Bluestone Energy claiming the governor’s coal company had breached its contract by failing to buy back unused coal stockpiles.

Murray Energy is the primary supplier of coal to the Pleasants Power Station.

What happens if the project fails?

West Virginia’s loss would be a neighbor’s gain.

Charlie Burd, executive director of the Independent Oil and Gas Association of West Virginia, said the state’s Northern Panhandle sits in the heart of the Marcellus-Utica Shale. If the project fails in West Virginia, investors can shift plans to a site a few miles east or west in a state that traditionally has supported natural gas.

“The competition here is Ohio and Pennsylvania. They already have combined well over two dozen natural gas-fired power plants in these states,” Burd said. “If you lose an $850 [million] to $900 million investment on a [830]-megawatt power plant ... Ohio and Pennsylvania will end up getting that investment.”

Thomas, the Brooke County Commissioner, said West Virginia workers finally will be working in their home state if the project is cleared.

“They’re out doing work in Pennsylvania and Ohio because there is nothing going on here,” Thomas said. “We are going to have a substantial amount of West Virginia workers working on this thing.”

Drew Dorn, president of Energy Solutions Consortium, wrote in a statement that the economic activity generated by the plant and the money already invested in West Virginia by the company should not be understated.

“Brooke County Power will be the single largest user of natural gas in West Virginia … Our company has invested millions of dollars in the Mountain State hiring West Virginia engineering, legal and economic firms to work toward the success of this project,” Dorn wrote.

White said Justice has succeeded in uniting labor and business in recent weeks. Steve Roberts, president of the West Virginia Chamber of Commerce, wrote an op-ed in The Intelligencer newspaper asking the development authority to approve the loan guarantee.

Burd said the oil and gas association is fully behind the facility, noting the industry already is flourishing here.

“It absolutely has our blessing,” he said. “It’s the perfect use for the abundant supply of natural gas we are producing in this state.”

The Brooke County project won’t be the only hit to economic development if it’s forced out of state, White said.

“If the Brooke County Power project is killed, in essence, then the Harrison County project could be right behind it,” he said. “Who’s going to invest in a project in West Virginia knowing that government is up to kill you?”

Reach Joe Severino at

joe.severino@wvgazettemail.com, 304-348-4814 or follow

@jj_severino on Twitter.