Virginia drops from A+ to C in worker freedom largest decrease in the country

Posted on November 1, 2022 by F. Vincent Vernuccio
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Virginia’s ranking fell more than any other state in the in the Commonwealth Foundation’s 50 State Labor Report “The Battle for Worker Freedom in the States: Grading State Labor Laws.”

Virginia plunged from an “A+” ranking in 2019 to a dismal “C” this year. This was due to what the report called “[t]he most dramatic government union victory of the post-Janus legal frontier” – Janus being the 2018 Supreme Court case Janus v. AFSCME declaring everything government unions do is political, and public employees have a First Amendment right not to subsidize this political activity.  It essentially brought right-to-work provisions to public employees across the country.

As the report noted “Three states experienced major grade changes since our 2019 report. Virginia dropped from “A+” to “C” for instituting collective bargaining, while Arkansas jumped from “C” to “A+” for banning it. Missouri’s comprehensive labor reforms were officially struck down, moving the state back down from “B” to “C.”

The reason for the fall was a law that went into effect in 2021 allowing localities to grant public employees the privilege of collective bargaining — something that had been illegal in Virginia for decades. Because of the new law, Virginia counties, cities, and school boards can enact ordinances giving government unions a monopoly to negotiate contracts for nearly all their public employees.

One of the large problems is that there are no guardrails on the legislation besides saying ordinances must have an unspecified mechanism for how unions can be formed and removed, and requiring local government take a vote if they are petitioned by a majority of public employees working at a specific job.

Besides that, and unlike most other states around the country which do specify what unions can bargain over, the law made Virginia the Wild West for collective bargaining. Anything not specifically prohibited by other provisions of state law was fair game.

Unions in Virginia can now pressure localities to give them more authority and privileges. The Commonwealth Foundation report offers Alexandria as an example. The City of Alexandria originally sought to give unions the ability to bargain but have that privilege limited to wages and benefits.

It quoted City Manager Mark Jinks’ worries about flexibility especially in light of emergencies like the recent pandemic which he said was a “large-scale macrocosmic example of how the City government needs to respond to crises and needs large and small, often immediately” Specifically, Jinks noted “COVID-19 required major shifts in how work was undertaken, immediate safety protocol development and implementation, reassignment of many City employees to new tasks not in their job descriptions, and dramatically changed work environments.”

Collective bargaining contracts in other states precluded flexible and immediate pivots in government services during the Covid emergency, even to the point of holding up online education services at the demand of the teachers unions.

Yet after unions such as the American Federation of State, County and Municipal Employees (AFSCME) put pressure on the Alexandria and its manager, the Ordinance was changed and the report notes “unions succeeded in including issues such as grievance resolution, safety, hours, and other working conditions in the final ordinance.”

The report also pointed to potential cost increases that will “likely put pressure on officials to raise taxes on state residents.”

This is not something that has escaped localities planning to pass bargaining ordinances. As of April of 2021 Fairfax County forecast a need to allocate $1.6 million for increased administrative costs due to bargaining for the county and the school division.

Loudoun County’s proposed FY 2022 budget included over $1 million to pay for extra staffing and overhead.

Estimates from the City of Alexandria were between $500,000 and $1 million per year for administrative costs.

The Commonwealth Foundation report grades states on the legality of public sector bargaining and it scope. It also gives weight to issues like release time (union officials paid with taxpayer funds to do union work), strikes, transparency, the ease with which an employee may leave or opt-out of a union, and right-to-work.

Virginia did have a few positives. The state protects employees with a right-to-work law — meaning a union cannot get a private sector worker fired for not paying them, although this is a right already granted to public employees thanks to the Janus case.

Virginia also has a secret ballot protection act and laws prohibiting strikes. However, provisions that have already been included in local ordinances are troubling signs. These include release time, almost unlimited bargaining, limitations on when public employees can exercise their rights due to arbitrary windows when they can leave and stop paying the union, and other issues.

Overall, the fall in ranking represents a worrying sign for Virginians and public employees across our Commonwealth.

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Wind Change: Turbine Failure Risk Back on Customers

Posted on October 31, 2022 by Stephen D. Haner
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The big risk with Dominion Energy Virginia’s planned offshore wind extravaganza has always been that either the wind out in the Atlantic blows too little or it blows too much.  Too little and the ratepayers are paying an inordinate amount for intermittent electricity; too much (a major hurricane say) and the turbines could be damaged or destroyed.

