Las Brisas Power Plant Is Gone With the Wind

The Texas company seeking to build a power plant to burn a coal-like fuel in Corpus Christi gave up ghost last week, done in by more competitive natural gas and wind alternatives.  The developer of the proposed Las Brisas Energy Center announced it was going out of business after failing to find enough investors to keep its uneconomic project on life support.

Las Brisas, intended to burn a petroleum coke waste product from nearby refineries, was opposed by local medical societies and a coalition of public health and environmental organizations, including the Environmental Integrity Project, the Sierra Club and the Environmental Defense Fund.  A state court last year found that Texas authorities had issued Las Brisas a defective clean air permit that did not meet control technology requirements for mercury and other dangerous air pollutants.  The project also had yet to obtain a permit for emissions of climate-changing carbon dioxide.   

Las Brisas’s developer promoted the plant as offering “reliable base load power,” “competitive pricing and overall consumer savings,” and “to insulate Texans from volatile natural gas prices.”  It didn’t work out that way.  Since the plant was proposed in 2008, Texas has seen a surge in both wind and natural gas-fired power generation as costs have come down for both alternatives.  The “pet coke” plant just can’t compete. 

These are stand up guys, though, aren’t they?  They acknowledged that they’d bet on the wrong fuel in a changing marketplace, and noted that in our dynamic entrepreneurial system, some business ventures just don’t work out, right?

Wrong.  They blamed the Environmental Protection Agency.  Here’s the statement by Chase Power Development CEO Dave Freysinger:

While market conditions played a role, the direct regulatory obstacles purposefully erected by the US Environmental Protection Agency (EPA) resulted in the decision to suspend development of the plant.

(Last year Las Brisas led a whacky lawsuit brought by a handful of would-be coal-plant developers attacking EPA’s proposed carbon pollution standards for new power plants.  The U.S. Court of Appeals in Washington correctly threw out the lawsuit, holding that you cannot sue to block a proposal because a proposal does not do anything.  You have to wait for the final standards.)

Sure enough, the right-wing echo chamber, including Fox News, was quick to claim “Obama EPA Kills Power Plant, 3,900 Jobs in Texas.”

It’s pretty interesting to contrast this tired old meme with the reality seen back in Corpus Christi. 

Here are excerpts from a January 25th editorial in the Corpus Christi Caller Times, entitled:  “To blame EPA for Las Brisas' failure ignores the market.”  The editors write that “once South Texas discovered it had more cheap, retrievable, relatively clean-burning natural gas in the ground than it will need for the foreseeable future, the economic justification for squeezing electricity from inherently dirty, underwhelmingly energetic petroleum coke became unconvincing.”

The editors note that “it could be argued, no less convincingly than its scapegoating of the EPA, that the Eagle Ford Shale drilling boom did more to undermine Las Brisas.”

Cheap, abundant, relatively clean natural gas directly challenges the concept of building a petroleum coke-fueled power plant that would have pushed the Corpus Christi area near its allowable limit for harmful emissions. In addition to the health risks it posed, Las Brisas likely would have limited other industrial expansion.

As for the claim of 3900 jobs, the Caller-Times editors note:  “The generously best-case permanent employment outlook for Las Brisas was maybe 100 jobs.”  (The company website projected 1300 temporary construction jobs, and only 80-100 permanent jobs.  You get to 3900, even temporarily, only by assuming 2 equally temporary "indirect" jobs for every direct construction job.)  Other companies, the paper argues, are offering more attractive industrial development projects and employment potential.

The editors also tipped their hat to Las Brisas’s opponents:

The local medical community, business-friendly and not as bleeding-heart as would be suspected of those whose purpose is saving health and lives, openly opposed Las Brisas out of health concerns. After reviewing the scientific projections, the medical folks provided tie-wearing, wing-tipped, credentialed backup to the environmental and consumer advocates who opposed Las Brisas.

Finally, the editors flatly rejected the Las Brisas backers’ blame-game: 

Las Brisas might have made economic sense when gas prices were higher, and assuming cheap, plentiful water for the long term. Its backers claim Las Brisas to be “a victim of EPA's concerted effort to stifle solid-fuel energy facilities.”  But Las Brisas had bigger problems than not being a wind farm. They were market-based problems. It’s not the EPA's doing that the cheaper alternatives also are cleaner.

‘Nuff said.

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