June 6, 2018
A Costly, Deadly Obsession With Coal
Research by EPIC Director Michael Greenstone and co-authors found that coal is the most expensive form of power generation when considering all societal costs is cited in the Wall Street Journal.
By Greg Ipvia The Wall Street Journal
President Donald Trump’s efforts to revive coal mining have been criticized as picking winners. Actually, it’s more like picking losers: coal has become a sunset industry as cleaner energy sources rapidly get cheaper. If Mr. Trump succeeds at reversing the tide, it will come at a steep price, in both dollars and lives, most tragically for the coal miners he seeks to help.
Centuries ago, coal was a miracle material. Cleaner, safer and more efficient than wood, it made the Industrial Revolution, steam power and electrification possible. In much of the world it remains ridiculously plentiful and will be the power generation fuel of choice for years to come.
In the U.S., though, coal is headed toward obsolescence. Thanks to the fracking revolution, natural-gas-fueled power plants are now cheaper to build and operate than coal-fired plants. Solar- and wind-generated power now costs less per kilowatt-hour to produce than coal. Renewables cost slightly more than coal when you include the cost of backup power since the sun doesn’t always shine and wind doesn’t always blow, according to the Energy Policy Institute at the University of Chicago. But as innovation in shale gas, wind and solar continues to drive down costs, coal will lose whatever advantages it has now.
Seeking to postpone the inevitable, Energy Secretary Rick Perry last year asked the Federal Energy Regulatory Commission to compel utilities to buy power from struggling coal and nuclear stations. Because they store fuel on site, he said, they reinforce the electrical grid against outages.
FERC rejected Mr. Perry’s request, but last week the White House, citing national security, said it was preparing a new, similar proposal.
Meanwhile, propping up uneconomical coal and nuclear plants would cost ratepayers a fortune. PJM Interconnection, which operates the wholesale electricity market serving 13 states and the District of Columbia, would bear $1.7 billion to $11 billion a year of added cost for coal-generated power and $1.4 billion to $22 billion for nuclear-generated power, according to PJM’s independent monitor.
These are just the direct, financial costs. Coal carries huge nonfinancial costs. For example, incorporating the “social” cost of climate change due to methane and carbon dioxide emissions, Michael Greenstone, director of the Energy Policy Institute, estimates coal is more expensive than any other power source, and nuclear becomes cheaper than solar and wind (because while the latter two don’t emit carbon they require gas-fired backup power, which does).
Finally, there is the cost to human life. Burning coal emits soot that even in tiny quantities causes cardiovascular and respiratory illness. In one study, Mr. Greenstone and his co-authors found that in China, which is currently negotiating to buy more U.S. coal, life expectancy is reduced by three years in households that use subsidized coal in the winter. The toll in the U.S., where emission standards are tougher, is much smaller, but still measurable.