Because the monopoly utility will own the project, not a third-party energy developer, all that risk lands on its ratepayers.  The State Corporation Commission (SCC) sought to protect Virginia ratepayers from the risk.  That was the point of its imposition of a performance standard on the project tied to its overall energy output.

That is the risk Dominion’s leadership refused to accept, threatening to kill the $9.8 billion project entirely.  It was not an idle threat.

Now Virginia Attorney General Jason Miyares (R) has a new proposal which protects Dominion and its shareholders from that risk after all, putting it back squarely on the utility’s 2.5 million customers.   Instead, the person charged by law as the protector of Virginia consumers is focused on the risk of construction cost overruns.

Given the massive profits it will reap over the possible 30-year life of the project, it is not surprising Dominion is willing take some risk on that front.  Should the project cost exceed $10.3 billion (note: that is already a 5% cost increase) and reach $11.3 billion, Dominion shareholders will split the additional cost with its ratepayers.

Even if consumers only have to finance an additional $1 billion to build it, that still increases Dominion’s potential annual return on equity by about $100 million per year.  An additional billion from its own coffers puts only a small dent in decades of profit.

With this approach, Dominion gets all those profits no matter how much power it produces, and consumers will fund any energy deficit.  The SCC could impose sanctions for poor energy production if Dominion’s own negligence is to blame, but too much or too little wind won’t hit its bottom line.  It will only hit customer energy bills.

The SCC’s hands are also tied on project cost overruns unless it approaches $14 billion.  Only then can the SCC step in and try to shut the boondoggle down.  Should it do so ratepayers will still be on the hook for amounts spent at that point.  Again, were this a third party developer’s project, the construction cost risk would never be on the customers.

This is not progress.  Unfortunately, with the Attorney General joining with the Green New Deal advocates to endorse it, and with the praise already heaped on it by Governor Glenn Youngkin (R), it enters the regulatory arena with a full head of steam.

Some background:  When we last visited this issue, the SCC had approved the wind project with its condition that Dominion would bear additional costs if it failed to hit output targets, a 42 percent capacity factor.  Dominion sought and got reconsideration of that, and all the parties filed another round of arguments and the public added more comments, one from the Thomas Jefferson Institute.  That was followed by a couple of weeks of silence, a sign that somebody was negotiating behind the scenes.

The deal emerged October 28, late on a Friday afternoon.  Miyares got to announce it first with great fanfare.  He called it “Historic” and touted “unprecedented consumer protections.”  You can read the document here, with pages 9-12 being the actual stipulation.  Basically five parties have signed on:  Miyares, Dominion, two environmental organizations and Walmart, the state’s largest employer and a huge Dominion customer.

The two judges of the SCC are not obligated to accept this stipulation and reverse their earlier stance.  Missing from the agreement are other parties, including the SCC’s own staff, another entity charged with protecting consumers.  Also missing are Clean Virginia, another major environmental group, and the Virginia Committee for Fair Utility Rates, representing industrial customers. The SCC may seek their reaction before deciding.

Every signatory to the deal, with the exception of Miyares, was basically in support of building this project all along because they all accept the premise that fossil fuel energy is a threat to human existence.  That includes Walmart.  If ten years from now Virginians regret the construction of this project and its impact on their electric bills, history will record Miyares as the political leader who kept Dominion from pulling the plug.

A good element of the stipulation involves accounting for any additional financial subsidy to the project provided by the Biden Administration’s Inflation Reduction Act.  If that does lower the final construction cost, the benefit should flow to consumers.  That would likely have been the SCC’s position anyway, but it is good to have that written into any final order.

In the last General Assembly, every Republican member of the House of Delegates voted to kill this project, or to at least remove the legislative provisions that made it mandatory.  Several Republican senators would have voted the same way if Senate Democrats hadn’t killed the bill in committee.  The House Republicans also voted in a different bill to fully restore the SCC’s regulatory authority to say yea or nay on its prudence.

In his recent energy plan document, Governor Youngkin spoke eloquently about the need to restore SCC independence and oversight.  Yet now once again we have a deal written in closed rooms by lobbyists and lawyers with varied motivations seeking to circumvent a valid SCC proposal to protect consumers.  An Attorney General who wrote a strong brief praising that SCC proposal has now undercut that position, for no other possible reason than to keep the project alive.

Support for this negotiated settlement flies in the face of those legislative efforts and eliminates any chance of a similar debate in 2023.  It belies the claims of trust in SCC oversight.  For reasons they should explain in more detail, Virginia’s top Republican leaders remain all in on offshore wind.

