EPA Rule Cited as Cause of Coal Plant Closures in Texas

Business Wire
September 12, 2011

Luminant Announces Facility Closures, Job Reductions in Response to EPA Rule

Luminant, the largest electricity producer in Texas, announced today it will idle its Monticello Units 1 and 2, which are coal-fired plants with a generating capacity of about 1200 megawatts, in order to comply with the Cross-State Air Pollution Rule issued by the Environmental Protection Agency (EPA). Luminant will also cease burning Texas lignite at its Monticello Unit 3 and its Big Brown Units 1 and 2, and begin operating on 100 percent Powder River Basin coal from Wyoming. The Cross-State Air Pollution Rule (CSAPR) imposes a 47 percent SO2 reduction and substantial NOX reductions by Texas sources beginning in January 2012. The Rule also requires a 64 percent reduction of SO2 emissions to Luminant’s fossil fuel generating units. Luminant claims that the idling of the two coal plants and the conversion of other coal plants from Texas lignite to lower sulfur Powder River Basin coal will result in the loss of approximately 500 jobs in Texas. Luminant also states that it expects to invest approximately $280 million by the end of 2012 and estimates that it will spend more than $1.5 billion before the end of the decade in environmental control equipment to comply with regulatory requirements. In a separate but related action, Luminant filed a petition with the U.S. Court of Appeals for the District of Columbia Circuit asking the court to invalidate CSAPR as to Texas. The company also has pending before the EPA a request for reconsideration and stay of the Rule, which it filed on August 5. Luminant is a subsidiary of Energy Future Holdings Corp., and has 15,400 megawatts of generation in Texas, including 2,300 MW fueled by nuclear power and 8,000 MW fueled by coal.