U.S. Secretary of Energy Chris Wright was in Lynchburg on Friday to announce up to $50 million in federal funding for electric transmission upgrades in western Virginia.
Wright was joined at a press conference at an Appalachian Power substation by U.S. Rep. John McGuire, R-Goochland County, and APCo President and COO Brian Abraham.
Wright said that the upgrades will improve existing transmission lines to strengthen the power grid and increase the supply of electricity, allowing more businesses to locate and grow in the area.
“The Trump administration goal is very simple: It’s to increase job opportunities to push up wages, increase energy supply to push down energy prices,” Wright said.
The project involves replacing wires inside about 14 miles of Lynchburg-area transmission lines so they can carry more electricity, a process called reconductoring. That effort, called the New London-Otter Transmission Line Rebuild Project, is expected to be complete by June 2029, APCo said in an email Friday.
Federal funding announced Friday also will go toward adding sensors to measure temperature, wind speed and other weather conditions to four transmission lines in western Virginia to optimize how much power they can carry. That technology is called dynamic line rating. “It’s taking existing infrastructure to deliver more electricity, allowing the creation of more jobs and lower prices,” Wright said.
The Department of Energy said in a news release that the infrastructure improvements would add about 290 megawatts of transmission capacity across APCo’s Virginia system and would happen one to four years sooner than conventional upgrades. Utilities often upgrade transmission lines by replacing them with new ones.
McGuire, who faces an election challenge in the 5th District this year from Democrat Tom Perriello, said the project would help improve outdated electric grid infrastructure.
“Some of the infrastructure you have is 40 to 70 years old. So we can update that infrastructure, get rid of bottlenecks, we can provide more energy, cheaper energy, safer energy and everything else,” he said.
APCo president says focus is on growth, affordability
Abraham said that APCo regularly considers investments such as the upgrades announced Friday regardless of federal funding but the subsidy reduces how much of the cost is passed to customers.
The project’s final price tag has yet to be determined, but because the federal money is matched by private investment from APCo, the total will be at least double the amount of the grant, Abraham said in an interview Friday.
“Every dollar we get is a dollar less that the customer has to pay,” Abraham said.
Abraham said at Friday’s announcement that the company is “doing everything we can to deal with affordability” and that “the biggest thing we see that we need to do as a company is grow.”
Increasing power transmission and distribution and bringing on large-load customers will ultimately reduce rates for residents, Abraham said.
In regulatory filings, APCo has said it’s seeing “explosive” demand in Virginia from potential large-load customers, “primarily” data centers, the buildings full of computer servers that power the online world.
“There’s no way to cut yourself to cut rates. It’s not going to happen,” Abraham said Friday.
Starting Monday, Virginia’s State Corporation Commission is scheduled to meet for public hearings about Appalachian Power’s latest rate increase request. State law requires APCo to submit its rates for review every two years.
In May, the company requested regulatory permission to earn $61 million more in annual revenue. That would raise the average residential customer’s monthly bill by $9.10.
On Friday, Abraham brought up a recently filed agreement among many of the parties involved in APCo’s regulatory case that would instead freeze rates for residential customers for one year and increase the average monthly bill by just 92 cents for a year after that.
The State Corporation Commission must sign off on the agreement for it to take effect.
APCo, a subsidiary of American Electric Power, serves about 540,000 customers in western Virginia, of which about 466,000 are residential customers.
Electric grid called a national defense issue
The federal funding announced Friday will be administered by Virginia Energy, APCo and other partners.
The transmission upgrade project was chosen as part of the federal Energy Department’s Speed to Power through Accelerated Reconductoring and other Key Advanced Transmission Technology Upgrades program, also called SPARK, which provides $1.9 billion in federal funding for grid upgrades.
The funding of up to $50 million will come from the Defense Production Act, according to the U.S. Department of Energy, rather than SPARK money, because President Donald Trump has identified the United States’ “aging and constrained electric grid infrastructure” as “an increasing threat to national defense.” APCo will receive $40 million of the total.
The act gives the president broad purview to direct businesses to prioritize certain projects and products in the name of national security.
