August 4, 2015
Opinions, Texas

Don’t be misled about power costs

By Brad Watson, Special to the Star-Telegram | August 3, 2015 |

The Sunday commentary by Tom Smith, director of Public Citizen’s Texas office (“Clean energy rules will save us money”) is misleading, inaccurate and not surprising.

This is just the latest verse of the same tired song Public Citizen has been singing for more than two years.

Now that the final rule for regulating greenhouse gases under Section 111 (d) of the Clean Air Act was released on Monday, we’ll closely review it to determine if the Environmental Protection Agency truly listened and fundamentally restructured its earlier proposal – which was unlawful, unworkable, and unfair to Texas.

Let’s fill in the record with the facts: Power costs in Texas would go up under the Clean Power Plan proposed rule. Even the EPA has acknowledged this.

A study by National Economic Research Associates Economic Consulting estimates that EPA’s proposal could raise electricity prices in Texas on average 27 percent, relative to a base case without the rule.

The NERA analysis shows that residential rates could increase under the proposed rule by 25 percent.

That would translate into an increase in average household electric bills of nearly $400 per year.

This significant increase would impact all Texans but would be particularly harmful for those with marginal income, such as elderly customers on fixed incomes or low-income customers.

Texas commercial and industrial customers would incur 31 percent and 26 percent increases, respectively, under the proposed rule, according to NERA.

The price increase for Texas businesses would represent a significant drag on the vibrant Texas economy.

These are costs, not savings, so it’s vital to examine the final rule for its economic impact.

The claims by Public Citizen about Luminant’s power plants, as usual, are just wrong.

All of our plants meet or exceed the requirements of all state and federal emissions standards, a fact we’re proud of.

Yet in 2013, Public Citizen and a small group of physicians with the Dallas County Medical Society demanded the Texas Commission on Environmental Quality order three of our coal plants to install cost-prohibitive equipment even though the air quality in North Texas is becoming cleaner, an indication existing laws and rules are working.

What Smith fails to mention is TCEQ denied the activists’ request then and again this year, stating their demand was “not justified.”

Those three Luminant plants generate enough electricity to power more than a million Texas homes in periods of peak demand like we saw last week in Texas.

Public Citizen claims a report by a Rice University associate professor shows they could simply be replaced by solar and wind power.

What Public Citizen consistently leaves out is that the same report found replacing these three plants with wind and solar would cost $56 billion and $40 billion, respectively. That’s savings?

At Luminant, we’re a large purchaser of wind and also generate power using coal, natural gas and nuclear energy. We believe a diverse mix of energy is best for providing affordable and reliable power in Texas’ competitive market, because the different fuel sources complement each other.

That balanced mix across the Electric Reliability Council of Texas power grid worked dependably last week when demand set all-time records for July.

Notably, base load fuels like coal, gas and nuclear ultimately met the demand, especially on Thursday as ERCOT said, “We are expecting less wind generation during today’s peak.”

We share in everyone’s concern and desire for cleaner air. Don’t be fooled by the claims of activists who make misleading, unrealistic demands that would lead to higher power costs.

Luminant’s plants are generating affordable power in an environmentally responsible way as we do our part in keeping the lights and those air conditioners on.

Brad Watson is senior director of corporate communications for Luminant, a Dallas-based wholesale energy producer.

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