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Energy Dept. to Texas: Chill Out. You Can Keep the Lights On And Still Meet Pollution Regs

Ever since the EPA announced new pollution regs that would come down hardest on dirty power plants, there's been considerable Sturm und Drang from the industry, who've been making all sorts of dire predictions about rolling outages resulting from burdensome, onerous, expensive federal regulation. The North American Electric Reliability Corporation grid reliability report singled Texas out as a state most likely to struggle to meet peak demand by 2013. Right after that, ERCOT released its own projections, portending reliability problems by 2012.

Generators, they claim, will falter under the weight of the Cross-State Air Pollution Rule, which places limits on emissions of sulfur dioxide and nitrogen oxides, and the Mercury and Air Toxics Standards, which sets limits on mercury and acid gases -- all pollutants that cost the country an estimated $12 billion a year in associated health problems, the EPA says.

Of course, painting pollution regs as the wellspring of all woe is a self-serving, foot-dragging strategy at best. Texas is the biggest polluter in the country, so it's no surprise that the burden would weigh heaviest here. But according to a report from the Department of Energy, it won't be that bad. Using computer models, DOE created a series of scenarios -- a middle-of-the road case and a "stringent test case," where the time extensions and dispensations the EPA will give energy generators struggling to meet deadline don't exist.

In every region but the territory covered by the Texas Reliability Entity, no new generation will be needed to meet demand, and even then, less than one gigawatt of added natural gas capacity should do the trick here. With gas prices as low as they are, that shouldn't be too difficult.

DOE estimates that the amount of time needed to retrofit existing generators or to build new ones is roughly the same as the EPA's compliance time line. And, if extenuating circumstances render them unable to meet the deadline and threaten reliability, extensions may be granted. Generators can do a number of things, DOE figures: Quit using filthy Texas lignite, purchase emission allowances, retrofit or retire units that won't make economic sense, or re-power them with natural gas.

It's doable, and even DOE's doomiest scenario has Texas meeting (just barely) its minimum reserve margin in 2015. Less than a gigawatt of natural gas combustion -- in a shale-wealthy state -- should get us through....provided, of course, that generators, enabled by state regulators and officials like state attorney Greg Abbott, retire the hoary old outages-and-job-losses shibboleth and pursue pollution controls that will improve air quality and the health of Texans.


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