Energy Future Holdings

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Energy Future Holdings Corp. (EFH) is a Dallas-based, privately held energy company with a portfolio of energy companies serving the Texas electricity market: Luminant, TXU and Oncor. EFH is owned by a group of investors led by private equity firms Kohlberg Kravis Roberts & Co. (KKR) and Texas Pacific Group (TPG), as well as global investment bank Goldman Sachs.

In 2010, Energy Future Holdings had $8.2 billion in revenue. Its CEO, John Young, received a total of $7.1 million in compensation in 2008, a year when the conglomerate reported a $9.8 billion net loss. Since the company was taken private in 2007, its filings are not made public, and Young's compensation in 2009 and 2010 is unknown.

Ties to American Legislative Exchange Council

EFH is a member of the American Legislative Exchange Council (ALEC). Sano Blocker, an EFH lobbyist and Senior Vice President of Public Affairs, represents EFH on ALEC's corporate ("Private Enterprise") board as of 2011.

A list of ALEC Corporations can be found here.

About ALEC

ALEC is a corporate bill mill. It is not just a lobby or a front group; it is much more powerful than that. Through ALEC, corporations hand state legislators their wishlists to benefit their bottom line. Corporations fund almost all of ALEC's operations. They pay for a seat on ALEC task forces where corporate lobbyists and special interest reps vote with elected officials to approve “model” bills. Learn more at the Center for Media and Democracy's ALECexposed.org, and check out breaking news on our PRWatch.org site.

Annual Financials

2010
Revenues: $8.2 billion
Profits: -$2.8 billion

2009
Revenues: $9.5 billion
Profits: $344 million

2008
Revenues: $11.4 billion
Net Income: -$9.8 billion

Executive Leadership

• John F. Young - President and CEO
• James A. Baker, III - Advisory Chairman
• Tom Baker - Chairman Emeritus
• Jim Burke - CEO, TXU Energy
• David Campbell - CEO, Luminant
• Chuck Enze - CEO, Luminant Construction
• Joel Kaplan - Executive Vice President, Public Policy and External Affairs
• Paul Keglevic - Executive Vice President and Chief Financial Officer
• Richard Landy - Executive Vice President, Human Resources
• Mac McFarland - Chief Commercial Officer, Luminant
• Robert Walters - Executive Vice President and General Counsel

Background

Luminant, formerly TXU Corp., is a Dallas-based energy company involved in electricity generation, distribution, and sales in Texas. In February 2007, TXU announced its acquisition by an investor group led by private equity firms KKR and Texas Pacific Group (registered under TPG Capital LP). In July 2007, TXU announced that its power generation and related businesses would now be assigned to the Luminant name. Both TXU and Luminant would be owned by EFH.

As part of the estimated US$45 million buyout, Luminant settled a series of lawsuits with Environmental Defense and the Natural Resources Defense Council and agreed to cancel 8 of its planned 11 new Texas coal-fired power plants as well as several new coal-fired plants in Pennsylvania and Virginia, back federal legislation to create a cap-and-trade system regulating CO2 emissions, and double spending on energy efficiency. In return, Environmental Defense and NRDC agreed not to campaign against TXU’s remaining three Texas coal-fired plants. In March 2007, TXU announced its official withdrawal of the air permit applications for the eight cancelled plants.

In 2006, Texas Gov. Rick Perry had fast-tracked the permitting process for 11 new col plants for TXU, the state's largest utility, shrinking a process that usually takes one to four years down to six months. Between January 2001 and July 2011, TXU (and then Energy Future Holdings), gave Perry $633,575—more than any other politician. Former TXU chairman Erle Nye, whom Perry appointed to Texas A&M's Board of Regents in 2003, gave the governor $2,000 on the day he signed the coal-plant executive order, and another $25,000 six months later. TXU's PAC also gave Perry $5,000 shortly after he signed the order.

