(The Center Square) – A company expanding operations in Texas that’s receiving taxpayer funding promotes ESG policies and United Nations 2030 Sustainability Goals, something conservative state officials have opposed.
Cooper Power Systems, a subsidiary of Eaton Corporation PLC, is expanding a manufacturing facility for voltage regulators in the rural East Texas town of Nacogdoches and getting a nearly $2 million Texas Enterprise Fund grant to do it. Eaton states it’s promoting environmental, social and governance (ESG) goals in accordance with its plan to comply with United Nations 2030 Sustainability Goals as a “participant in the U.N. Global Compact.”
The grant comes amid Comptroller Glenn Hegar’s stated position of imposing sanctions against companies implementing ESG policies by barring them from receiving investments from money under his purview.
Eaton states that its 2030 goal “targets include reducing the carbon emissions from our operations by half, lowering product and supply chain emissions, certifying all manufacturing sites as zero waste to landfill, and achieving carbon neutral operations. We have also set targets to further enhance employee safety, development and engagement, and to provide more transparency into the progress the company is making toward achieving its ESG goals.”
It also says it is focusing on energy transition from fossil fuels to “renewables” because of “climate change.”
The money it’s receiving in taxpayer incentives comes through the Texas Enterprise Fund, long-criticized as corporate welfare for multi-million and billion-dollar companies.
TEF awards are economic development agreements referred to by state officials as “deal-closing” grants meant to entice businesses to choose Texas over another possible state. The grants must be agreed upon by the governor, lieutenant governor and speaker of the house.
The governor’s office has argued TEF awards have helped bring business to regions of the state that might not otherwise come. Eaton Corporation, a $20 billion global technology company that makes electrical components, systems, and services for power quality, distribution, and control, has already been operational in East Texas.
Its stated plan on its website is to reduce its 2018-era greenhouse gas emissions by 50% by 2030, have all of its manufacturing sites zero waste-to-landfill certified by 2030, and invest $3 billion in research and development to create “sustainable solutions by 2030.”
The manufacturing facility expansion in East Texas is expected to create more than 200 new jobs and generate over $100 million in capital investment.
Gov. Greg Abbott lauded the expansion, stating, “Texas’ unmatched business climate, highly skilled workforce, and reasonable business regulations encourage companies like Eaton to expand and grow operations in our state. The expansion of Eaton’s Cooper Power Systems location in Nacogdoches is a major win for hardworking East Texans, bringing hundreds of good-paying jobs and millions in capital investment to the community. Growing Texas’ capabilities in this industry supply chain and investing in energy infrastructure is critical to cementing our state’s position as a global energy leader.”
“Eaton is making a $100 million investment to expand our Nacogdoches, Texas operations and respond to the unprecedented need for critical power distribution infrastructure to support electrification, grid modernization, and resilience,” Eaton Senior Vice President Guillaume Laur said. “The investment doubles Eaton’s production capacity of voltage regulators and three-phase transformers.”
When fully operational, the plant is expected to employ a total of over 625 employees and create over $500 million in annual economic impact, Laur said.
Eaton isn’t the only company promoting zero-carbon energy expansion in the region.
In February, USA BioEnergy announced it was building a $1.7 billion advanced biorefinery in deep East Texas in Newton County, costing taxpayers and the local school district an undisclosed amount of money through a different economic incentive. Its plan involves featuring “carbon capture technology to prevent greenhouse gas emissions from contributing to CO2 levels in the atmosphere” by converting over one million green tons of wood waste into millions of gallons of premium clean burning transportation fuel.
Last December, Air Products and The AES Corporation also announced they were constructing in North Texas the first mega-scale green hydrogen production facility in the U.S. Once operational, the company said the plant would generate $500 million in tax benefits over the project’s lifetime.
