WITHOUT COAL IN TEXAS

With Coal Plans Cut Back, Texas Faces Energy Gap
Clifford Krauss, March 8, 2007 (NY Times)

- Texas…giant oil and gas fields dominate America’s energy patch. It is now the nation’s largest wind power producer, with more than 2,000 turbines…It…[is] the biggest producer of greenhouse gases.
- And now Texas faces a big hole in its electricity production…because of immigration and the rise in riches from the recent increase in oil and gas prices.
- That hole just got bigger as the TXU Corporation, the state’s biggest utility, scrapped plans for eight new coal-fired plants under a deal it has agreed to with potential new owners. The deal has delighted many environmentalists, but it has also stoked one Texas-sized problem.

- Unless new generation is built quickly from some source, Texas energy production in 2009 will fall below reserves recommended by the state operator of the power transmission grid for guaranteeing smooth operations during peak periods of high heat.
- Texas officials must figure out how to replace the 6,000 megawatts that TXU’s former plan would have added to the grid, equivalent to about 10 percent of the state’s current installed capacity. This comes as the state’s population is expected to grow by 20 percent, to nearly 30 million people, over the next decade.
- The decisions Texas makes are likely to have national repercussions given that the state’s economy is the second largest, after California. Texas is a national trendsetter, and the choices it makes on how to use its natural gas and coal are likely to have an impact on electricity rates far beyond its borders…

- TXU might not have received regulatory approval of the eight plants in the first place, but the cancellation of the plants has investors in natural gas, nuclear and renewable energy sources poised for new opportunities.
- Environmentalists and some state officials see an opening for renewable energy in a state that is already the national pacesetter in wind energy production…
- Still, few experts think enough renewable power can be developed quickly enough, given the lack of transmission capacity and high costs. Natural gas, which provides nearly half the state’s electricity, is set for another surge because gas plants can generally be built faster than nuclear or coal facilities…
- Texas still produces more natural gas than it consumes…
- Permits have been granted for a string of liquefied natural gas terminals, rejected in other parts of the country for environmental and security reasons, and they are being built on the Texas and Louisiana coasts. They will help replace some of the lost coal power with imported gas.

- Investors are drawing up plans to add to the state’s two nuclear power plants…most analysts see a bright future for nuclear in the state…
- Texas utilities will be forced to be more creative…
- Even without the eight proposed coal-fired plants that TXU jettisoned, other new coal plants are still in the planning stages. TXU has three coal plants waiting for regulatory approval, and at least six more are proposed by several private and municipal power companies.
- Energy officials say they believe state regulators will approve many of them to avert an energy crisis…