West Virginia Public Energy Authority Reboot Gets Support, But Raises Concern | News, Sports, Jobs

File Photo
The Mitchell Power Plant in Marshall County.

CHARLESTON — Supporters of the creation of the revamped Public Energy Authority see it as a way to keep fingers on the pulse of West Virginia’s coal and natural gas-fired power plants. Opponents see it as an overreach. Others expressed support but urged restraint on the authority’s full powers.

Last weekend, Gov. Jim Justice announced the reactivation of the West Virginia Public Energy Authority at the West Virginia Coal Association’s annual conference. The Public Energy Authority — defunct since at least 2012 when the term of the last remaining public member expired — is supposed to promote the state’s power plants fueled by coal, natural gas, and other natural resources in national electricity markets.

The authority is also empowered to finance, build, and even operate coal and natural gas-fired power plants. It can do this through financing power projects, purchasing or leasing electrical power or natural gas transmission projects, and issuing bonds to cover the costs of purchase or construction.

Justice’s announcement about the Public Energy Authority came within days of the appointment of Bill Raney, the former president of the West Virginia Coal Association, as the newest member of the three-member West Virginia Public Service Commission replacing Brooks McCabe. Chris Hamilton, the current president of the West Virginia Coal Association, was one of four public members appointed to the Public Energy Authority.

“Reactivating the West Virginia Public Energy Authority is fantastic news and comes at just the right time,” Hamilton said in a statement. “The WVPEA can help stabilize our industrial, power generating and carbon manufacturing assets as we research and deploy innovative carbon capture technologies.”

The announcement also came after news that the PSC approved a certificate of convenience and necessity requested by Appalachian Power and Wheeling Power for environmental improvements for the Mitchell Power Plant in Marshall County, the John Amos Power Plant in Putnam County, and the Mountaineer Power Plant in Mason County.

U.S. Rep. David McKinley, representing West Virginia’s 1st Congressional District, was pleased with the PSC decision. However, with the Kentucky PSC voting against a similar request by Kentucky Power (which owns 50% of the Mitchell Plant), a pending decision before the Virginia version of the PSC, and the possible sale of Kentucky Power, McKinley said it is still possible that Appalachian Power and Wheeling Power might still wind down Mitchell.

“I think it was the right decision and we should be very pleased with that, but we have to temper it unfortunately,” McKinley said by phone Wednesday. “By 2028, they may shut down one of their generators, so they’ll only be working at half-capacity. If we shut down half of the capacity, that means we’re going to be using less coal and use less maintenance, and fewer employees and a lesser tax base as a result.”

McKinley was at last Saturday’s West Virginia Coal Association meeting when Justice announced the Public Energy Authority. Long an outspoken opponent of shutting down the Mitchell Power Plant, McKinley said he supports the restart of the Public Energy Authority.

“The governor and I had some big conversations about this,” McKinley said. “We were looking at making sure we understand all the options we have … It was created several years ago for a reason. I think we have to rely on that reason and look at that. It went dormant something like 10 years ago … now we have some more flexibility.”

The Public Energy Authority was created by the late former governor Arch Moore and the West Virginia Legislature in the late 1980s. It was reauthorized again in 2007 with the passage of Senate Bill 177 that created the Division of Energy within the Department of Commerce. While the authority has submitted reports and collected information in the past, it has never actually made any power plant purchases.

While both McKinley and House Speaker Roger Hanshaw, R-Clay, see the Public Energy Authority as an important tool in the toolbox for monitoring the economic health of power plants, both expressed concerns about the state potentially using taxpayer dollars to start buying and leasing units or power plants.

“Would you put taxpayer money at risk if a coal-fired power plant is expected to expire by 2025? Be careful,” McKinley said. “I think just having another tool in the toolbox will be helpful as we continue this fight in Washington.”

“The private sector is still the best option to decide what is in the best interests of these power plants,” Hanshaw said by phone Thursday. “The state should not get into the business of owning part of a power plant.”

In conversations with consumer advocates, environmental groups, and representatives of clean energy providers, they raise concerns about the influence of the West Virginia Coal Association and the Gas and Oil Association of West Virginia (GO-WV Executive Director Charlie Burd was also appointed to the Public Energy Authority).

They also raise concerns that the state will get involved with power plants that will cost more to run than the benefits the state would receive from running them, ultimately costing taxpayers and electric ratepayers. Karan Ireland, regional organizing representative for the Sierra Club, called the plan “ridiculous.”

“This is bad for West Virginians. It’s not the way to move forward,” Ireland said by phone Wednesday. “It’s tethering us to the past and it is instilling in this long-dormant agency the power to make decisions that will adversely affect West Virginians in terms of their tax money, in terms of their utility bills, and in terms of public health.”

The Public Energy Authority was nearly re-started earlier this year. An earlier version of Senate Bill 542 requires that all electric utilities keep a 30-day supply of coal for the remainder of the life of existing coal-fired plants. It also requires that electric utilities provide advance notice of retirement, shutdown, or sale of electricity-generating units at power plants.

An unsuccessful amendment to SB 542 would have required power plants to keep a 90-day supply of coal. It also would have required utilities to file compliance reports every three years with the Public Energy Authority. During a meeting of the Senate Energy, Industry, and Mining Committee meeting on March 9 on SB 542, PSC Chairwoman Charlotte Lane called much of what the Public Energy Authority does duplicative of the functions of the PSC.

“We get reports from the utilities as far as their operation and maintenance for shutdowns and all of that,” Lane said. “We do regulate the public utilities in this state. By that, we’re not only in rate regulation, but we’re also looking at their operational status. I don’t see why we would not a duplication of what the utilities already do in reporting to us.”

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