Energy and Environment Reporting for Texas

A Closer Look at Whether Millions of Dollars in Texas EPA Lawsuits Are a ‘Bargain’

Photo by Brendan Smialowski/Getty Images

The Texas Attorney General says that $TK million in lawsuits against the Obama administration has been a "bargain" for Texans.

Despite a mixed record of suing the Obama administration (five wins, eight losses, and two dismissals as of last count), Texas Attorney General Greg Abbott says today that all these lawsuits are a “bargain” for Texans.

In an op-ed published in the Dallas Morning News and emailed to reporters, Abbott says that one recent victory against the Environmental Protection Agency (EPA) “saved more than 500 jobs and protected Texans’ access to reliable electricity — which was jeopardized by the EPA’s draconian regulations.”

But it wasn’t clear which recent case he was referring to. Or where that 500 jobs figure came from.

So we called up Abbott’s press office to ask which case it was.

Charles Castillo picked up the phone. “Do you really think your listeners are going to care which case?” he said, laughing.

Well, yes, we do. It turns out Abbott is referring to the Cross State Air Pollution Rule, which aims to reduce pollution — mostly from coal power plants — across state lines. A federal appeals court vacated that rule in August, sending it back to the EPA. It could be revised within a year.

The EPA, Luminant, and a Financial Cliff

When asked where he got that 500 jobs number from, Abbott’s press office emailed two references that they said “back this claim up.” Both of them come from the company that stood to lose the most with the rule’s passing: Luminant.

Luminant is a company with the reputation as one of the biggest polluters in the state, and the Monticello plant has the most toxic emissions of any power plant in Texas, according to the environmental integrity project’s review of EPA data.

The EPA claims they did “extensive outreach” to the industry to make the rule work, specifically with Luminant. They said they had figured out a way for a “no-shut down, no-layoff solution.”

But Luminant said two of their units at the Monticello coal power plant in Northeast Texas would likely have been shuttered by the new rule if they didn’t make upgrades. The units are nearly forty years old.

Which is interesting, because shortly after the rule was turned down last month, Luminant announced they would close the coal plants for half the year anyways. These were the same plants it had threatened to shut down because of the EPA rule, it’s just that now they would be shuttered because they weren’t making enough money. The company said that no job losses would result because of the idling.

Luminant’s parent company, Energy Future Holdings, could be facing a serious financial cliff. The company currently holds $42 billion of debt. Part of the company could go bankrupt soon. The billionaire investment mastermind Warren Buffett, who put some $2 billion into the company a few years ago, is open about where things went wrong. “That [investment] was a mistake – a big mistake,” Buffet wrote in a letter to investors earlier this year. “In large measure, the company’s prospects were tied to the price of natural gas, which tanked shortly after our purchase and remains depressed.”

After the Attorney General’s office sent us the two Luminant statements claiming the new rules would have resulted in the loss of 500 jobs, we emailed the Attorney General’s office back to see if they had any independent reports.

“We are assuming they understand best how their company works and would have been affected by CSAPR, and we are also assuming that they are not putting out misleading information,” Lauren Bean, Abbott’s Deputy Communications Director, wrote in an email to StateImpact Texas.

The Attorney General has made no secret of the enjoyment he gets out of filing suits against the administration and the EPA. “What I really do for fun is I go into the office,” Abbott said recently, “[and] I sue the Obama administration.”

Those lawsuits have come at a cost of $2.5 million, a figure Abbot’s office doesn’t dispute, and which today he called a “bargain.”

“When Texas challenges the federal government, it’s about more than money,” Abbott writes today. “It’s about principles — fundamental principles enshrined in the Constitution and recently reaffirmed by the U.S. Supreme Court.”

The Associated Press recently looked into the return on investment for those suits, finding that of the 24 lawsuits Abbot has filed (sixteen of them over environmental regulations), “many of the lawsuits have resulted in defeats.” They peg the cost of Abbott’s suits at over $2.5 million and using up “more than 14,113 hours spent by the staff and state lawyers working those cases.” (Abbott sued the Bush administration, too, but only three times.)

“Texas has won five of Abbott’s 27 cases, lost eight and had two others dismissed because the regulations or laws being challenged were lifted or repealed by Congress,” the Associated Press writes. “The 12 others are pending.”

In an interview for the article, Abbott said those “saved” jobs from Luminant (estimates his office hasn’t independently verified) help cover his office’s high costs for litigation. “That case alone probably pays for all of the cases combined,” Abbott told the Associated Press.

But the Congressional Research Service, a non-partisan, independent research arm of Congress, looked at the question of job losses and plant retirements because of EPA regulation (including the CSAPR rule) and found that coal power was threatened more by cheap natural gas prices (mostly due to the rapid boom of drilling using fracking) and old plants that haven’t upgraded their pollution controls.

“Many of these plants are inefficient and are being replaced by more efficient combined cycle natural gas plants, a development likely to be encouraged if the price of competing fuel—natural gas—continues to be low, almost regardless of EPA rules,” the report says.

And in another case against the EPA that Abbott “won,” the point is largely moot. Almost all of the refineries and plants affected under revisions to the state’s air permitting program went ahead and came into compliance anyways.


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