Report Details Financial Risks of Proposed $6 Billion Coal-Fired Power Plant

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Download 2 page Fact Sheet of Report Here

Download full Report Here (33 pages)
A report released in Virginia today details the financial pitfalls of investing in a massive $6 billion coal-fired power plant in Hampton Roads, as proposed by the Old Dominion Electric Co-Operative (ODEC). The high costs of constructing and operating such a plant would burden ratepayers with a far higher cost than alternatives, the report from Synapse Energy Economics concludes.

Join the authors and energy experts tele-conference at 2:00 PM today (details below).

According to ODEC, the plant would emit 14.6 million tons of carbon dioxide annually. In addition to the $6 billion construction cost, and standard fuel and operating costs, paying for carbon emissions credits for these emissions under a federal cap-and-trade program could impose an annual cost of between $223 million and $670 million by 2016. As regulations become more stringent, that could rise to between $587 million and $1.76 billion a year by 2030.

Alternatively, a mixture of energy efficiency measures, offshore wind, biomass, and natural gas generation providing the same power as the proposed plant would emit five times less carbon dioxide and cost ratepayers between 1.7 cents and 4.5 cents less per kilowatt-hour. The report concludes that, in light of the current economic recession and Virginia’s legislative policy to reduce energy consumption, the need for the additional 1,500 megawatts of power from the Hampton Roads plant is highly uncertain.

Other recent reports on proposed coal plants in the South mirror the Synapse findings that coal generation is increasingly costly, making efficiency increasingly a smarter investment. A January report by Abt Associates showed that meeting electricity demands through efficiency instead of constructing Dominion Power’s Wise County coal plant would save the average household in Dominion’s service territory up to $91 per year, boost the state economy by hundreds of millions of dollars, and create at least 2,600 more jobs. In South Carolina, an analysis released last week of Santee Cooper’s proposed coal plant concludes that, in light of construction costs, anticipated controls on carbon emissions, the state of the economy, and unexploited energy efficiency potential, investing in the plant would be a serious mistake. And in Kentucky, a report released in early April on a coal plant proposed there likewise advised that consumers would benefit from canceling plans for the project and investing instead in more economical and less capital intensive options, including energy efficiency.
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The Synapse report was commissioned by the Wise Energy for Virginia coalition, in partnership with the Natural Resources Defense Council. A fact sheet on the report’s conclusions is below, and the full report is available at http://wiseenergyforvirginia.org/resources/
From the Wise Energy for Virginia coalition partners:

“If the plant is built, it will inflict economic and environmental harm on our state for its entire 60-year lifespan. Now is the time to consider all the consequences of such a massive investment, and this report helps bring the economic consequences to light,” said Tom Cormons, director of Appalachian Voices’ Virginia office.

“This report shows what Wall Street and virtually all other power producers in the United States already know: new conventional coal plants are irresponsible investments. We’ve had enough of those lately,” said Theo Spencer, a Senior Advocate at the Natural Resources Defense Council.

“Across the country, plans for 24 coal-fired power plants were cancelled in 2008 alone. This latest report explains why the tide is turning against these dinosaurs,” said Cale Jaffe, Senior Attorney at the Southern Environmental Law Center.

“We know that the cost of carbon goes far beyond dollar amounts. However, this report shows in a crystal clear analysis that Virginia families simply can’t afford further investments in costly, dirty coal,” said Kirsten Collings, Campaign Director at the Chesapeake Climate Action Network.

Tom Cormons, Virginia Campaign Coordinator, Appalachian Voices
Cale Jaffe, Senior Attorney, Southern Environmental Law Center
Kayti Wingfield, Coalition Coordinator, Wise Energy for Virginia Coalition