Al Armendariz, Texas' highest environmental official until last spring, moved to Austin this summer to join the Sierra Club as its senior campaign representative for the statewide Beyond Coal Campaign. The move follows his untimely resignation as administrator of the U.S. Environmental Protection Agency's South Central Region (Region 6), where he was in charge of enforcing EPA policy throughout Texas and surrounding states for 2½ years. His career at EPA was cut short by a flap over a 2010 video that surfaced earlier this year, showing Armendariz speaking at a public meeting in the small Texas town of Dish, north of Fort Worth. In the video, he espouses making examples out of lawbreakers, likening the practice to Romans conquering villages in the Mediterranean: "They'd find the first five guys they saw, and they'd crucify them," he says. Congressional Republicans called for Armendariz's head, widely circulating the video as proof of "EPA's crucifixion philosophy," in the words of Oklahoma Sen. James Inhofe. Armendariz resigned on April 30, feeling he'd become "too much of a distraction."
Though Armendariz's tenure at EPA was short, the list of agency actions during that time – especially those challenging Texas' environmental regulation – was long. Most notably, in 2010 EPA disapproved revisions, known as "flexible permitting," to Texas' Clean Air Act implementation plan, though the state had been issuing flex permits for many years. Texas challenged that decision and a string of other EPA actions in court.
The state scored its most recent win in this ongoing battle last month, thanks to a 5th Circuit Court opinion handed down Aug. 13 vacating EPA's disapproval. That decision, which puts the ball back in EPA's court on flex permitting, by no means signals the end of the war between EPA and Texas. Throw a dart at Attorney General Greg Abbott's calendar, and you'll likely hit a day when some court is refereeing a dispute between Texas and the EPA.
I spoke with Armendariz about the recent flex permit decision and other important rulings, including the recent decision (pending at the time of the interview) on Texas' challenge to EPA's Cross-State Air Pollution Rule. We also talked about his resignation and his plans going forward. In coming to Austin, he leaves behind his professorship at Southern Methodist University in Dallas, where he taught civil and environmental engineering. Now that he's at the Sierra Club, he plans to move Texas beyond coal, an endeavor that includes helping move Austin beyond the Fayette Power Project, a goal set by City Council with passage of Austin Energy's 2020 generation plan in 2011.
Austin Chronicle: Welcome to Austin. Have you lived here before?
Al Armendariz: I was born and raised in El Paso. I lived for a while as a kid in Houston, and then the last 10 years lived in Dallas, but only for a few weeks now in Austin. So I'm getting to see a lot of the state in my life, but first time in Austin.
AC: Is there anything you're looking forward to here on a personal level?
AA: Yeah, I've had the opportunity to get to know a number of the representatives of the environmental groups as well as people who work at the Legislature, elected officials and their staff, and people at the state agencies, and so I guess I'm looking forward to seeing them more often.
AC: And are you going to go to South by Southwest?
AA: [laughs] I'm not sure – if time allows, I might find myself over there.
AC: What are your thoughts as you look back over your tenure at EPA?
AA: I am very proud of the work that I did at EPA and really proud of being able to work with the great staff who are there at Region 6. We did a lot of great work together, and it really spanned all the different areas of EPA's authorities: clean air, clean water, safe drinking water, hazardous waste, oil spill response. Our region is highly industrialized; it has a growing population. My region included not just Texas but also Louisiana, Arkansas, Oklahoma, and New Mexico, and in several of the states, we had large emergency responses like the BP oil spill in 2010 as well as wildfires out in New Mexico that we were directly involved with. So it was a privilege to get to work with the staff, and I'm really proud of many things that we did.
AC: My understanding is that EPA worked in concert with several agencies on the BP oil spill.
AA: It was a grueling experience, but I am very proud of the EPA staff that I got to work with. EPA has an emergency response staff, we have wetland scientists, we have on-scene coordinators, and many other staff who were involved with me in responding to the oil spill. EPA worked in support of the [United States] Coast Guard, and the Coast Guard was the lead federal agency, and they asked EPA as well as a number of other federal agencies, like Fish and Wildlife Service as well as the military, to assist in the response, and it was very difficult work. It lasted many, many days and weeks and months, but I'm very proud of the work that we did.
AC: How big is the Region 6 staff?
AA: The regional office has about 850 full-time staff.
AC: All based in Dallas?
AA: The majority are in Dallas. There's also a number of staff in Houston and a small office in El Paso, as well.
