Galt Global Review

It is also cheap.

According to the U.S. Department of Energy, the fact that coal is cheap and abundant is one of the primary reasons why consumers benefit from some of the “lowest electricity rates of any free-market economy.”

These two factors - a low cost and abundant supply - make coal a resource most political leaders are unwilling to give up.

Given that coal is also the world’s largest source of C02 emissions – the main culprit in global warming –coal plants are at the top of the list of global warming threats cited by climate scientists.

The United States, China, Australia, India, South Africa and Russia are the world’s largest producers and consumers of coal. In the U.S., coal supplies 50% of the nation’s electricity. In Australia, it is 90%. And in China, close to 80% of all electricity is generated from coal. A recent article published this month in Scientific American disclosed that China builds the equivalent of two 500-megawatt coal-fired power plants each week.

In comparison, renewable energy sources, such as wind and solar power, supplied 3.4% of the world’s electricity supply in 2007.

With nearly half of our planet’s electricity being supplied by coal, like it or not, coal will continue to be a major source of electricity for years to come.

More environmentalists are also realizing that eliminating coal completely is a difficult proposition.

David Hawkins, director of the climate program at the Natural Resources Defense Council (NRDC), believes that as a technical matter, the world economy could be run without coal. But as a political matter, it is “not going to happen fast enough.”

Although we must do everything we can to accelerate our use of renewables, Hawkins argues, the renewable-energy future is far too slow in coming to eliminate coal completely. We need to start reducing C02 emissions before phasing out fossil fuels.

“ We aren’t champions of coal, but we are realists,” Scott Anderson, an energy policy specialist for U.S. Environmental Defense, told a senate panel earlier this year. “Since the transition away from fossil fuels is likely to take a very long time, we foresee a longer-term need to deal with coal-based emissions.” (Source: Scientific American)

Next Generation Coal
With 27% of all known coal reserves in the world, the United States is the “Saudi Arabia of Coal.” It also puts the U.S in the position of being a potential world leader in the production of clean coal technology, or “next generation coal,” whose supporters believe that this is a realistic solution to the problem rather than halting the production of coal-powered electricity.

Next generation coal involves carbon sequestration technology, which the the U.N. Intergovernmental Panel on Climate Change (IPCC) has identified as a “critical technology for reducing carbon emissions.”

Michael Morris, Chairman of American Electric Power, thinks that clean coal power plants are the way of the future, which means retrofitting existing coal-powered pants.

The whole notion of “delegitimizing” coal is “something we should all be frightened off,” he says in an article for TIME, published earlier this year.

“Within five years to a decade, heavy industrial users will face involuntary power cuts unless more coal plants that emit less C02 come on line,” Morris said in a talk to energy executives at a conference last year. “You simply can’t pare off plant after plant and have the U.S. economy leap forward in any way, shape or form.” (source: Reuters)

Hold the Coal
People like Bruce Nilles, director of the Sierra Club’s anti-coal campaign claim that the investment in new coal plants – clean technology or not – will drain resources from cleaner energy options and close the markets for renewable energy options.

This side of the debate, which pushes to suspend the construction of new coal plants and focus instead on renewable energy, has support in high places.

Dr. James Hansen, director of NASA's Goddard Space Center, the world's largest climate research agency, told Congress last April that a suspension on new coal plants is "the most critical action for saving the planet at this time."

Changes are already occurring. Research compiled by Coal Moratorium NOW! (CMN) and Rainforest Action Network (RAN) shows that fifty-nine proposed coal-fired power plants were either cancelled or shelved during 2007.

The study concluded that climate concerns played a role in at least 15 of these plant cancellations. Among its other findings:

• Coal plants have disappeared entirely from some utility companies long-range plans;
• Despite heavy spending there are still poor results for “clean coal;”
• And financial markets have “cooled to coal.”

"Coal-fired power plants are the wrong investment for our climate, our health, and our economy,” states Becky Tarbotton, director of Rainforest Action Network's Global Finance Campaign, in E News USA. “Utilities, regulators, and investors are realizing that the path ahead is energy efficiency and renewable energy.”

Recently, three major investment banks - Citigroup, JP Morgan Chase and Morgan Stanley – drew up a new set of standards that will make it much harder now to finance new coal-fired power plants in the U.S. These banks won't provide financing unless the proposed coal plant uses some form of CSS technology.

In other words, writes David Sassoon in a recent editorial for The Guardian: "clean coal or no coal.”

But as a recent article in Scientific American reports: “So much for clean coal — at least for now.”

The U.S. Department of Energy (DOE) just announced that it has cancelled plans to build FutureGen, a 275-megawatt power plant which would have burned coal to produce electricity, and stored 90% of the resulting C02 emissions through carbon sequestration.

Not only would it have captured greenhouse gas emission, the FutureGen power plant would have also produced hydrogen.

DOE said it was cancelling the project to save money and to help industry add carbon sequestration technology to existing coal plants. DOE did not make it clear, however, which power plants will be used to demonstrate clean technology.

As it stands now, few employ the required integrated gasification and combined cycle (IGCC) technology capable of turning coal into gas and removing CO2 before being burned. Furthermore, only a handful of clean coal plants are planned, due to rising costs of cement, steel, and the additional cost of the technology.
The Duke Energy Plant (reviewed in Part I of this series) is so far the only commercial IGCC plant that may be coming, permit pending.

Many people, including Howard Herzog, Principal Research Engineer for MIT’s Lab for Energy and the Environment, see cancelling FutureGen as a setback.

Yet others point out that little attention is being given to DOE’s alternative plan: to have multiple, commercial clean coal plants with carbon capture and sequestration technology operational by 2015 or 2016.

Stay tuned as The Galt Global Review follows the development of this story.