San Antonio Approves Climate Plan to Phase Out Fossil Fuels as City Generates Record Revenue from Natural Gas and Coal Plants

Last week, San Antonio’s City Council adopted a Climate Action and Adaption Plan (CAAP). The plan has been in the works for over two years, with many voices weighing in on the best way for the city to reduce emissions. The plan would lead to a dramatic reduction in the use of coal and natural gas, a path that could endanger city taxpayers who benefit from affordable energy and revenues from the city’s power provider.  

CPS Energy is the sole electricity provider to the city and supplies natural gas to most of the city’s residents.  The company primarily relies on natural gas and coal plants to supply this energy – both of which came under fire during the development of the CAAP. Activists have pushed San Antonio to phase out fossil fuels entirely, much like the City of Georgetown, Texas, where residents are now facing higher power bills for shifting to 100 percent renewables. Georgetown is now trying to cancel its renewable energy contracts in the courts.

In San Antonio, affordable natural gas has allowed residents to pay 11 percent less for electricity than the national average. It has also helped reduce ozone concentrations in recent years.

Thanks to the Texas heat, CPS Energy had a strong year selling power on the state’s grid. CPS Energy provides power to San Antonio, but it produces excess power that it sells into the broader market, and a portion of those revenues are then returned to the city. San Antonio had a $7.8 million surplus for its 2020 budget, driven in large part due to higher than expected revenues from CPS Energy’s coal and natural gas power plants.

The windfall that San Antonio received from CPS Energy’s revenues will allow the city to fund numerous special projects that would have otherwise been tabled. Projects such as a new police substation, an emergency general fund to help those facing eviction, an increased budget for the Martin Luther King, Jr. March, and a Mexican American civil rights institute are just a few of the projects that will all be possible because increased revenues from natural gas.

But those record revenues – which protect San Antonio taxpayers from higher taxes to pay for public services – are now on a path to phaseout with the CAAP, or at the very least in jeopardy. In fact, it’s unclear how the city will even achieve its “net zero” emissions plan. According to the Rivard Report, “getting to carbon-neutral is fraught with challenges, many of which City officials have essentially put off until later.” 

All of this raises an important question: if the city phases out affordable fuels like natural gas, how will it replace the millions of dollars of revenue that CPS Energy is currently providing each year?

Taxpayers will soon find out.