If you’re interested in West Virginia energy issues and you aren’t reading Bill Howley’s blog, The Power Line, you should be. It’s about a lot more than power lines.

With two posts this morning, Bill offers some interesting thoughts on stories today in the Gazette and the Daily Mail about the new public relations push by Appalachian Power regarding its proposal to acquire additional coal-generated capacity from a sister American Electric Power unit.

First, in commenting on my Gazette story, Bill writes:

The main thing driving AEP’s changes, however, is the deregulation of how electricity is sold in OH, AEP’s base of operations.  AEP’s Ohio Power now have to compete with other power companies.  AEP has to keep OH rates as low as possible, so Ohio Power can no longer afford to get their power from expensive coal-fired plants.  AEP is dumping its Ohio Power shares in WV coal plants because electricity from those plants is too expensive to sell in the newly deregulated OH markets.

So who ends up with those expensive-to-run obsolete coal plants?  APCo’s WV rate payers.  Yes, AEP is playing its WV rate payers for chumps.  Again.

AEP is dumping its coal-fired generation capacity on WV because WV is a regulated market where APCo can recover all its expensive fuel costs, as well as its capital costs, from consumers without having to face the rate competition the company faces in OH.

Read the rest of this entry »

If some of the early posts are any indication, The State Journal’s new “Grounded” blog is a welcome addition to the journalism scene regarding energy policy in West Virginia. State Journal reporters Pam Kasey and Taylor Kuykendall were already churning out tons of energy coverage, and it looks like they’re going to be doing even more with their publication’s new blog.

Of particular importance is the sort of coverage that Pam Kasey has given so far on the blog to a political event by Republican Senate candidate John Raese and the reaction to it by incumbent Sen. Joe Manchin.

First, in a post headlined Is Senate candidate Raese obfuscating energy issues? called out the nonsense Raese pulled at an event held at the Albright Power Station in Preston County, writing:

The event was misleading from the moment the release went out inviting the media to “a major announcement on the regulatory nightmare of cap and trade here in West Virginia.” Cap and trade died in the Senate in 2010 and shows no signs of being resurrected any time soon.

She continued:

First, about FirstEnergy’s power plant closures. The utility announced in February that it would close its Albright, Rivesville and Willow Island stations by September, citing at the time upcoming environmental regulations as a primary factor.

FirstEnergy has since explained in filings with the Public Service Commission of West Virginia that the small, old, inefficient plants are a financial drain on the company; the fact that it is closing the plants well in advance of the Jan. 1, 2015, effective date of the primary environmental regulations it cites supports that. This was reported by The State Journal in April and in May.

Raese’s statement clings to the idea that environmental regulations are the only reason for the closures. But the fact is, these generating units are all more than 50 years old, some much older. They aren’t up to current technological standards — that includes environmental standards but also standards of efficiency.

Read the rest of this entry »

In a sidebar to a larger piece about how contributors to Kentucky Gov. Steve Beshear’s political campaign got help getting Kentucky Derby tickets, the Courier-Journal in Louisville had this interesting tidbit today:

Don Blankenship, the controversial former chief executive of Massey Energy, was part of Gov. Steve Beshear’s Derby Day entourage this year.

Blankenship was aboard the CSX train that took Beshear, other top state officials and guests from Frankfort to Louisville and back on Derby Day, state records show. And his name is on a list of people invited to Beshear’s Derby Eve Gala at the Governor’s Mansion.

Courier-Journal statehouse reporter Tom Loftus continues:

Richardson said Blankenship was the Derby weekend guest of two West Virginia businessmen who were invited to Beshear’s private Derby activities — James Justice II and his son, James Justice III.

“Mr. Blankenship … was not directly invited by the administration. It’s not uncommon for guests to the Gala or train to request several invitations for friends or family,” Richardson said.

Blankenship is listed in state campaign finance records as giving $1,000 to Beshear’s re-election campaign last year. Meanwhile, the Justices, who have significant energy and agriculture interests in Kentucky and elsewhere, were among the largest contributors to Beshear’s political causes last year. The family gave $100,000 to Beshear’s inauguration fund, $50,000 to the Kentucky Democratic Party and $121,600 to the Democratic National Committee.

It’s especially interesting that Blankenship and Justice are hanging out together, given that Blankenship’s public image isn’t necessarily that positive anymore in West Virginia, while Justice — despite his mining operation’s frequent violation of safety laws — continues to generate overwhelmingly favorable press.

In this May 2, 2012 photo, Jeff Moline grooms and compacts a coal pile after a rainstorm degraded the pile at  at the Sherco power plant in Becker, Minn.   (AP Photo/The St. Paul Pioneer Press, Jean Pieri)

One of the more interesting pieces this week was a story in Scientific American, relating the results of a study published in Science, about surprise workplace safety inspections:

Costly safety upgrades, nitpicky government inspection and resulting fines are often blamed as being bad for business. But a new study shows that when government job-safety inspectors make a surprise visit, they actually enable companies to save money—and jobs—for years to come.

Occupational safety has improved immensely over the decades, but in industries with traditionally high injury rates, such as manufacturing, lumber or food processing, work is still dangerous, putting employees at risk and leaving employers vulnerable to expensive accidents. But how much can just one safety inspection help?

Quite a bit, the new analysis suggests: Just one inspection saved companies 26 percent on workers compensation claims over five years.

Of 818 companies with more than 10 employees, the 409 that were randomly selected for inspections saved an average of $355,000 over five years in worker injury claims and compensation at each firm, compared with the other 409 similar companies that were not inspected.

Also this week, SNL Financial published an updated report on safety violation disclosures coal companies filed with the U.S. Securities and Exchange Commission:

Coal mines operated by Alpha Natural Resources Inc. were assessed more proposed fines for federal safety and health violations in the first quarter than all other public coal companies combined with total fines well above $5 million — a level roughly consistent with previous quarters following Alpha’s acquisition of troubled Massey Energy Co.

Alpha operates 145 active coal mines, the most of any U.S. public coal producer, and many of those operations are underground mines in Central Appalachia, where more complex mining, with larger workforces, tends to occur and often results in more safety violations than at large-scale surface mines in the western United States. Still, assessments issued to Alpha by the U.S. Mine Safety and Health Administration have shown no significant decline since Alpha’s June 2011 acquisition of Massey, suggesting the company continues to struggle to bring legacy Massey mines into compliance.

  Read the rest of this entry »