All posts by Brad Watson

Luminant Files Motion to Stay the EPA’s Regional Haze Federal Implementation Plan Final Rule


Luminant_logo_sm300x189Luminant today filed a motion at the U.S. Fifth Circuit Court of Appeals to stay the Environmental Protection Agency’s Regional Haze Federal Implementation Plan final rule for Texas and Oklahoma. Along with two other power generators, Luminant is asking the court to stop implementation of the final rule while under legal review because the rule is causing irreparable harm to businesses and communities across Texas.

Luminant filed a petition for review challenging the EPA Regional Haze FIP on Feb. 29.  The state of Texas, other power generators and the Utility Air Regulatory Group have also filed petitions for review, and all petitions have been consolidated into a single case.

The Regional Haze rule under the Clean Air Act is not a health-based program, but is designed to improve visibility over decades at national parks. Under the EPA’s final rule, Texas is unlawfully burdened with unnecessary regulations and costs when the visibility is improving under the Texas State Implementation Plan.

Luminant believes the EPA final rule is unlawful, arbitrary and goes far beyond the agency’s authority under the Clean Air Act:

  • There remains no legal or technical basis for the EPA’s FIP since the plan submitted by Texas fully complies with the statute.
  • For the first time in history, the EPA unlawfully disapproved the Regional Haze consultation between two states, Texas and Oklahoma.
  • The costs are extreme and unjustified for no perceptible benefit in visibility at three national parks: Big Bend and Guadalupe Mountains in Texas and Wichita Mountains in Oklahoma.
  • Never before has the EPA singled out individual sources in this way. The cost to Luminant, at  more than $1 billion, to retrofit the Big Brown and Monticello power plants with sulfur dioxide scrubbers is unreasonable and would likely challenge the long-term viability of those plants.
  • The EPA FIP and its excessive costs are unnecessary since the federal monitors at these parks show visibility already improved beyond the 2018 goals set in the final rule.

In filing the petition for review, Luminant has asked the court to overturn this unlawful rule.  More on Luminant’s position on Regional Haze and the motion to stay can be found here.

 

Luminant Joins State of Texas, other Generators in Court Challenges to the EPA’s Regional Haze Final Rule


Luminant has filed a motion at the U.S. Fifth Circuit Court of Appeals to stay the Environmental Protection Agency’s Regional Haze Federal Implementation Plan final rule for Texas and Oklahoma. Along with two other power generators, Luminant is asking the court to stop implementation of the final rule while under legal review because the rule is causing irreparable harm to businesses and communities across Texas.

Luminant filed a petition for review challenging the EPA Regional Haze FIP on Feb. 29.  The state of Texas, other power generators and the Utility Air Regulatory Group have also filed petitions for review, and all petitions have been consolidated into a single case.

The EPA proposed this rule in 2014 and we laid out our serious concerns on our POV blog and in comments filed. The final rule was issued in January.

As these legal cases get underway, what’s important to remember is that the Regional Haze Rule under the Clean Air Act is not a health-based program. It’s designed to improve visibility over decades at national parks. Environmental activists and some in the media often mislead on this point by trying to connect the rule with health effects to garner support for yet another government regulation. Indeed, under the EPA’s final rule, Texas is unlawfully burdened with unnecessary regulations and costs while visibility is improving under the Texas State Implementation Plan.

At Luminant, we’re proud of our environmental record of meeting or exceeding the laws and rules of our nation and state. We’re Texans and we want clean air, water and natural resources for generations to come.

Some background: regional haze is the impairment of visibility at national parks caused by many sources, such as vehicles, windblown soil and power plants, but also emissions and smoke blown in from Mexico. These rules require each state to prepare what’s called a state implementation plan, or SIP, to gradually improve visibility over decades at national parks inside their borders and those in other states impacted by their emissions.

Texas’s Regional Haze SIP—submitted to the EPA in 2009—covers Big Bend and Guadalupe Mountains in West Texas and the Wichita Mountains in Southern Oklahoma.