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Youngkin’s Energy Plan Pivots to Reason

Posted on October 5, 2022 by Stephen D. Haner
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In his newly released energy plan, Governor Glenn Youngkin (R) makes it clear he sees the economic abyss created by the unrealistic and ideological green utopia demanded by his predecessor.  Seeing a looming disaster and stopping it are two different things.

The new document is not a full 180-degree change from the previous plan concocted by former Governor Ralph Northam (D).  For example, Youngkin is not reversing his previous endorsement of Dominion Energy Virginia’s planned $10 billion offshore wind project, a central part of the Northam plan. Also, Youngkin apparently is sufficiently convinced that carbon dioxide is harmful that he wants to spend your money on carbon capture and storage.

Nor does Youngkin call for outright repeal of the 2020 Virginia Clean Economy Act (VCEA), but rather he endorses removing its rigid mandates as to how rapidly to retire fossil fuel energy generation, and their mandatory replacement with wind, solar and related battery technology.  The problem is even tweaks require amending state law, and previous efforts to do that were thwarted by the Democrats who still control the Virginia Senate and who still accept the Green New Deal catechism in full.

But the change in direction in the new document is dramatic, and it has already been roundly condemned by the various groups that are heavily advocating the rapid end of fossil fuels.  By its enemies shall you know it.  Placing concerns over customer cost and system reliability as a higher priority than reducing carbon emissions guarantees that the plan starts yet another ideological battle for the governor.

Under another recent law those advocates pushed through the plan Youngkin issued October 3 was to be premised on a rapid move to a zero-carbon energy infrastructure, moving beyond transportation and electricity into agriculture and how to heat buildings and cook food.  Youngkin didn’t just fail to comply with that directive, he rejected the premise.

From the news release that came out with the Energy plan’s announcement in Lynchburg:

The plan adopted in recent years by the previous administration goes too far in establishing rigid and inflexible rules for the transition in energy generation in Virginia. We need to recognize that a clean energy future does not have to come at the cost of a healthy, resilient, and growing economy. We first must embrace a measure of humility as to our ability to project and predict 30-years of energy demand and technological innovation. And we certainly should not make irreversible decisions today to exit critical elements of power stack.

The “measure of humility” includes statements that Virginia might not retire all or even most (or any?) of its natural gas generation by the current deadlines, will continue to push for additional natural gas pipelines to grow that energy source, and will not follow California into mandating only electric vehicles on new car lots by 2035.   The report cites a Weldon Cooper Center estimate that the electric vehicle mandate will increase electricity demand by 25% (and that’s hardly the only electrification mandate from the Northam years) and then warns:

Transitioning from baseload generation (to wind and solar) while attempting to accommodate this increase in electricity demand could be a disastrous combination for Virginia’s grid reliability. California, which is now asking drivers to refrain from charging their electric vehicles to prevent blackouts, provides an instructive example of what banning non-electric vehicle sales and retiring all baseload generation would look like in Virginia.

Governors propose. Legislatures dispose.  The votes to repeal the clean car regulations were not there in the 2022 General Assembly, at least not in the Senate.  The attempt was made.  It surely will be made again.

The absolute best elements of the plan, and here there is some bipartisan consensus, are centered on restoring the traditional and independent oversight authority of the State Corporation Commission.  Several of Youngkin’s recommendations are complete reversals of recent General Assembly policies and practices which override the SCC, all adopted at the direct behest of the supposedly regulated entity.  Passing them will not be easy, either, because in that case too many Republicans signed on to the earlier bills.

Some of the regulatory elements the governor is challenging go all the way back to the seminal 2007 legislation that established Virginia’s unique and consumer-dismissive electric regulatory regime.  They include the proliferation of individual rate adjustment clauses on customer bills and the statutory profit margins protected by law.

A headline promise in Youngkin’s plan, probably unachievable within his term, is to develop a small modular nuclear reactor somewhere in Southwest Virginia.  Appalachian Power Company serves that territory, and no regional electric cooperative would need or could ask ratepayers to fund such a project.  A nuclear reactor is a bit more expensive than the usual highway or school construction project that gets tucked in a governor’s budget, and somebody needs to buy the power output.

Northam’s plan four years ago frankly laid out a deep green vision for an energy transformation, and he and his supporters then set about implementing it just about in full, aided by taking full control of both houses of the legislature for 2020 and 2021.  It was far more a legislative wish list than an engineering and economic blueprint.  Give them credit, they got it done.

