Leadership West Virginia: Energy, manufacturing focus of Eastern Panhandle session
Jul 11, 2023
Jul 22, 2023
WHY HERE? - John Shaver, vice president of manufacturing at Proctor and Gamble, explains why West Virginia was the perfect location for Proctor and Gamble's Tabler Station manufacturing facility. -- Steven Allen Adams
MARTINSBURG – The Eastern Panhandle is one example of how manufacturing is making a comeback in West Virginia, with the state leading the way in not only how things are made but how those facilities are powered.
Members of the Leadership West Virginia class of 2023 spent Wednesday through Friday in Berkeley and Jefferson counties learning about the Eastern Panhandle’s history and economy. The week’s session was also focused on statewide economic development, energy, and manufacturing.
Class members took part Wednesday in a tour of Harpers Ferry National Historic Park, including the Bolivar Heights Civil War battlefield; Camp Hill, the home of the Storer College historically black college and university and site of the Niagara Movement, a precursor to the formation of the NAACP and black civil rights; and lower town, home of John Brown’s fort and the raid that lit the spark that led to the Civil War.
Thursday, class members traveled to Eastern West Virginia Regional Airport and learned about how the airport has become a key hub in the region’s economic success, as well as the role of the West Virginia National Guard in the region and state’s economy.
With the Eastern Panhandle being the fastest growing region of the state, there are lessons and challenges to be gleaned for other regions of West Virginia.
BUILD IT UP
Class members toured the Proctor and Gamble Tabler Station Plant in Inwood Thursday afternoon. The plant began operation in 2018, representing a $2 billion investment in Berkeley County.
The 2.5 million square foot manufacturing facility makes 24 different lines of products, including Bounce dryer sheets, Swiffer pads and mops, Dawn dish detergent and Pantene shampoo. More than 1,400 people work at the Proctor and Gamble plant.
Much of Proctor and Gamble’s product manufacturing now takes place in the Eastern Panhandle. John Shaver, vice president of manufacturing at the Tabler Station Proctor and Gamble site, cited the region’s access to much of the population east of the Mississippi through the I-81 corridor, as well as the region’s workforce.
“The company made the decision to make a major expansion with our manufacturing facilities about seven years ago now,” Shaver said. “We wanted to choose a location that had a fantastic workforce, so West Virginia met the criteria for that, and also to be centrally located … that’s why we picked this location.”
Class members spent Friday at the Erma Byrd Ora Byrd Nursing Building on the campus of Shepherd University, where they heard from economic development officials, academia and representatives of electric utilities.
According to the West Virginia Department of Economic Development, the state ranked first in 2020 for lowest turnover rate in manufacturing. Since 2017, more than $6 billion worth of business investment has come to the Mountain State. According to the West Virginia Manufacturers Association, manufacturers make up more than 10% of total state output and more than 6% of the state’s workforce.
West Virginia has made several announcements of large manufacturers coming to the state. Among those were North Carolina-based steelmaker Nucor in Mason County at the beginning of 2022 and California-based Clean Vision Corp. announcing a hydrogen manufacturing facility for Eastern Kanawha County in June.
All of those new businesses and manufacturers coming to the state create blessings, but also create challenges. Jim Linsenmeyer, the Eastern Panhandle regional manager for the state Department of Economic Development, said the need for workers in the state and around the nation is running into issues.
Linsenmeyer said a shift to younger employees sometimes leads to employees who only stay for a short period of time and create challenges for older managers. Workforce housing shortages are driving up the prices of homes and rentals. The closure of facilities post-COVID-19 and poor reimbursement rates has led to a shortage of childcare.
In West Virginia, 80% of graduates of the state’s four-year colleges and universities leave the state, creating a brain drain, as has the demand for a trained workforce from vocational schools and two-year community and technical colleges. One of the things the Department of Economic Development has worked on with some of the state’s higher education institutions involves tours of major manufacturers to show that good-paying jobs can be had in West Virginia.
“We had tours at Clorox, at Proctor and Gamble. Then we had a reception at the Bavarian Inn and invited other employers to show our young folks that, hey, look, there’s great jobs here, and you also have all this outdoor adventure,” Linsenmeyer said.
While West Virginia has seen new business growth, that growth could be affected by national pressures, such as inflation. John Deskins, assistant dean for outreach and engagement and associate professor at West Virginia University, said a recession going into 2024 is not likely, which is the good news. The bad news: economic growth will happen, but it will be slow, as will overall employment in the state.
“The slow growth that we see nationally, it’s certainly going to impact us in West Virginia. But this is a lot different than the tone that I was taking a year ago,” Deskins said. “Now, my bad news is we’re probably going to have slow growth, but at least it’s going to be growth. A lot different from a recession.”
