SD62 - Report of the Virginia Coal and Energy Commission


Executive Summary:
The Virginia Coal and Energy Commission has been directed by statute to study all aspects of coal as an energy resource, and endeavor to assist in the development of renewable and alternative energy resources (9-145.1 of the Code of Virginia). This document is submitted as the Commission's report on its 1993 activities.

The range of activities undertaken by the Commission in 1993 evidences the breadth and complexity of issues relating to coal and energy in the Commonwealth. Occupying most of the Commission's meetings were four areas of concern. The health and future of Virginia's coal industry was accorded a high priority. After peaking in 1990, production, demand, and price for Virginia coal has steadily declined. Coal exports from Hampton Roads dropped from 53.3 million tons in 1992 to an estimated 38.5 million tons in 1993. Though many of the reasons for the declines are due to international factors, such as lower demand for electricity and metallurgical coal in Europe and increasing competition from other coal-producing countries, the Commission discussed steps for improving the situation. The Commission ratified several of the preliminary recommendations of the comprehensive export plan for Virginia coal prepared by the Department of Economic Development (DED), the Department of Mines, Minerals and Energy (DMME), and the Virginia Center for Coal and Energy Research (VCCER), pursuant to Senate Joint Resolution 208 (1993).

The Energy Preparedness Subcommittee met twice to address alternative sources of financing for Virginia's energy programs following the cessation of federal oil overcharge funds. After studying the services provided under the Low Income Home Energy Assistance Program (LIHEAP), the Weatherization Assistance Program (WAP), the Institutional Conservation Program (ICP), and the State Energy conservation Program/Energy Extension Service (SECP/EES), the subcommittee recommended that the Commission endorse agency proposals for general fund appropriations to offset a portion of the lost federal funds. Funding for energy programs was also addressed in connection with other activities of the VCCER, the Powell River Project, and DMME, including implementation of the Virginia Energy Plan.

The third topic on which the Commission focused its attention was the development of alternative and renewable sources of energy. This is consistent with the goals of the Virginia Energy Plan. The removal of barriers to the use, availability and acceptance of renewable energy sources and alternative transportation fuels can accelerate the commercialization of these resources in the Commonwealth. The preliminary findings of a study authorized by DMME reveal numerous opportunities for action to foster these resources in the utility, building, and transportation sectors. The Energy Preparedness Subcommittee also dedicated a meeting to studying the opportunities and incentives for the burning of waste tires as an alternative source of fuel.

Finally, the Commission continued its role of monitoring implementation of energy policies affecting Virginia. The principal recent development has been the enactment of the federal Energy Policy Act of 1992 (EPACT). Though implementation of many non-regulatory aspects of EPACT will depend on congressional funding, Virginia can position itself to take advantage of opportunities for federal funding. The other major recent policy development continues to be the State Corporation Commission's outlining of parameters for public utility conservation and load management programs. A June 1993 order establishing mandatory cost/benefit analyses of conservation and load management programs and endorsing of a multi-perspective approach to program evaluations culminates the SCC's three-year effort to address broad policy questions.

At its meeting on January 11, 1994, the Commission accepted the resignation of A. Victor Thomas as chairman, and applauded him for his able leadership during the preceding two years. Frank W. Nolen, formerly vice chairman, was elected as the Commission's new chairman. J. Paul Councill, Jr., was elected as the new vice chairman of the Commission.