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10/16/2013

Environmental groups question EFH ability to reclaim mines

Two environmental groups say it's far from assured that Dallas-based Energy Future Holdings will be able to meet its obligations to reclaim East Texas coal mines if the big utility files for bankruptcy and the mines are closed in the future. The Sierra Club and Public Citizen say a new study shows that EFH  subsidiary Luminant Generation, the state's biggest power producer, hasn't been required to post performance bonds that would cover the cost of restoring thousands of acres disrupted by lignite mining to feed three big power plants. Instead, the Texas Railroad Commission has allowed the Luminant Mining to pledge assets of a sister company, Luminant Generation, as a self-bond. Those multiple self-bonds add up to about $1 billion. But they study says the financial woes of parent EFH make that backing suspect, and recommends that the Railroad Commission demand cash or an equivalent guarantee so state or federal taxpayers don't have to foot the bill for reclamation.

Luminant spokesman Brad Watson said the company doesn't plan to close the mines and has complied with all state rules governing reclamation obligations. He said the company has reclaimed 73,069 acres of lignite mines since 1971, including 3,774 acres last year.

-- Jim Fuquay

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