Austin will keep running Fayette coal power plant, missing key climate goal

Austin Energy will not retire its stake in the Fayette coal power plant next year, the publicly owned electric utility announced Monday. Shutting down its portion of the plant by 2022 had been a key part of the city’s climate goals.

Austin Energy said it was unable to reach an agreement on the closure with the Lower Colorado River Authority, which co-owns the plant.

“We’ve been talking to LCRA for a while,” Pat Sweeney, Austin Energy’s vice president for power production, told KUT. “At the end of the day, we just couldn’t come to terms that both parties could agree to, to allow us to exit at an affordable basis and at the timeline that was contemplated.”

Sweeney said he could not discuss details of the negotiations because they were confidential.

Carbon dioxide is the No. 1 contributor to the global climate crisis. Five years ago, Austin’s share of the Fayette coal plant was found to be responsible for “80 percent of the utility’s greenhouse gas emissions and 28 percent of all Austin’s greenhouse gas emissions.”

Closing Austin’s portion of the plant by 2022 was an important step to achieving carbon-reduction goals outlined in Austin Energy’s Resource, Generation and Climate Protection Plan to 2030. That plan, in turn, was a cornerstone of the city’s ambitious Climate Equity Plan, which aims to reach net-zero emissions communitywide by 2040.

Sweeney said Austin Energy may need to update its resource-generation plan to take into account the continued operation of the Fayette plant. But the utility will be using a carbon-pricing mechanism known as “reduce emissions affordably for climate health,” or REACH, to limit the amount of coal it burns at the Fayette plant. “Our goals are the same; they can change in future updates, but for the time being, they’re the same,” he said. “They’re to reduce the emissions carbon profile of our generation fleet and ultimately get out of the generation of carbon.”

Those who have worked for years to wean Austin off fossil fuels reacted to the announcement with anger and disappointment.

“I frankly find it to be outrageous,” said Cyrus Reed, who serves on the city’s Electric Utility Commission and is the conservation director for the Lone Star Sierra Club. “There really is no way to get to zero carbon if we’re going to continue to burn coal at Fayette.”

Reed also criticized the way Austin Energy announced the news, saying the utility could have included new deadlines to aim for even as it announced the breakdown of negotiations with LCRA.

“We’re going to be mobilizing people to call into City Council to make sure that we look at what seems to be somewhat of a rash decision carefully,” he said.

Sweeney said the utility has been updating Council regularly on the state of negotiations with LCRA. As of now, he said, the utility has no new deadline for when it may be able to get out of the coal business.

“The only endpoint we can talk about is … power plants, like many things, get to an age where they’re just not economically and functionally feasible to continue operating,” he said.

He wasn’t sure exactly when that time would come for the Fayette plant but “there will be an end.”

While the utility will continue to run the coal plant, it’s on track to retire its Decker Creek gas-burning facility by March. It has also announced plans to run a controversial biofuel electric plant it owns in East Texas year-round thanks to “improved operations and current market conditions.”

This story was produced as part of the Austin Monitor’s reporting partnership with KUT.

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