Power portfolio

Out of its total 19,356 MW of electric generating capacity in 2005 (1.81% of the U.S. total), Luminant produced 55.6% from natural gas, 32.5% from coal, 12.6% from nuclear, and 0.1% from oil. All of Luminant's power plants are in Texas.

Existing coal-fired power plants

Luminant owned 9 coal-fired generating stations in 2005, with 6,137 MW of capacity. Here is a list of Luminant's coal power plants:

Plant Name	State	County	Year(s) Built	Capacity	2007 CO2 Emissions	2006 SO2 Emissions
Martin Lake	TX	Rusk	1977, 1978, 1979	2380 MW	19,800,000 tons	77,419 tons
Monticello	TX	Titus	1974, 1975, 1978	1980 MW	16,300,000 tons	77,538 tons
Big Brown	TX	Freestone	1971, 1972	1187 MW	9,842,000 tons	96,221 tons
Sandow 4	TX	Milam	1981	591 MW	5,284,000 tons	23,747 tons

In 2006, Luminant's 4 coal-fired power plants emitted 51.2 million tons of CO₂ (0.85% of all U.S. CO₂ emissions) and 275,000 tons of SO₂ (1.83% of all U.S. SO₂ emissions).

Sierra Club calls for closure of three coal plants in Texas

On March 18, 2011 the Sierra Club released a report stating that three of Luminant's coal plants in East Texas should be shut down because the facilities do not meet Clean Air Act standards and need $3.6 billion in upgrades in order to comply with federal regulations.

The three plants targeted were Big Brown, Monticello Steam Station and the Martin Lake Steam Station plant. The Sierra Club expressed concern about "the major threats to air and water pollution that citizens in the Barnett Shale [in North Texas] are dealing with firsthand."

The study recommended:

[R]eplacement of three coal fired power plants built in the 1970’s (Big Brown, Monticello and Martin Lake) is a financial and environmental necessity. The plants, currently owned by Energy Future Holding/Luminant and serving North Texas are financially mismanaged, cannot compete profitably in the current market, require pollution control upgrades that are unaffordable and have suffered deep losses in market value. The financial outlook for the company and the plants going forward show very little upside. A broad look at the national and Texas energy market suggest planning tools and resources exist to ensure a smooth transition to a more financially stable and reliable supply of electricity.

Energy Future Holdings announces potential coal plant and mine shutdown

It was announced on September 12, 2011 that Texas based coal plant Monticello Units 1 and 2 would be idled in January 2012 if Energy Future Holdings, owner of Luminant, failed in its legal challenge to pending federal air pollution rules. It was also reported that the company would close both its Thermo Mine and Winfield South Mine at the same time.

Lawsuit over Air Pollution at Martin Lake Plant

In July, 2007, the Sierra Club put EFH and its subsidiary, Luminant, on notice that the group intended to sue the company for Clean Air Act violations at its Martin Lake plant. The plant was rated as the first in the nation for power plant mercury emissions in 2005, emitting a total of 1,705 pounds of mercury that year. The Sierra Club claimed that both the U.S. EPA and the Texas Commission on Environmental Quality ignored soot pollution and other violations at the facility. They also claimed that Martin Lake was one of the dirtiest plants in the entire country in regard to particle pollution, mercury, sulfur dioxide, nitrogen oxide and carbon dioxide. These toxins, the Sierra Club noted, are producing a great health risk to communities nearby. The facility currently uses scrubber technology.

In September 2010, EFH and its Luminant Generation unit were sued by the Sierra Club over pollution emitted by the Martin Lake plant. The plant near Longview is among the dirtiest in the U.S., the environmental group said in its complaint filed in federal court in Texarkana, Texas: “It is the worst power plant for mercury pollution among all U.S. coal plants, emitting 1,764 pounds in 2008,” the Sierra Club said in a statement. The San Francisco-based group asked a judge to find the plant’s operators in violation of the U.S. Clean Air Act.