AC: Obviously, EPA and Texas have had somewhat of an antagonistic relationship. I want to get your perspective on that, especially regarding recent and pending court decisions. The one I'm most familiar with is Coalition for Responsible Regulation v. EPA. What are the implications, in particular for Texas? [On June 26, the District of Columbia's U.S. Court of Appeals ruled in favor of EPA against the Coalition for Responsible Regulation; Texas was among the plaintiffs. The three-judge panel's unanimous ruling upheld several EPA decisions, including an "endangerment finding" that greenhouse gases threaten public health, a "Tailpipe Rule" setting greehouse gas emissions standards for automobiles, and "Tailoring" and "Timing" rules regarding greenhouse gas standards for stationary sources, such as coal-fired power plants.]
AA: Well, let me say this. I think that the court decision on greenhouse gases is probably the most important environmental decision that the federal courts have made in a very long time. I think it's going to be very, very important for Texas – the people and the industry in Texas. Climate change is by far the most significant environmental challenge that we have in this state. We're now in the second year of a drought affecting large portions of our state, and scientists are telling us that if we don't deal with climate change, we can expect more droughts – and more severe droughts – moving forward. So I don't think there's any question that climate change and drought are the most important environmental challenges that we have in Texas. So that court decision was critical. It upheld the federal government's authority to regulate greenhouse gases. It's going to allow the federal government to take steps to reduce greenhouse gas emissions from automobiles, power plants, other industrial facilities. And it's long overdue, but it's a fantastic step in the right direction.
AC: Some of the plaintiffs have petitioned for a rehearing. Do you expect that this might go to the Supreme Court eventually?
AA: I don't know. It might. It's hard to predict what people will spend their money on. Let me just say this: The EPA based its regulations of greenhouse gases directly on the Supreme Court's Massachusetts v. EPA decision, and the records for the rules that EPA developed – the endangerment finding, the tailoring rule, and others – flow directly from that Massachusetts v. EPA decision, so I suspect that, regardless of how the greenhouse gas decision is appealed, the agency is going to win. And the agency's authorities to regulate greenhouse gas emissions are going to be upheld by the D.C. circuit and by the Supreme Court in all efforts to undermine EPA's authority.
AC: Tell me about the proposed Las Brisas coal plant in Corpus Christi – it has to get a greenhouse gas permit, right?
AA: The Las Brisas facility is going through the process of getting a federal greenhouse permit because of the dates in several of EPA's greenhouse gas regulations. It did not complete the state permitting process before January 1 of 2011. Because of that it became subject to the Tailoring Rule provisions, which require greenhouse gas permitting for sources that are going through Clean Air Act permitting after January 1, 2011. So the Las Brisas facility has been involved in greenhouse gas permitting well before the June 2012 decision by the D.C. circuit that upheld the endangerment finding. Las Brisas has had an application into the federal government since late 2011, and it applied for that permit well before this court case.
AC: Because of the Tailoring Rule.
AC: And the date of the Tailoring Rule is why some of the other plants [e.g., White Stallion in Matagorda County] don't have to apply?
AA: Correct. So there are facilities all over the country that received their air permits from state agencies before 2011, and those facilities are not required to get greenhouse gas permits. But facilities that get their permits after 2011 are required, and that's the reason that the Las Brisas facility has applied for and is waiting to receive the greenhouse gas permit from the EPA.[page]
AC: Other important cases are happening as well. One is regarding the Cross-State Air Pollution Rule. Can you give me a sense of the importance of that case and its implications for Texas? [Texas was among the plaintiffs contesting this rule; a decision was pending at the time of this interview. On Aug. 21, the DC Circuit Court of Appeals ruled against EPA [pdf of ruling attached to email]. The decision, a two-to-one ruling, was made by a different panel of judges than those who ruled unanimously in favor of EPA in Coalition for Responsible Regulation v. EPA.]
AA: Sure. The Cross-State Rule is critical because it reduces emissions of two of the most dangerous air pollutants: sulfur dioxide and nitrogen dioxide. And it's targeted at facilities that have such large emissions that they affect communities in downwind states. EPA determined that a number of large sources in Texas – and, in particular, a large number of coal-fired power plants owned by Luminant, as well as a few other operators – had emissions large enough to affect communities in downwind states.
AC: Our downwind states are those east of Texas?
