The expanded use of natural gas as a fuel for electricity is the key debate in Dominion Energy Virginia’s integrated resource plan pending before the State Corporation Commission. Not waiting for the decision in that case to come later this year, the utility has now filed an application to start building the first of those gas plants.

Dominion’s Chesterfield Energy Reliability Center would include four small gas turbines designed to run only when needed to meet peak demand, both for Dominion or for other utilities in the PJM Interconnection region. Dominion had previously announced it would start its gas expansion with that project, to be built near a retired coal plant along the James River on ground already zoned for the use.  

The entire integrated resource plan, (IRP), prepared before the November election, now rests on several false premises and should likely be scrapped entirely. If the recent changes in federal energy policy are then met with a change in direction for the state, Dominion could then proceed with the far more cost-efficient choice of a full baseload combined cycle gas plant in Chesterfield, instead of the smaller gas turbines being proposed now.

The integrated resource plan and the Chesterfield plant application both hinge on the question of whether additional natural gas generation is required to maintain reliability. Protecting system reliability is the only loophole in Virginia’s 2020 Clean Economy Act (VCEA), which otherwise prohibits new hydrocarbon plants and demands the existing facilities all close.

You can watch the paper record on the integrated resource case build here, with a hearing set for next month, or read Dominion’s full application for the Chesterfield plant here. The company and opponents have already lined up experts with impressive credentials testifying that natural gas is either needed or not needed to maintain reliability. The three SCC judges will have to choose whom to believe.

One of the assumptions at the heart of Dominion’s proposal was approval of a new set of federal restrictions on hydrocarbon generation, which were pending at the federal Environmental Protection Agency. The dominant scenario in its plan is based on compliance with those EPA regs, which now are likely to disappear. 

Every future scenario Dominion offered also involved the completion of the Coastal Virginia Offshore Wind (CVOW) project, now under construction, plus the construction of two additional offshore wind facilities. The two additional projects are now frozen by a review Trump ordered in one of his first Executive Orders. Their underlying federal leases could be revoked. 

Again, one must assume the two future plants are fully suspended for at least four years and perhaps for longer, and it is questionable whether even spending ratepayer money on planning them is prudent. Including them in the IRP makes it fiction. For that matter, the future of the $10.7 billion wind project already under construction is in doubt, but the Trump Administration’s actions on that are harder to predict. A push is on to kill it.

Finally, uncertainty now clouds all the federal subsidies approved under President Joe Biden, crucial to reducing the ratepayer cost of all Dominion’s planned wind, solar and battery projects. They are far less economical without the subsidies, which are baked into every one of Dominion’s IRP scenarios. Congress may not kill them all, given all the local pork barrel they represent, but there could be some limits imposed. 

So before next year, probably even before this IRP case reaches its conclusion, the energy environment may have changed radically and left it behind. The legal term to describe its status as of today is “moot” as in “of little or no practical value, meaning or relevance.” 

Which simply reinforces the conclusion that the Dominion Chesterfield project should be focused on building a new large base-load plant, not four small peaking plants.

As mentioned before, Dominion wants to build four “peaker” plants that run just as intermittently as the wind, solar and battery facilities they are designed to back stop. Some measures of the levelized cost of energy indicate a megawatt of electricity from that technology is twice as expensive as gas combined cycle turbines and more expensive than from nuclear. A combined cycle facility would undoubtedly provide more value to ratepayers and more power for Virginia and the rest of the PJM region.  

Absent Dominion’s intention to comply with the VCEA vision and to build massive amounts of additional solar and wind generation, there would be no logic at all in spending billions on these four peaker plants. If natural gas is needed for reliability, and the Thomas Jefferson Institute for Public Policy has long believed that it is, then go all in on the needed full-scale plants.

Eight months from now another bit of uncertainty should clear up. The 2025 election could reinforce Virginia’s commitment to the dream of carbon-free electricity, or voters could recognize zero-carbon as the pipedream it really is and vote to change direction.

The SCC cannot legally recognize election uncertainty and must act as if the VCEA will remain in force. Other things approved under President Biden – the new EPA carbon regulations and the wind project approvals – are also still technically in force. But the IRP decision they drive may quickly be proved hollow and the justification for the Chesterfield peaker project could vanish. 

Steve Haner is a Senior Fellow for Environment and Energy Policy. He can be reached at Steve@thomasjeffersoninst.org.