Dominion Virginia Power Offers to Close Coal-Fired Station in Accord Over Proposed Gas-Fired Power Station; Closing Would Help Regional Air Quality

RICHMOND, Va., Dec. 2, 2010 /PRNewswire/ -- Dominion Virginia Power is volunteering to close a West Virginia coal-fired power station as part of its plan to build a natural-gas fired power station in northwestern Virginia. The net result would be more electricity to serve Virginia's growing needs and cleaner air in the region that includes the Shenandoah National Park.

In an accord reached with the National Park Service and the Virginia Department of Environmental Quality, Dominion has volunteered to close its 74-megawatt North Branch Power Station in Bayard, W.Va., when the proposed Warren County Power Station near Front Royal begins commercial operations, which is scheduled for late 2014 or early 2015. Emissions reductions credits from closing the station will be combined with other offsets to mitigate the emissions from the new power station.  The agreement is conditioned upon the Virginia Air Pollution Control Board's approval of the air permit for the proposed station, other regulatory approvals and the construction and operation of the proposed station.

"The planned Warren County Power Station is designed to be among the cleanest fossil-fuel fired facilities in the nation. We expect that it will be at or near the top of the EPA's national clearinghouse list of facilities with the best air pollution control technologies," said David A. Christian, chief executive officer of Dominion Generation.

"Our decision to close North Branch makes good sense for our customers and the environment.  Our proposed Warren County station will provide nearly 20 times more electricity than North Branch with cleaner-burning natural gas."

The agreement, which is now part of the Virginia air permit application for the Warren County station, states that the mitigation plan for the station "consists of a combination of emission reduction credits and emission allowances … resulting in a net environmental benefit to park resources."

Dominion's proposal is contingent upon receiving approvals from Virginia Department of Environmental Quality and the Virginia Air Pollution Control Board.  The air board is expected to vote on Dominion's application for the Warren County air permit at its Dec. 17 meeting. The company anticipates seeking permission from the Virginia State Corporation Commission next year to build the new power station.

North Branch was put in cold reserve status in August of this year, meaning it is not currently generating electricity. Without this agreement, the station could be returned to service in a short time if needed. North Branch, which burns a mix of coal and waste coal to generate electricity, began commercial operation in 1992. Dominion purchased the station in 1994.

No Dominion employees will lose their jobs as a result of the closing. The station required only three employees for it to be maintained in cold reserve status. They will be transferred to the company's nearby Mt. Storm Power Station upon completion of activities related to North Branch's retirement.

The proposed Warren County Power Station would be powered solely by natural gas and would have three combustion turbines and a steam turbine. The station would generate approximately 1,300 megawatts of electricity, or enough energy to power 325,000 homes. The power station is helping Dominion close a gap of 5,600 megawatts of generation needed in its service area by 2019 as identified by PJM Interconnection LLC, the regional independent system operator of the 13-state transmission system.

Dominion Virginia Power is a subsidiary of Dominion (NYSE: D), which is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 27,600 megawatts of generation, 12,000 miles of natural gas transmission, gathering and storage pipeline and 6,000 miles of electric transmission lines.  Dominion operates the nation's largest natural gas storage system with 942 billion cubic feet of storage capacity and serves retail energy customers in 13 states. For more information about Dominion, visit the company's website at www.dom.com. 

SOURCE Dominion Virginia Power