But there are several parts of the state with signs of growth, including Cabell and Jackson counties, Marshall County, counties in North Central West Virginia and Berkeley and Jefferson counties. These counties added nearly 16,000 jobs between 2012 and 2019, while the balance of the state lost 44,000 during the same period.
“The good news tends to be really heavily concentrated, even though it is good news and we are making progress and we do have these good announcements that should be touted rightly so,” Deskins said. “We have good things happening. We have positive momentum in many of our counties, but we have so many counties where there’s just not a whole lot going on.”
West Virginia has seen steady population loss, driven by older West Virginians dying and younger West Virginians having fewer children. However, Deskins also said that net in-migration to the state – the number of people moving into West Virginia versus the number of people moving out of the state – is slowly increasing, largely driven by the number of new, good paying jobs available now.
POWER IT UP
Coal is forever linked to West Virginia, but the state has worked over the last several years to become an all-of-the-above energy state. That includes becoming more receptive to nuclear, wind and solar.
The Eastern Panhandle will be home to a 6 megawatt solar power facility in Marlowe by 2025. Once a former coal ash disposal site, Marlowe Solar will produce 10 gigawatt hours per year and provide up to 10,000 annual solar renewable energy credits.
Mon Power and Potomac Edison, both FirstEnergy subsidiaries, are constructing five solar sites on existing sites it owns in the Northern Panhandle at Wylie Ridge (2025), North Central West Virginia at Rivesville (2025) and Fort Martin (2024), the Potomac Highlands at Davis (2026) and Marlowe Solar.
The effort is being made possible through Senate Bill 583 passed in 2020, which is designed to support economic development for solar projects targeting brownfields and other low-value sites. The bill allows each utility to develop 200 megawatts of solar generation in 50 megawatt increments, and it requires an 85% subscription rate. It also includes energy storage.
“In our first phase, we don’t have storage identified as a potential resource, but in our phase two, three, and four, storage is in our plans,” said Douglas Hartman, director of energy services for Mon Power. Our approach has always been that we can do this ourselves. We’re not going to bring in a developer to build our solar sites. Our approach has always been self-build.”
Companies are also expanding renewable energy to take advantage of loans, grants, tax breaks, and other incentives in the $733 billion Inflation Reduction Act. According to the U.S. Energy Information Agency, renewables now make up 21.5% of the nation’s electricity generation as of 2022, while coal only makes up 19.5% now and is likely to keep decreasing.
But Todd Flowers, director of business development for Dominion Energy, said the transition to renewables and the retirement of coal-fired power plants is moving faster than the market can handle, leading to the potential of future outages and brownouts. While renewables are growing, there still needs a power source to handle the baseload, particularly for heavy energy users such as server farms that use enormous amounts of power.
“Although a lot of our elected officials say we need to shut down our coal producing facilities, we’re saying not if you want a reliable grid,” Flowers said. “We can’t shut down most of our power stations if we want to deliver energy reliably … We do need to decarbonize. We recognize that, but we also need to have a reliable grid to ensure that our customers have electricity when it’s needed.”
According to Flowers, Dominion Energy is seriously considering future expansion of nuclear energy production. The IRA also includes a tax break for creating emissions-free nuclear power generation, up to a 15 per megawatt hour subject to certain exceptions. Another credit would provide up to a 30% investment tax credit for new emission-free nuclear facilities built after 2025.
The race is on for building small modular nuclear reactors (SMR) which use only a small amount of nuclear fuel, making them far safer to manage, mitigating the risks of meltdowns and producing far smaller amounts of nuclear waste. Microsoft founder Bill Gates is funding a salt water SMR, which would use sodium to regulate reactor temperature instead of the traditional water-cooled nuclear plant. A SMR takes up less space than a traditional nuclear plant and is less complex.
“We’ve rethought the way that these plants are deployed and with small modular reactors, the components can be built in a factory,” Flowers said. “You get that assembly-line precision, you engineer them before you start construction instead of doing final design engineering as concrete is going in the ground. You have a standard design for an SMR design and the majority of that equipment is factory-fabricated.”
Dominion Energy is working on site selection for SMR sites in Virginia and West Virginia, including retired nuclear and coal-fired power facilities that already have access to transmission lines. The West Virginia Legislature passed a bill last year eliminating a prohibition on the construction of nuclear power plants in the state, a prohibition that had been in place since 1996.
Challenges include the types of SMR technology to use, as well as the current regulations and the new regulations likely to come for SMRs by the U.S. Nuclear Regulatory Commission. Both the PSC and the state Department of Environmental Protection have rules and regulations in place dealing with the construction of new power plants and the handling of radioactive waste. Dominion Energy hopes to have a working SMT by 2023.
Whatever the dominant form of energy production takes hold, West Virginia is sure to have a role in powering the nation.
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