Texas officials granted an air permit for the $3.2 billion, 1,320 MW Las Brias pet coke-fired power plant.

The Texas Commission on Environmental Quality voted 2-0 in favor of the permit, which clears the way for  construction work to start this fall. The plant could enter service in 2014.

The approval came as the U.S. Environmental Protection Agency asked the state commission to withhold the permit until EPA could resolve issues with the application. The EPA questioned the plant's ability to meet new federal standards for nitrogen dioxide and sulfur dioxide.

EPA told state environmental regulators that the plant's developer, Chase Power Development, should not start construction until it is determined if the plant is subject to new federal greenhouse gas rules that took effect Jan. 2.

The Texas commissioners reportedly did not address the EPA's concerns about the project during a hearing. They focused instead on recent findings of two state administrative law judges, who had recommended that the commission deny the permit in part because of flawed and improper air modeling.

TCEQ Chairman Bryan Shaw and Commissioner Buddy Garcia were reported as saying the Las Brisas application had met the state's rules and would be protective of public health and the environment. A third commissioner, Carlos Rubinstein, abstained from voting because he was briefed on the permit application in his previous role as deputy executive director.

Environmental advocates criticized the decision, reportedly saying the commissioners approved "a permit that is defective on its face." Ilan Levin, a Sierra Club attorney, told reporters that environmental groups are prepared to file suit in state district court to block construction.

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