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Economic Progress Coming Soon to the West Virginia Natural Gas Industry - WVSCA Affirms Siting Certificate
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As has been reported in a number of news and industry outlets recently, West Virginia lags very far behind neighboring Ohio and Pennsylvania in developing new base load power plants that are powered and supplied by the abundance of natural gas in the Marcellus and Utica Shales. Those same reports show that while two other natural gas fired plants have been approved to be sited in West Virginia, those projects have been opposed and stymied in a series of fruitless (but costly and time-consuming) legal challenges. As a result, West Virginia has fallen behind neighboring states in terms of constructing new power plants that produce cheaper and more environmentally friendly supplies of energy, despite the rich reserves of natural gas located in West Virginia formations. Consequently, West Virginia producers, processors, and landowners have not been able to harness fully the economic benefits of natural gas developed in West Virginia, but, to date, transported elsewhere for generation. That tide may finally be turning.
In a Memorandum Opinion issued November 1, 2018, the West Virginia Supreme Court of Appeals affirmed the Public Service Commission of West Virginia's grant of a siting certificate to ESC Brooke County Power I, LLC for the construction of an $884 million natural gas fired generating plant located near Colliers, West Virginia despite opposition funded by coal interests.
Brooke County Power sought the PSC's approval to construct an 850 MW base load plant primarily sourced from abundant West Virginia natural gas reserves, which will serve the wholesale energy market. The plant is estimated to generate a total economic benefit of approximately $20 billion dollars over 30 years to the state and local economies. Moreover, the plant will be built on the site of a former strip mine, which is currently owned by the State of West Virginia. Brooke County Power entered an agreement with the West Virginia Division of Natural Resources, and a PILOT agreement with the Brooke County Commission, the Brooke County Board of Education, the Sheriff of Brooke County, and the Assessor of Brooke County. Additionally, by way of an agreement with the West Virginia State Building and Construction Trades Council, AFL-CIO, the source of labor for construction and operation of the project will overwhelmingly favor West Virginia workers.
Certain local landowners and a non-profit organization appealed the PSC's order approving the project to the Supreme Court of Appeals. The West Virginia Coal Association also opposed the project as an amicus curiae. Together with the PSC and Brooke County Power, the Building Trades, the West Virginia Oil and Natural Gas Association, the Brooke County Commission, the Board of Education of Brooke County, and the Independent Oil and Gas Association of West Virginia, Inc. filed briefs in support of the siting certificate. The PSC, Brooke County Power, and the Building Trades argued the case on behalf of the project. In quick succession, the Supreme Court of Appeals unanimously upheld the PSC's decision. This project, and others like it, will allow West Virginia to reap more of the benefits of the booming natural gas industry, which has prospered in Ohio and Pennsylvania.
Spilman attorneys Lee F. Feinberg, Susan J. Riggs, and Grant P. H. Shuman represented Brooke County Power before the PSC and the Supreme Court of Appeals.
If you have any questions, please contact us.
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