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Perry Misses Point on Texas CO2 Cuts

Rick Perry said carbon dioxide emissions in Texas were down because of “incentive-based regulation” during his time as governor. But the evidence shows a decline in manufacturing jobs and federal energy policies — not the state’s — are more likely to be the cause of the reduction.

  • Perry pointed to policies that upgraded old diesel engines. But the nitrogen oxide figures he cited actually exclude vehicles, and transportation sector CO2 rose over the time frame in question. The CO2 reduction was largely due to a decline in the manufacturing sector.
  • He also said that Texas transitioned toward natural gas in its power supply, but the percentage of natural gas actually declined. Wind power, meanwhile, grew dramatically, thanks in large part to federal policy.

During his appearance at the annual Conservative Political Action Conference (at the 16:24 mark), Perry, the former governor of Texas, said the state’s population grew by 5.6 million people since he took office in 2000 (which is approximately true, depending on exactly what years he intended to include), adding that “that’s lots of cars on the roads in Texas.” He said that jobs went up by 1.4 million over seven years (it was actually a growth of 1.3 million), and then rattled off several emissions reductions that occurred at the same time as the population and job growth:

Perry, Feb. 27: During that same period of time using thoughtful incentive-based regulation, we decreased our nitrogen oxide levels — which by the way is a real pollutant, it’s a real emission — nitrogen oxide levels were down by 62 and a half percent, ozone levels were down by 23 percent, sulfur dioxide levels down by 50 percent, and our CO2 levels were down — whether you believe in this whole concept of climate change or not — CO2 levels were down by nine percent in that state. Isn’t that the goal of what we were working towards? The point is that you can have job creation and you can make your environment better. And that ought to be the role of those 50 states, of being able to put policies into place, incentive-based policies. We put policies in place that helped remove old dirty burning diesel engines from the fleets. We were able to transition our electrical power system to the natural gas burning. I mean that ought to be our goal in this country. And it all starts with energy policy. Open up the XL pipeline, create energy jobs. …

In the past, Perry has decried the Environmental Protection Agency’s “overreaching regulation” and claimed that states could do better at managing air quality than a “centralized, all-knowing, one-size-fits-all federal government. But as we found before, Perry exaggerates the Texas reduction in nitrogen oxide, citing only emission reductions from “point sources” including industrial sites and power plants while leaving out emissions from cars and trucks — a source that he specifically mentions in his speech.

SciCHECKinsertThe Texas Commission of Environmental Quality pointed us toward several policies that did in fact help upgrade diesel engines, an issue that is indeed closely related to nitrogen oxide emissions — but again, the reduction Perry cites does not include mobile sources of NOx. And even still, TCEQ says that the main policy, the Diesel Emissions Reduction Incentive, will cut about 161,000 tons of NOx over the lifetime of the vehicles in question. In 2014, the program will yield an average of 54 tons reduction per day, or less than 20,000 tons for the full year. In 2011 alone, NOx emissions from mobile sources topped 700,000 tons, suggesting the program will have little impact on total NOx emissions.

Texas’ 50 percent reduction in sulfur dioxide, meanwhile, does not compare all that favorably with the rest of the region. Between 2000 and 2011, the U.S. and Canada combined achieved a 54 percent reduction in sulfur dioxide emissions. According to the EPA, the U.S. alone saw total SO2 emissions decline from 16.3 million tons in 2000 to 6.6 million tons in 2011, a reduction of almost 60 percent. As the U.S. Energy Information Administration describes, reductions in SO2 emissions accelerated after 1990 when a federal cap-and-trade system was instituted under the Clean Air Act to reduce acid rain.

Where Did CO2 Cuts Come From?

Perry’s new claim that CO2 levels have dropped by 9 percent is largely correct, though neither “the last 14 years” nor the seven years from 2007 to 2014 are the exact time frame for that number. According to the Energy Information Administration’s data that were available at the time Perry made his claim, Texas’ CO2 emissions were 720.3 million metric tons in 2000, the year Perry took office, and 655.5 million metric tons in 2011 — a reduction of almost exactly 9 percent. (EIA has since released data extending through 2012, and also adjusted its figures on earlier years. The new figures show that CO2 emissions fell by only 4.6 percent between 2000 and 2012; Perry left office in January of this year. For this analysis we will use the 2011 numbers that were available when Perry made his claim.)

The question, though, is why those reductions occurred. Perry cited removal of older diesel engines from “the fleets,” as well as an increase in natural gas as an electricity source. Neither of these is the likely source of the bulk of the CO2 reduction. We emailed Perry’s press officers to get clarification on the policies to which he was referring, but we didn’t get a response.

