Study says Virginia pumped storage project could bring $576 million in economic benefits19 October 2017
A proposed Dominion Energy Virginia pumped storage power station in Southwest Virginia, US, would bring approximately $576 million in economic benefits to the Commonwealth, according to a new study by Richmond-based Chmura Economics & Analytics. More than half of this impact would occur in the coalfield region, the study found.
Commissioned by Dominion Energy, the report also found the hydroelectric project would support nearly 3000 Virginia jobs during development and construction, including more than 2000 in the coalfield region. Once in operation, the facility would produce about $12 million annually in tax revenue for local governments in Southwest Virginia, according to Chmura.
“We are very excited about the prospect of bringing another major capital investment to the coalfield region of Southwest Virginia,” said Mark Mitchell, vice president of generation construction. “The entire grid system will benefit from having this new generation once it comes online, and the local area will benefit from the jobs and economic benefits that will come from it.”
As part of a broader expansion of its generation portfolio in the state, Dominion Energy is currently evaluating the potential for a pumped storage project in the coalfield localities. These include the counties of Buchanan, Dickenson, Lee, Russell, Scott, Tazewell, Wise and the city of Norton. The proposed facility comes as a result of legislation passed by the 2017 Virginia General Assembly, which encourages the development of pumped storage technology in the region. To date, all eight localities have passed resolutions supporting the concept and agreeing to a revenue sharing plan.
The Chmura study was based on a scenario in which planning and construction costs of a pumped-storage project were estimated at $2 billion. At this investment level, the study found the power station would create nearly $320 million in total economic impact for Southwest Virginia. Construction of the facility would support 2,980 jobs in Virginia between 2017 and 2027, including 2,083 positions in the coalfield localities. The study also found that more than $7.7 million in new tax revenue would be created for the Commonwealth during this phase.
Once in operation, the study predicted the power station would generate about $37 million annually in total economic impact for Southwest Virginia. Chmura projected a completion date for the facility of 2028.
Coalfield area lawmakers have promoted pumped storage as one way of addressing the region’s economic challenges. The legislation passed this year allows a Virginia utility building a pumped storage facility in the coalfields to petition the State Corporation Commission for recovery of its project costs as they are incurred.