AA: Yes, these are states to the east and northeast of Texas. So when this rule is implemented, it's going to require the power plants in the state to reduce their emissions, and the nice collateral benefit is that Texas communities will also enjoy the health benefits. So the rule is going to target emissions from sources because of their impact on downwind states, but the collateral benefit is that Texans who live near these plants will also experience the public health benefits when those emissions are reduced.
AC: So if there's not a favorable ruling for the EPA, what will the next step be?
AA: Well, with the Cross-State Rule, or most other EPA regulations, if a decision goes against the agency, what the agency is often instructed to do by the courts is to modify the regulation to comply with instructions by the court. It's very rare that a court will structure a rule itself. What typically happens is a court will either uphold a rule that is promulgated by an executive agency or, if it identifies flaws, it instructs the federal agency to go back, to correct the rule, and to republish it. And I'm optimistic that the Cross-State Rule is going to be upheld – but even if it's not, I would anticipate the ruling of the court in that case to instruct EPA to go back and fix some flaws in the rule and to then republish it. [Ed.'s note: The court has vacated the CSAPR, which means EPA will have to make modifications before moving forward with regulation on this issue; Armendariz suspects EPA might appeal the court's decision. CSAPR was itself a modification based on a previous D.C. Circuit Court ruling that EPA's rules regarding downwind pollution were too weak.]
And that's how the Cross-State Rule came about, during the Bush administration. The Bush administration put forward a rule that purported to reduce emissions from one state to another, and they called it the CAIR Rule. That stood for the Clean Air Interstate Rule . But the environmental community sued because they felt that the rule was not strict enough and didn't comply with the requirements of the Clean Air Act, and they won. So what the federal courts did is they sent the CAIR Rule back to EPA. They said the rule's not stringent enough, and you need to correct a number of provisions, so the agency published the Cross-State Rule as the outgrowth of the decision on the Clean Air Interstate Rule. So again, this is just an example of how the courts rarely themselves will restructure rules or write rules when it comes to environmental regulations. What's more common is either they uphold the rules as they're written and the agencies win, or they instruct the federal agencies to go back and correct flaws and republish the rule. And so the decision from the Cross-State Rule is likely to be one of those two options.
AC: Is that similar, then, to where EPA stands right now with the ruling on Texas' flex permitting?
AA: Sure, it's exactly the same. TCEQ [Texas Commission on Environmental Quality] has been trying to get approval for a flexible permitting program for about 15 years, and the agency decided when I was there that the program as it was written by TCEQ could not be approved – and therefore should not be implemented. The court ... decided that EPA's rationale for not approving the flexible permitting program was flawed, so they sent the flexible permitting request back to EPA, so EPA is going to have another opportunity to rule on whether the program should be approved or not.
The flexible permitting program is severely flawed. What the agency did is it decided on a legal strategy to disapprove it based on a certain reading of the Clean Air Act. The court decided that that rationale is insufficient. So now EPA is likely to go back and move forward with the disapproval, [but] with a different set of reasons and a more robust record, and republish the disapproval after it has that record.
AC: It seemed like there were two different arguments in the ruling, one being what you just mentioned, and the other being this idea that EPA's action is "16 years tardy," as the judge [E. Grady Jolly] wrote.
AA: The Clean Air Act does instruct EPA to evaluate requests from states – to add permitting programs like a flexible permitting program or to change existing programs – as quickly as possible and within a year. Unfortunately, EPA – long before I or [EPA] Administrator [Lisa] Jackson came into office – had been sitting on this request by the state of Texas to add a flexible permitting program to the state Clean Air Act program.
It's important to realize that the state of Texas does have maybe what we'll call a standard permitting program, and they implement that program in a way very similar to the other 49 states. So the other 49 states have an air permitting program that's implemented generally the same way that Texas implements its standard permitting program. But what Texas wanted to do was add another piece to its standard permitting program; they wanted to add an alternative to its standard permitting program called the flexible permitting program, and they asked EPA in the mid-Nineties for permission to do so.
The Clean Air Act is very clear. Judges have repeatedly upheld that until EPA says yes, you shouldn't implement them [revisions]. It's kind of like asking ... It's the kind of thing where EPA is given authority under the Clean Air Act to decide if an alternative program or change to an existing air program is consistent with the Clean Air Act, and unless and until EPA says yes, the answer is no. So EPA has never approved the flexible permitting program, Texas has never had an approved flexible permitting program, and the court ruling ... doesn't change that fact. They've never had a flexible permitting program. They didn't a year ago, they didn't 10 years ago, and they don't today.
