Austin and Coal Power

Background

Austin Energy owns two generation units at the Fayette Power Plant (FPP) in La Grange, Texas, jointly with the Lower Colorado River Authority (LCRA). The units, which were built in 1979 and 1980 respectively, make up 607 megawatt (MW) of Austin Energy’s total generation capacity and produce electricity from low-sulfur coal mined in the Powder River Basin in Wyoming. In 1983 Austinites turned out against coal power, voting down a measure that would have allowed the city to issue revenue bonds in order to finance and co-own a third generation unit at FPP. According to the most recent “Austin Energy Resource Guide”  FPP is responsible for 71 percent of the Austin Energy’s total CO2 emissions while generating 35 percent of the utility’s power.

Price of Electricity

Traditionally, the price of coal has been low and stable in comparison to other fossil fuels.  But the electricity from coal is already becoming more expensive in Austin. From 2007 to 2008 the price of delivered coal increased by nearly 75 percent ($50 million to $87 million), because Austin Energy had to renegotiate its delivery contract with Union Pacific Railroad. Currently, the utility is spending approximately $189 million on emission control equipment that will remove most sulfur dioxide and some mercury from plant emissions.  And: The federal government will likely charge utilities for emitting carbon-dioxide in the future, thereby further increasing the price of power from coal, the dirtiest of all carbon fuels. As a result, coal-fired power plants have become less popular with energy companies, which now increasingly choose to invest in fuels and technologies that are less carbon intensive. An ERCOT report that shows the number of connection requests to the Texas grid by fuel type illustrates this development.

Environmental Impact

The Fayette Power Project is the number one source of toxins and greenhouse gases for Austin Energy including emissions of CO2, NOx, SO2 and Mercury. According to PowerSmack calculations based on 2005 numbers from the EGRID database, FPP was responsible for 72 percent of Austin Energy’s CO2 emissions, 68 percent of all NOx, 99.9 percent of all SO2, and 100 percent of all mercury. While not all percentages will decrease significantly once “scrubbers” are installed at Fayette, the emissions of some pollutants will be reduced. Austin Energy expects that the new technologies will lower sulfur dioxide emissions from about 33,000 tons in 2007 to 6,857 tons by 2011 and the emission of  “Hazardous Air Pollutants” from 308.4 pounds to 246.7 pounds over the same time period. In 2006, the utility added two low NOx burners reducing NOx emissions from 31,739 tons to 9,521 tons annually.