A Florida company plans to build two pumped storage hydroelectric stations just miles apart on previous coal mine sites in Wise County.
Rye Development has already secured a preliminary permit from the Federal Energy Regulatory Commission for its proposed Stonega pumped storage project, which would be near the Roda community. FERC licenses and oversees hydropower projects in the U.S.
The company has also filed an application with FERC for a preliminary permit for its proposed Bluff Spur project, which would be built near the Dunbar community.
The company notes that it is very early in the process for both projects, which are near the Kentucky border.
Local officials say they are aware of the projects, but do not have much information about the proposals.
If approved, the two projects would be the third and fourth pumped storage facilities in Virginia.
Pumped storage facilities generate electricity by moving water between two reservoirs at different elevations. This energy storage is vital to grid reliability, according to the U.S. Department of Energy.
When electricity demand is relatively low and electric costs are cheaper, water is pumped from the lower reservoir to the upper reservoir. When electricity demand peaks, water is released from the upper reservoir and descends to power the plant’s turbines.
Rye Development, headquartered in West Palm Beach, is already moving forward with a southeastern Kentucky pumped storage project near the Virginia and Tennessee borders that has secured a federal grant for up to $81 million.
One preliminary permit is sought; another is already in hand
On June 25, FERC published a notice of Rye Development’s preliminary permit application for the Bluff Spur project, under the incorporation of Bluff Spur Pumped Storage LLC. A preliminary permit would allow the company to move forward with filing a license application, but it would not authorize any land-disturbing activity.
The Bluff Spur project would be located north of the Dunbar community, northeast of the town of Appalachia and northwest of the city of Norton. The area has been heavily mined underground and on the surface for decades.
How to comment
The deadline to file public comments on the Bluff Spur application is 5 p.m. Aug. 17. FERC encourages submitting comments online.
Comments also can be mailed to Debbie-Anne A. Reese, Secretary, Federal Energy Regulatory Commission, 888 First Street N.E., Room 1A, Washington, D.C. 20426.
Application details can be found here using docket number P-15425.
It would include an upper reservoir at an elevation of 3,620 feet and a lower reservoir at 2,280 feet. Each would have a surface area of about 70 acres. It would use two turbine generators with a total rated capacity of 300 megawatts.
The project would include building a 3.4-mile, 161-kilovolt transmission line to a substation.
“Initial fill and make-up water for the project would come from adjacent waterways and/or groundwater wells,” the notice states.
The project would have annual power generation of 840 gigawatt-hours — enough to power roughly 60,000 to 75,000 homes. That’s based on average household annual power consumption of about 11,000 to 12,000 kilowatt-hours.
Becky Brun, a Rye Development spokesperson, declined to answer a number of questions about the proposal but provided a statement from Sandy Slayton, the company’s vice president for environmental affairs.
The project “has the potential to create thousands of family-wage jobs, spur local economic development, and help meet growing energy demand in an environmentally responsible way,” Slayton said. “Pumped storage hydropower projects are built to serve communities for more than a century, delivering reliable, affordable energy and long-term economic benefits.”
Slayton continued: “This site appears to have the ingredients for a successful pumped storage project, but much more work needs to be done. A preliminary permit … is simply the first step in a lengthy licensing process. It’s not permission to build. Instead, it allows time for feasibility studies to be completed and gives Rye Development priority to apply for a future hydropower license at this site.”
Rye Development received a FERC preliminary permit in July 2025 for its proposed Stonega pumped storage project and is now working through the process of seeking full permitting. The preliminary permit is good through June 30, 2029.
The Stonega project would be built on a former surface mine site east of, and close to, the Roda community.
Stonega’s upper reservoir would be built at an elevation of 3,427 feet, with a surface of about 62 acres. The lower reservoir would be built at 2,280 feet, with a roughly 70-acre surface. The project would include building a new 161-kilovolt underground transmission line and a 161-kilovolt overhead line. It would generate an estimated 1,800 gigawatt-hours of electricity annually, enough to power as many as 145,000 homes.
Preliminary permit documents indicate that threatened, endangered or potentially endangered species in the area include four bat species, three mussel species and one insect species.
