Another bad week for coal
The following post was first published on Passing Through, The Nation‘s guest blog, where I will be posting all month.
Regular readers of Grist know that coal is the enemy of the human race. They may also know that coal is on the ropes and, despite its recent PR blitz, in something of panic. Let’s take a look at some news from just the past week or so.
A new report from gas, coal, and power consulting firm Wood MacKensie says that "the rate of coal plant cancellations accelerated during 2007 to the point that more than 50% of the new coal capacity announced since 2000 has now been canceled." That the trend will likely continue, especially given that fact that the cost of building a power plant has gone up by 130% since 2000.
Among the blocked coal plants is the infamous Sunflower plant in Kansas, which had its air permit denied late last year based on its projected CO2 emissions. Since then, Sunflower has done everything it can to get around the decision, including jingoistic attacks on Kansas governor Kathleen Sebelius and a laughable coal-friendly "compromise" offered by its buddies in the legislature. (That bill passed today, but Sebelius says she’ll veto and there aren’t enough votes to override her.) Now, it appears, they’ve resorted to outright bribery: Sunflower says it will give $2.5 million over 10 years to Kansas State University … but only if the plant is approved. Classy.
Then there’s the dirty coal plant planned for Ohio by American Municipal Power. The NRDC made a public records request and got a hold of an internal AMP report (PDF) which is, to put it lightly, embarrassing. According to AMP’s own numbers, the cost of construction has risen 180% in just over two years. The initial estimate put it at $1.2 billion — it’s now at $3.3 billion and rising.
Thanks to the 50-year contract AMP will sign with the state, Ohio ratepayers will be on the hook for any costs that arise from dealing with CO2 — costs that are all but inevitable given pending legislation. AMP estimates the costs at $73 million a year, but a report (PDF) from independent research firm Synapse Energy Economics puts the costs at between $287 and $500 million a year. Oops!
In short: ratepayers in Ohio are going to get screwed 10 ways to Sunday by politically connected coal barons who haven’t bothered to assess the renewable alternatives. Think Ohioans will sit still for it?
Maybe coal can survive if it’s "clean"? Maybe. But an official at Royal Dutch Shell said last week that carbon prices would have to reach about $100/tonne — three times current levels — before investment in carbon capture and storage would make economic sense. Ah well.
Does all this churn amount to a necessary and laudable transition? No sir … it’s a crisis! At least that’s what the CEO of American Electric Power — a coal-heavy utility — says. Other utilities, however, are getting on the energy-efficiency stick. And it’s a good thing: Internationally renowned environmental analyst Lester Brown says that coal’s time is up and that Wall Street will increasingly turn against it. (In this he agrees with notorious lefty enviro rag the Wall Street Journal.)
The coal industry shot back, accusing Brown of exaggerating coal’s contribution to climate change and ignoring the economic necessity of power generation.
"We’re economically necessary." Is that the kind of argument people should have to make? Shouldn’t it be self-evident if it’s true? Isn’t it contradicted by coal’s ongoing economic failures?
And should it really come coupled with a request for massive government subsidies?
So there you have it: just in the past week, elite opinion against coal has accelerated, two major coal projects have run into embarrassments, and an independent report has confirmed that things are only going to get worse. Now you know why Big Coal has been sponsoring presidential debates, putting Santas on corners around D.C., and pouring millions of dollars into a PR campaign. It knows its time has passed.