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Dominion seeks rate hike for Clover coal ash cleanup (UPDATE)

SoVaNow.com / January 16, 2019
Dominion Energy is seeking a rate hike adjustment to cover the cost of cleaning up coal ash and other waste byproducts at three of its power plants, including the Clover Power Station in neighboring Halifax County.

Coal combustion residuals (CCR), commonly referred to as coal ash, include wastes such as fly ash, bottom ash, boiler slag, and flue gas desulfurization sludge (gypsum) produced from burning coal to generate electricity.

A public hearing on Dominion’s rate request will be held June 11, at 10 a.m. in the State Corporation Commission’s second floor courtroom located in the Tyler Building, 1300 East Main Street, Richmond. Members of the public are welcome to testify at the hearing.

Dominion estimates that the average customer using 1,000 kilowatt-hours will see a rate increase of $2.15 per month on their bills, although officials with the SCC suggest the increase could be closer to $3.30 per month for 20 years. If approved, the increase will take effect Nov. 1.

According to an application filed by Dominion in December, the utility needs to recover expenditures related to the storage and disposal of coal ash at three sites — the Clover project, the Chesterfield Power Station near Chester, and the Mt. Storm Power Station near Bismarck, West Virginia. Dominion says the work is needed to comply with EPA and Virginia Waste Management Board regulations

In the application to the SCC, Dominion Energy said that while it is increasing its reliance on clean emission resources — listing natural gas and renewable energy in the category — “coal remains an important element of Dominion Energy’s diverse mix of power generation resources.” The company said it will continue to operate the coal-fired units at Chesterfield, Clover and Mt. Storm after addressing storage and disposal of waste byproducts from coal combustion.

To comply with regulations for the storage of coal ash, Dominion said it will spend $302.4 million to construct state-of-the-art landfill, sedimentation ponds, and water treatment facilities at the three plants. Of the total sum, $7.6 million is earmarked for upgrades to the Clover Power Station, where the work involves only the replacement of a liner on two sediment ponds. The remaining $294.8 million would be spent on improvements at the Chesterfield and Mt. Storm generation plants.

Dominion is asking the SCC to allow it to pass on $113.7 million of the total cost to customers beginning in the 2019 rate year.

The company’s application acknowledges that Clover’s two sediment ponds, spanning four acres, do not meet current EPA rules for handling and storage of coal ash wastes. Ponds containing gypsum sludge were originally lined from top to bottom with concrete and riprap, sand, and a potentially permeable synthetic liner. With the planned upgrades, these ponds are “being brought into compliance by retrofitting them with a new liner system of clay, a geosynthetic high density polyethylene liner, a geotextile cushion, and a concrete pad,” according to the utility.

Under Virginia law, Dominion can seek a rate hike from the SCC to recover projected and actual costs of projects that are deemed “necessary to comply with state and federal environmental laws and regulations applicable to generation facilities used to serve a utility’s native load obligation.” Dominion argues that all of the work being done at the three stations are, in fact, necessary to comply with environmental laws and regulations.

(Editor's note: This article has been updated from the original to reflect that the clean-up at the Clover Power Station pertains to coal ash and other waste byproducts from the coal combustion process. It also clarifies that the work taking place at the Clover Station involves the replacement of the liner on two sediment ponds where coal wastes are stored.)


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