Texas’ balanced energy portfolio is what drives our state’s economic growth and provides job security to millions. Texas energy jobs aren’t just in oil fields, mines and power plants. The affordable electricity rates provided by our diverse energy supply ensure that other employers, such as those in our vast manufacturing and technology industries, maintain and grow their operations in Texas. Our diverse energy mix keeps residential electricity bills low, ensuring that more money stays in the pockets of hardworking Texans.
This growth and prosperity is being put at risk by the Environmental Protection Agency. Coal, which provides more than a third of the state’s electricity generation, faces the greatest risk. Its share is decreasing because of unwise environmental policies from Washington.
The EPA has taken direct aim at Texas, imposing burdens far greater than any other state. The Clean Power Plan (CPP), announced in June, would require a 38 percent reduction in Texas’ carbon dioxide emissions from power plants by 2030. Though Texas’ carbon dioxide emissions rate is lower than the national average, the EPA seeks to force Texas to shoulder a disproportionate share of the nation’s reductions, which will be greater than those of 27 other states combined.
The EPA has predicted over half of Texas’ coal-generation will have to be shut down under the CPP, with plant closures across the state. What does this mean for Texas? Lost jobs, higher electricity rates and greater chances of rolling blackouts.
A 2014 University of North Texas study found the Texas coal industry provides an economic benefit of more than $7 billion annually, supports more than 24,000 jobs that pay over $1.8 billion and contributes more than $690 million in state and local taxes. The biggest economic impact will come in the form of much higher energy bills.
By 2020, EPA rules are projected to increase annual power and gas prices in Texas by $42 billion and nationally by $284 billion. This will lead to a 54 percent increase in household electricity and gas bills, forcing the average Texas household to spend an additional $1,050 per year on electricity and gas. The impact to large consumers of electricity will be much more dramatic, especially in the manufacturing and petrochemical sectors of the Texas economy.
Ironically, the CPP will fail to provide any meaningful benefits to the U.S. or Texas. President Obama has pledged to reduce U.S. carbon dioxide emissions by 26 percent to 28 percent by 2025, which he claims prompted China’s pledge to peak skyrocketing carbon dioxide emissions by “around 2030.” While touted by the administration as a major step forward, China and the rest of the developing world will continue to increase carbon emissions so that reductions here will be dwarfed by increases abroad.
In fact, by 2030, all of the projected CPP emission reductions will be offset by Chinese emissions in 13½ days.
We do not want to return to rolling blackouts or large-scale outages, as we saw in Texas in February 2011 when a severe Arctic blast and a sharp rise in electrical demand forced ERCOT to initiate rolling blackouts temporarily. We cannot control the weather. We can control policy.
Affordable and reliable electricity is the backbone of Texas’ economy. Our economic prosperity is contingent upon the adoption of sensible policies that maximize the use of our state’s abundant, diverse and affordable energy portfolio, including oil, natural gas, coal and renewables. Letting Washington bureaucrats decide how Texas generates electricity will have catastrophic consequences. The Clean Power Plan is all pain, no gain.
Mike Nasi is general counsel for Balanced Energy Texas, a statewide coalition of energy consumers, producers and providers committed to supporting policies that preserve and promote our state’s leading role in energy and economic development.