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Richlands accepts $2 million Tobacco Commission award, advances 5 MW generator project
Summary
The Richlands Town Council unanimously accepted a $2 million Tobacco Commission grant plus a $2 million low‑interest loan toward a proposed 5 megawatt natural‑gas generator project. Council members said the funding improves local energy control and economic development prospects.
The Richlands Town Council voted unanimously to accept a $2 million grant and a $2 million low‑interest loan from the Virginia Tobacco Commission to help fund a proposed 5 megawatt natural‑gas generator.
Town manager Jason May told the council the Tobacco Commission award was smaller than the $6 million the town initially requested but still provides important capital for the project. "We were awarded $2 million in grants and a $2 million loan," May said, describing the award as one element of about $14 million in total project cost the town is pursuing through additional grants and loans.
Why it matters: Council members said local generation would help stabilize or lower the town’s power costs and create an asset the town can use to support future economic development. Councilmember Seth, speaking after the presentation, said the project has attracted attention beyond Richlands: "I've had calls from U.S. senators over this project," he said, calling the effort "pioneering" for the region.
The council authorized acceptance of the award by roll call vote. The manager said staff are working through loan documents, land contracts and coordination with private partners and financial advisors to finalize funding and proceed with design and procurement. Jason May said the town has already paid approximately $5.3 million in deposits toward the generator and is planning quarterly updates to council on project funding and milestones.
The vote: Council approved accepting the Tobacco Commission award in a unanimous roll call. After the vote council members said they expect the combination of grant and loan funding to lower the town’s long‑term power costs and to position Richlands to offer competitive power prices to attract industrial customers.
Next steps: Staff will continue working on loan documents, land agreements and additional funding sources. The manager plans to provide the council with a quarterly generator project update at the December meeting, including financing, land contracts and pay application status.