What the court did is told EPA that the rationale that it used to say no – the rationale that it used to disapprove the state getting a flexible permitting structure – was insufficient, and if it wanted to say no it had to come up with a more robust rationale, it had to come up with a different legal argument. So I suspect that's what the agency's going to do over the near term.
AC: My understanding is that part of the problem with the flexible permit program is that it allows a plant's emissions standards to be based on the entire plant rather than per unit. Why is that bad?
AA: Well, you can imagine if you and your significant other, rather than both of you being held to the speed limit on the highway [in which] each of you had to stay below 70 miles per hour, rather than that, imagine if you had a bubble limit, and the bubble limit for your family was 140 miles per hour. It would be impossible for the police who are monitoring traffic out on [Interstate Highway] 35 to know whether or not you, as you're traveling 80, are doing so legally, because simultaneously at that exact same time, your spouse would have to be traveling less than 60. Or if you're traveling 100, then you could only do so if your spouse on 35 at that time is traveling less than 40.
The enforceability becomes extremely difficult if you have a bubble limit that goes across multiple units, because you simultaneously have to know what each emission point is emitting in order to be able to compare the cumulative emissions of all those sources to your bubble limit. And so it's what we call "practical enforceability." By applying a bubble limit across an entire facility – especially a large, complex facility that has multiple boilers and multiple process units and other large sources, as well as numerous medium-sized and smaller sources, versus when you put all of that under a bubble limit – the limit under the flexible permit becomes practically unenforceable. There's no way for an inspector or someone from EPA or TCEQ or the Department of Justice to go to the facility and to know whether that facility is in compliance, because there's no way to measure simultaneously what the emissions are across the entire facility all at once.
AC: Really? It's hard to understand why one couldn't figure out how much the plant is emitting all at once.
AA: It's partly because some of these units at the facility might have monitors on them that record emissions 24/7, to tell you what's going into the air. Some of them don't, and they're simply estimated, based on an engineer's calculations. Others have their emissions based on daily through-put values, the crude oil through-put for that day or the amount of coal burned that day. And so what you end up having are a number of sources across a facility that have emissions estimated very different ways.[page]
AC: So it's like apples and oranges.
AA: Yeah, some of them on a continuous basis, some of them every so often, others based on computer algorithms that are run in a computer, others that are based on an individual actually going and doing a stack test on them, some that are based on just engineering estimates. So you have this wide variety of ways that you measure emissions, and because of that it's impossible to know at any given point in time that the cumulative effect of all those emissions would be below a cap, because there's no way to simultaneously measure all the emissions from all those sources all at once.
AC: It's my understanding that in the time since EPA officially disapproved the flex permitting, it has been working with Texas businesses [that hold flex permits] to get federally approved permits. Does this latest ruling have any effect on those processes of EPA and businesses working together?
AA: I hope not. TCEQ has never had a flexible permitting program. They didn't have one 10 years ago, they didn't have one last year, they don't have one today. The decision of the court doesn't change that fact. There are approximately 100 flexible permit holders who are holding permits which are not valid under the federal Clean Air Act. So if those facilities were asking me for advice, I would advise them to continue the process they've been on for more than a year, which is to get into the standard permitting process that the TCEQ implements.
The TCEQ operates the largest Clean Air Act program anywhere in the country. There are thousands of major sources in the state, and more than 90 percent of them have their air permits through the standard TCEQ permitting structure. Only a very small number decided to obtain flexible permits, and working with us and with TCEQ, essentially all of them agreed to get rid of the flexible permits, to get permits that were issued by TCEQ in the standard permitting program. I would hope that these industrial facilities stay on that process, because I think businesses value certainty. And if they hold on to their flexible permits, if they decide to try to fight and keep their flexible permits, they're holding Clean Air Act permits that were never approved by the federal government, and they're going to be subject to federal enforcement, to suits by environmental groups and citizens, and it just prolongs the uncertainty.
No other state operates a flexible permitting program – no other state in the union anywhere. The state of Texas is the only one that implemented a flexible permitting program like the one that they did. All these companies know that they can operate safely and they can operate profitably in Louisiana, in Ohio, in Pennsylvania, in California, in other large industrial states. There's no reason that they need a flexible permit for their facilities in Texas. They should get their standard permits and move on and put all this nonsense and all of this litigation and all of this enforcement threat behind them.
