New EPA Proposal Not Likely To Change Texas’ Shift Towards Renewables

As wind power becomes increasingly important in Texas the state is becoming less dependent on coal.

By Laura RiceAugust 27, 2018 1:48 pm|

The Environmental Protection Agency has a new proposal to replace the so-called Clean Power Plan – which would have required states to slash carbon emissions by shifting from coal power to natural gas and renewables. The Obama-era regulation had been challenged by Texas and about two dozen other states as too costly, a threat to electricity supply, and a rule that exceeded the EPA’s authority.

So what about the plan’s replacement and what does it mean for Texas? Matt Smith is Director of Commodity Research for ClipperData. He says “Affordable Clean Energy Rule” essentially gives states more power to regulate (and relax) carbon emissions.

“This could mean coal plants won’t have to spend millions of dollars of investments to undertake these environmental upgrades to try and reduce those emissions,” Smith says. “So essentially, as you mentioned, unwinding the Clean Power Plan.”

But Texas has been undergoing a sort of power transition that makes the changes less likely to affect the state. Right now, about third of power generation in Texas is coal and another third is natural gas.

“That said, there are three large coal plants being retired this year — which means their piece of the pie is going to be reduced,” Smith says. “At the same time, when you combine solar and wind, [for last year] they accounted for 18-percent of the generation mix in Texas. Texas is the largest wind power producer and last year, across the US, it was the largest in terms of wind capacity additions.”

Irving-based Exxon Mobil is reportedly even trying to buy renewable energy in Texas.

“This is signalling two things really,” Smith says. “One, that renewables are becoming more cost-effective or cost-competitive and so they are a more attractive option. But at the same time as well it’s highlighting that Exxon Mobil, a traditional oil company, is making a commitment to be more sustainable as well.”