Austin City Council will vote Thursday on a plan to generate electricity into the future that includes building a new natural gas power plant. The city’s electric utility said the proposal will provide low cost, reliable energy, but some environmental groups call it an abandonment of Austin’s ambitious climate goals. Several City Council members also want the plan amended.
In 2021, Austin City Council adopted a Climate Equity Plan, with the goal of making Austin a "net-zero" emission city by 2040 through dramatically reducing regional greenhouse gas emissions, and canceling the impacts of what emissions remain through the use of carbon offsets and other environmental policies.
A big part of meeting those goals assumed Austin Energy would continue to transition to emission-free renewable energy and shut down the Fayette coal power plant which the city owns in partnership with the Lower Colorado River Authority.
But the energy demands of a growing city – and the costs of importing power from often distant wind and solar farms – have created a need to generate more power closer to where it’s consumed.
That prompted the utility to propose a “peaker” plant as part of its power generation plan, the Austin Energy Resource, Generation, and Climate Protection Plan to 2035. These plants typically operate in times of peak energy demand. The utility says the plant would run only in times of high energy costs and high demand, and is necessary to keep electricity affordable and reliable.
Lisa Martin, Austin Energy’s chief operating officer, told KUT a strategy that relies only on carbon-free technologies like big batteries and rooftop solar "doesn't meet all of our growing needs and doesn't mitigate all of the reliability and affordability risks.”
Martin said the power plant proposed by the utility would generate power by running turbines much like jet engines.
She said it is far cheaper and less of an operational commitment than an earlier proposal to build a larger gas plant, known as a combined cycle plant, that would operate more frequently.
“The point is that if technology evolves and we don't need peakers in three, five, seven years ... then they probably have already paid for themselves,” Martin said. “They're pretty easy to pack up and sell.”
Austin Energy says the city would pay less to import electricity from the state’s grid operator if it had a peaker plant. Austin Energy paid over $135 million in such costs in 2022, Martin said; in 2023, it paid $150 million.
‘Backsliding on our climate goals’
While many agree the city should generate more power closer to home, climate advocates argue the utility should be exploring non-carbon-emitting solutions.
“We are backsliding on our climate goals and making our air quality worse,” Kaiba White, a member of Austin’s Electric Utility Commission, told KUT.
Instead of building a new gas plant, she said, Austin could keep its power supply reliable by building out more rooftop solar, investing in utility-scale batteries and increasing energy-efficiency programs.
White contends Austin Energy wants new gas power generation to avoid buying electricity from other suppliers when costs are high, not necessarily to bolster energy reliability.
“It is in response to high [energy] prices that they will be running those peakers,” she said. “It is a financial investment, at least as much as a reliable investment, and I think more so a financial investment.”
The bigger picture
The debate over the gas plant proposal is part of the larger question about where Austin stands in terms of reaching its climate goals and how much money it's willing to spend to do so.
Austin Energy’s efforts to divest from the Fayette coal plant have stalled out because, it says, the Lower Colorado River Authority has made exiting the partnership too expensive.
White, who also works as a climate policy and research specialist for the group Public Citizen, says there are other parts of the proposed generation plan that weaken Austin's climate commitments. She has outlined them publicly here.
She and others critical of the plan hope the City Council will amend it this week to include stricter mandates and metrics to push the utility toward decarbonization.
That may happen. On Monday, several City Council members came out with proposals to amend the plan.
One calls for more research into greener alternatives to a gas power plant and "establishing regular and clear reporting guidelines to the Council" on Austin Energy's progress in achieving its emissions goals.
Austin Energy leaders say the public utility remains committed to its climate goals, even with the proposal for a new natural gas plant.
“We stand among the elite of utilities across the nation with our carbon-free by 2035 goals,” Martin told KUT. “We are reaffirming that goal in this plan.”
The plan will be discussed Tuesday in a City Council work session and is scheduled to be voted on Thursday.
