It was a vision of new power for West Virginia rising out of the ashes for all coming into the state to see.
A witness for FirstEnergy’s West Virginia subsidiaries shared plans with a panel of state lawmakers for a new solar facility on a 26-acre reclaimed ash disposal site for the shuttered R. Paul Smith Power Station along Interstate 81 adjacent to the Potomac River in Berkeley County.
Douglas Hartman, generation services director at FirstEnergy Services Company, told legislators the planned facility in Marlowe will be one of the first things travelers see coming into the state from Maryland along Interstate 81.
“[It’s] something that would positively promote solar energy for the state,” Hartman told the Joint Standing Energy Committee.
Hartman was the first presenter before the committee in an interim legislative session meeting last month focused on solar development in West Virginia. Hartman and representatives of Appalachian Power and Toyota forecast a bright future for solar, less than two months after the Public Service Commission approved FirstEnergy’s request to build five utility-scale solar facilities across West Virginia if it reaches a certain level of customer commitments.
John Scalzo, vice president of regulatory and finance at Appalachian Power, reported that the company had a waiting list for solar customers as soon as it filed for commission approval of a proposed 50-megawatt solar facility in Berkeley County that the commission signed off on last month.
Kevin Butt, environmental sustainability senior director for Toyota North America, noted Toyota’s $4.9 million solar facility at its Buffalo, Putnam County, manufacturing plant. Toyota needs more renewable projects as it moves toward carbon neutrality, Butt told lawmakers.
“We want to be able to work with the communities where we put these projects to enhance and benefit them, not only through supplying jobs but also improving the economy in that area,” Butt said.
But top-ranking members of the state Senate Energy, Industry and Mining Committee quickly demonstrated why coal is still king in the state.
“It really pisses me off that we’re going down this path,” Sen. Rupie Phillips, R-Logan, the committee’s vice chairman, said of renewable energy.
Phillips voiced concern that a turn toward renewables would send West Virginians’ electricity prices soaring. They’ve already been escalating amid West Virginia’s persistent reliance on coal-fired electric generation.
Prices rose at a faster rate and remained at higher levels in regions with higher shares of coal from 2004 through 2019, according to the U.S. Bureau of Labor Statistics.
Prompted by a lawsuit led by West Virginia, the Supreme Court ruled Thursday that the federal Environmental Protection Agency lacks the authority to shift the nation’s power generation to lower-emitting sources than coal.
But the ruling won’t change market forces driving the coal industry’s decline.
Instead, the decision has put the state’s anachronistic embrace of coal squarely in the national spotlight while adding to West Virginia renewable energy advocates’ fears that lawmakers are futilely resisting an energy transition instead of shaping it to the state’s advantage.
“We have to have the political will to do it,” said James Van Nostrand, director of the West Virginia University College of Law’s Center for Energy and Sustainable Development.
Market forces at play
Coal accounted for roughly a fifth of the nation’s net electricity generation in 2020.
But that share was a whopping 88% in West Virginia.
State ratepayers faced a 90% climb in average residential electricity retail price from 2005 to 2020, according to federal data. Only Michigan had a greater increase by percentage.
Sen. Randy Smith, R-Tucker, state energy committee chairman, made clear last month that he doesn’t want to see coal replaced as the centerpiece of the state’s electric power portfolio.
“I just feel that we’re putting our state and our country in jeopardy with our national security, with our power grid because of the feelgood movement,” Smith said during a committee meeting.
Smith asked Public Service Commission Chairwoman Charlotte Lane if her agency had a non-coal “emergency plan” in place to prepare for an extended period of hot weather.
“Right now, our emergency plan, I guess, is we are doing everything we can to keep the coal-fired plants operating until 2040 and beyond,” Lane responded.
In September, the commission required Appalachian Power’s John Amos plant in Putnam County and Mountaineer plant in Mason County and Wheeling Power’s Mitchell plant in Marshall County to operate with a capacity factor of 69%, citing concern Appalachian Power might not be maximizing use of the plants.
Capacity factor is the ratio of electrical energy produced by a generating unit for a given time to the electrical energy that could have been produced at full power during the same span.
Appalachian Power and renewable energy advocates have questioned the commission’s 69% capacity factor requirement, saying it’s uneconomic.
“I think it’s short-sighted to only advocate for policies that are based on maintaining power generation sources that powered the country last century because the country is moving on,” said Delegate Evan Hansen, D-Monongalia, a leading proponent of renewable energy.
Enter West Virginia v. EPA.
Supreme Court Chief Justice John Roberts wrote that it wasn’t plausible for Congress to give the EPA authority to cap carbon dioxide emissions at a level that would force a nationwide transition away from coal-fired electricity.
The court’s decision further cemented West Virginia’s leaders as the chief obstacle to aggressive U.S. climate action.
U.S. Sen. Joe Manchin, D-W.Va., has frustrated renewable energy proponents by blocking sweeping climate action included by Democrats in a planned budget package that stalled without his support in an upper chamber split between the two major parties.
Manchin spokeswoman Sam Runyon declined to comment on the court’s ruling.
“You do have one state and its leaders setting up a huge hurdle or roadblock for the path to reduce emissions to prevent a warming planet,” said Matt Kasper, deputy director of the Energy and Policy Institute, a utility watchdog that favors renewable energy.
Scientists say the U.S. and world must drastically cut fossil fuel use to limit global warming to 1.5 degrees Celsius above pre-industrial levels, a threshold that scientists say would trigger significantly greater climate change impacts that include more intense flooding and damage to infrastructure in West Virginia.
Nine coal-fired power plants in West Virginia combined to emit more than 55 million tons of carbon dioxide and lead to 381 deaths in 2019, according to a Clean Air Task Force analysis of state data derived from a federal screening model.
