Commission on Energy and Environment
September 9, 2008
The second meeting
of the Commission on Energy and Environment was held in Richmond.
The initial presentation surveyed existing energy policies established
in the Code of Virginia and Executive Orders including regulatory incentives,
grant programs, and tax credits. A surprising number of these initiatives
are inactive because they have either been allowed to expire, the funding
has disappeared, or the target population is not aware of the available
benefits. Senator Petersen asked why Virginians might not know of some
of the incentives, such as the various tax credits that might be claimed
for alternative fuel vehicles and energy efficient appliances. Staff noted
that further investigation may be needed to determine the steps necessary
to publicize and market those programs that are funded. Senator Whipple
asked that staff continue to identify and provide further information
on inactive programs.
Staff also provided
a presentation on innovative energy efficiency and conservation policies
in other states. Notable policies include:
- A four-day work
week for state employees.
- A revolving loan
program for energy efficient projects.
- The mandated installation
of solar water heaters in new homes.
- The accelerated
phase-out of incandescent light bulbs.
- The creation
of an independent entity to manage energy efficiency programs for customers
of various utilities.
Mr. Wallmeyer asked
staff to elaborate on which programs have provided the best results. Staff
noted that it is difficult to measure success since many of the programs
are very new. Dr. Schultz asked staff's opinion of programs best suited
for Virginia. Staff replied that, while some of the programs such as mandatory
solar water heaters would be wholly inappropriate for Virginia, others
such as mandatory labeling and independent administration of energy efficiency
programs may prove to be a good fit.
Manager, Virginia Energy Management Program
Thompson provided the Commission with an overview of progress made towards
implementing the recommendations of the Virginia Energy Plan. Senator
Whipple asked for clarification on the demand response program payments
with regional transmission organization PJM. Mr. Thompson explained that
the program allowed a reduction in load during peak times to change rates
and permit users to opt out from consuming the most expensive energy.
asked about the role of switchgrass in the pilot project at Piedmont Geriatric
Hospital in light of its potential as a feedstock for cellulosic ethanol.
While the switchgrass is burned to co-fire a generator at the facility,
such a use is not incompatible or exclusive to its cellulosic ethanol
potential. Overall, the project creates a market for switchgrass grown
by Virginia farmers.
Delegate Hogan asked
about the degree to which the Commonwealth is vulnerable to sudden increases
in the price of natural gas. Mr. Thompson noted that the state actually
consumes more natural gas than petroleum and that supply interruptions
would have a significant impact on our economy. Senator Whipple and Delegate
Nixon asked for additional clarification and data on some of the points
covered in the report. The Commission would like to know the degree of
actual progress made towards goals instead of general statements about
activity in certain areas.
G. Hatcher, Virginia Coastal Energy Research Consortium (VCERC)
Dr. Hatcher provided the Commission with a brief overview of VCERC, its
mission, and its members. Currently, there are two primary thrusts of
the research funded through VCERC: algae-to-biodiesel conversion technology
and the capacity for wind energy in the Atlantic Ocean off the coast of
Science Applications International Corporation
Since the Commission
will tour Mr. Hatcher's laboratories at the next meeting, the presentation
was turned over to Neil Rondorf, a VCERC industry partner, to discuss
wind energy. Mr. Rondorf stressed the importance of taking a responsible
environmental and economic approach to developing the wind potential off
Virginia's coast while adapting technology to meet our resources. Senator
Peterson asked for clarifications on the permits necessary to proceed
on a large scale wind farm in the Atlantic. Mr. Rondorf responded that
the federal government hoped to develop permits that would be analogous
to and complementary of any state permits to ease the regulatory burden
on the developer. Delegate Hogan questioned the reliability of the wind
power. Mr. Rondorf responded that although wind generation produces a
low power factor, the electricity could be used cooperatively with natural
gas fired turbines to relieve congestion.
Karmis, Professor, Dept. of Mining and Minerals Engineering, Virginia
Karmis gave the Commission an overview of work being done at the Center
to advance carbon capture and sequestration and noted the wide discrepancy
between funds appropriated to VCCER by the Commonwealth and those appropriated
to comparable organizations in other states. While initial tests of carbon
capture technology will begin shortly, a large volume test is needed.
Dr. Karmis notes that Virginia is fortunate to have geologic formations
that are suitable to store carbon and that policy makers should view such
formations as a valuable natural resource. The Department of Energy will
provide $65 million towards the large volume tests, leaving an additional
$40 million in cost share commitment to be raised from other sources in
the next few months. Dr. Karmis stressed the urgency and importance of
identifying these funds for the project so that the Commonwealth will
not lose its competitive advantage. Delegate Sickles inquired about the
relationship between his research and the Virginia City Power Plant in
Wise County. Dr. Karmis explained that the large volume test targeted
storage integrity and not sequestration. Any initial projects should place
the geologic storage close to the source of the carbon dioxide.
Senior Manager, Wal-Mart’s Public Affairs and Government Relations
Hobbs provided the Commission with an overview of policies implemented
by Wal-Mart, the country's largest corporation and second largest employer,
to improve energy efficiency and environmental sustainability. Delegate
Nixon questioned whether the unique "green" packaging Wal-Mart
had developed with certain manufacturers was considered proprietary. Ms.
Hobbs responded that it was not and that Wal-Mart hoped such innovations
could be shared with other manufacturers across the industry. Dr. Hatcher
expressed his hope that Wal-Mart would provide some oversight with respect
to the validity of claims presented on packaging, such as the useful life
of a compact fluorescent bulb.
Hugh E. Montgomery,
Jr., Director, Institute for Defense and Homeland Security
Montgomery provided the Commission with a perspective of energy issues
from the Department of Defense. Mr. Wallmeyer agreed that one of the primary
shortcomings of the Virginia Energy Plan is the absence of prioritization
for the recommendations and asked what actions the General Assembly should
take. Mr. Montgomery noted that the Commonwealth will find the highest
return on investment in conservation measures. Delegate Hogan further
commented that increased investment in conservation need not occur at
the behest of government. Mr. Montgomery spoke about his personal hope
that waste to energy would take hold as a viable option.
Davis, State Director, USDA Rural Development
Ms. Davis discussed
the availability of funding for loans from the Rural Energy for America
Program (REAP), formerly known as the Renewable Energy Systems and Energy
Efficiency Improvements Program. Like its predecessor, REAP provides grant
and loan guarantees to farmers, ranchers and rural small businesses to
promote energy efficiency and renewable energy. The authorized funding
for REAP between 2009 and 2012 is $255 million, which is more than double
the funding authorized in the previous Farm Bill. The moneys can be used
to purchase renewable energy systems and to provide energy efficiency
improvements to a facility or process that reduces energy consumption.
Sample funds have been provided to:
- Install factory-made
wood-burning furnace to heat water that will be pumped through insulated
- Install geothermal
renewable energy system at a winery and farm.
- Install wind turbines
and solar PV array pumping system.
- Build a 12,000,000
gallon bio-diesel plant.
Mr. Wallmeyer questioned
whether personal guarantees would be required of loan recipients. Ms.
Davis replied that personal guarantees should not be required and stressed
the importance of getting the word out to potential borrowers.
The next meeting
date will be on October 14 at Old Dominion University in Norfolk. Information
will be posted on the study's website and the General Assembly calendar
as soon as it is available.
The Hon. Mary Margaret
Ellen Porter, DLS
of Legislative Services > Legislative
Record > 2008
| Legislative Services | General