Why Coal Is Inevitable 14 comments
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Brad Plumer quotes part of a discussion between Dave Roberts and Sarah Forbes:
[Roberts]: China has hundreds of old-fashioned pulverized coal plants. The argument is that they’re not going to stop burning coal because it’s cheap. But attaching a CCS facility onto a pulverized coal plant is one of the most expensive options. If they won’t do large-scale renewables, why would they do this? If they are willing to do something more expensive, why this and not renewables and efficiency?
[Forbes]: I hope and believe that they are moving forward on renewables. I guess I see it as: if we’re going to continue using coal, this is our one chance to solve climate change. It should not replace investment in energy efficiency or investment in renewables, not here, not in China, not anywhere.
And he adds:
Important question, one that underscores an oddity in the coal debate. Even though it’s still very much unproven, CCS for coal tends to get far more in subsidies than any other low-carbon technology. This held true for the House climate bill, and will no doubt be true of the Senate bill. Advocates usually insist that CCS should get top billing because we’re already using so much coal—it supplies roughly half of our electricity—and therefore coal’s “not going away.” As Virginia Democrat Rick Boucher put it, “preservation of the ability of electric utilities to continue coal use is essential.”
But this is backwards. Conventional coal’s only become so widespread because, for more than a century, it was cheaper than alternatives—partly due to the fact that the pollution it caused went largely unregulated. As we shift to a low-carbon world, where we can no longer afford to burn dirty coal freely, that may not continue to be the case. If CCS ends up being the cheapest, easiest low-carbon option, sure, we should go with that. But if, say, baseload solar thermal proves cheaper than CCS, then that’s going to win out—as well it should. It doesn’t make much sense to say coal’s “not going away” and therefore we have to accommodate it. What we have to do is curb carbon-dioxide emissions. CCS is certainly worth exploring and researching as a promising option, but if it turns out not to be economical as other means of averting climate change, then there’s no principled reason to preserve coal’s primacy.
This is exactly right, and a very good point. And I think it’s particularly relevant in the Chinese context, where there is a great deal of infrastructure left to be built (and where domestic interests don’t necessarily get their voices heard quite like they do here). There’s no reason to assume that China will have to use coal plus CCS, and if we begin sharing technology with them or otherwise encouraging them to green their generation capacity, there’s really no reason for us to push them toward coal plus CCS.
But there’s a problem here in America. As Brad says, for a century coal was very cheap — in part because its negative externalities (which go beyond carbon; have a look at health statistics for mining towns in West Virginia) were unpriced — and it therefore became widespread. The end result was that many people in many places have something to lose from reduced coal use, and so while there’s no principled reason to preserve coal’s primacy, there are very good political reasons for such preservation to nonetheless occur.
This obviously sucks. We’re directing a lot of money in subsidies to coal producers to try and implement a technology we’re not even sure can work on an appropriate scale — money that could be used instead to deploy green technologies that we know work, or to fund research for even greener technologies that might work, or to defray the cost of carbon pricing to the general public. Even better: we could use the money we’re directing to CCS to write checks to the actual people who’d be out of luck if coal’s role in the economy shrank. Then they’d be happy, we’d probably save money, and that whole coal issue would be solved.
But that’s not how things tend to work; we don’t protect the people, we protect the interests. So until the coal caucus is defeated by some anti-coal coalition, CCS it is.
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Carbon Capture Sequestration (CCS) is about the technology being developed to reduce CO2 emissions and enable "clean coal burning" in order to utilize a plentiful energy resource at at time when other competing energy costs are on the rise.
Anyway, getting to my point. Coal is a big part of our future for no other good reason than it is cheap, available and plentiful. It is therefore of interest to all investors and while overlooked by most should not be ignored. It will factor big in our oil-stressed future.
If you doubt me then look at what Teck-Cominco (amongst others) is doing now and note the very significant investments they have made in terms of coal. Teck incidentally has sold off much of their stakes in their Gold properties to pay down debts on coal-fields. Now why is that I wonder?
Unless big companies like Teck are suddenly breeding stupid minds I think it is safe to assume that the future of coal is secure and will even grow over time as CCS advances and other coal-to-fuel technologies are promoted, advanced and developed.
Our post-oil future is coal based and certain.
(IGCC: Internal Gasification Combined Combustion)
CCS - keep an eye on what the norwegians are doing in the north sea.
> jack
Coal is too costly, it's just it's cost is in our income taxes, health care, shortening of buildings, bridges lives, water, land and air pollution etc from mining to burning. We need and soon will have all these costs in coal through a tax so it's real, full cost is in it.
