June 2, 2014

Obama carbon rule requires 39 percent reduction in Texas

Texas would have to cut its rate of carbon dioxide emissions by 39 percent by 2030, compared to a national average of 33 percent under the EPA proposal.

In a sweeping initiative to curb pollutants blamed for global warming, President Barack Obama’s administration unveiled a plan Monday aimed at cutting carbon dioxide emissions from power plants by 30 percent while imposing tougher standards on Texas.

The proposal aims to encourage states to become more efficient at generating power with less carbon, using whichever methods they find most effective.

Texas, which is already better than average, would be expected to improve by 39 percent, compared to about a 33 percent average improvement per state nationally, according to EPA data released Monday.

The plan does not reduce emissions by a set amount across the board, but aims to reduce emissions by 30 percent by 2030 compared to 2005.

Power plants are the largest source of greenhouse gases in the U.S., accounting for about a third of the annual emissions that make the U.S. the second largest contributor to global warming on the planet.

“The glue that holds this plan together — and the key to making it work — is that each state’s goal is tailored to its own circumstances, and states have the flexibility to reach their goal in whatever works best for them,” EPA Administrator Gina McCarthy said in prepared remarks. She characterized the proposal as “ambitious, but achievable.”

Texas Gov. Rick Perry immediately attacked the proposal, calling it “the most direct assault yet on the energy providers that employ thousands of Americans, and fuel both our homes and our nation’s economic growth.”

Texas Attorney General Greg Abbott said he will fight a new federal requirement to cut Texas carbon emissions.

Others praised the plan, saying it contains considerable flexibility and doesn’t appear to penalize a fast-growing state like Texas.

“While it’s not going to be easy, it’s probably achievable,” said John Fainter, who heads the industry-sponsored Association of Electric Companies of Texas. He said allowing states to develop their own solutions “indicates some concern about reliability,” which could be compromised if too many coal-fired generating plants were forced to retire too quickly.

Economist Bud Weinstein, of the Maquire Energy Institute at Southern Methodist University in Dallas, said the nation has already reduced carbon emissions from power plants by 20 percent since 1995. That was largely driven by the shift from coal to inexpensive natural gas, he said.

“Another 30 percent has tremendous implications for the coal-fired industry, which has been going away for some time,” he said. “In some cases, it will be expensive. There could be job losses. But there will be job creation,” Weinstein said.

Texas environmental groups welcomed the proposal.

Obama’s proposal “will clean up the industries that create the lion’s share of carbon pollution in our country,” said Scheleen Walker, director of the Lone Star Chapter of the Sierra Club. “The new protections will also help reduce other life-threatening air pollution including mercury, soot and smog.”

Texas is a mixed bag when it comes to electricity and carbon.

The state easily led the nation in 2012 in total carbon emissions as well as total power produced, according to the EPA figures. But despite Texas’ fossil fuel image, it also boasts the most wind power of any state and is better than most when it comes to carbon emissions in relation to power produced.

In 2012, Texas power generators emitted 1,298 pounds of carbon dioxide for every megawatt-hour generated, the EPA figures show. A megawatt is enough to power about 200 average Texas residences during a summer heat wave.

That emission rate ranked the state No. 18 in the country. It rated better than coal-dependent states, like Wyoming and Kentucky, but worse than states in the Pacific Northwest, where hydroelectric power is available.

The EPA’s proposal calls for Texas to cut its rate of carbon dioxide emissions to 791 pounds per megawatt-hour. That’s a 39 percent improvement rate, the 13th biggest among the states.

According to the EPA, Texas got about half its power in 2012 from natural gas, 32 percent from coal, 7.5 percent from wind and 8.9 percent from nuclear. Natural gas produces about half the carbon emissions of coal to make the same amount of electricity.

EPA officials said the standards are based on the 2012 “state of the fleet” for each state’s generation capacity, taking into account previous efforts to cut emissions through energy efficiency programs, renewable energy standards and other programs.

“It will be up to the states to define their plans … to meet the goals,” one senior EPA official said on a conference call with reporters Monday morning. It could be a carbon tax or other system, the officials said, “and states will make their own choices of what makes sense for them.”

The goals set by the EPA also include considerations of what alternatives are available to a state, such as the supply of natural gas to replace coal. And ultimately if a state doesn’t set a plan, the EPA will set one.

“If Texas’ governor refuses to help, as was the case with Medicaid expansion, the EPA can create its own state plan,” Abbott’s statement said. “But the specifics of how EPA could force Texas to comply remain murky.”

States have until 2017 to develop a plan, or until 2018 if they work with other states. That means the deadline for compliance comes well after President Barack Obama has left office.

The 645-page plan, expected to be finalized next year, is a centerpiece of Obama’s efforts to deal with climate change and seeks to give the United States more leverage to prod other countries to act when negotiations on a new international treaty resume next year.

The EPA projected that carrying out the plan will cost up to $8.8 billion annually in 2030, but the actual costs will depend heavily on how states choose to reach their targets.

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