The court’s decision allowed the EPA to keep regulating greenhouse gas emissions but made clear the agency lacked broad power to pursue novel approaches to slowing climate change.
“[F]ew will benefit, while everyone else has to deal with the increasing floods and extreme weather events resulting from the fossil-fueled climate crisis,” said Vernon Haltom, executive director of Coal River Mountain Watch, a Raleigh County-based nonprofit group opposed to mountaintop removal mining.
In his majority opinion, Chief Justice John Roberts wrote that the EPA overstepped its bounds in planning under an Obama administration rule that never took effect to restructure the nation’s electricity generation mix to transition from 38% to 27% coal by 2030.
Even after the Supreme Court put the Clean Power Plan on hold following another West Virginia-led lawsuit, the U.S. far surpassed the plan’s coal reduction target.
Coal compose just 21.8% of U.S. utility-scale electricity generation in 2021 — barely surpassing the 20.1% that came from renewables.
Market forces driving coal out of state energy portfolios elsewhere in the country aren’t likely to end any time soon.
Michelle Bloodworth, president and CEO of coal-fueled electricity trade group America’s Power, lamented in a statement that a capacity auction held last month is likely to result in more coal retirements.
The capacity auction was held by PJM, the regional transmission organization that coordinates the movement of wholesale electricity in West Virginia and 12 other states.
The auction procures power supply resources in advance of the delivery year to satisfy electricity needs in the PJM service area.
American Electric Power and FirstEnergy-controlled coal-fired plants should be mostly insulated from the capacity auction’s results because they’re supported by ratepayers, said Toby Shea, utility credit rating expert with Moody’s Investors Service, a credit rating and research firm.
“The regulated [plants] are protected from market forces,” Shea said.
Renewable energy proponents say that the Public Service Commission has hurt ratepayers by favoring coal, leading West Virginia in ignoring market trends.
“We’re anachronistic because the Public Service Commission is determined to bail out the coal industry on the backs of West Virginia ratepayers,” Van Nostrand argued.
“The commission’s efforts [have been to] protect coal operators and shareholders from a marketplace that offers cleaner, cheaper alternatives, a phenomenon that has been accurately described as socialism for the coal industry,” said Sean O’Leary, senior researcher for the Ohio River Valley Institute, a pro-renewables nonprofit think tank.
The commission has said that operating at higher capacity factors would lower costs recoverable from customers, encouraging self-generation over paying rising PJM market prices for purchased power.
Appalachian Power and Wheeling Power asked the commission in April in a pending request for a $297 million increase in the rate that the companies charge for buying power or fuel to generate electricity. The rate increase would raise the monthly bill for a residential customer using 1,000 kilowatt-hours by $18.41 starting Sept. 1.
Guaranteed earnings for state-regulated monopolies have incentivized utilities to keep investing in fossil fuel plant upgrades, but even that calculus could be changing.
A 2020 analysis from the financial advisory firm Lazard estimated the ongoing cost of a new solar energy project is $24 to $32 per megawatt hour, $10 to $16 less per megawatt hour than the cost to operate an existing coal-fired power plant.
“The political will in West Virginia is we want the coal plants to burn at 69% capacity factors,” Van Nostrand said.
‘We’ve been bamboozled’
In a presentation before the state Public Energy Authority last month, Appalachian Power President and Chief Operating Officer Chris Beam reported that the company lost out on attracting an unnamed battery manufacturer to West Virginia because it couldn’t meet the company’s renewable energy needs.
“[It would have been] a large investment with … what I like to say [are] career jobs,” Beam said. “They pay money where you can raise a family, buy a home.”
Nucor Steel West Virginia filed a letter of support for the Berkeley County solar project with the Public Service Commission that the agency later approved. Nucor noted that the availability of renewable energy was a “key consideration” in Nucor’s decision to build a $2.7 billion sheet mill in Mason County expected to employ about 800 full-time workers. State officials also approved more than $300 million in taxpayer subsidies to help lure the company to West Virginia.
“In West Virginia, we need to recognize the transition that is happening all around us and position ourselves for new energy jobs because those are the jobs that are going to increase in the future,” Hansen said.
State Attorney General Patrick Morrisey had framed the petition led by his office as a move to protect the state’s economy.
“We are optimistic that the decision will save many West Virginia jobs,” Morrisey said in a statement Thursday hailing the Supreme Court’s ruling.
The number of coal employees dropped by half and coal production declined 42% statewide from 1990 to 2019, according to state data.
West Virginia New Jobs Coalition coordinator Carey Jo Grace was among the speakers who urged a shift in West Virginia’s economic mindset.
“We’ve been bamboozled into believing that coal equals jobs and money for our state,” West Virginia New Jobs Coalition coordinator Carey Jo Grace said during a recent gathering of advocates in Manchin’s hometown of Fairmont. “What has it brought us? It’s brought us mountaintops that are blown off … It’s brought us hollowed-out coal communities where people are struggling to get by and don’t have a grocery store unless they drive for 45 minutes.”
The state that elected Gov. Jim Justice, a coal magnate and climate change questioner, to a second term by a more than 30-point margin and a Republican supermajority in the state Legislature in 2020 has made its choices on coal and climate clear.
“Coal has been an extremely important part of West Virginia’s identity for decades,” Hansen said. “People are very proud of our coal heritage, and rightfully so. So I think it’s a difficult shift to make.”
Because of West Virginia v. EPA, it’s a shift that West Virginia now has more freedom to make at its own pace — however perilous that pace might be.
“I’m kind of getting tired of it, because it’s like, how many times can we say the same thing?” Grace asked. “And when are people going to start listening?”