The CAA requires states to consult each other on emission reductions needed to achieve progress. And Texas and Oklahoma did that. They went through extensive, mutual consultations on the Wichita Mountains prior to each state submitting their respective plans to the EPA.

But, when the EPA announced its proposed rule in November 2014, it rejected the cooperation between Texas and Oklahoma. For the first time in history, the EPA disapproved a consultation between two states over regional haze plans. In a move that ignores the CAA’s direction for the state to be the primary author of its own plan, the EPA substituted its own judgment for that of the state via a federal implementation plan, or FIP, for Texas.

In doing so, the EPA invented new requirements in this federal plan for the three parks that, in effect, treat Texas differently than all other states. The agency even concedes that what it has cobbled together for Texas is “without…prior precedent.”

In his comments to the EPA, Texas Governor Greg Abbott underscored the EPA’s arbitrary view of the Texas SIP compared to other states. While the Texas plan proposed to eliminate regional haze at Big Bend and Guadalupe Mountains by 2155, Abbott pointed out the EPA gave California until 2307 to restore visibility at two national parks, almost 300 years from now.

Relying not on real world data but instead on computer modeling and non-statutory factors, the EPA is ordering additional emission reductions and unlawfully picking the specific plants where those reductions must be made, which has never been done before in this way.

The results for Texas under the EPA’s demands would be harsh:

  • More than $2 billion in unjustified costs for new upgrades by 2019 and retrofits by 2021 to further control sulfur dioxide at 14 Texas coal units, nine of them Luminant’s, all of which are hundreds of miles from these parks.
  • A risk to reliable electric power in Texas cited by ERCOT if coal plants are forced to retire prematurely.
  • No detectable change in visibility at Big Bend, Guadalupe Mountains and Wichita Mountains since the improvement projected by the EPA is so small it could not be detected by the human eye.

That last point demands some explanation. Regional haze is measured by deciviews. The human eye can only detect a change of 1.0 deciview or more. Yet, as the foreword in our comments points out, the EPA’s plan would, at most, improve visibility in 2018 at the parks by significantly less than that.

Further, visibility has improved beyond what even the EPA would require in this proposal that relies on computer models. Based on real world data, not models, from federal monitors at these three parks, visibility has surpassed the levels that EPA asserts are necessary by 2018.

Incredibly, the EPA wants to unload severe costs on Texas for no perceptible improvement and while federal monitors show visibility already improved beyond the 2018 goals set in the final rule.

Luminant and other generators will be forced to spend billions of dollars in non-recoverable costs while this case is being decided because of a rule that is manifestly illegal.

Two of Luminant’s plants, Big Brown and Monticello, would be required to install SO2 scrubbers for more than $1 billion, as estimated by the EPA. Our company’s 10-K disclosure filed with the SEC March 1 laid out the risk that new scrubbers “would likely challenge the long-term economic viability of those units.”

With the EPA unyielding, the time has come to let the courts decide.

Our official statement can be found here.

Luminant_logo_sm300x189

Luminant Response to EPA SO2 Designations


Luminant_logo_sm300x189

Luminant’s Monticello, Martin Lake and Big Brown power plants are operating in compliance with all the environmental rules and laws of our state and nation.

The proposed SO2 designations by the EPA are based on computer modeling funded by environmental groups. We firmly believe these models do not accurately predict actual emissions measurements and that these designations should be determined by real-world emissions data from air quality monitors. We are in the process of evaluating the EPA’s technical support documents.

Should the EPA finalize these designations as proposed, the state will begin the process to evaluate whether potential control or operational changes, if any, may be necessary to demonstrate attainment.

Luminant Responds to EPA Final Regional Haze Plan for Texas and Oklahoma


The Environmental Protection Agency released its final Regional Haze Federal Implementation Plan for Texas and Oklahoma. The rule is purportedly intended to improve visibility over the next several decades at certain federal parks in far west Texas and Oklahoma.

