By Stephen Smoot
“When I came in, I knew that for West Virginia to lift its standard of living up, we need to identify those needle moving things to raise population, increase workforce participation, and draw private sector investment at a level we’ve never seen before,” said West Virginia Governor Patrick Morrissey at the recent Oil and Gas Association summer meeting.
He added that revenues from added power production and other expected development will help to address funding issues in school aid, water and sewer infrastructure, and other major issues.
One of Morrissey’s signature policies lies in jump-starting Mountain State energy production by 50 gigawatts by the year 2050. A single GW can power 750,000 typical residential homes. With PJM Interconnection sounding alarms about the near-future in both production and distribution of electric power, increasing West Virginia’s productive capacity has been made a priority.
Most of the power produced will be exported, but in turn that will generate revenues coming back to West Virginia in multiple streams.
Achieving the 50 by 50 goal would significantly accelerate production in West Virginia. Already, if the Mountain State, according to the Governor, were an independent nation it would rank in the top 20 globally in energy production. That includes serving as the second largest coal producer and fourth natural gas producer. About 10 percent of the nation’s natural gas supply comes from the state.
Success in expanding production capacity would at the same time earn more revenues for the state while helping the 13-state grid, including West Virginia, remain reliable and consistent. Rising energy demand in the Mid-Atlantic and Midwest has put increasing strains on the 13-state grid serving the region.
Recently, the Governor spoke at the Oil and Gas Association’s summer meeting. He provided an update showing that in less than a year, almost 20 percent of the ambitious goal has been realized. He opened by reaffirming the conclusions of a panel at the event, saying “Through our energy resources and through our energy dominance, West Virginia is going to ascend and continue its comeback like you’ve never seen before.”
He added that West Virginia will “be a major player in America’s energy dominance strategy.”
The Governor credited the policies of President Donald Trump for laying the groundwork for the Mountain State to expand capacity so rapidly. He also discussed how lawsuits launched by the West Virginia Attorney General’s Office during his and his successor’s tenure there also removed regulatory barriers to growth. “The regulatory side of the equation should never be underestimated,” Morrissey added.
Morrissey shared that overall, the state has seen recent private sector investment of approximately $15 billion that will help to create 15,000 jobs. That includes not only energy production projects in North Central West Virginia, Grant County, and elsewhere, but also added manufacturing facilities such as a military drone producer coming to Berkeley County.
He mentioned specifically the 625 megawatt project planned for Harrison County’s Wolf Summit.
“That doesn’t factor in broadband. That doesn’t factor in rural health,” he stated.
Morrissey explained that as COVID funding disappeared, speed in engaging economic development became more paramount. “We emphasized speed to build much more aggressively than anyone else,” he explained, then added, “and you know what I was told? That’s the reason we were able to prevail” with the Berkeley County investment projected to add 60 high-paying jobs.
“The secret sauce,” he continued, lies in expediting permitting and capital availability so that a business can focus on other issues such as construction and hiring.
The “really stunning” series of announcements over the past year and a half tally up to nine gigawatts of added power likely coming to the state. That represents a little less than 20 percent of the stated goal for 25 years.
“As we begin getting a lot of that revenue to flow in as the construction winds down, we’re going to position our counties very effectively” to respond to fiscal issues and also mitigate the effects of development. He explained that 30 percent of revenues will go to the county hosting a facility, 10 percent “shared around the state”, 10 more percent for water and sewer infrastructure, as well as grid maintenance and protection.
Morrissey also responded to concerns from those who state that in the past West Virginia did not get its due in energy production revenues. In past times, coal mined would get shipped for use out of state. West Virginia’s current effort, however, seeks to keep the benefit of coal and gas extraction in not only the upstream, but also midstream and downstream as well.
He stated, “I want to make sure we’re monetizing the intersection between energy and technology, where we’re going to create more value-added products and services for the citizens of our state.”
Another recent major energy-related announcement came from West Virginia University. The flagship state higher education institution will receive $321 million over a decade to work with the National Science Foundation and others to create next generation grid protection technology, including cybersecurity, energy storage, and advanced manufacturing. The grant does not promote expanded production of energy, however.
It is expected to generate $1 billion in economic activity and 21,000 jobs in West Virginia and other Appalachian states.