The success of Youngkin’s plan will rise or fall on which elements of it are now translated into successful legislation.  Even the 90 degree turn he proposes may require that various legislators face an electorate angry over 1) energy prices, 2) the threat to eliminate their preferred transportation or home energy choices and 3) the fear that the various investments in intermittent renewable energy will prove disastrous.  (See Dominion’s refusal to actually back up its promises on offshore wind.)

Northam didn’t have the votes to do what he wanted in 2018 but did a year later.  Youngkin now has a different (we say better) plan that also lacks sufficient support in the legislature, but another election is coming.

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Public Interest Groups Join to Explore Lawsuit over Dominion Windfarm

Posted on October 3, 2022 by Jefferson Policy Journal
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A coalition of public interest groups – The Heartland Institute, the Committee For A Constructive Tomorrow (CFACT), and the American Coalition for Ocean Protection (ACOP) – announced in late September that they have hired counsel to explore a lawsuit protecting the right whale from Dominion Energy Virginia’s efforts to place an offshore wind (OSW) project directly in their habitat off the coast of Virginia. Virginia’s Thomas Jefferson Institute for Public Policy is participating in the American Coalition for Ocean Protection (ACOP).  ”While the Jefferson Institute’s concerns are more focused on the unreasonable ratepayer cost and ratepayer risk the project imposes on Dominion’s 2.5 million Virginia customer accounts,” noted Institute president Chris Braunlich,  “we share the concern that environmental laws be applied uniformly and transparently, and not be ignored for politically-driven proposals.” “Too much of the Dominion application is shrouded in secrecy,” Braunlich continued, “including the effect on wildlife in the area of the proposed windfarm.  All the facts should be put on the table before a project of this magnitude is approved.”

Approval of the project at the state level by the State Corporation Commission, or the Virginia Supreme Court if aspects of the SCC decision are appealed, is not the final green light for construction of the $10 billion project.

The coalition has retained as counsel the law firm of Gatzke, Dillon and Ballance (GDB) of Carlsbad, California to represent them in evaluating the upcoming draft Environmental Impact Statement (EIS), which the Bureau of Ocean Energy Management (BOEM) is producing for the Dominion’s Coastal Virginia Offshore Energy Project.

GDB has extensive experience representing plaintiffs pursuing litigation to defend whales and a strong track record of success in challenging proposed U.S. offshore wind projects.

“Unless BOEM requires extensive, effective, unprecedented protection measures for the North Atlantic right whale immediately, this species is almost certainly headed toward extinction,” said David Stevenson, president of ACOP. “With only a little more than 300 individual right whales alive today, this endangered species is in dire need of protection, and the Virginia Wind Project lies directly in their annual migration path. The project will require extensive daily maintenance by multiple service ships, and the potential for whale fatalities due to ship strikes is indisputable.”

Initially, GDB will provide the coalition with advice and counsel to determine if BOEM has undertaken the legally required “hard look” at the OSW Project in order to provide necessary protection for Virginia’s environment and for the state’s electricity consumers, as required by the National Environmental Policy Act (NEPA). In addition, the firm will advise the coalition as to whether or not the EIS draft meets the requirements of the Endangered Species Act (ESA), the Clean Water Act, the Outer Continental Shelf Lands Act, and other relevant federal and state statutes that govern the construction and maintenance of the project.

“We are very pleased to have retained the services of a law firm with such extensive expertise in the requirements of federal laws such as NEPA and ESA,” said CFACT President Craig Rucker. “We are not only very concerned about the future of the right whale, which extensively uses the ocean waters affected by the wind-power project, but also concerned as to how BOEM will address the fact that this project, despite its alleged benefits regarding carbon dioxide and climate change, will actually cause the release of more carbon dioxide into the atmosphere than it will consume.”

BOEM anticipates that the draft EIS for the Virginia Wind Project will be released for public review and comment later this year. Dominion Energy is proposing to build 176 wind towers, which would stand more than 700 feet tall 27 miles off the coast of Virginia Beach. The company has announced that it expects to begin generating electricity from the project by the end of 2026.

“The Virginia Wind Project is a risky, costly, waste of resources and a pitiful way to generate electricity for a state which claims to be business and consumer friendly,” said Heartland Institute President James Taylor. “Before construction commences, the project should be given the same level of scrutiny for environmental protection by the courts and the federal authorities as has been provided for fossil fuel projects in Virginia, such as the Mountain Valley Pipeline.”

