January 30, 2008

Tyler Morning Telegraph
Clean Air, Affordable Energy Both Possible

The battle between energy production advocates and environmentalists is nothing new, the Texas Public Policy Foundation's Bill Peacock pointed out in a recent essay.

"Conflicts over energy production go back at least as far as the 13th Century, when the English nobility attempted to stop commoners from burning what was then known as sea coal for warmth because of the soot it produced," Peacock says. "Of course, the commoners had been forced to burn coal largely because the nobility had kept commoners from acquiring clean-burning wood from the royal forests."

Current conflicts aren't very different; they center on two issues: the cost of energy production and its impact on the environment.

"Energy production from fossil fuels, e.g., coal, oil and natural gas, is often blamed for many of the world's environmental ills," Peacock says. "But no one today was around to experience firsthand how dirty the world was before the invention of the internal combustion engine, when horses - and horse manure - were prevalent on city streets."

Energy had other positive effects, as well.

"It is similarly easy to forget how much the new wealth made possible by cheap energy has enabled society to devote significant resources to environmental cleanup," Peacock says.
But new reports from the Foundation show that energy production has been largely decoupled from increases in pollution.

"From 1980 to 2005, air pollution of all kinds sharply declined, even as coal consumption increased more than 60 percent and driving nearly doubled. Emissions of lead, sulfur, carbon monoxide, and NOx are all lower," Peacock says. "Texas already meets federal health standards for most air pollutants."

Certainly, there are still air quality problems in Texas.

"The key remaining air pollution challenge for the Dallas/Fort Worth and Houston areas is ozone," Peacock says. "Yet even here, tremendous progress is being made. Dallas/Fort Worth is on a glide path to attainment under existing controls, though it will come a year or two after the current deadline."

Energy production is not free. And Peacock acknowledges that it's getting more expensive.

"Of course, energy costs money," he says. "At the national level, concerns over costs have focused largely on gasoline and other oil-related products. Remedies to 'high prices' - including price controls and taxes on 'windfall profits' - have all made prices rise even higher."

In Texas, the cost of electricity has been the subject of contentious debates in recent years.

"During the transition to deregulation of Texas' electric market, peak prices for electricity rose as much as 80 percent," Peacock says. "Although critics wanted to blame deregulation, the price shocks were actually driven by the tripling of natural gas prices."

But as natural gas prices have stabilized, so have electricity prices.

"The benefits of deregulation are easily seen," Peacock says. "In the last year, electricity prices in Texas have dropped 5.37 percent while the national average has increased 0.82 percent. Texas' comparatively inefficient neighbors in Oklahoma and Louisiana have seen their electricity prices increase by about five percent."

And while states such as California and New York have experienced supply problems, deregulation has provided Texas with a reliable supply of electricity.

"Since 1995, 37,063 megawatts of new generation have been added to the Texas market, putting Texas above the reserve margin needed to ensure reliability for extreme temperatures and unexpected major generation outages," Peacock says.

Coal and other fossil fuels remain vital to the Texas economy - and not a threat to the environment.
"The facts clearly show that Texans can have an affordable, reliable supply of energy and breathe clean air, too," Peacock says.