CHARLES CITY COUNTY PROJECTED GAS POWER PLANT REVENUES
Based on the new information presented at the Power Plant forum on October 28, 2019, below is a revenue projection. Hopefully, the county administration will soon provide a formal local government projection.
1) C4GT— representing attorney from Williams Mullen stated that the capital investment would be ~$1 billion.
2) Chickahominy— Jeff Freeman, Jr., Managing Partner, stated that the capital investment would be ~$1.4 billion.
3) C4GT representative stated that construction would take 28-33 months, employing 600-800 transient workers, and ultimately operations would employ 20-24 full-time skilled staff. Chickahominy/Balico construction would take up to 38 months, employing up to 1,000, and ultimately 40 staff.
4) A SCC representative stated that the actual construction expenditure would be discounted to 90% of investment and about $200 million would be deducted from each plant for emissions control equipment. Additionally, the discounted investment would be held steady at 90% for five years, followed by a depreciation for 20 years to a year 25, value of 10% of the property. (Note: this is presumably a 4% per year depreciation from year 5 to year 25)
5) Michelle Johnson, County Administrator, reported that the Department of Education advised her that the Local Composite Index share for school funding would increase/state funding would decrease by $1.5 million for a $1 billion increase in taxable property (Note: it is not clear if this amount takes into consideration that the local share of the LCI will continue to increase as the student population decreases; the LCI will increase from the FY20 = .5175 to .5880 in FY21; and the LCI is capped at .80 for the local share).
6) The current Charles City property tax rate is $.76/$100 valuation.
7) Agreements between the plant companies and the Charles City Economic Development Authority call for the EDA to make cash grants (presumably from funds allocated to the EDA by the county government) to the companies of 25% of all local taxes paid for the first 10 years and 10% for the second 10 years. Plus reimbursement to the companies for all other locality fees. http://co.charles-city.va.us/160/Economic-Development-Authority
8) On September 10, 2019, Dominion Energy—a near monopoly, regulated utility, with a very low risk, guaranteed income stream—in a pleading to the State Corporation Commission requested an increase to a 10.75% return on equity as “…fair and necessary…to help the company compete for investment capital.” For C4GT and Chickahominy/Balico, private, unregulated power plant developers, in a risk-competitive market, it might be speculated that a rate of Return-On-Investment would likely be much higher than that requested by Dominion. Plant ownership and management, funding mechanisms, and financial information is redacted in SCC public documents.
Calculation: County Tax Revenues Estimate C4GT Chickahominy/Balico Investment (1), (2) $1,000,000,000 $1,400,000,000 — Discounted to 90% (4) 900,000,000 1,260,000,000 — $200 millionEmissions Control Reduction (4) 700,000,000 1,060,000,000 X $.76/$100 property tax rate (6) 5,320,000 8,056,000 — 25% EDA cash grant (7) 3,990,000 6,042,000 Total estimated taxable property County revenue (6) 10,032,000 — $1.5 million reduction in state school funding (5) Total net county government revenue increase $ 8,532,000
Total minimal annual profits to plant owners (8) $258,000,000
Total County tax revenue as a percentage of total investor profit 3.3%
After the first 10 years of operations—possibly by 2033, if construction begins in 2020 and operations by 2023—the investors profits likely will have recovered the total capital investment and further operations will be pure profit, with no incentive for further investment or unwillingness to abandon the plants as stranded assets in the likelihood of changing market conditions away from fossil fuel electricity generation. “The sun doesn’t always shine and the wind doesn’t always blow”, but battery technology is rapidly improving, the cheapest energy is that which isn’t used, and the climate emergency will demand many, many energy use and lifestyle changes. Plant pollution effects and substantial County tax revenues are likely not to occur until Fiscal Year 2024, probably after elected officials granting approval for the plants are no longer in office. Tax revenues are also likely to decrease over $1/3 million per year after the first five years of operations, as the value of the plants depreciate 4% or $80 million per year (4).
County tax revenue income is a relatively small 3.3% of the likely total profits generated by these plants. However, the value of all county property will dramatically increase by over 220% (from $1.09 to $3.49 billion), while county government revenue may increase less than 40% (from $22.3 to $30.8 million). By comparison with these two, $2.4 billion plants, the controversial Richmond Navy Hill project is $1.5 billion and the Arlington Amazon campus is $2.5 billion. Because of the small number (total of 60) permanent jobs, the low county median household income of $54,000 is unlikely to increase and neither will the $163,000 median home value, as most highly skilled staff will likely not reside in the county. It is hoped that the up to 1,800 (3) over three years, world-wide, transient construction workers will be educated, careful, sober, law-abiding, good neighbors; but what will they contribute to Charles City?
