A West Virginia power plant that has purchased coal from Sen. Joe Manchin’s family business for decades was denied the buyout it needed last week to cease supplying customers with power and transition to cryptocurrency mining.
The Grant Town power plant—an 80-megawatt plant in Marion County—has for years primarily used coal from a company Manchin founded in 1988, Enersystems, to generate energy for West Virginia customers. Those customers include Mon Power and Potomac Edison, subsidiaries of utility giant FirstEnergy, which together serve nearly one million customers in the state.
Videos by VICE
The plant has long faced financial woes that resulted in FirstEnergy raising consumer rates by an aggregate of more than $100 million over the last few years. Climate legislation also threatens to put financial pressure on the plant, with a manager previously saying that it couldn’t afford to make upgrades to comply with any greenhouse gas cuts. As has been the case for numerous struggling power plants in the U.S. recently, particularly those powered by fossil fuels, a full pivot to cryptocurrency mining would’ve been a lifeline for Grant Town.
But first, it needed to be bought out from its $200 million contract with FirstEnergy—a move the utility argued would, rather, be a death sentence for Grant Town, E&E News reported Wednesday. And last week, the Public Service Commission of West Virginia, the state utility regulator, nixed the possibility of negotiations, per E&E News.
In a decision issued after months of deliberation, the Commission blocked buyout talks. According to the Commission, Mon Power and Potomac Edison are already short of capacity to fulfill their power requirements, and losing Grant Town to crypto mining would only make things worse. Ultimately, the Commission ordered the companies to seek an agreement with another power generator to fill their capacity gap.
“Any buyout likely will require a significant up front cost that the Companies will expect existing customers to pay,” the Public Service Commission wrote in their decision. “Even if there is a net present value benefit of a buyout, in the form of no purchased power costs from Grant Town in the future, the net impact is highly speculative and dependent on the availability and prices of replacement capacity and energy.”
Grant Town’s owners previously argued that continuing under the current agreement would drive up energy prices further. Acknowledging this, the Commission conceded that any rate hikes would be worth the “environmental and financial benefits” that the plant brings to the state.
Grant Town’s trajectory follows that of many power plants on their last legs amid a global transition away from fossil fuels; a pivot to generating energy for the power-hungry computers that mine cryptocurrency has thrown a lifeline to a number of plants that would otherwise no longer be lucrative enough to stay open. But Grant Town is powered by some of the dirtiest coal on the market, per E&E News, which is supplied by Manchin’s company: waste coal, the refuse from defunct mining operations that’s typically a mixture of clay, soil, rock, and coal.
Waste coal has an estimated 60 percent of the energy value of other types of coal, requiring up to twice as much to be burned to generate the same amount of energy. Waste coal contains high levels of mercury and sulfur relative to other types of coal, and its combustion releases fly ash, a fine, powdery material that contains contaminants like arsenic that leach into soil and waterways.
Grant Town is the only power plant in the state that still uses waste coal, dug from mines that closed years ago, almost all of which has come from Manchin’s company. The Senator has made millions of dollars from sales of waste coal over the last four decades through companies like Enersystems that he founded in the 1980s. Though his son has since assumed leadership over these companies, The Washington Post reported that he’s continued to reap financial rewards from them. The Senator has fallen under intense scrutiny for the conflict of interest they present in his decision-making around climate legislation.
In December, Manchin cited climate policy as reasoning behind his opposition to President Biden’s $2 trillion Build Back Better Act, which included measures to phase out fossil fuels while promoting the growth of renewables. This is just one of a litany of policy decisions he’s made in his political career that have favored coal.
For Grant Town, pivoting to cryptocurrency mining would not represent a pivot away from burning waste coale—it would sustain it, just for a different purpose. Now, the plant is still slated to keep burning waste coal to provide power to residents of the state and may still pursue some form of crypto-mining. Grant Town’s president told the Commission in hearings last year that, should the buyout be rejected, it would pursue a “scaled-down” version of its mining projects, per a November E&E news report.
Grant Town’s owner, American Bituminous Power Partners, did not respond to Motherboard’s request for comment.
