South Boston Energy Project
South Boston, VA
Who is NOVEC?
• NOVEC stands for Northern Virginia Electric Cooperative
• NOVEC was formed in 1983 by the consolidation of Prince
William and Tri-County Electric Cooperatives.
• NOVEC serves more than 150,000 customers located in
the counties of Clarke, Loudon, Fairfax, Fauquier, Prince
William and Stafford all located in northern Virginia.
• Prior to 2009, NOVEC received all of its power supply
through an all requirements contract via an alternate
wholesale power supplier.
• Starting in 2009, NOVEC began providing for its own
power supply requirements.
Power Supply Portfolio
• With this new responsibility, NOVEC embarked on
evaluating various options for meeting the power supply
requirements. The following were the initial main sources:
1.
2.
Power Purchase Agreements (PPAs) with existing resources
Bilateral Contracts and PJM Market Purchases
• While these sources allowed us to sufficiently meet our
load requirements; NOVEC continued to consider other
opportunities given the dynamic nature of its on-going load
responsibilities.
• As part of its on-going resource consideration, NOVEC
investigated numerous resource alternatives. Included were
PPAs with new and existing resources, slice of system
options, partnering arrangements and self-build options.
Other Factors
• At the same time NOVEC was evaluating these
opportunities, the federal legislators were working on
language for a federal renewable energy program.
• The metric that was being discussed as to which utilities
would be under this federal requirement was any utility
who had sales of 4 terawatts or greater.
• Based upon NOVEC’s forecast over the next few years,
NOVEC would meet that metric in short order.
• Due to this potential requirement, NOVEC included in its
evaluation renewable energy projects.
• A developer from Michigan, NOVI Energy, brought forth a
proposal for a wood-burning biomass plant located in
South Boston, VA.
Decision to Move Forward
• With the potential of a federally mandated renewable energy
standard, and the evaluation of a multitude of other offers,
NOVEC decided to move forward with a renewable project.
• NOVEC evaluated PPAs with existing biomass and wind
projects, new biomass projects, the opportunities of buying an
existing renewable project and the South Boston project.
• The results of these preliminary evaluations showed that
NOVEC could construct the South Boston project at a cost equal
to or lower than all of the other offerings whether they were
renewable energy projects or not.
• As decision was made to move forward and perform a detailed
review of the South Boston Project.
Due Diligence Undertaken
• A forest industry expert, the Parton Group, was hired to
conduct a detailed review of the wood basket in and around
the South Boston region. Parton met with the local loggers in
this area as part of their evaluation and came to the
conclusion that the local wood basket would be sufficient to
fuel the plant.
• A PJM Feasibility Study was filed to determine what upgrades
would be necessary to connect to the power grid in the area.
• Air permit requirements were developed and filed with the
VDEQ. Public meetings were scheduled and held and no
opposition was present.
• Sargent & Lundy was hired as the Owner’s Engineer to begin
development of specifications and costs for construction.
Final Decision
• Once NOVEC received all of the results from the various studies and
design, we analyzed the cost impacts and the societal impacts and the
finding suggested that the project should be moved forward.
• One of the remarkable outcomes that we discovered was how much
support was received from the local public for this project. We did not
have any opposition filed by any member of the public through the various
meetings and/or regulatory proceedings.
• VDEQ worked with us in an expeditious manner to finalize and approve
the necessary air permit.
• The towns of South Boston, Halifax and the County of Halifax stood solidly
behind this project and provided significant support as we moved through
the final regulatory requirements for approval.
• In the fall of 2010, NOVEC began preliminary construction of the South
Boston Energy project and South Boston Energy, LLC filed an Application
for approval to construct, own and operate a 49.9MW biomass facility.
Next Steps
• South Boston Energy, LLC requested a waiver from the VSCC to begin
construction in December 2010 even though the approval of CPCN
application was is process. This was necessitated due to the
requirements of the American Recovery and Reinvestment Act (ARRA)
Grant provisions . Under the then rules of the ARRA, a cash grant in lieu
of taxes was available for certain renewable projects as long as
construction was started in 2010.
• The VSCC issued a Certificate for Public Necessity and Convenience on
April 28, 2011.
• Negotiations for selecting the EPC contractor were completed and a
contract to proceed was approved in May 2011. Fagen, Inc was selected
as the EPC contractor.
• The facility is now nearing completion going through final
commissioning and performance tests.
Clearing of Site
Civil Work in Progress
Piling Support for Structures
Boiler Structure
Sept 2012
Receiving Wood Chips
Conveyor
Today