CHARLES CITY COUNTY PROJECTED GAS POWER PLANT WASTE POLLUTANTS The massive private corporate investment and huge plant structures will dramatically change the physical, social, economic, and political character of our county. By adding these plants utilizing 270 acres to the 930 acre landfill, the Roxbury area of the county will solidify itself as a regional sacrifice area. Arriving in a small, rural, lower socioeconomically, majority-minority community, without a sophisticated government and community infrastructure, the modest, relatively short-term, increased government tax revenues will continue to be accompanied by almost inevitable corporate big-money secrecy, trampling on local people and our interests, and corruption of values. The failure to inform, lack of transparency, redacting of information, and lack of actively encouraging involvement in the approval process for these plants already portends a curtailing of public democracy. In the process of scrounging for thirty pieces of silver, no apparent policy thought has been given to preserving our environment or providing government benefits for future generations who will be affected by these plants and their waste products. In exchange for 3% of plant profits, what will the plants leave us as permanent pollution waste in our the county?
9) “Small particulate pollution have health impacts even at very low concentrations—indeed no threshold has been identified below which no damage to health is observed.” World Health Organization https://www.who.int/newsroom/fact-sheets/detail/ambient-(outdoor)-air-quality-and-health In other words, any particulate matter emissions will impair someone’s health, though it cannot be predicted specifically who in a population will be affected. 10)“EPA develops standards for controlling the emissions of air toxics from sources in an industry group (or “source category”). These maximum achievable control technology (MACT) standards are based on emissions levels that are already being achieved by the controlled and low-emitting sources in an industry.” https://www.epa.gov/haps/ reducing-emissions-hazardous-air-pollutants In other words, repeatedly touted as “meets regulatory requirements” by DEQ, really means regulations that the best available control technology (average of the top 12%) that can be met by industry. Although less toxic than raw waste, It surely does not mean regulating for no health impairing pollutants. 11) C4GT, Virginia DEQ Air Permit #52588 and Water Permit #16-1694 12) Chickahominy/Balico, Virginia DEQ Air Permit #52610 and Water Application #GW007800
If operated similar to Dominion Energy’s Brunswick plant, operating 80% of the time, producing about 2/3 of licensed pollutants, the C4GT plant will contaminate our atmosphere and increase climate heating with over 2,700,000 tons of CO2 equivalents per year, over 67 million tons during 25 years; the Chickahominy plant will exhaust 4,200,000 tons per year, 105 million tons over 25 years. When dumped into our air, even with pollution controls, we should call them what they are: poisons. These poisons will change our local air from relatively clean to a state permitted level of dirty.
Additional, important major pollutants—waste product exhaust from burning gases that have been buried in the earth for millions of years—by these two plants that are serious dangers to human health, and to wildlife, air, soil, water:
Poison Projected Pounds/ Year Over 25 Years Human Health ill Effects
Particulate Matter 460,000 11.5 million Respiratory symptoms, decreased lung function, aggravated asthma and cardiovascular effects such as heart attacks and stroke
Sulfur Dioxide 130,000 3.3 million Multiple adverse respiratory effects
Volatile Organics 400,000 9.8 million Eye and respiratory irritation and cancers, aggravated respiratory disease, ozone
Nitrogen Oxides 920,000 23 million Smog, respiratory irritation
Carbon Monoxide 720,000 18 million Aggravated heart disease
Lead 36 900 Childhood developmental disabilities, heart disease
Mercury 18 450 Severe infant neuromuscular impairment
Other Heavy Metals 335 8,400 Progressive neurological degenerative processes
(These do not include the 1.4 million pounds of annual pollutants from the very dirty existing INGENCO landfill plant.)
The C4GT plant is permitted to withdraw over 2.7 billion gallons of water from the James River each year, likely near Port Tobacco at Weanack, at Shirley plantation, and return 20% of the withdrawal. The disturbance effect on long buried Kepone in the James River is not known. Releasing over 2 billion gallons of water into the air each year will contribute to increased air-borne humidity levels in our already humid local climate. The—not yet allowed—potential withdrawal of well water by the Chickahominy plant from the endangered Potomac aquifer for 7 years may lower our well water levels; even though it is contracted to use water from the New Kent wells or Pamunkey River by 2024.
Annually, polluting double that from all metro Richmond motor vehicles, 11 times the weight of all Charles City houses, 8 times the water use by all Charles City homes and increasing as the plants age. “Regulatory requirement” really means a state sanctioned level of dirty. The amounts of poisons to be spewed over the Charles City air, land, water, and lives of current and future generations by these plants for the use of electricity by non-residents and financial profits of non-residents is mind-boggling and almost numbing in its’ vastness. What will be our reckoning?
Steve Fuhrmann, One Concerned Citizen