The EPA announced its new transport rule last Thursday and while the rules adds another layer on the trainwreck of issues facing utilities and the energy industry, it also strikes another significant blow at the battle between EPA and State of Texas. The Lone Star state was told they will have to follow extra rules requiring them to make a 47% cut in their SO2 emissions by next year. It is different from what EPA proposed last year, and that has Texas fuming, especially since a major of the jobs that have been created in the U.S. recently, have been in Texas.

TCEQ Chairman Bryan Shaw testified the week prior at the Senate Environment Committee and said EPA's own data showed Texas power plant emissions have no negative impact on downwind states and only result in negative consequences. The also complained that EPA failed to give sufficient or adequate notice regarding the potential details of Texas inclusion. The TCEQ requested a meeting with Administrator Jackson on June 7 to address these issues, but the EPA did not respond. The TCEQ and PUC wrote a joint letter to White House Office of Management and Budget Administrator Cass Sunstein on June 9 asking that he fully consider the effects of this rule upon Texas. TCEQ is concerned this rule will result in significant increases in the cost of power as well as curtailment or shutdowns of existing coal-fired plants in Texas.

Other sources of electricity will not compensate for these shutdowns, especially in light of the Jan. 2012 compliance date. A large percentage of Texas coal fired generation is lignite or lignite blended with Wyoming coal, with 18 plants totaling over 11,000 MW of generation could prematurely shut down. The consequences will be far-reaching on energy consumers, particularly elderly and low-income populations whose health and welfare are dependent on reliable energy without which they would face increased incidences of heat stress, heat stroke, and death.