Evaluation of Appalachian Power Company Effluent Limitation Guideline Costs in Virginia

Sierra Club
Project Completed November 2022

Synapse supported the Sierra Club in Virginia in its engagement in Appalachian Power Company's petition for approval of a rate adjustment clause (E-RAC) for costs to comply with federal environmental regulations (Case PUR-2022-00001) as well as its 2022 Integrated Resource Plan (Case PUR-2022-00051).

Synapse submitted testimony in both dockets to evaluate the economics of installing effluent limitation guideline (ELG) projects at two existing coal plants: Amos and Mountaineer. We found that the company did not conduct a robust modeling exercise of alternatives and relied on outdated modeling assumptions. Synapse conducted its own modeling to reflect recent policy changes such as the Inflation Reduction Act, West Virginia PSC Orders, and adjustments to PJM market rules. Synapse found that a scenario in which ELG investments were avoided and the plants were retired in 2028 was more economic for ratepayers than a scenario in which the plants incurred the ELG investments and continued operating until 2040.

The E-RAC case was a follow-up to a prior docket (Case PUR-2020-00258) that addressed similar issues at Amos and Mountaineer. Synapse also supported the Sierra Club in this earlier case.