And in spite of policies that did help upgrade diesel engines, the transportation sector’s CO2 output actually rose from 2000 to 2011, from 181.3 million metric tons to 188.5 million metric tons. The electric power sector’s contribution also rose, from 227.6 million to 237.8 million metric tons. Although those sectors may well have reduced their carbon intensity — the amount of CO2 per vehicle-mile driven, or per megawatt-hour of electricity produced — the absolute decrease in CO2 emissions in Texas means that the bigger reduction must have come from elsewhere. Specifically, it came from the industrial sector.

The industrial sector, which encompasses all manufacturing and related activities, saw its CO2 output decrease from 284.9 million to 204.6 million metric tons, a drop of more than 28 percent. This reflects an ongoing trend in industrial output across the United States.

As the Environmental Protection Agency states: “Greenhouse gas emissions from industry have declined by almost 17 percent since 1990, while emissions from most other sectors have increased.” In its 2010 Climate Action Report to the United Nations Framework Convention on Climate Change, the U.S. State Department wrote that industrial sector energy consumption has “declined steadily since 1973,” and that in 2008 consumption was 10.2 percent below 2000 levels. The 2014 update of that report also noted a steady decline since 1990, and added: “This decline is due to structural changes in the U.S. economy (i.e., shifts from a manufacturing-based to a service-based economy), fuel switching, and efficiency improvements.”

The shift away from manufacturing is borne out by Texas jobs data. According to the Bureau of Labor Statistics, Texas had more than 1 million manufacturing jobs in December 2000 when Perry took office. In December 2014, the state had about 890,000 such jobs. At the end of 2011, which is relevant to the CO2 drop Perry cited, Texas had 849,400 manufacturing jobs. This is a drop of 20.3 percent, accounting for a large proportion of the drop in CO2 emissions from the industrial sector.

Even if we allow that changes to vehicles and the power sector in Texas contributed to the decline in CO2 emissions (through carbon intensity improvements), Perry is wrong about the state’s primary contribution to those improvements. The electricity supply in Texas has indeed shifted since 2000. That year, coal accounted for 24.2 percent of all the electric generating capacity in the state, and natural gas accounted for 67 percent. There were only 173 megawatts of wind power at that time, or about two-tenths of 1 percent of the total capacity.

In 2012, coal’s share had fallen slightly to 21.1 percent of the total capacity, and natural gas had in fact also fallen, to 61.1 percent — Perry’s claim, then, that Texas had managed to “transition our electrical power system to the natural gas burning” is not accurate. Meanwhile, wind power grew to represent more than 11 percent of the total capacity in 2012, at more than 12,000 installed megawatts (this has continued to grow over the last few years, according to the American Wind Energy Association). Wind power emits no carbon dioxide, and natural gas burning power plants emit about half of what a coal plant emits.

Wind power’s ascendence is due in part to Texas state policies, but this effect is limited. Texas does have a Renewable Portfolio Standard, a law dictating how much of a state’s energy supply must come from renewable sources like solar and wind. The standard, however, has been eclipsed already: It called for 5,880 megawatts of renewable energy by 2015, and a voluntary target of 10,000 megawatts by 2025. Wind power alone had surpassed the initial target by 2008, and the larger goal by 2011.

Studies have suggested that it is a federal policy, the wind power production tax credit, along with declining manufacturing costs and improved technology, that actually drove much of the growth in wind energy in recent years all across the country. According to a review by the National Renewable Energy Laboratory (part of the federal Department of Energy), the “PTC has been critical to the development of the wind industry and deployment of wind generation capacity in the United States over the past two decades.” In past years when the tax credit was allowed to expire before being reinstated, wind installations have dipped between 73 percent and 93 percent. Another Department of Energy report in 2013 showed that the cost of a wind turbine fell between 20 percent and 35 percent between 2008 and 2012.

Though the proportion of electricity from both coal and natural gas declined thanks to wind’s increasing share over this time frame, both fossil fuel sources did increase their absolute amounts of installed capacity. Coal power went from 19,812 megawatts installed in 2000 up to 23,132 in 2012, an increase of 17 percent. Natural gas, meanwhile, increased from 54,807 megawatts installed capacity to 66,983 megawatts in 2012, an increase of 22.2 percent.

Perry is thus correct at least that natural gas has increased faster than coal, though no particular state policy explains that fact. Simple economics, however, could explain it: The overall price of coal in the U.S. nearly doubled from 2000 to 2011, while the price of natural gas to the electric power sector actually was about the same in 2000 and in 2011, according to data from the EIA. Furthermore, Texas has not shrunk from coal power in more recent years either — according to the EIA no state added more coal-fired electricity in 2013 than Texas, and the state added about twice as much coal as natural gas power.

All in all, the drops in carbon dioxide emissions over much of Perry’s term in office can’t be attributed to state policies alone. By claiming the emissions reductions were a result of state-level “thoughtful, incentive-based regulation,” Perry ignores the contribution of federal policy to wind energy and the shift away from a manufacturing-based economy.

Editor’s Note: SciCheck is made possible by a grant from the Stanton Foundation.

– Dave Levitan