Summary: Paying Through the Nose to Breathe Easy: How EPA Changes Will Affect the Texas Electricity Market

By Vernon Trollinger, October 7, 2011, FAQs, News, Save Money, Small Biz

A good friend of mine often travels to China for buisness. One thing that dismays him is the air quality. “Most Chinese cities,” he said, “are covered in smog. You can’t see the horizon. It’s all just shrouded in a gray haze.”

China is making money hand-over-fist but because of air pollution they face decreasing crop yields from acid rain and mushrooming health costs for asthma, bronchitis, and other lung illnesses for the next three generations. Our Texas air may be a LOT cleaner but our economic growth has been slow to modest at best. This summer’s triple digit temps and cooling costs are roasting everyone who pays an electric bill.

So in July, when the US Environmental Protection Agency announced that it’s new Cross-State Air Pollution Rule would take effect January 1, 2012, a howl of dismay and anguish shot up around the state. The reason? Last July, EPA when announced the Transport Rule the agency concluded that Texas SO2 emissions had no significant downwind effects.

But out of a clear blue sky this year on July 6, EPA changed the plan’s rules without informing Texas. Sulfur Dioxide (SO2) output from Texas was based on data at an air quality one monitor 500 miles away in Madison County, Illinois, home to iron and steel. industries.

Texas faces bearing 25 percent of the overall SO2 reduction burden imposed under this rule —more than twice the state’s contribution to the total SO2 emissions of all states included in the rule.

Electricity Reliability Commission of Texas (ERCOT), Texas Commission on Environmental Quality and the Texas Public Utility Commission condemn the rule have all condemned the rule claiming it will raise electricity rates and shut down coal-fired plants that can’t afford to install pollution-control equipment. Texans will “face increased incidences of heat stress, heat stroke and death”. EPA, on the other hand, claims its expensive plan goes a long way to reducing illness and improve the quality of life in 27 states.

To get a rough sense of the big picture, try going to a chili cook-off in a church basement where no one wil be allowed to leave for 48 hours and you’ll get the point. There’s a lot of resentment downwind.

Yet, while it looks like EPA capriciously changed the rules, they are definitely not the only ones adding to the stink. Luminant, PUC, and ERCOT know there’s a 5,280 megawatt elephant at that church chili cook off.

Read the full article to find out how it could effect your Texas electricity rate for the next year.

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