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El Paso Electric reaches settlement with environment and community groups on Newman 6

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The fight on Newman 6 is over.

El Paso Electric and the coalition of community and environmental groups opposing the construction of the new methane power plant unit in Northeast El Paso announced an agreement Tuesday, removing the roadblocks to Newman 6’s construction.

The environmental groups will withdraw their opposition to the plant, and in exchange, the utility will agree to a four-year moratorium — excluding Newman 6 — on constructing any new natural gas units. The agreement also states the site will not be used for future fossil fuel construction after Newman 6 is built. 

El Paso Electric’s Newman 6 project faced delays after the Sierra Club, Earthworks and the New Mexico citizen’s group called Chaparral Coalition for Community Health challenged the state of Texas’ pending approval of El Paso Electric’s air quality permit, citing health and environmental concerns.

David Baake

David Baake, a New Mexico attorney who co-represented the coalition and negotiated the settlement, said the agreement was “unprecedented.”

“As far as we can tell, this is the first time any utility in the U.S. has agreed to a fossil fuel moratorium that includes natural gas,” Baake said. 

The groups agreed to immediately withdraw their contested case hearing set before an administrative judge for later this year. They also agreed not to oppose the project’s air quality permit, which requires approval before the Texas Commission on Environmental Quality.

This will allow the permitting process to finish, allowing the utility to start construction on Newman 6. Power plant operations will start in 2023, according to the El Paso Electric website. 

El Paso Electric officials were “pleased” with the agreement, saying in a statement that as soon as the air permit is approved, the utility will start construction of the 228-megawatt natural gas power plant the company has said is necessary for regional growth and higher electricity demand. 

In addition to the environmental groups, there was significant opposition to the plant’s construction from the city of El Paso and Doña Ana County in New Mexico. 

The environmental groups were the only members of the settlement agreement since they were the sole groups given standing in the legal proceeding moving through the State Office of Administrative Hearings. 

Much of the fight came from Ida and David Garcia, who can see the power plant from their backyard and were concerned about pollution in Chaparral, New Mexico. Ida Garcia formed the Chaparral Coalition for Community Health. Her husband, David Garcia, a former Doña Ana County commissioner, said they feel hopeful but are still wary about the agreement. 

“We will continue to monitor and see if El Paso Electric keeps its promise. If not, we’re gonna end up back in court,” David Garcia said. 

Ida and David Garcia outside their home, less than a mile away from the Newman Power station, in Chaparral, New Mexico. (Claudia Silva/New Mexico In Depth)

Antoinette Reyes, the southern organizer for Rio Grande Sierra Club, said the groups asked for additional concessions in bargaining, such as additional investment in solar and wind energy, but said this deal was the utility’s “best offer.” 

“Hopefully, the settlement can be used as a precedent for other cases like this in Texas, because normally, utilities don’t end up offering as much as we were able to get them to in this case,” Reyes said. “While there was still more that we had hoped for, this is a good first step.”

Reyes said organizers are asking the city of El Paso to oppose any proposed additional fossil fuel infrastructure for future projects beyond the moratorium. 

Miguel Escoto, an organizer for the national nonprofit Earthworks, who assisted in the Chaparral effort, said the agreement was “bittersweet.”. 

“Our goal was to stop Newman 6 from happening. And we did not win that,” Escoto said. “But at the end of the day, I’m very proud of what the community organized for.” 

There are a few other exceptions to the four-year moratorium laid out in the agreement. El Paso Electric would be able to build a plant if there are “emergency or reliability conditions,” and it would not impact infrastructure built for a single customer, such as a generator built for a hospital. 

El Paso Electric can still seek approval for fossil-fuel power plants, but cannot start building until the fourth year. The pause does not affect construction on existing plants. The moratorium goes into effect after the air permit is issued. 

The agreement also lays out an early retirement of older natural gas power plants as soon as Newman 6 is built, which the company has said would cut emissions. The older plants were constructed before additional federal regulations in the 1970s. 

The utility agreed to additional emissions controls on Newman 6 that will reduce pollution by 40% to 790,000 tons of carbon dioxide a year and 72 tons per year of nitrous oxide, which contributes to the production of smog. 

The agreement said even if the state regulatory agency does not require those limitations in the permit, the utility will stay below those emissions. El Paso Electric will make a web page and post the quarterly reports the utility gives to regulatory agencies.  

The Federal Environmental Protection Agency’s upcoming decision regarding the area’s air quality designation – the passing or failing pollution grade given to counties – could impact additional payments to Chaparral in the agreement.

The EPA requests that areas that do not meet air quality standards work to control emissions, whether by stopping pollution at the source, or paying for other entities to remove greenhouse gases from the atmosphere. Such investments — including tree planting, or building wind turbines and other renewable energy — are called offset credits. 

If the EPA changes the county’s grade to noncompliant with air pollution, the utility said it would balance additional smog pollution by committing $500,000 in credits, saying that purchase would offset 110% of Newman 6’s volatile organic compound emissions.

That money would go to an existing source of volatile organic compound emissions in El Paso county, which either would need to shutdown or agree to an enforceable limit to its VOC emissions, Baake said.

Baake said offset markets are well-established under the Clean Air Act and in larger cities like Dallas and Los Angeles, and said one could form in El Paso.

“There was a lot of hesitation among some of the members of our coalition about whether these credit markets really work, or whether they really result in pollution reductions,” Baake said. “We’re obviously going to keep an eye on how El Paso Electric plans to fulfill that obligation.” 

Earthworks organizer Escoto said this portion of the agreement was exploiting what he called a “loophole” in federal regulations for pollution. 

“The affected community Chaparral is still breathing in all that pollution; it’s like a license to pollute,” Escoto said. 

If no offset market arises by 2023, the utility and the Chaparral community coalition agreed to spend the $500,000 on jointly selected “emission reduction or energy efficiency projects,” according to the agreement. The Sierra Club could advise, but would have no authority to decide spending.

After Newman 6’s permit is approved, El Paso Electric will also pay out $400,000 to a nonprofit charitable fund to be operated by the Chaparral citizen’s group. The Sierra Club could again have an advisory position, but no decision to spend the funds.  

Reyes, the Sierra Club organizer, said the fund is a win for a “historically marginalized community of color” to have more of a say in their community. 

“Hopefully it’s life changing for those that live close to the facility,” she said. 

El Paso Electric also agreed to pay $40,000 to the groups for attorney and expert fees.

This story has been updated to clarify credit offsets.

Cover photo: An artist’s rendering of El Paso Electric Co.’s proposed Newman 6 power plant in Northeast El Paso.

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Danielle Prokop

Danielle Prokop is a climate change and environment reporter with El Paso Matters. She’s covered climate, local government and community at the Scottsbluff Star-Herald in Nebraska and the Santa Fe New Mexican. She can be reached at dprokop@elpasomatters.org.

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