Energy

Why Coal Country Now Says Climate Change Is A Threat And What It Plans To Do About It


When a conservative congressman from a coal-producing state says that climate change is the biggest challenge of our lives, it grabs your attention. That this Republican congressman had paired up with a West Coast Democrat counterpart in something resembling bipartisan cooperation on climate change legislation, is even more striking. Does it raise the odds of something actually getting done?

The approach presented in a new “discussion draft” of the presumptive McKinley-Schrader bill is both collaborative and all-inclusive. Reps David McKinley of West Virginia and Kurt Shrader of Oregon aim to reduce CO2 emissions by 80% by 2050. The key tenet: investing in research and development — efforts that promote clean technologies and an advanced electric grid that can host more green energies.

What’s in it for coal? Coal country is coming to grips with the fact that coal’s power has waned and that its survival depends on carbon capture and sequestration. While the use of coal is quickly withering among developed countries, it is still expected to make up at least 30% of the global energy pie going forward, says the World Coal Association.

Environmentalists would no doubt prefer to spend national treasure developing wind and solar power. But if the coal and natural gas sectors do not meet hard targets within a decade, then tougher regulations would be enacted. The pressure is thus on those industries to cut their CO2 emissions.

“If we’re going to ask the coal and gas industries to eliminate their emissions, they should every opportunity to develop the technologies that can protect their workers and consumers,” the two congressmen wrote in USA Today. “Agreeing to this bargain would admittedly be a gamble for energy companies, but it’s betting on a future of American innovation and ingenuity, and that’s the kind of bet Americans like to make.”

The legislation would also promote investment in advanced nuclear energy technologies — ones that double-up on safety and efficiency measures while providing clean and carbon-free electricity.

So far, carbon capture has been expensive and elusive. But the legislation would rev up three pilot projects, with an eye toward commercial-scale development. The cost? $2.2 billion a year for five years. Arch Coal
ARCH
, Cloud Peak Energy and Peabody Energy
BTU
have said that they support such policies — all companies that have had to restructure.

The plan is similar to the one that former Energy Secretary Ernest Moniz has laid out, which is the creation of a “Green Real Deal.” At the heart of this proposal is an “all-of-the-above” strategy to reduce greenhouse gases — one that he says is grounded in reality and not wishful thinking.

A practical approach is better than hurling grenades at one another. And it’s for the common good, given that the United States spends surprisingly little on infrastructure — 3% of gross domestic product. Case-in-point: The Wind Energy Foundation says that 51,000 megawatts of renewable energy is in jeopardy if the transmission network is not expanded by decade’s end.

“Significant investments in technology and infrastructure would help rebuild and grow the U.S. economy, while its clean energy standard would help put us on the pathway to carbon neutrality,” says Bob Perciasepe, president of the Center for Climate Energy Solutions.

Shrinking Pie

It’s been a long and bumpy road for coal, which powered the country for decades. But environmental codes that sought to limit the level of harmful emissions gave utilities a choice: either install expensive scrubbers to cut emissions or shut down those plants. The toll on coal thus began in earnest around 2008. At the same time, the job losses mounted, adding financial pain to an industry that lost thousands of jobs during this time.

Coal’s share of the electric generation pie was 50% in 2007 and it is now 25%, and falling fast: no utility has any plans to build coal-fired power. Between 2010 and early 2019, 546 coal plants that generated 102,000 megawatts retired. And in 2020, another 150 are on the chopping block, says the U.S. Energy Information Administration.

If the coal sector is live on, it has to capture and bury carbon.

“The draft legislation supports clean energy technology development, including an all-encompassing program for the demonstration and deployment of carbon capture, utilization and storage, combined with a new federal regulatory framework that requires low- and zero-emitting generation,” says a statement by American Electric Power
AEP
(AEP), one of the biggest coal-generating utilities. “The transformation of the electric power sector is important for our nation as part of an effort to achieve economy-wide clean energy objectives by 2050.”

Beyond AEP, Duke Energy
DUK
and Southern Co.
SCCO
are taking similar actions and they are supporting the bipartisan McKinley-Shrader bill.

Importantly, those utilities are duty-bound to provide low-cost and reliable electricity to their constituents. For that reason, they are incorporating more wind and solar while changing out their coal plants for those that run on natural gas that is both cleaner and cheaper.

Still a Stretch

But does carbon capture and sequestration have a viable path forward? The technologies are improving, although commercialization is still a stretch.

Consider: Southern Co.’s advanced 582-megawatt coal plant in Mississippi was intended to capture and sequester CO2. Cost overruns and time delays ultimately killed the project, which ballooned to $7.5 billion. And AEP pulled the plug on a carbon capture project in West Virginia, saying that it would be unable to recover its expenses from ratepayers.

FutureGen also flopped. It was a $1.1 billion project — one that would have retrofitted an oil-fueled unit in Meredosia, Illinois.

At the same time, however, Mitsubishi Heavy Industries and Southern Company completed an initial demonstration phase of carbon capture at Southern’s coal-fired Plant Barry in Alabama. That demo was able to recover more than 90% of the carbon dioxide, send it through a 10-mile pipeline, and inject it underground.

And, NRG Energy’s
NRG
Petra Nova plant in Houston is capturing 90% of the CO2 emitted from an existing coal plant and using it for enhanced oil recovery. StatOil, furthermore, is placing 1 million tons of carbon per year into a saline aquifer located in the North Sea.

So can carbon capture and sequestration save coal country or is the technology off limits to most utilities? If it is out-of-reach, how about targeting federal monies to hard-hit areas like Appalachia — similar to what former Vice President Joe Biden has proposed?

If developing countries still rely on coal, then the pursuit of carbon capture makes sense — analogous to how the developers of battery storage have brought that technology into the mainstream. But that still does not preclude a “Marshall Plan” for coal country.

The McKinley-Shrader bill is going nowhere this year. Donald Trump is the president and he denies the existence of climate change — hardly a motivation for him to support government investment in the green industries of tomorrow. Environmentalists, meantime, also need to be convinced that carbon capture is a worthy pursuit. The measure aims to bridge those differences.

The November presidential race will be the determining factor. But if both sides agree that climate change is threatening the country’s economic and environmental health, then it follows that a bill to marry infrastructure investment with carbon mitigation could move forward.



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