AC: I read your interview with Kate Galbraith in the Texas Tribune, and you made an interesting point that all this litigation is creating an unpredictable environment for business.
AA: Sure. At the end of the day, what these companies do very well is manufacture products or manufacture energy, provide jobs for Texans, and make money for their shareholders. Unfortunately, the companies that chose to obtain flexible permits have been having to deal with a lot of environmental uncertainty and potential Clean Air Act litigation and potential enforcement. I think most of these companies would value putting all that behind them so they can just focus on their primary business interests – and not have to spend any more time than necessary worrying about their air permits.
AC: You also said it's actually not that hard to work with industry or have good dialogue with companies. I'm wondering if that perspective is something you'll be bringing to the Beyond Coal campaign here in Texas. What sort of approach do you envision?
AA: Oh, sure. I absolutely think that the best environmental outcomes often happen when you have all the stakeholders working together. When I was at EPA, I worked with numerous companies on matters that had tremendous environmental outcomes. One recent example is the work we did with the utility PSO, which stands for Public Service of Oklahoma. Here's a utility that was subject to EPA regulations on a couple of coal-fired power plants, and they came to us looking for an alternative to those regulations that would still have environmental protection, still have environmental benefit, but give them some flexibility in how long they continue to operate those plants. So we worked with the Oklahoma DEQ [Department of Environmental Quality], with the Oklahoma governor's office, with the utility, and were able to construct a plan that all of us could sign off on. It was great for the ratepayers in the state of Oklahoma, it was good for the utility, it was good for the environment, and it couldn't have happened if either the state or the federal government or the utility weren't at the table. We had lots of stakeholders, everybody had their own interests, they brought them forward. We then negotiated, sometimes difficult negotiations, but at the end of the day we came up with a plan that everybody could sign off on and I think everybody was happy with.
AC: I need to ask you about your resignation from EPA and the controversy over the analogy – about "crucifying" – that you used in the video. When it comes to enforcement, it seems like an agency is supposed to take a hardline approach. So what's the big deal about that statement?
AA: Yeah, well, I don't want to spend much time speaking about those remarks themselves, those remarks that I made a couple years ago. I really am focused on the work that I've got in front of me and the work that I'm doing now with the Beyond Coal campaign.
I will say this: I think effective law enforcement for environmental statutes or any other statutes includes holding violators accountable. And I believe there is a deterrent effect when you have vigorous law enforcement. A vigorous law enforcement program will have a deterrent effect on that same company or individual and potentially persuade them from thinking of violating the law again down the road, and a vigorous enforcement program also provides a level playing field. You don't want to have a situation where companies that are choosing to cut corners and companies that are choosing to enhance their profits by violating our environmental statutes have a competitive advantage over companies that are trying to do the right thing. And law enforcement is one of the tools to prevent that from happening. Law enforcement is one of the ways that you prevent an unlevel playing field. It's one of the ways that you prevent companies that are choosing to violate the law, choosing to cut corners, and choosing to increase their profits at the expense of the environment. It's how you prevent that from happening and how you dissuade other companies from following along those lines.
AC: In the coverage of this video, there hasn't been much discussion of Dish, Texas [where the video was taken]. What is the story with this small town?
AA: Yeah, Dish, Texas, is an important community. It is a rural, conservative, quiet community outside the city of Fort Worth. It's a place out in some beautiful countryside where a number of families have built their homes. It's people who want to live in the country, people who are living in a community away from the freeways and large buildings of downtown Fort Worth. But about 10 years ago, their way of life began to radically change. Oil and gas companies moved into Dish and began heavily industrializing the area with large numbers of new compressor stations and pipelines and natural gas wells and drilling rigs and tank farms, and the noise and the air emissions and the waste pits from all of that activity changed that community and really altered its way of life. It's unfortunate. It's a community where people have been greatly impacted by natural gas extraction. And it's a sad story.
AC: Has there been litigation coming out of Dish?