The U.S. Department of the Interior and the Virginia Department of Wildlife Resources have expressed concern about the project’s potential impact on fish and wildlife, along with concern about acid mine drainage resulting from construction on a former surface mine.
The agencies recommended that the company coordinate with the U.S. Fish and Wildlife Service, along with the Bureau of Indian Affairs and the Virginia Department of Environmental Quality. Also, they recommended examining the geology of the upper reservoir for potential impacts to downstream water quality.
Brun emphasized that if Rye Development decides to move forward with either of these projects, “the company must complete a full FERC license application and undergo a thorough FERC review, which typically takes several years.”
The company has no other comments on the Stonega project at this time, she said.
Public documents don’t indicate who might be a customer for the electricity. The area is served by Old Dominion Power Co., a subsidiary of Kentucky Utilities.
An ongoing discussion in Wise County, which is home to one data center, is pursuing additional data centers and possible self-contained systems to provide electricity for them.
Local officials have not heard a lot; one advocate says it’s concerning
Brian Falin, Wise County’s director of economic development, confirmed that county officials were made aware of the Bluff Spur application in February, “but we do not have any additional information other than what is included in the application.”
Karen Mullins, the interim county administrator and county attorney, echoed Falin’s comment.
“Wise County has not been contacted regarding the FERC feasibility permit,” she wrote in an email. “I was sent a screen shot of a post from Facebook. I did inquire of IDA, Brian Falin, and received the same information.”
County Supervisor Fred Luntsford, whose district includes the project sites, could not be reached for comment. Luntsford is also the Appalachia town manager.
The Virginia Coalfield Economic Development Authority is not involved with the projects, said Jonathan Belcher, its executive director, who said he has no information about them.
LENOWISCO Planning District Commission Executive Director Duane Miller said he was aware of the Bluff Spur preliminary permit application, but he has no other information.
Wally Smith said he is closely watching the project permit processes. Smith, a biology professor at the University of Virginia’s College at Wise, is an elected director of the Lonesome Pine Soil and Water Conservation District. He is also vice president of the Clinch Coalition, a local environmental advocacy group.
“Building pumped storage hydro projects on surface-mined land would pose complex questions about potential impacts to water quality and quantity for downstream communities, especially given our region’s increasing trends in flood severity,” Smith wrote in an email.
“I am deeply concerned that Wise County residents appear to have been caught off-guard with both of these proposals and only became aware of them after plans were developed and proposed to FERC, given their proximity to private residences and location within the Powell River watershed. Close coordination with county residents and other local stakeholders will be key to ensuring that projects like these develop in a way that is sensitive to local concerns.”
Company moves forward across Kentucky border
Rye Development is moving forward with its Lewis Ridge pumped storage facility in Bell County, Kentucky, near where Virginia meets Tennessee at the Cumberland Gap. The company got its preliminary FERC permit in 2022 and is pursuing its license.
In 2024, the federal Department of Energy approved a grant of up to $81 million for the $1.3 billion project. In April of this year, Kentucky Utilities and Louisville Gas and Electric Co. announced a partnership with Rye Development.
The utilities said they are “performing a thorough evaluation of the project and if proven effective,” they intend to seek permitting with the Kentucky Public Service Commission. Construction could begin next year, and the facility could go online in 2031. The project is expected to create about 2,300 jobs during construction and contribute about $1.65 million annually in local tax revenue once it becomes fully operational.
The 266-megawatt Lewis Ridge project could power nearly 67,000 homes annually.
Rye Development’s proposed projects would be the first pumped storage facilities in Southwest Virginia.
Dominion Energy made the first attempt, seeking a permit in 2017 for a pumped storage facility on East River Mountain in Tazewell County. But Dominion canceled its plans in late 2024, citing factors including the estimated $2 billion cost and a corporate shift to other energy sources.
[Disclosure: Dominion is one of our donors, but donors have no say in news decisions; see our policy.]
Dominion operates one of Virginia’s two pumped storage facilities, the Bath County Pumped Storage Station. The 3,003-megawatt facility is the largest in the United States and went into service in 1985.
The other Virginia pumped storage facility is the 636-megawatt Smith Mountain project. It was created when Appalachian Power built the Smith Mountain dam on the Roanoke River in the 1960s, creating the reservoirs known as Smith Mountain Lake and Leesville Lake.