While Luminant is still in the process of reviewing this, it unfortunately appears that the EPA ignored the substantial comments that were submitted to it in opposition to the proposal, and we continue to believe that it goes far beyond the EPA’s authority under the Clean Air Act. There is no legal or technical basis for EPA’s FIP since the state implementation plan submitted by Texas fully complies with the Clean Air Act. More importantly, the visibility benefits the EPA seeks for Texas and Oklahoma are already being met as evidenced by the federal monitors for these parks, yet EPA’s FIP would require Texas to spend $2 billion for what EPA itself projects would be no perceptible improvement in visibility.

The plan Texas submitted is working to improve visibility, and EPA should not saddle this state with huge and unnecessary costs that result in no discernible visibility improvements.

Check out our view on the plan as proposed on POV here:
https://pov.energyfutureholdings.com/2015/04/luminant-files-regional-haze-comments/#.Vmi9nEorIdU

The Reality About North Texas Ozone And Power Plants


You may see some news coverage soon on “new” studies touted by environmental activist groups about ozone in North Texas and three of Luminant’s power plants. The studies will undoubtedly and mistakenly conclude that if only costly emission controls were mandated for these plants, the region would finally be in attainment for ozone.

But, alas, there’s nothing new here.
Continue reading “The Reality About North Texas Ozone And Power Plants” »

U.S. District Court In Dallas Dismisses Most of Federal Civil Claims in NSR Case


The United States District Court in Dallas today dismissed a majority of the civil claims against Luminant that were filed by the U.S. Department of Justice on behalf of the Environmental Protection Agency. These claims alleged New Source Review violations at Big Brown and Martin Lake power plants.

The claims dismissed by the court included claims for work performed during five of the six maintenance outages at the plants that EPA had alleged violated NSR.

In August 2013, the Department of Justice filed suit against Luminant claiming the company violated the Clean Air Act by conducting routine maintenance work at Big Brown and Martin Lake during six outages between 2005 and 2009.

But in deciding a motion filed by Luminant to dismiss the claims, the court ruled that the five claims for work performed during outages prior to 2009 were barred by the statute of limitations because EPA did not file its suit within five years of the start of the outages.

The only NSR claim now remaining is for routine maintenance at Martin Lake Unit 1 during its spring outage in 2009. Also remaining is a claim involving administrative information requests that Luminant responded to before the case was filed.

We remain confident that we will prevail on the remaining two claims if the case ultimately goes to trial, which is currently scheduled for October 2017.

Luminant Responds to Final EPA Rule on GHG

Company reviewing to determine if rule respects Texas’ unique intrastate electricity sector, dynamic competitive market


Luminant_logo_sm300x189As we did when the proposed rule was released, Luminant will extensively review the Environmental Protection Agency’s final Section 111 (d) rule before commenting in detail.

We’ll be looking closely to determine if the EPA truly listened and fundamentally restructured this final rule from the proposed rule, which was unlawful, unworkable and unfair to Texas.

The final rule, to be workable, must respect Texas’ unique intrastate electricity sector and dynamic competitive market. The proposed rule did not account for these factors, with its huge cost increase for consumers, unrealistic dispatch of coal to natural gas and mandate for a massive build out of renewables — without crediting Texas for its significant and nation-wide leading investments in renewables to date — that would threaten reliability.

With the record demand for July we saw last week, we again are reminded why Texas and its growing economy must continue to be served by the diverse mix of energy that’s proven to be dependable — coal, natural gas, nuclear and renewables.

Continue reading “Luminant Responds to Final EPA Rule on GHG” »

Luminant Responds to Misleading Op-Ed Piece by Environmental Activist Group

The claims by Public Citizen about our power plants are just wrong


Luminant_logo_sm300x189A commentary posted today in the Fort Worth Star-Telegram by Tom Smith, director of Public Citizen’s Texas office, 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.

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 Environmental Protection Agency 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 claims by Public Citizen about our 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 with the TCEQ stating their demand was “not justified.”

Continue reading “Luminant Responds to Misleading Op-Ed Piece by Environmental Activist Group” »