The impending closure of the 650-megawatt Oklaunion plant is more writing on the wall for the state’s power generators.
Chalk this one up as another loss for the White House.
Last month, American Electric Power (AEP) announced that it would close its 650-megawatt power plant in Vernon, a rural community of 11,000 just south of the Texas-Oklahoma line, by September 2020. The closure of the Oklaunion Power Station is the latest in a string of shuttered coal-fired power plants across the state: Since 2011, at least six have been mothballed, scheduled for retirement or closed altogether, casualties of cheap natural gas and a booming renewables sector.
While it’s not shocking that another Texas coal plant has succumbed to market headwinds, it is somewhat surprising that Oklaunion was the latest casualty. At only 31 years old, it’s more than two decades away from the typical retirement age of 54. The plant was also running relatively efficiently until 2013, according to the Institute for Energy Economics and Financial Analysis. Plant efficiency has dropped in the years since, however, sapping profits and forcing AEP to pull the plug. The impending closure maps a tough road ahead for Texas’ aging fleet of coal plants, some of which also face the prospect of installing expensive new pollution controls to comply with Obama-era environmental regulations (Oklaunion itself is among the state’s top 10 emitters of nitrogen oxide, according to the Sierra Club).
Not only are coal plants prone to spewing greenhouse gases and smog-producing chemical compounds, many facilities nationwide have grown inefficient and costly to operate as they’ve aged. Electric utilities are looking for cheaper, more efficient power sources such as natural gas and wind. For the state’s power generators, the writing is on the wall: There’s little room for coal in Texas’ future.
Still, President Donald Trump’s administration, including climate-change-denier-turned-energy-secretary Rick Perry, is doing everything in its power to insulate coal plants from unfavorable market forces. Last year Perry pitched a plan to subsidize unprofitable plants with billions in taxpayer money, a tactic that even some coal proponents decried as “anti-competitive,” writing in an October 2017 letter that “it would distort, if not destroy, competitive wholesale electricity markets [and] increase the price of electricity to all consumers.” In January 2018, Trump-appointed federal energy regulators reviewed Perry’s plan. The regulators ultimately ruled against it, finding that “There is no evidence in the record to suggest that temporarily delaying the retirement of uncompetitive coal and nuclear generators would meaningfully improve the resilience of the grid.”
It wasn’t the first time Perry had tried to prop up coal. In 2005, then-Governor Perry attempted to hurry along coal plant construction by ordering the Texas Commission on Environmental Quality to fast-track reviews for 11 new plants. That order was struck down by a district court judge, and eight of the 11 proposed plants were never built.
Those failed efforts haven’t stopped Perry and Trump from continuing to meddle in energy markets. In June, the administration unveiled a new strategy to save coal, this time under the all-too-common guise of national security: Only coal and nuclear power plants have the “secure on-site fuel supply” to ensure electric grid reliability in the case of an emergency, an Energy Department draft memo read.
In Texas, Trump and Perry’s pro-coal push has been bolstered by the Texas Public Policy Foundation, a conservative think tank funded by oil industry cash. The group has embarked on a campaign to end subsidies for wind energy developments, which represent an increasingly potent competitor to fossil fuels. TPPF has released ads hammering wind developers for, gasp, wanting to turn profits. The influential conservative group also tried to convince residents of Georgetown — an Austin suburb powered solely by renewable energy — that the wind industry is populated by “takers,” as opposed to “makers.” Whatever that means.
Oklaunion’s shutdown bookends a series of coal-fired power plant closures in Texas. The trend began in 2011 when CPS Energy, San Antonio’s municipal electric utility, chose to mothball its 871-megawatt J.T. Deely Power Plant instead of retrofitting it with new pollution controls. In 2016, AEP retired its coal-burning units at the Welsh Power Plant for similar reasons. Then, in late 2017, Luminant announced that it would close three of its coal-fired plants in Texas: Monticello (Mt. Pleasant), Big Brown (Fairfield) and Sandow (Rockdale), representing a combined capacity of 4,600 megawatts (1 megawatt powers about 750 homes at once). The Three Oak coal mine supplying Sandow has also closed.
“We’re not gonna see another coal plant. It’s just an expensive, wasteful way to generate power,” said Chrissy Mann, senior representative of the Sierra Club’s Beyond Coal campaign. “The future of Texas is solar, wind and storage with a tiny bit of gas.” She noted that even without Deely and the other plants, the state power grid hummed along this summer, despite seeing record levels of electricity use.