Dominion Virginia Power has received final approval from the State Corporation Commission to transfer control of its transmission facilities to PJM Interconnection, a regional transmission organization, on Jan. 1, 2005.
The transfer is required by the Virginia Electric Utility Restructuring Act, which was passed by the General Assembly in 1999. Once Dominion joins PJM, it will have the capability to buy and sell power, whereas before, the company was typically only a buyer of power to serve electricity-needy Northern Virginia.
That impending change in status has worried residents who are already concerned about Dominion's plans for the proposed 230 kilovolt transmission line to western Loudoun. Critics wondered if the transmission line, which will have the capacity to import twice as much power as the area needs in the next decade, could be part of a longer-term plan to sell power over PJM's 13-state grid.
The transmission line to western Loudoun will be built as a radial line, meaning power will go only in one direction, but eventually will become part of the larger grid years from now. Dominion's siting and permitting coordinator, John Bailey, alarmed critics of the line at a Nov. 1 Board of Supervisors meeting by saying that when the transmission line is hooked into the grid, "Electrons will flow."
Residents from the areas south of Leesburg, whose backyards could become the site for 110-foot steel towers supporting the line, have decried Dominion's proposal. A transmission line hung over their homes, being used to sell power in other states — that was unacceptable.
BUT THE CONFUSION is a result of the repercussions of energy deregulation.
The entire electric utility industry is in the midst of a sea change prompted by the mandated joining of regional transmission organizations like PJM.
By joining PJM, Dominion will turn over control of its transmission grid to PJM, which functions as an independent broker between its 300 member utilities. Not only does the larger grid help prevent blackouts — power can be shipped from another member utility to the problem area — it also allows real-time selling and buying of power among its members.
"It kind of works like a stock market, but instead of selling stock, they're selling electrons," said Joe Patterson, spokesman for PJM.
Dominion customers won't notice a change in their home, but they will enjoy a financial benefit. According to an analysis by Charles River Associates, PJM membership will result in net savings of up to $464 million by 2014 for customers. Dominion, on the other side, will experience a reduction in revenues up to $537 million.
"People assume Dominion wants to be in that organization, but Dominion doesn't necessarily like the way it has to do this either," said Doug Koelemay, senior advisor to the Northern Virginia Technology Council.
Koelemay likened the change to the way the telephone industry has evolved — originally, when two people spoke, an operator literally opened a physical line between the two speakers. Now, the operator has been eliminated, and physical distance plays a much smaller role.
Joining PJM does a similar thing — physical distance is practically eliminated as a consideration. Dominion may buy and sell power, yes; but it may be buying that power from a North Carolina company and selling it in Pennsylvania. It is unlikely that power generated in Northern Virginia will be shipped elsewhere any time soon; as John Smatlak, Dominion's managing director of electrical transmission said, "We're not trying to sell power out of state. We're trying to deliver power within Northern Virginia."
Customers, too, can buy power from other states, presenting competition to Dominion that the company has never faced before.
"There is a whole different future emerging," Koelemay said, "and no one's sure how it's going to work. The whole rationale behind it has changed."
SO THE IDEA that the public can pressure the Board of Supervisors, which in turn pressures Dominion, which in turn pressures the State Corporation Commission to give the public what it wants may be a little quaint in this case.
The Board of Supervisors has told Dominion that it wants the power line route to western Loudoun buried along Route 7. Dominion resisted and cited the cost of construction and repair. What it hasn't claimed publicly, however, is perhaps the most understandable reason: Dominion is simply not a company that builds underground lines, and nothing is going to change that.
Dominion has over 6,000 miles of overhead lines — and 35 miles of underground, some of it built decades ago. It has to fly in out-of-state experts to repair an underground line because the expertise isn't in place in the company. All that pressure from the public and local officials isn't going to change a business model that has been entrenched for years.
"If the socket and plug don't fit together, we can't just pass a law to make the socket and plug fit together," Koelemay said.
Underground line proponents aren't willing to give up yet, however. Blake Netherwood is vice president of the grassroots organization, Save the Trail, which kicked the proposed transmission line off Dominion's easement on the W&OD Trail. He pointed out the flaw in Dominion's logic on repairing underground lines — namely, that with the redundancy the company would build into an underground line, the need for repair would be "about zero, unless a bomb goes off," he said.
Dominion's claims about having to shut down the line for weeks at a time — as it did for a recent underground failure in Alexandria — is also unnecessary with a newer line, Netherwood said.
"If they had a cable failure, they could just pull it [out] from one end to the other," he said.
THE LINK between Dominion joining PJM and the proposed transmission line is one that Dominion denies outright.
"There is no connection between the transmission line and PJM," said David Botkins, a spokesman for Dominion. "That line needs to be built because of the needs of Northern Virginia."
"They can argue that the intent is not to sell power," countered Netherwood. "But the reality of that is ... the only way they can sell power is to have that potential of their selling power."
What the long-term plan of the company is seems unclear to even its representatives. Customers get increased reliability, cheaper rates and more options after Dominion joins PJM. But what does Dominion get, besides a huge loss in revenue?
"We win when our customers win," said Botkins. He did add that with the ability to buy power from more sources, "the pressure to generate is not as great."
The vagueness of Dominion representatives' statements in past months about everything from underground repairs to talks with the Virginia Department of Transportation about right of way on Route 7 — quickly jumped upon by both residents and local officials — isn't helped by the fact that the company has now said that no further information on the transmission line will be released to the public until next year.
Dominion's application to the SCC will contain several proposed routes for the western transmission line (including the W&OD Trail because Dominion owns the easement there; the company has agreed not to name it as the preferred route) but it won't contain information about economic and environmental impacts of each proposed route. That will be decided by the SCC.
The application, which will be completed in February or March, will become public after the SCC receives it.
IT'S ALL a bit hazy for everyone involved: a combination of residents' passionate opposition to the transmission line and Dominion's own uncertainty about the repercussions of joining PJM, causing residents in turn to create their own theories.
"It's just very hard to predict exactly how the future is going to be shaped," Koelemay said.