Luminant announced Friday it will close two coal-fired power plants in Central Texas, including Big Brown in Freestone County, prompting concern for the economies of each community and relief for air-quality concerns.
The two-unit Sandow Power Plant in Milam County, the Three Oaks Mine that supports it and the two-unit Big Brown Power Plant in Freestone County are becoming casualties of “challenging plant and market economics,” according to a press release from Luminant, a subsidiary of Vistra Energy. The Turlington Mine that supports Big Brown was already scheduled to stop production this year.
“This announcement is a difficult one to make,” Vistra President and CEO Curt Morgan wrote in the press release. “It is never easy to announce an action that has a significant impact on our people. Though the long-term economic viability of these plants has been in question for some time, our yearlong analysis indicates this announcement is now necessary. These employees have kept both plants reliably powering Texas for decades, and we appreciate their service.”
An estimated 650 people likely will lose their jobs and 2,300 megawats of capacity will be lost because of the closings.
About 200 of the job losses will be in Freestone County east of Waco. Eligible staffers will receive severance benefits and help finding new employment, the press release states.
“This will have a significant impact. We’re losing jobs, well-paying jobs, and we will see a decrease in our tax base,” Freestone County Judge Linda Grant said. “This is a tremendous blow for a county our size.”
The county of about 20,000 residents has reduced the tax value of Big Brown for several years, but at $65 million, it remained the largest tax revenue generator in the county, Grant said.
Grant was away from her office when reached for comment Friday and did not have exact numbers on revenue produced by Big Brown. She did say the loss could make an increase in the tax rate necessary.
Russell Devorsky, executive director of the Heart of Texas Council of Governments, said the shuttering of Big Brown “will have a devastating impact short-term,” but wondered if the plant site might make an ideal location for a modern facility because of its proximity to the electric grid managed by the Electric Reliability Council of Texas.
“From a pollution standpoint, Big Brown is an old coal-firing plant, so air quality in Central Texas should benefit,” Devorsky said. “It went online in the early 1970s and was designed to last 40 years, which it has.”
If ERCOT determines the Big Brown units are not needed to ensure power reliability, and if the site has not been sold during that 60-day review, it will cease operations on Feb. 12, according to Luminant’s press release.
The Lone Star chapter of the Sierra Club applauded the closing of the plants.
“Public health analyses have shown that pollution from Big Brown and Sandow cause or contribute to more than 6,400 asthma attacks, 187 premature deaths, and more than 151,000 lost or limited work days every year, resulting in more than $1.6 billion in public health and lost productivity costs annually,” according to a Sierra Club post online.
“The retirement of these super polluters is a victory for all of Texas,” Cherelle Blazer, a longtime Sierra Club organizer in Dallas, wrote in a statement that appears on the club’s website.
Waco-based economist Ray Perryman said closing the plants “is part of a long-term trend” that puts coal-fired facilities on the endangered list.
“Part of it is the environmental concern, but is mostly a matter of economics,” Perryman said in an email. “In a deregulated market where there is no longer a guaranteed rate of return, the lower marginal cost of smaller natural gas plants makes them a more attractive option for providing power to the grid. Decisions on individual plants will be based on specific factors, including regulations in the relevant market.
“In general, though, older coal-based plants will play a declining role in the future.”
Friday’s news follows by only days Vistra Energy’s announcement that the coal-fired Monticello Power Plant in Titus County would close. The company estimated about 200 employees would receive pink slips in that closure.
Chris Evilia, executive director of Waco’s Metropolitan Planning Organization, said the closing of Big Brown and Sandow could prove beneficial to Waco and McLennan County as they strive to remain compliant with federal air quality guidelines.
“If we were to become non-compliant, we would have to come forward with strategies to reduce emissions, and they possibly could involve cars and trucks and their impact on air quality,” Evilia said. “Certain projects might not be able to move forward, and that would impact our transportation infrastructure, road and highway construction.
“So the announcement Friday probably was a positive, as long as we can make sure we have an adequate supply of electricity.”