(Warrenton, VA – August 20, 2008) The Piedmont Environmental Council (PEC) has filed its response to the State Corporation Commission (SCC) Hearing Examiner’s recommendation of approval for the high-voltage transmission line requested by Dominion Power to the SCC Commissioners.

“This case is far from over and the brief filed with the SCC clearly outlines the defects in the recommendation made by the Hearing Examiner in this case,” said Christopher G. Miller, President of the PEC. “In many aspects of the case the Hearing Examiner agreed with our contention that the line is not for Virginia’s energy needs and that the line will have a negative impact on rates. In fact, the Examiner labeled Dominion’s advertising campaign regarding the line as “self serving”.”

PEC also expresses its deep concerns regarding the complete failure by the Hearing Examiner to address the identified impacts to well-documented natural, historic, cultural, and scenic resources, not to mention the impacts on individual landowners and communities. “The PEC calls on the SCC Commissioners to mitigate all of the specific impacts identified by testimony as to visual impacts on historic districts, scenic roads, the Appalachian National Scenic Trail and National Register historic properties,” said PEC President Christopher Miller.

In its comments, PEC joined the Board of Supervisors of Fauquier, Prince William, Rappahannock and Culpeper Counties, among others, in urging the SCC commissioners to find that Hearing Examiner Skirpan fundamentally misinterpreted the law of the Commonwealth and ignored the evidence from numerous public hearings when he ruled that violations of national reliability standards simulated to occur in 2011 established conclusively the need for approving the proposed transmission line.

PEC and other opponents pointed to evidence from the public hearings, including a three-week long evidentiary hearing convened in Richmond last February and March, showing that the proposed line, known as the Loudoun line, did not resolve the simulated violations of reliability standard beyond the summer of 2011.  For that reason, PEC contended that "the Loudoun line would be a billion-dollar cure for an unlikely simulated disease in one summer peak season at an annual increased cost to the area's ratepayers of $368 million — $168.8 in increased payments to generators and $200 million for the annual cost of service for the Loudoun line itself."

Opponents including PEC reject the contentions of Dominion and Allegheny that the Loudoun line is driven by electric service reliability concerns.  Instead, they point to the genesis of the Loudoun from a concept called Project Mountaineer that was launched at 2005 conference in Charleston, West Virginia devoted to answering how more megawatts of inexpensive coal-fired electricity could be transported from the Ohio River valley in the west to high-priced energy markets along the eastern seaboard.  The answer, according to PEC, is the Loudoun line impacts the Appalachian Trail, federally recognized historic districts and historic properties, Civil War battlefields, and other public scenic, historic and cultural resources to transmit electricity from Dominion's and Allegheny's western coal generator fleets to lucrative markets in the east.

PEC enumerates in its comments questions that will shape the course of Virginia energy policy and development, but which that Hearing Examiner Skirpan dodged in his report to the SCC.  These questions include:

1. Assuming that there is need for more west-to-east electric power transmission that causes the transmission loading and voltage violations that the Loudoun line is proposed to solve, does the Loudoun line actually provide a sustainable solution to those violations?  Mr. Skirpan recommended conditional approval of the proposed Loudoun line without addressing evidence showing that, at most, the Loudoun line provides a solution for the summer of 2011 only, and that those violations recur in 2012 and beyond.

2. Does electric service reliability require that predominantly coal-fired generation west of Virginia be transmittable throughout service area of the regional transmission grid operator (which has tripled in size in recent years), or is that simply the fulfillment of the economic aspirations of western generation owners, including the Applicants, as contemplated by Project Mountaineer?  The Hearing Examiner ruled that economics was irrelevant to the issue of whether there is a need for the proposed transmission line.

Together with the other transmission line opponents, PEC raised additional grounds for rejecting Hearing Examiner Skirpan's recommendation that the Loudoun line be conditionally approved.  These include Mr. Skirpan's conclusion that integrated resource planning is not allowed in the Commonwealth and therefore Dominion and Allegheny were not required to develop energy plans that optimize ratepayer investments in combinations of power generation, demand management and efficiency, and transmission lines.  To the contrary, PEC pointed to recently enacted law that requires Commonwealth utilities to pursue such integrated resource planning.

PEC reserved some of its harshest criticism for the Hearing Examiner's failure to analyze whether the Loudoun line is needed in addition to the proposed $1.8 billion Potomac Appalachian Transmission Highline or PATH line that will run parallel to the Loudoun line but is considerably larger ? 765 kilovolts as opposed to Loudoun's 500 kilovolts.  Both lines have been endorsed by the regional transmission grid operator.  PEC contends that "it would be the height of irresponsibility for the SCC to accede to Hearing Examiner Skirpan's recommendation and authorize the expenditure of a billion dollars in ratepayer money on the Loudoun line before it is known whether the PATH transmission line will be constructed and render the Loudoun line superfluous."

A SCC decision approving Hearing Examiner Skirpan's report would, according to PEC and other opponents, "confine the Commission to rubber stamping projects that promote utility interests, at enormous cost to ratepayers, but which have not been shown to be in the public convenience and necessity."  A SCC decision accepting or rejecting the Hearing Examiner's recommendation is expected before the end of the year.

Robert Lazaro
Director of Communications
571.225.0198