Saturday, May 2, 2009

Clean Coal: There's Money in it! But not for you

Ever since coal powered the industrial revolution there has been controversy over its environmental impacts versus its ability to provide cheap abundant electricity. Even Mark Twain commented on the issue, “Filthy Coal: There's Money in it!" Today coal-powered electricity is just as controversial. The commercial blocks during the evening news are battlegrounds for special interest groups trying to persuade the opinions of Americans on coal-power. Respective TV ads claim that, “the reality is there is no clean coal” or “It’s time to re-power this economy with coal” ( 2009, America’, 2009).

There are 1500 coal power plants in the U.S. that, under the new administration, may be required to reduce their CO2 emissions by capturing their emissions. This will require substantial infrastructure spending; the existing carbon capture technology may reduce coal power plant electricity production by about 1/3. This means that government spending would have to be allocated not only to equip existing power plants with sequestration technology but also to expand total capacity to make up for the loss. This is good news if you are a power plant construction specialist. If you are a tax payer or an electricity user I would be worried.

The following table shows the cost of replacing all coal powered electricity with other sources based on EIA Data and Dr. Webber's presentation on the electricity sector.

Given the costs outlined in Table 1, the economic impact of the decisions made by the government in regards to coal-powered electricity could surpass trillions of dollars. As a nation recovering from economic recession this sort of burden on the taxpayer and American utility companies could be immense. Maybe we should think twice before we take the energy we have for granted.

1 comment:

lighthouseffect said...

This is an interesting topic.

John Barry, the VP of Shell's Unconventionals and Enhanced Oil Recovery unit was recently asked his opinion on clean coal. His thought is that although carbon capture and storage funding (CCS) has been part of the stimulus package, "the cost of first-generation major industrial facilities with CCS is going to be high, and with costs running into the billions of dollars for an individual installation, we expect that more funds will be needed."

This opinion seems to support the blog post in that we need to carefully think through the short and long-term implications of the energy-related decisions we make - especially as it relates to individual consumers.