Coal Wins Round 1

Coal and natural gas are squaring off in the Senate and coal clearly has the upper hand. Most of this upper hand is attributed to cost.

As a result, the coal industry is lobbying to stall the House's plan to cap greenhouse gas emissions. With the cap imposed, carbon emissions will need to be captured or otherwise removed. The high cost of doing this may well steal away coal's cost advantage over natural gas and its other competitors.

At least for now, though, coal is unquestionably the most economical alternative.

Sources:
The New York Times

Budget overrun overstated.

The Illinois-based FutureGen project is back! Reasons why include: stimulus money, an Illinois-born president along with other, unnamed advisers also from Illinois, and an administration that is promoting "clean energy" as one of its core goals.

We just hope that their math is a bit better this time. Or does that really even make a difference? What do you think?

Read about it @ BNET Energy.

If you are to err, err on the side of caution.  Just try not to err $500 million on the side of caution.

This is the size of the "math error" committed by The Energy Department in its cost analysis of the FutureGen coal plant, a mistake which ultimately led to the shelving of the project.

What makes this error even more psycho is that it seems to be based on an assumption by the Department of Energy that the construction costs for the plant would possibly double during the time of construction.  Once again, we here at Coal Energy Now may not be math majors, but we can state quite confidently that inflation will not go up by 100% in the time that it takes to build FutureGen.

The project's restoration is under consideration by Secretary of Energy Steven Chu.

Source:
Gaffe could revise plans for innovative coal plant at Google News.

The United States' transition away from coal energy has begun.

Permits for new coal plants are being denied and many that were in production are being abandoned. With the Energy Department forecasting a 22% increase in power usage in the next 20 years, it is obvious that the vast majority of this increased power will come from alternative sources. This is further evidenced by the $16.8 billion of stimulus allocated for renewable energy compared to the relatively paltry amount of $3.4 billion for clean coal technologies.

Chris Morrison of BNET Energy contends that it would be wise for environmentalists to allow the construction of new plants with better emission-control technologies on the condition that older plants with antiquated technology be closed. While it is true that new plants are considerably cleaner, the general consensus is that "clean coal" technology, which includes carbon capture and sequestration, will not be readily available for at least another decade. It would be more costly to build new plants that would have to be either shut down or overhauled completely in order to implement CCS technology after just ten years. Factor in the exorbitant expense of implementing carbon capture technology and the prospect of building a coal-fired plant becomes financial suicide.

Still, despite the block against new plants, very few existing coal-fired power plants that are in operation have been shut down. With over half of the nation's energy derived from these plants, it is easy to see why.

However, once laws are enacted that impose costly fines against coal producers for carbon dioxide emissions these existing coal factories will certainly begin to diminish. As renewable energy becomes more efficient and reliable the dwindling profits of the coal energy factories will be squeezed further by the new competition.

For better or worse, the transition has certainly begun.

Sources:
Companies rethink coal plants from USA Today.
Coal plants checked by enviro campaigns, costs from The Washington Post.
Cost is Chief Barrier to Clean Coal from The New York Times.
Time for Environmentalists to Compromise on Coal from BNET Energy.

The Supreme Court declined to hear an appeal from the Bush Administration's Environmental Protection Agency regarding the exemption of coal-fired power plants from the Clean Air Act. According to The New York Times this effectively paves the way for new regulations on emissions from the coal plants.

A petition granted by the Environmental Protection Agency calls for a review of a memorandum that disallows carbon dioxide emissions to be considered in the federal approval process for power plants.

Read the article in the New York Times.

This time the unfavorable forecast comes from the president of the National Mining Association in a speech given to the West Virginia Coal Assocation today.

Read how much he expects production will drop in BusinessWeek.

Members of the Ohio Valley Environmental Coalition and Coal River Mountain Watch environmentalist groups are denouncing the federal ruling last Friday that went in favor of the U.S. Army Corps of Engineers. The environmentalists claim that the courts are not listening to the scientists who are debunking the Corps' efforts to mitigate the loss of streams covered by the process of mountaintop removal.

Read our post about the Friday's ruling here.

Read more about the responses from environmentalists at SustainableBusiness.com.

Yet another chink in the armor of "clean" coal is a new treaty called for by the Obama administration which seeks to eliminate mercury pollution.  Coal-fired power plants are responsible for more than 50% of all mercury emissions.  With environmental concerns a top priority and mercury pollution referred to as the gravest chemical problem in the world, this news does not bode well for the coal industry.

Read the Associated Press story on Google News.

Climate change concerns are intesifying and coal is being acknowledged by a growing number of people as the crux of the problem.  The push to make coal "clean", viewed as the only viable solution by the coal industry, seems certain to raise the cost of producing energy from coal so high that it will have to be funded by the government.

The fallout from this includes a deluge of plans for new coal-burning power plants being denied as the coal industry fights to survive.

Read the story at the New York Times.