Energy and Environment Reporting for Texas

Texas Officials Blast New Pollution Rules For Power Plants

A stream of workers leave the TXU Monticello power plant near Mt. Pleasant, Texas February 26, 2007.

Photo by REUTERS/Mike Stone /Landov

A stream of workers leave the TXU Monticello power plant near Mt. Pleasant, Texas February 26, 2007.

In Austin, business leaders and politicians blasted new federal rules aimed at reducing air pollution from power plants. At a hearing held by the Texas Public Utility Commission, there were dire predictions of a ruined Texas economy and higher electricity costs for residents.

Hour-after-hour, the three members of the Texas Public Utility Commission heard why the state’s roaring economy, some call it the Texas Miracle, could be brought to its knees

“I fear were going be on the road again to try to persuade people why this is the potential — if it were to come to pass in this form — death knell to the Texas Miracle and frankly the kind of economic destruction this would create nationally is a little hard to overstate, “said Phillip Oldham, a lobbyist for the big business group, the Texas Association of Manufacturers.

The chairman of the PUC, Donna Nelson, predicted an end to the Texas deregulated electricity market.

“There’s almost nothing in this rule that there could be any other outcome other than the junking of the completive market,” said Nelson.

At issue are new Federal rules to cut pollution from power plants. Each state would have to come up with a plan that would cut carbon pollution, or greenhouse gases, by an average of 30 percent in less than two decades. Texas, with all its refineries and a lot of coal-burning power plants, is the largest producer of greenhouse gases and is being asked to cut more emissions than other states.

“The plan disproportionately impacts Texas and in our opinion it oversteps the law,” said Mac MarFarland, CEO of Luminant, the biggest electricity utility in Texas.

For years, the State of Texas has been filing lawsuits against the Federal Environmental Protection Agency, trying to stop it from enforcing regulations aimed at reducing power plant pollution.

Texas has lost most of the cases, including a major ruling earlier this summer by the U.S. Supreme Court. The Court gave the EPA the go-ahead to regulate greenhouse gas emissions from power plants. At the PUC hearing, there was testimony that Texas would again file suit over these latest rules.

What would the rules cost electricity consumers? About $20 a month according to one industry estimate.

But the EPA says the new rules would save the nation billions of dollars a year from benefits to public health and to the climate. At a speech in June when the rules were announced, EPA’s Administrator, Gina McCarthy, had anticipated the pushback and the dire predictions. McCarthy said the same thing happened in the 1960’s when the government attacked the smog problem and then again when the EPA went after sources of acid rain.

“In the 1990s, critics cried wolf and said fighting acid rain would make electricity go up and our lights go out, they said the industry would and I quote, die a quiet death. Well they were wrong again, industry is alive and well. Our lights are still on and we have dramatically reduced acid rain,” McCarthy said.

States have until 2016 to formulate their plans to cut power plant pollution but in the meantime, there will likely be battles in court over how much Texas must do.


  • cholly302

    The description of the proposal is not quite right. It would not require each state to reduce power plant emissions by 30 percent. Instead it proposes that each state make specific improvements to the CO2 intensity–lbs CO2 per kWh–of its power plant fleet by 2030, and if each state does what EPA thinks is feasible the result will be a 30 percent reduction by 2030. Under the proposal, Texas would have to make the largest improvement in its power plant CO2 emission rate, but as one of the most polluting states in the nation, it should be fairly easy–and cost-effective–to achieve.

  • Colin Meehan

    No mention of the presenters who didn’t claim the sky is falling? Several presenters (myself included) presented data and proposals that showed how Texas could lead and indeed benefit from the rule. Several conventional energy companies like Calpine and Exelon support the rule and the CEO of NRG says it doesn’t go far enough. Seems worth a mention at least, even if the PUC overwhelmingly invited companies and groups opposed to the rule – can’t imagine why they would do that…

  • FSC

    Not quite accurate that Luminant is a utility – in Texas, separate companies generate electricity, procure that electricity on behalf of consumers in the wholesale market, and then transmit/distribute electricity over the poles-and-wires. Luminant falls under the first definition – it is an electric generator. Companies meeting the third definition are more properly referred to as a utility. Luminant’s sister company, Oncor, is such a utility.

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