Virginia’s largest utility has received approval from state regulators to construct a liquefied natural gas (LNG) storage facility for two of its gas-fired power stations in the Southside region, despite opposition from environmental groups advocating for more renewable energy sources.
Dominion Energy received approval from the State Corporation Commission (SCC) on Monday to build a 25-million-gallon LNG storage facility, capable of holding up to 2 billion cubic feet of gas. The facility will serve the utility’s 1,358-megawatt Brunswick and 1,588-megawatt Greensville power stations, both of which use combined-cycle turbines that burn gas and capture steam. These stations are named after the counties in which they are located.
Jeffrey G. Miscikowski, Dominion Energy’s vice president of project construction, testified that the facility is necessary to ensure a reliable and safe fuel supply for the Brunswick and Greensville power stations in the event of natural disasters, extreme weather, or other disruptions to fuel supply.
While Dominion did not respond to requests for comment on the approval, environmental advocates have expressed concerns. Grayson Holmes, a senior attorney with the Southern Environmental Law Center, criticized the project, noting that customers are still paying off the $1 billion-plus cost of the power plants. He argued that the LNG storage facility would add hidden costs, exposing customers to further financial risks associated with natural gas.
The SCC approved the project after Dominion argued that severe cold-weather events, such as Winter Storm Elliot in December 2022, had shown the vulnerability of gas supply during extreme weather, when gas production wells froze and constrained delivery to natural gas-fired plants.
The SCC acknowledged the growing frequency and severity of extreme weather but noted that no party claimed the project would be detrimental to reliability during such events. The Virginia Office of the Attorney General raised concerns, citing that in the last 20 years, Dominion had not experienced any customer outages due to fuel supply disruptions at its plants, the very kind of events the LNG storage facility is designed to mitigate.
Despite this, reports from grid operator PJM Interconnection and other authorities highlighted the need to prepare for increasingly severe weather events, which are exacerbated by climate change. Studies have also pointed to vulnerabilities in power plant components, such as sensing lines, that can freeze during cold snaps, leading to plant failures.
The two power plants combined generate enough electricity to power about 700,000 homes—around a quarter of Dominion’s total generation capacity over the last five years. The LNG storage tank could supply enough fuel to run both plants for four days or one plant for up to eight days.
The facility is expected to increase Dominion’s effective load-carrying capacity (ELCC), generating an additional $52 million in revenue by selling electricity under forecasted 2028 prices.
However, operation of the tank is expected to produce about 68,919 tons of carbon dioxide-equivalent emissions annually, representing a 1.1% increase in emissions from the stations’ 2023 output of about 6 million tons.
Construction of the LNG facility is slated to begin this year, with completion expected by the end of 2027. The facility will be located on a 25-acre parcel adjacent to the Greensville Power Station and will utilize existing natural gas infrastructure between the two stations and a connection to the Transcontinental Gas Pipeline Company.
Miscikowski testified that the construction would create about 400 jobs and generate $700,000 in annual local and state tax revenue, along with $17.5 million in local economic activity. Once operational, the facility would support six full-time jobs.
The LNG facility comes with an estimated capital cost of $547 million, and the utility expects to recover between $1.07 billion and $1.45 billion over the life of the project. This could result in an annual increase of $5 to $12.50 for the average residential customer.
According to Dominion’s environmental justice analysis, the facility is located within a one-mile radius of four census block groups, two of which are low-income and communities of color. However, the SCC determined that the project would not disproportionately impact economically disadvantaged or minority communities, noting that the local community had opportunities for involvement.
The project approval also comes as Dominion seeks approval for a new natural gas plant in Chesterfield County, designed to provide electricity during peak demand periods. This plant is expected to support the anticipated 5.5% annual load growth in the region, largely driven by data center development.
Environmental groups argue that Dominion’s plans to expand fossil fuel infrastructure conflict with Virginia’s Clean Economy Act, which mandates the decarbonization of the state’s grid by mid-century. Under the law, fossil fuel plants cannot operate past 2045 unless there are reliability concerns. The LNG facility is expected to last 30 years, but if the plants are forced to close before then, it could result in stranded costs, environmental advocates argue.
Peter Anderson, director of state energy policy at Appalachian Voices, expressed concerns that the project would soon become a stranded asset, asserting that clean technologies like large-scale batteries could provide real reliability benefits while meeting the state’s climate goals.