Luminant Will End Lignite Mining In Central Texas, Idle 2 Coal-Fired Plants

Luminant's Monticello Power Plant (File)

FORT WORTH (September 12, 2011)—Dallas-based Luminant has filed a federal lawsuit seeking to remove Texas from a new Environmental Protection rule due to go into effect early next year that the company says will force it to idle two power plants and end mining operations at three lignite mines, including one in Central Texas.

The company also plans to file suit to stop the rule, which is due to take effect on Jan. 1, 2012 and will require Texas and 26 other states to reduce power plant emissions.

Read Luminant’s Press Release

Luminant spokesman Allan Koenig said Monday the only way the company can comply is by idling its Monticello Units 1 and 2 in Northeast Texas and by ending use of lignite for fuel at its Big Brown Units 1 and 2 in Freestone County, using instead only coal from the Powder River basin.

The company says it would also end mining operations at its Big Brown/Turlington Mine in Freestone County and at its Thermo and Winfield mines in Northeast Texas, although it would continue reclamation activities at all three.

The Big Brown plant and its mine employ more than 300 workers and in 2010 paid $8.6 million in taxes, according to Luminant’s website.

Koeing says the effect of the moves would be to reduce generating capacity by 1,300 megawatts.

The Electric Reliability Council of Texas, which operates most of the state’s power grid, says if the EPA rule takes effect, power outages could occur because Texas hasn't had time to mitigate the capacity losses.

Luminant said it will begin a substantial investment program to upgrade environmental control equipment and take other steps to reduce emissions at Monticello Unit 3 and two other coal-fired plants, the Martin Lake Power Plant in Rusk County and the Sandow 4 Power Plant in Milam County.

“We have spent the last two months identifying all possible options to meet the requirements of this new rule, and we are launching a significant investment program to reduce emissions across our facilities,” said David Campbell, Luminant’s chief executive officer.

“However, meeting this unrealistic deadline also forces us to take steps that will idle facilities and result in the loss of jobs,” Campbell said.

The EPA’s assistant administrator for air, Gina McCarthy, however, defended the rule, saying it “will prevent tens of thousands of premature deaths and thousands of asthma attacks by ensuring Americans do not have to breathe pollution emitted by facilities in other states.”

As recently as Sunday, she said, the EPA offered to share information with Luminant that shows that compliance can be achieved without shutdowns and layoffs.

“This administration agreed with the previous administration's 2005 decision that these facilities threatened the health of Americans living downwind, and this action by Luminant represents an abrupt change of direction,” she said.

“Since the Bush Administration, these facilities have made business decisions to comply with a rule that is very similar to what we announced in July - staying within pollution limits without needing to make serious investments in pollution controls at several facilities,” she said.

“Today, rather than continuing their previous efforts at complying with important health safeguards, and despite EPA's repeated pledges to work with them in finding an agreeable path to cutting pollution, they made the choice to lay off workers and idle facilities,” she said.

Gov. Rick Perry blamed the possible job losses on the Obama administration’s “burdensome regulations.”

“Yet again, this administration is ignoring Texas’ proven track record of cleaning our air while creating jobs, opting instead for more stifling red tape,” Perry said.

“As expected, the only results of this rule will be putting Texans out of work and creating hardships for them and their families, while putting the reliability of Texas’ grid in jeopardy,” he said.

U.S. Rep. Bill Flores, R-Bryan, echoed Perry in blaming the administration for the possible job cuts.

“On a day in which President Obama is touting his ‘job creation plan,’ his policies have forced the largest competitive power generation company in Texas, Luminant, to close facilities and sacrifice approximately 500 jobs,” he said.

“In order to comply with the unrealistic deadline and damaging requirements of a recent EPA rule forcing Texas power generators to make dramatic reductions in emissions, the company must reluctantly idle two generating units and end operations at three Texas mines,” he said.

“It is outrageous that the EPA failed to adhere to the rulemaking process by excluding Texas in the 2010 draft rule, only to add Texas at the last minute in the final June 2011 published rule and expect compliance within six months. These regulations will hurt middle-class jobs and harm electric reliability in Texas with no proof that electric power generation in Texas is causing the non-attainment of pollution standards in other states,” he said.

Read Luminant’s Press Release