GDB has represented plaintiffs who have brought suits against BOEM, the Department of the Interior, the National Marine Fisheries Service, and other federal agencies with respect to the New York Bight offshore wind project off the coast of New York and New Jersey, as well as the Vineyard Wind project off the southern shore of Martha’s Vineyard, Massachusetts. These suits seek declaratory and injunctive relief and are currently pending in the Federal District Court for the District of Columbia and the Federal District Court in Massachusetts, respectively.

“We are equally troubled that Virginia ratepayers could be exposed to huge rate increases resulting from intermittent, unreliable wind generation,” added Rucker. “Should litigation become necessary to remedy deficiencies in BOEM’s final EIS, we are grateful to have experienced counsel for advice as we move forward.”

The coalition intends to comment on the draft EIS within 45 days of its issuance by BOEM, unless BOEM provides for a longer public review and comment period.

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Dominion Hides Threat to Whales

Posted on September 19, 2022 by David Wojick
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Secrecy abounds around the monster offshore wind (OSW) project proposed by Dominion Energy. In this case it is all about the threat to the severely endangered North Atlantic Right Whales.

I earlier reported on the big hidden whale study done by the US Bureau of Ocean Energy Management (BOEM), which is doing the Environment Impact Assessment for this huge project.

Digging into Dominion’s filing with BOEM I found something even worse. Dominion has done an actual threat assessment but it is 100% secret! This is outrageous.

Here is a bit of background so folks can dig for themselves. There is a lot to look at.

BOEM has a separate website on this monster OSW project, which would be one of the world’s largest. The project is titled Costal Virginia Offshore Wind or CVOW. Dominion has submitted a large set of documents in what is called the Construction and Operations Plan or simply the COP.

The COP is here.

There is a long main report plus 32 technical appendices. My endangered whales interest was immediately drawn to “Appendix R: Threatened and Endangered Species Review”.   It is here.

I expected to get a discussion of the potential threats the project poses to the severely endangered North Atlantic Right Whale and what Dominion might do to minimize the adverse impact. I should also learn what other threatened and endangered species are involved, right?

Instead, I just got a cover page bearing this notice: “Proprietary and Confidential Business Information Exempt from Public Disclosure“.

That is all there is to Appendix R. It is 100% secret. Even the number of pages is not disclosed, as it is with the other Appendices, that one can actually read.

So the huge question is”What’s the secret?” What is so secret that every word has to be kept from the public?

It cannot be the details of project construction and operation, because these are abundant in other Appendices. Nor that there are risks to others. The very next, Appendix S, is Navigation Safety Risk Assessment. There are 225 public pages there.

My guess is that it says there are real risks to the Right Whales, maybe to other species too. Of course there is nothing proprietary or business confidential about this sort of analysis. In fact it is central to public policy making.

That this assessment is kept secret is outrageous all by itself, but it also raises a much deeper issue. Will the BOEM Environmental Impact Assessment also include secret science?

BOEM is currently doing a draft EIA, scheduled to come out this December. Agencies are not allowed to disclose proprietary and confidential business information. Will BOEM ignore Appendix R, or even worse use it without disclosing it? The same is true of their secret, million-dollar study of Right Whale migration. Migration behavior is central to OSW risk assessment.

Speaking of migration behavior, I got some truly valuable data from a prominent whale watching and advocacy group. They say “As for your question regarding migrations, there is a great online resource which documents surveyed and opportunistic sightings and acoustical detections of right whales called WhaleMap https://whalemap.org/WhaleMap/. In general, a subset of the population, including pregnant females, migrates to the calving area in Southeast US around November and move back to northern waters in the spring. However, there are acoustic detections in the mid-Atlantic waters year-round and not all right whales migrate. To make things more complicated, some whales have migrated to the Southeast US, returned to the northeast waters, and then back to the southeast within the same calving season.”

So it looks like Right Whale migration is complex stuff. It is like this with some birds, blue jays for example. Maybe this is what BOEM found and does not want to release. After all, their middle name us “Ocean Energy” so they are all for this monster project.

Speaking of bias I am somewhat skeptical of Dominion’s secret assessment. It was done by a heavy duty engineering group named Tetra Tech Inc.

Unfortunately their Home Page motto is “Committed to Sustainability and Climate-Positive Actions”. Offshore wind is certainly claimed to be a “Climate-Positive Action. Saving the desperately endangered North Atlantic Right Whales from these ill-conceived actions, not so much. Clearly Tetra Tech is committed to this OSW project.

Since all the impact assessment to date seems to have been done secretly by proponents of the project, I expect the first draft EIA to be pretty poor when it comes to protecting the whales. Hopefully defenders of the whales will rise to the occasion.

Save the whales from OSW!

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