Rocky Year for Coal Industry: 26 Power Plant Plans Shelved in 2009
‘There Is a Shift Going on Across America- by Matthew Berger - Dec 22nd, 2009
Despite a lack of substantive action on climate change in Copenhagen or, yet, in Washington, environmental groups are celebrating a year of victories over one of climate change’s biggest culprits.
Coal releases more carbon dioxide emissions per unit of energy produced than any other fossil fuel, but it also provides more than half the United States’ electricity supply. It is possible, however, that 2009 marked a turning point away from that reliance on coal.
Seminole Electric dropped plans to build a new coal-fired power plant in Florida late last week, in part because of the likelihood of future regulation of greenhouse gases. That canceled plant was one of more than two dozen this year. The Sierra Club announced Monday that 26 coal-fired plants in all were “defeated or abandoned” in 2009 — the largest number since 2001, it says, when the number of proposed coal plants spiked at 150.
Plans for a coal plant in South Carolina were suspended in August. A plan to ship coal from Wyoming’s Powder River Basin to South Dakota and Minnesota was put on hold later that month — after a decade-long fight, the Sierra Club points out. And plans for a coal-fired power plant on the Ohio River were scrapped in favor of a smaller, gas-fired plant. Just days into office, the Obama administration revoked the air permits for the Big Stone II plant that would have shipped its power to Minnesota but would have avoided the state’s tougher regulations by being located just across the border in South Dakota. In November, the project was shelved.
It remains to be seen whether this year’s trends will stick or simply represent a dip for coal, but what is clear is that 2009 has been a rocky year for the industry.
The Energy Information Agency projects in its monthly report that coal consumption by the electric power sector will have fallen nearly 10 percent by the end of the year. It says electric sector coal consumption should rise a bit next year, but will remain below 2008 levels. The amount of coal for coke production and for “retail and industry sectors” also declined by significant amounts.
The EIA also estimated carbon dioxide emissions from fossil fuels fell 6.1 percent, a drop that was led by a reduction in emissions from coal, which fell more than 10 percent.
“There is a shift going on across America as companies realign away from old dirty practices involving coal and toward cleaner energy options, including wind, solar and becoming more efficient,” said Bruce Niles, director of the Sierra Club’s Beyond Coal Campaign.
Changing Climate of Regulation
Niles’ organization sees campaigns to raise awareness about the impacts of coal and the alternatives to the power source as key to this shift.
“Communities across America have become aware about the danger of coal and have organized to stop these projects from moving forward,” Niles said. “The public is rising up, demanding cleaner energy, and developers and investors are taking note.”
But 2009 has also been characterized by an economic recession that touched nearly every sector to some degree. It also saw, as the EIA’s outlook notes, an increase in coal prices relative to natural gas.
“The Sierra Club is like the crowing rooster taking credit for the sunrise. A very soft economy and very low prices for natural gas were also big factors that slowed the growth in coal-based generation as they were factors slowing the growth in power generation in general,” Luke Popovich, a spokesman for the National Mining Association, told SolveClimate.
Since coal is one of the dirtiest energy sources in terms of greenhouse gas emissions, however, power companies are keeping an eye on possible regulations from Washington. It is likely no accident that proposals for new coal plants shot up in 2001, the first year of the Bush administration, and dropped in this first year of the Obama administration.
“The Obama administration is starting to do something the Bush administration refused to do — regulate carbon emissions,” Niles told SolveClimate.
The White House has pushed Congress to pass legislation limiting greenhouse gas emissions; the House passed the American Clean Energy and Security (ACES) bill in June; and the Senate is expected to pass its version in the spring. In the event those bills do not result in actual legislation, the U.S. Environmental Protection Agency is poised to regulate emissions itself. Following through on a court decision that was ignored during the last two years of the Bush administration, the EPA two weeks ago declared greenhouse gases a danger to public health and welfare.
These, in addition to decisions on smog, mercury and mountaintop-removal mining, all point to a tougher regulatory climate for coal-fired plants in coming years, and power companies seem to be taking notice.
Though Niles says none of these regulations “are actually pinching the coal industry yet,” they will lead to companies “internalizing the cost of coal.”
“Developers are looking at these numbers and saying these plants are too expensive,” he says. Read Entire Article