1. WEST VIRGINIA DIVISION OF ENERGY Jeff Wood September 24, 2009

2. WEST VIRGINIA DIVISION OF ENERGY Energy Efficiency Program Coalfield Community Development ----- West Virginia Public Energy Authority Who We Are…

3. WEST VIRGINIA DIVISION OF ENERGY Our overall goal is to displace 1.3 billion gallons of oil by 2030. That figure represents 60% of our state oil use, our nation’s current level of oil imports. Our savings are reflected in oil use reductions as well as enhanced resource development. West Virginia Energy Opportunities Document www.energywv.org

4. WEST VIRGINIA DIVISION OF ENERGY We have a growing dependence on imported oil supplies Five years ago the daily excess worldwide oil capacity was 3-4 mmbbl. Today - 0 The monthly Federal trade deficit is $60 billion. Monthly oil imports cost the U.S. $35 billion 2/3 of world’s oil reserves are in the Persian Gulf region

5. WEST VIRGINIA DIVISION OF ENERGY The changing world of oil production

6. WEST VIRGINIA DIVISION OF ENERGY

7. W.Va. Coal Distribution for Power Generation

8. WEST VIRGINIA DIVISION OF ENERGY Natural Gas Deposits Have Been Discovered Across the U.S Conventional Formations Unconventional Formations

9. WEST VIRGINIA DIVISION OF ENERGY Renewable Portfolio Standards Many state renewable portfolios allow wood-fired electric hydro, solar and wind generation as options West Virginia renewable projects now in place provide more than 1,000 megawatts to other PJM state portfolios

10. WEST VIRGINIA DIVISION OF ENERGY States with Portfolio Standards

11. WEST VIRGINIA DIVISION OF ENERGY Wind: 1,011mw Hydro: 391 mw* *Licensed+unbuilt+underway+outside FERC West Virginia existing and planned electric capacity 2009 8 %

12. WEST VIRGINIA DIVISION OF ENERGY West Virginia’s Renewable Portfolio Standards Renewable and Alternative Options in the Standard Special consideration to projects on Surface Mined Sites 10% by 2015; 25% by 2025 Energy Efficiency incentives in the project as well

13. WEST VIRGINIA DIVISION OF ENERGY Operational Wind Projects (330 MW) Shell Wind Energy/Dominion/Nedpower (Mount Storm) 264 MW Florida Power and Light (WV Wind Energy Center) 66 MW Permitted wind projects (461 MW): Invenergy ( Beech Ridge) 186 MW US Wind Force (Mt. Storm) 150 MW AES (Laurel Mountain) 125 MW Project before the WVPSC AES (New Creek) 165 MW US Wind Force – (Pinnacle) 55 MW Wind Project Development in West Virginia

14. WEST VIRGINIA DIVISION OF ENERGY Licensed Hydroelectric Energy in West Virginia London/Marmet, Kanawha River Winfield, Kanawha River Millville, Shenandoah River Lake Lynn, Monongahela River Hawks Nest & Glen Ferris, New River Dam No. 4 Hydro Station, Potomac River Dam No. 5 Hydro Station, Potomac River Racine L & D, Ohio River New Martinsville, Ohio River Belleville, Ohio River Summersville, Gauley River

15. WEST VIRGINIA DIVISION OF ENERGY Tygart Dam: 20mw R.D. Bailey Project: 7.8mw Sutton: 12mw Jennings Randolph: 10.5mw Robert C. Byrd: 48mw Opekiska Lock and Dam (Mon River): 10mw Hildebrand Lock and Dam (Mon River): 10mw Morgantown Lock and Dam (Mon River): 9mw Preliminary licensed hydroelectric facilities FERC

16. WEST VIRGINIA DIVISION OF ENERGY The pellet industry in West Virginia Hamer Pellet Fuel operates plants in Elkins and Mt. Hope Lignetics of West Virginia operates a plant near Glenville, W.Va.

17. WEST VIRGINIA DIVISION OF ENERGY Pellet market growth prospects Exports to meet EU electrical needs. Commercial applications including institutional and agricultural applications (poultry houses).

18. WEST VIRGINIA DIVISION OF ENERGY Biomass advantages in coal projects Biomass can be up to 50 percent of the BTU input. Co-firing and carbon sequestration can address CTL’s environmental issues. Idaho National Laboratory study indicates that CTL liquids could have the same environmental impact (well to wheel) as conventional petroleum products with biomass co-firing and sequestration.

19. WEST VIRGINIA DIVISION OF ENERGY Issues for biomass in coal projects Concentration of biomass supply at a central point is a primary concern Assuming a 25% biomass blend, a 10,000 b/d plant would require 1.5 million tons of coal a year and 1 million tons of biomass The Baard CTL plant is designed for 50,000 b/d West Virginia ’ s use of imported oil could be offset with a 100,000 b/d CTL plant

20. WEST VIRGINIA DIVISION OF ENERGY Helping to relieve the gasoline demand crunch Cellulosic ethanol is envisioned as a way to reduce use of imported oils Source:USDOE EIA Annual Energy Outlook

21. WEST VIRGINIA DIVISION OF ENERGY Barriers to cellulosic ethanol use Contains less BTU energy than gasoline Conversion technologies are still being advanced Like corn-based ethanol, it is corrosive

22. WEST VIRGINIA DIVISION OF ENERGY Energy Independence and Security Act (EISA) expands the Renewable Fuel Standard to 36 billion gal/yr of renewable fuel by 2022 Corn ethanol limited to 15 billion of 36 billion gallons in 2022 Remaining 21 billion gallons is advanced biofuels Biodiesel must be at least 1 billion gallons in 2022 1/3 of current US corn crop now goes for 8 billion gallons of ethanol Cellulosic ethanol

23. WEST VIRGINIA DIVISION OF ENERGY West Virginia already has biofuels available Biodiesel Fuel produced from domestic, renewable resources Can be blended at any level with petroleum diesel to create a biodiesel blend Ethanol An alcohol-based fuel made by fermenting and distilling crops that have been broken down into simple sugars In the United States, ethanol is generally made from starch crops such as corn or sorghum

24. WEST VIRGINIA DIVISION OF ENERGY Two public retail E85 locations Dulaney Oil Co. Ltd.Exxon 144 Dents Run Rd.50 Genesis Blvd. Morgantown, WV 26505Bridgeport WV 26330 Must be used in an FFV (Flexible Fuel Vehicle). About forty FFV models are available in 2009: Chrysler, Ford, General Motors, Mazda, Mercedes, Isuzu, Nissan and now Toyota flexible fuel vehicle (FFV) models See http://www.e85fuel.com/e85101/flexfuelvehicles.php E85 in West Virginia

25. WEST VIRGINIA DIVISION OF ENERGY QUESTIONS? Jeff Wood West Virginia Division of Energy (304) 957-2027 Jeff.F.Herholdt@wv.gov