The U.S. Environmental Protection Agency (EPA) on Thursday issued the first greenhouse gas (GHG) permit in Texas. The move comes nearly a year after Texas refused to implement federal GHG regulations that require air permits for high-emission projects and the EPA seized the state’s authority to grant permits.

The permit issued on Thursday was granted to the Lower Colorado River Authority (LCRA) Thomas C. Ferguson Power Plant in Llano County, Texas. LCRA is modernizing and expanding its plant by replacing its 37-year-old 440-MW gas-fired unit with a new 590-MW combined cycle gas-fired plant. “The new plant relies on an advanced electric power generation system that reduces nitrogen oxide emissions and also includes advanced environmental monitoring of GHG emissions,” the EPA said.

“The new LCRA plant will use improved environmental controls and install modern high-efficiency equipment,” said EPA Regional Administrator Al Armendariz. “LCRA is leading the way by providing Texans an efficient and reliable source of clean power.”

LCRA is the first company in Texas to complete the GHG permit process and obtained a final permit in about eight months. “We believe that replacing our aging Thomas C. Ferguson Power Plant with this new combined-cycle natural gas plant benefits everyone,” said LCRA General Manager Becky Motal. “The region will benefit from the latest environmental controls and our customers will benefit from our ability to better manage costs with a plant that will use about 35 to 40 percent less fuel than traditional gas-fired plants.”

The EPA’s so-called Tailoring Rule, which took effect on January 2, 2011, requires amendments to state permitting programs and in the federal Clean Air Act’s prevention of significant deterioration (PSD) provisions to include requirements for greenhouse gases. Specifically, it requires all new or modified facilities to obtain an air permit before construction that governs all regulated pollutants, including greenhouse gases. The rule affects, for the most part, fossil fuel facilities, though it does not exempt biomass power producers.

Texas is the only state that refused to implement the federal rules. The state has 167 facilities that would be subject to the federal permitting requirements. The EPA has said it is currently reviewing 10 additional GHG permit applications for Texas facilities.

When the state last December refused to put in place the new regulations, the EPA issued an interim final rule to seize control of GHG permitting in the state. Texas immediately filed an emergency motion with the appellate court on Dec. 30, alleging that the EPA had abused “its powers in an attempt to evade citizen participation in the regulatory process.” Despite a series of lawsuits to block the GHG rules, Texas has yet to win in court.

The Texas Commission on Environmental Quality questioned the need for the federal permit, saying it had authorized the LCRA project in September after finding the application was fully compliant with state environmental laws.

Sources: POWERnews, EPA, TCEQ