Coal-fired power plants take hits

The article in the Tribune reviews the status of building new coal-powered power plants in the USA. There is strident opposition, primarily because of the concerns on global warming.

K.S.Parthasarathy



Coal-fired power plants take hits
K.S. Parthasarathy

Coal-fired power plants are taking hits from all sides. The unkindest cut to future coal-fired power generation came recently when Samuel Bodman, Secretary, the US Department of Energy (DOE), declared that the Bush administration had decided to withdraw funding to FutureGen, the US government’s effort to develop a “clean coal” power plant.

The plant would have turned coal into hydrogen-rich synthetic gas, generating electricity while pumping carbon dioxide underground for permanent storage (The Wall Street Journal, WSJ, February 2, 2008). The project had international participation.

The DOE found that the cost of the project soared to $1.8 billion, nearly double the original estimates.

Now activists appeared to have shifted their attention from nuclear power plants to coal-fired plants.

Referring to the example of Richard D. Libert, a Republican, a cattle rancher and a retired army lieutenant colonel, the New York Times observed that “an increasingly vocal, potent and widespread anti-coal movement” is developing in the West.

Besides filing law suits, the environmentalists assert that “these coal plants don’t make any sense, whether from an economic or environmental or property-rights standpoint”.

On October 18, 2007, the Kansas Department of Health and Environment (KDHE), USA, rejected a permit to Sunflower Electric Power to construct a pair of 700-megawatt, coal-fired electric power plants in Holcomb, a town in the western part of the state; the department believes that the greenhouse gas emitted by it threatens public health and the environment.

The decision marks a victory for environmental groups that are fighting proposals for new coal fired plants around the country.

We do not know of the impact the decision will have on coal power plants. In the USA, all combustion facilities need permits. The KDHE’s decision is the first of its kind taken by a government agency citing carbon dioxide emissions as the reason to reject a permit.

“It would be irresponsible to ignore emerging information about the contribution of carbon dioxide and other greenhouse gases to climate change and the potential harm to our environment and health, if we do nothing”, The Washington Post quoted Roderick L. Bremby, Secretary of the KDHE, as saying.

The writing on the wall was clear. On April 2, 2007, the U.S. Supreme Court ruled that the Clean Air Act gives US Environmental Protection Agency (EPA), the authority to regulate emissions of carbon dioxide and other greenhouse gases. Court cases around the country had been held up to await the decision in this case. Among them is a challenge to the environmental agency’s refusal to regulate carbon dioxide emissions from power plants, now pending in the federal appeals court.

Between 2000 and 2006, US utilities submitted over 150 coal plant proposals. By 2007, they constructed 10 of them; 25 additional plants were under construction. But during 2007, 59 proposed plants were cancelled, abandoned, or put on hold.

Concerns about global warming played a major role in 15 of these cases. Coal plants are being eliminated from long-range plans. The renewables are elbowing them out.

Of the 59 plants which took the hits, 44 were abandoned by the utilities themselves because of increase in construction costs, insufficient financing or failure to receive expected government grants, lowering of estimates of power demand and concerns about future carbon regulations.

Citigroup Inc, J.P.Morgan Chase & Co. and Morgan Stanley, three of Wall Street’s biggest investment banks announced the formation of The Carbon Principles, climate change guidelines for advisors and lenders to power companies in the United States.

The new environmental standards will make it harder for companies to get financing to build coal power plants in the U.S. The banks will factor in the cost of emission capping regulations while lending money.

Twenty something in the Wall Street rather than ‘environmentalists’ decided the fate of nuclear power in the 70s and 80s!

With the development of clean coal technology stalled, nuclear power appears to have a brighter future; not quite, nuclear power is equally costly. Future energy options remain unpredictable.

K.S. Parthasarathy is former Secretary, Atomic Energy Regulatory Board