Report: Ratepayers will foot the bill for power transmission project

Yahoo

20 hours ago

Jun. 7—MORGANTOWN — Depending on who you ask, NextEra's MidAtlantic Resiliency Link transmission project will either take advantage of West Virginia ratepayers and countryside to power up data centers in Virginia — or it'll be an economic boon to the Mountain State, generating hundreds of jobs and hundreds of millions in tax revenue.
The Institute for Energy Economics and Financial Analysis is solidly in the former camp.
In a May report compiled by Cathy Kunkel, "West Virginia Ratepayers Footing the Bill for Infrastructure Build Out, " the IEEFA makes the claim that two power transmission projects slated to run through West Virginia on their way to northern Virginia will cost West Virginia ratepayers more than $440 million over the next 40 years despite the demand being almost entirely attributable to data centers.
A data center is a physical room, building or facility that houses IT infrastructure for building, running and delivering online applications and services, according to IBM.
One of those projects, a billion-dollar transmission line that includes NextEra's MidAtlantic Resiliency Link, is looking at parts of Monongalia and Preston counties as a route for the 105-mile "major highway " of 500-kilovolt overhead transmission lines running from Greene County to Frederick County, Va.
The project will require a 200-foot right of way along its entire length and terminate in northern Virginia, which already has the highest concentration of data centers in the world.
The power-hungry facilities are being built at an increasingly rapid pace.
According to the IEEFA, electricity demand across the 13-state territory under grid operator PJM Interconnection remained relatively flat for nearly two decades. That's changed in the last three years due almost exclusively to the rise of data centers.
As of 2023, data centers accounted for more than one-quarter of the electricity consumption in the state of Virginia, based on data presented by IEEFA. One large data center, the report states, can draw as much power as a city.
The think tank says the traditional method of cost allocation — spreading the cost of capital investments across the customer base — isn't equitable when capital improvements are being constructed to feed a single customer or a very small group of customers.
"As this report explains in greater detail, traditional methods of cost allocation for major new transmission projects in PJM have not yet been reconsidered in light of the new challenges posed by data center demand growth."
The Dominion Post reached out to NextEra with three questions: What benefit will West Virginians receive in exchange for the large transmission lines running through rural parts of the state ? What percentage of the power being pulled from Pennsylvania to Virginia will support data centers ? Will residential ratepayers end up subsidizing the construction of this project in any way ?
"The MidAtlantic Resiliency Link is one of the transmission projects PJM selected to enhance grid reliability for customers locally and across the region, " NextEra replied in a statement. "While it's part of a regional solution, the local benefits are significant. The [MARL ] would create hundreds of construction and support jobs, which will, in turn, drive significant investment in the local economy, growing existing businesses and attracting new businesses. Importantly, West Virginia is projected to receive an estimated $150-$400 million in taxes over the 40-year life of this project, depending on the length and route of the final transmission line. The [MARL ] would help drive economic development throughout the state."
But before any of that comes to pass, a route must be finalized.
Some residents in Monongalia and Preston counties have started voicing concerns about the possibility of having the transmission lines run through or near their properties.
Property owners in rural, wooded and farming areas fear they'll be forced to give up ground through eminent domain should their land fall in the chosen path.
On May 29, the Preston County Commission passed a resolution opposing the MARL project as currently proposed and urging state and federal regulators, as well as NextEra, to halt development of the project through Preston County.
Asked whether a similar resolution might come out of Monongalia County, Commissioner Sean Sikora said the commission is doing its due diligence and has reached out to Preston County for a copy of the resolution—but isn't ready to take any kind of public stance on the matter.
NextEra has conducted a series of open house-style public meetings in recent weeks to discuss, among other things, the potential routes, and intends to make its choice known to the various state public service commissions this fall.
According to the current timeline, the project is to be completed by the end of 2031.