ERCOT calls EPA "cross-state" rule unreasonable

The Electric Reliability Council of Texas (ERCOT) said the U.S. Environmental Protection Agency's new rule on SO2 emissions will have a "significant impact on coal generation." The independent system operator said the timing of the new rules is unreasonable because it does not allow enough time to implement operational responses to ensure reliability.

ERCOT said its May 11 report to the Texas Public Utility Commission on the effect of proposed environmental regulations did not address the impact of SO2 restrictions on coal plants  because the restrictions were not included as part of the EPA’s earlier rule proposal. It said in a statement that "initial implications are that the SO2 requirements for Texas added at the last stage of the rule development will have a significant impact on coal generation." Coal provided 40 percent of the electricity consumed in ERCOT in 2010.

The statement said "Our concern is that the timing of the new requirements – effective Jan. 1, 2012 – is unreasonable because it does not allow enough time to implement operational responses to ensure reliability."

ERCOT said it is worried that many coal plants in ERCOT will be forced to limit or shut down operations to maintain compliance with the new rule. It said that possibly could lead to inadequate operating reserve margins with insufficient time to reliably retrofit existing generation or build new, replacement generation. 

As the independent system operator for the Texas electric grid, ERCOT fulfills specific responsibilities assigned by the Public Utility Commission of Texas and the Texas Legislature. It has primary responsibility for the reliability of electricity across the state's main interconnected power grid. 

ERCOT said "this is one of those cases where we believe it is our role to voice our concern that Texas could face a shortage of generation necessary to keep the lights on in Texas within a few years, if the EPA’s Cross-State Rule is implemented as written."

ERCOT said "At this time, it is not clear that ERCOT operations has adequate tools to maintain long-term reliability in the face of the possible loss of a large amount of existing baseload generation in such a short period of time."

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