Texas regulators approve AEP's 600 MW coal unit

HOUSTON, July 3 (Reuters) - Texas utility regulators on Thursday approved American Electric Power Co's (AEP.N) proposal to build the $2 billion, 600-megawatt John W Turk Jr. coal-fired power plant in Fulton, Arkansas.

Commissioners voted 2-1 to grant AEP's Southwestern Electric Power Co a certificate of need to build the plant, citing need for future power supply, but expressing concern about the risks to ratepayers of future environmental costs associated with coal-fired power plants if carbon dioxide becomes a regulated pollutant.

SWEPCO supplies electricity to customers in Arkansas, Louisiana and in northeast Texas under regulated rates.

Utility regulators in Arkansas and Louisiana have approved the utility's plan to build Turk, but no air permit has been issued by Arkansas environmental regulators.

Fulton is located in Hempstead County about 20 miles (32 km) northeast of Texarkana on the Arkansas-Texas border. (Reporting by Eileen O'Grady; Editing by Marguerita Choy)