Already coal use in the US is dropping as old coal plants die and replaced by NG, wind and eff, conservation. Last yr there was more wind than any other electric source.
NG is used first in a gas turbine which exhaust feeds an old coal or new steam plant getting 55-60% eff is the new fossil fuel model as coal handling, transport, pollution scrubbing, etc costs are just too much.
So anyone betting on coal are bound to be more poor in the future except coal for iron making like Walter Industries.
The smart long money is on quality companies owning wind farms, other RE as the price of electricity rises and their costs are low, fixed.
Coal to petro-fuel was developed by the Nazis, and later used by apartheid South Africans. Neither group had access to global markets, and so were desperate.
The process doesn't really solve much of today's challenges. We can use wind to produce ammonia to fuel engines. We have lots of natural gas. Coal mining is an environmental and health mess, and burning or converting just compounds the problem. Only when the externality costs (water pollution, habitat destruction, air pollution, mercury and uranium pollution, health care issues, etc.) are ignored does coal appear inexpensive.
Food is really cheap if you always steal from the supermarket.
On Jul 16 10:11 AM johnbee wrote:
> I seem to remember that a company called Sasol or Sasoil in South
> Africa turned coal into fuel in a very big way. Can't this be done
> still and at what cost?
Yes Sasol does do F-T processing but the same can be used to make waste yard, forest, crop biomass into gasoline or diesel.
The Nazi's used this in WW2 and Shell, Syntroleum use it to make Diesel from stranded NG. Interestingly they have run biomass through them but have sold none for that. As Biomass is much cleaner it costs less to make into fuel as the catalyst need cleaning and replacement less often.
There are now big F-T plants in the ME called GTL using NG to diesel though by changing temp, pressure and temp, most any HC can be made. They are several BTL pilot plants in the US now being built.
Sure, China will be heavily using coal for a long time. But, no matter how successful alternative energy is in the US we will be using oil and coal for a long time also. I wish the West would stop pestering China to join the treaties, and get on with developing a plan to move the West, especially the US which is late to the game, at an optimum pace to a low carbon electric economy.
Enough of the hot air!
Coal has a future but we need to develop a means to use it in a less harmful way. I don't like dirty coal burning any more than you do but let's not write off the whole industry and the technologies being developed now that could make coal a big winner in the future. This is still one resource that is so plentiful and accessible domestically that it makes oil look like gold plated energy.
We need more investment in coal and research done far back in the 30s and 40s clearly suggested strong potential. Keeping it clean is in everyones best interest. Coal has a very bright future in my opinion but we will have to leave the details to the scientific minds to make it both acceptable in the new "green" world and efficient enough to compete with new energy forms like solar and wind.
On July 16th 2009 Ryan Avent wrote:
"This obviously sucks. We’re directing a lot of money in subsidies to coal producers to try and implement a technology we’re not even sure can work on an appropriate scale — money that could be used instead to deploy green technologies that we know work, or to fund research for even greener technologies that might work, or to defray the cost of carbon pricing to the general public"
To sequester CO2, first it must be captured from the high velocity gas stream going out the boiler and into the chimney and out into the atmosphere. If you have observed a power plant chimney in full operation you will see this very high volume of hot CO2 gas flowing out of the large diameter chimney stack. This gas flow has to be captured and then compressed with very large compressors, run the compressed gas into pipes that sends the gas into the ground..... into some cavern deep into the earth.
Two big problems. First is, to compress the gas, 30-50% of the output power generated by the coal powered power plant is needed. This CO2 capturing plant itself will cost more than the power plant. Second, let us assume somehow that the capturing plant is economically feasible (which it is not) so we can continue the discussioon. The captured and complressed CO2 is now sent to some deep storage spaces below the earth. How long (assuming it exists in the right locations) will it take to get filled up with enormous daily volume of CO2 gas from the power plant? Not very long! Can't store anymore CO2. Then what? We are back where we started.... meaning the CO2 is then again released straight into the atmosphere...and consequent addition to global warming.
Anyone who have taken College Chemistry will understand my logic. [Why Steven Chu who has won a Nobel Prize cannot understand this and does not shoot down CS ideas is beyond me.]
The only significant solution to global warming is building more nuclear power plants. Phasing out coal and phasing in nuclearpower will take 30 years plus. People can adjust over this time period. We need to start with the nuclear power plant design we know followed by more advanced designs that are inherently safer and cannot be used to produce atomic bombs. We need to start building prototypes of various designs of nuclear palnts (which includes plants that use safer and more abundant thorium instead of uranium) as we build new one to replace coal plants and the old nuclear plants built in the 60's and 70's.