AA: There's probably a very good story to be told by talking to the former mayor. His name is Calvin Tillman. Calvin was mayor in the early 2000s. He's a very honorable man. He's a conservative Republican by political persuasion. But he saw what was happening to his community, and he saw what the natural gas companies were doing. The city of Dish was very small; it doesn't have tremendous resources for lawyers and for litigation. He tried to do what he could to protect the people of his town. Unfortunately, the emissions got so large and got to the point that he thought they were affecting his own family and causing health problems to his children, so he left town. And because he left town, he could no longer sit as mayor of Dish. So he's had a front-row seat to the effect that natural gas drilling can have on small communities, can have on their way of life – both the impact on the community as well as the impact on his own family. He's someone I admire greatly.[page]
AC: I should steer the conversation to Austin, because I want to learn about your work now that you're at Beyond Coal. What do you hope to see happen with the city's decision on Fayette?
AA: I'm going to work hard to transition the city of Austin completely away from the Fayette coal-fired power plant. It really is time for the city of Austin, as well as the rest of Texas, to move beyond coal. We produce more wind energy in Texas than the next several states combined. We also have tremendous solar and geothermal resources that are untapped, so we don't need coal to work with abundant and reliable electricity in this state. And my goal is to work with the mayor and City Council, to work with Austin Energy and LCRA [Lower Colorado River Authority], to move the city of Austin as quickly as possible off of coal. And we can do so over a period of years and in a way that creates clean energy jobs, helps expand wind and solar in our state, no longer requires huge amounts of water at a time of drought, and does so in a way that is reliable and doesn't result in rate increases for the people of the city.
AC: And you believe that's possible? That's of course the main controversy that comes up in conversations about Fayette: price versus environment. (See "AE's Coal Conundrum," Nov 20, 2009.)
AA: Absolutely. Coal is getting more expensive, and the price of renewables is falling quickly. There are contracts that the wind energy companies are signing with electric providers across our state which are at or below the cost of providing electricity from fossil fuels like coal, and the price of that renewable energy is dropping. So as we move forward in coming years, I suspect we're going to see renewables competing with resources like coal on a cost basis.
AC: Across the state there's increasing concern about grid reliability, and the Public Utility Commission recently increased the price cap for wholesale power to encourage investment in new generation. Do you think that's something Texans should be concerned about when thinking about renewables and shutting down coal?
AA: Grid reliability is obviously very, very important. But I think it's important to realize our recent history in Texas when it comes to reliability. We had blackouts and brownouts in this state in the winter of 2010. Those blackouts were precipitated by a cold front that moved through the state and the impacts that it had on the fossil fuel resources. The low temperatures caused problems with the natural gas distribution system in our state, they caused problems at a number of the coal-fired power plants in our state, and it was those fossil fuel resources – the natural gas and coal resources – that had severe problems that winter when it got cold. It wasn't the wind energy; it wasn't the solar resources of the state. It was the coal and natural gas resources of the state that went down, causing grid reliability problems in our state.
So there's a bit of a myth that fossil fuel plants are 100 percent reliable and that wind and solar are intermittent and less reliable. When you actually look at the history of Texas, what you see is that our old, dirty, coal-fired power plants go down frequently, and they're under need of constant maintenance, and that blackout episode from 2010 shows us that we can't rely on them 100 percent of the time to provide the state with electricity.
So what we need the state to do is to work with all of the stakeholders. We need the PUC [Public Utility Commission] and ERCOT [Electric Reliability Council of Texas] and the environmental community and the utilities and the cities and the industrial purchasing groups to all work together to develop renewable sources of energy, which are really abundant in our state. If we do so intelligently, we can have more than enough energy for all the needs in our state without any concerns about reliability.
AC: What role should natural gas play, given the environmental concerns associated with it?
AA: The goal of Sierra Club is to replace the coal-fired generation in Texas and throughout our country with clean, renewable sources like wind and solar and geothermal. If any of that coal capacity is going to be replaced with natural gas, our goal is to make natural gas use as small as possible. And it's incumbent upon the natural gas industry to also meet the highest standards for protection of our air and our water and the communities that live near the natural gas fields. And insofar as any natural gas is going to be used, it really is a short-term stopgap, because the use of natural gas does have greenhouse gas impact, and it does lead to climate change in prolonging our drought from the combustion of the natural gas at the utilities as well as leaks of methane in the natural gas infrastructure. And so we need to use it as little as possible, and if we are going to use it, we need to minimize the environmental impact.
AC: When it comes specifically to Fayette, what are your feelings on the city selling versus attempting to retire its share? [Austin Energy owns half of two units at the three-unit plant; LCRA owns the remaining units, operates the plant, and has right of first refusal if the city attempts to sell its share.]
