ERCOT fears electricity shortage under new EPA rule

By Asher Price

AMERICAN-STATESMAN STAFF

Texas could face a shortage of electrical generation within a few years if the federal government moves forward with a new rule meant to cut down on power plant smokestack emissions, the chief executive of the state’s grid operator warned on Tuesday.

“We believe it is our role to voice our concern that Texas could face a shortage of generation necessary to keep the lights on in Texas within a few years” if the U.S. Environmental Protection Agency moves forward, said H.B. “Trip” Doggett , president and CEO of the Electric Reliability Council of Texas .

The Cross-State Air Pollution Rule will force Texas utilities, and others in the eastern half of the country, to cut emissions that contribute to smog and soot beginning next year, putting older coal plants under pressure. According to the EPA, Texas air quality suffers from power plant emissions from as far away as South Carolina. Texas plants, in turn, affect air quality in states as far away as Michigan.

The EPA and environmentalists said the ERCOT claim is overblown.

“Texas power plants will be able to cut their pollution without jeopardizing reliable electricity service for Texans,” said Gina McCarthy , an assistant administrator for the EPA .

She said almost half the soot-forming sulfur dioxide emissions covered by the rule are produced by three plants.

“The balance of Texas power generation is already relatively clean and will not face a heavy compliance burden under this rule,” she said.

In the most recent budget year, Austin got 32.5 percent of its power from the coal-fired Fayette Power Project, which is 65 miles southeast of Austin. With the recent addition of scrubbers, that plant is unlikely to run afoul of the EPA rules.

But Doggett said the rule is “unreasonable because it does not allow enough time to implement operational responses to ensure reliability.”

Coal generation provided 40 percent of the electricity consumed on the Texas grid in 2010, and coal plants may be “forced to limit or shut down operations in order to maintain compliance with the new rule, possibly leading to inadequate operating reserve margins with insufficient time to reliably retrofit existing generation or build new, replacement generation,” he said.

“We think they’re just blowing smoke,” said Tom “Smitty” Smith, who heads the Texas office of environmental group Public Citizen.

He said ERCOT should do more to look at the potential of efficiency measures and an expansion of renewable power, as well as the ramping up of natural gas plants.

But the pronouncement from ERCOT was unusual, said Chris Brewster , an attorney who evaluates ERCOT at the law firm Lloyd Gosselink.

“ERCOT doesn’t usually get involved in environmental regulatory issues,” Brewster said.

Utilities have said the new rule will drive up the costs of generating electricity, and officials at the Texas Commission on Environmental Quality released a statement that said the rules will “have adverse economic effects, without demonstrable environmental and health benefits.”

McCarthy , the EPA official, said the rule would lead to fewer premature deaths and better health for the elderly and children with breathing problems. She said the EPA’s analysis shows that potential average electricity cost increases fall well within the range of normal electricity price fluctuations.