Luminant's Martin Lake Plant Nation's Worst for Mercury Emissions

In March 2010 the Environmental Integrity Project (EIP) released a report using available EPA data that indicated half of the country's 50 largest mercury-emitting power plants have increased their emissions in recent years. The report also noted that half of the coal plants in the United States do not have the most up to date emission controls in place, and five of the plants with the highest amount of mercury emitted are located in Texas.

Coal-fired power plants generate more than 40 percent of U.S. emissions. Mercury released into the air settles in rivers and lakes, where it moves through the food chain to the fish that people eat. The report states that Luminant's Martin Lake Steam Station in Texas is the nation's worst mercury polluter. The plant reported a 4.56 percent increase from 2007 to 2008.

The 2011 Environmental Defense Fund report, "Mercury Alert: Cleaning up Coal Plants for Healthier Lives" found that 25 plants alone are responsible for nearly a third of all mercury emissions in the power sector, while providing only eight percent of U.S. electricity. The findings are based on 2009 U.S. Department of Energy data. The plant with the highest mercury emissions was Martin Lake Steam Station, releasing 1,566 lbs in 2009.

Coal projects sponsored by Luminant

Active

• Oak Grove Plant (Texas)
• Sandow Unit 5 (Texas)
• Sandy Creek Plant (Texas)

Cancelled

• Big Brown 3 (Texas)
• Lake Creek 3 (Texas)
• Martin Lake 4 (Texas)
• Morgan Creek 7 (Texas)
• Monticello 4 (Texas)
• Tradinghouse 3 & 4 (Texas)
• Valley 4 (Texas)

Existing Coal Mines

• Beckville Strip Mine
• Big Brown Mine
• Oak Hill Strip Mine
• Sulphur Springs Strip Mine
• Tatum Mine
• Thermo Mine
• Three Oaks Mine
• Winfield South Mine

Contact details

Energy Plaza
1601 Bryan Street
Dallas, TX 75201 USA
214.812.4600 - phone
Website: http://www.energyfutureholdings.com

Articles and Resources

Related GEM.wiki articles

• David Campbell
• Alliance for Energy and Economic Growth
• Goldman Sachs
• Laura Miller
• Luminant
• Public Strategies, Inc.
• Texans for Affordable and Reliable Power
• Texas and coal
• United States and coal
• Global warming

External links

• "TXU Corporation", Google Finance, accessed December 2006.
• "Judge Rules In Favor Of Texas Clean Air Coalition", CBS11TV.com, December 14, 2006. (This is an Associated Press story).
• Randy Lee Loftis and Elizabeth Souder, "Coal debate generates high-dollar ad campaigns", Dallas Morning News, February 15, 2007.
• "PS Aids Huge TXU Buyout Deal," O'Dwyer's PR Daily (sub req'd), February 27, 2007.
• Hamilton Nolan, "TXU deal uses double-sided PR," PR Week, February 28, 2007.
• Tara Lohan, "The New, Green Face of Wall Street," AlterNet, March 3, 2007.
• Rebecca Smith and Jim Carlton, "Environmentalist Groups Feud Over Terms of the TXU Buyout," Wall Street Journal (sub req'd), March 3, 2007.
• Steve James, "US Coal-Fired Power Plant Plans up in Smoke?," Reuters, March 5, 2007.
• Kevin Bogardus, "Lobbyists hired to represent investor groups in $45B buyout," The Hill, March 28, 2007.
• "TXU Investors Round Up Lobbying Team," Deal Book (New York Times blog), March 28, 2007.
• Rebecca Smith, "TXU Sheds Coal Plan, Charts Nuclear Path: Expansion Efforts Include Large Plants in Texas; Rivals Likely to Follow," Wall Street Journal (sub req'd), April 10, 2007.
• Pratap Chatterjee, "Climate Change Debate Fuels Greenwash Boom," CorpWatch, December 11, 2007.