AA: We don't support taking steps at this time to sell the city of Austin's portion of the Fayette power plant because we're concerned that the Fayette power plant could be sold to an entity that has less concern for the public health of the citizens of Austin and less concern about our drought and climate change than the City Council of Austin.
We congratulate the mayor and the City Council for agreeing to move Austin beyond coal. We're proud of the fact that the mayor and the City Council have agreed to examine ways to move beyond the Fayette coal power plant. And we think the most straightforward path forward is for the city of Austin to gradually phase down its use of the plant and replace that plant completely in a few years with renewable energy.
So we're not in favor at this point of taking steps to sell the city of Austin's share of that plant, because we're concerned that any potential buyer might be less accountable to the citizens of Austin and might not have the same concerns for public health and drought and water use and climate change that the City Council and the mayor have.
AC: So if it really were a matter of either selling or continuing to run it, would Sierra Club support running it – because it would be worse for Fayette to be in someone else's hands?
AA: If the plant were to be sold as part of a process to gradually transition its capacity to renewable energy and as part of a process to shut it down, then we'd be very interested in talking to the city and Austin Energy and LCRA about that process. But we're not in favor at this point of selling it to an entity without a plan for transitioning that power to renewable sources and shutting it down over a number of years.
AC: So what kind of work do you guys have cut out for you? How do you figure out how to help the city work out something with the LCRA to do that? It sounds complicated.
AA: Sure. The Sierra Club has been incredibly successful nationwide in stopping the construction of new coal-fired power plants as well as working with state and local officials in transitioning away from approximately 120 existing coal-fired power plants. So what we want to do is work with the mayor and City Council, work with LCRA and Austin Energy, on a plan that replaces that power that we're getting from the Fayette plant with wind and solar and other clean sources of energy.
One thing that we would be very interested in talking to all of the stakeholders about is the upcoming EPA rules. There are rules like the Cross-State Air Pollution Rule, the mercury and air toxics rule, as well as other environmental regulations that the ratepayers of this area are going to have to pay for if that plant stays in operation very much longer. We believe there's a way to avoid those costs as part of a plan that will gradually ramp down the Fayette coal plant and replace it with clean energy. And we believe there's a way to do so such that the ratepayers are not burdened with the cost of the new environmental regulations and instead have the money that would have gone to keeping that old plant up and running invested in renewable sources like wind and solar. So that's a process that we've already begun with stakeholders in the Austin area and are going to stay engaged in over the next couple of years.
AC: I'm surprised because I had understood, from interviews with others at Sierra Club, that the organization's position was: if the city sells, that's still better than the status quo – and that the next move would then be to focus on LCRA, as the operator.
AA: Yeah, we've had a lot of discussion over the last couple of weeks. It was Sierra Club at the local level, the state level, and the national level, as well as the other environmental and consumer groups in the Austin area, like Public Citizen, on this issue of the sale of the plant versus shutting down the Fayette plant. I think everybody's position is that if selling the plant to another party is part of a comprehensive plan that has as its end point the replacement of the Fayette plant with wind and solar and other renewable sources, then that is something that we could support. But unless we know who the buyer is and what their plans are for that plant, and unless the sale of that plant is part of that transition plan, then we can't simply support sale to another party because we're concerned that that party might have the intention of keeping the plant running for another 30 years.
AC: And what about the argument that if the city sold the plant, it would then have that much more money to implement green programs?
AA: Well, we think the city is going to have the ability to make those investments by avoiding the upgrades that these new environmental rules are going to require on the Fayette plant. So if you look at the next few years between now and about 2016, the Fayette plant is looking at having to identify hundreds of millions of dollars to make environmental upgrades – to put on controls to reduce mercury emissions, to put on controls to reduce NO2 emissions, to put on controls to reduce particulate emissions, and it would be better for the city of Austin to invest those hundreds of millions of dollars in renewable sources rather than investing those dollars in keeping a 30-year-old plant running.
AC: Looking forward then, what do you think Texans should have their eye on, in terms of court cases?
AA: I think the Cross-State Air Pollution decision this summer is going to be very important, as well as the agency's efforts to strengthen the national air quality standard for particulate matter, and any appeals by industry of the victory in the D.C. circuit court on greenhouse gases and the endangerment finding. I think those are three different parts of the Clean Air Act, but they're vitally important to the public health of the people of Texas.
AC: So it's all about the Clean Air Act – that's where all the action is?
AA: It's certainly kept me busy for the last few years, yeah.
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