There will be no new coal plants built in the US, and existing ones are coming under pressure from renewables. Energy utilities are switching to wind power instead: Xcel Energy has promised to use 100 percent carbon-free electricity by 2050. L. Michael Buchsbaum goes in-depth.
“Then the coal company came with the world’s largest shovel/And they tortured the timber and stripped all the land/They dug for their coal ‘till the land was forsaken/And then they wrote it all down as the progress of man…”
Singing about his family’s ancestral home in Western Kentucky, John Prine’s 1971 country-folk song “Paradise,” about the ravages of strip mining, became an anthem for the growing environmental movement.
Now some 50 years later, the last 971 MW unit of the giant Paradise power plant, once the largest coal-fired power plant in the world, may finally be shuttered by the Tennessee Valley Authority (TVA), ending an era. Simply uncompetitive against renewables and cheap fossil gas, that unit and almost every other coal-fired one nationwide, may be nearing the end of the line.
Coal use in the US still falling
From its 2007 peak, America’s coal consumption has fallen over 44%. Now at only 691 million short tons (MMst), it’s at the lowest level since 1979. Since 2010, at least 630 coal-fired plants across 43 states — nearly 40 percent of the U.S. coal fleet, have either closed or announced they soon will, according to data by the American Coalition for Clean Coal Electricity. The trade group doesn’t have any interest in greenwashing, either: it represents some of what were once the largest coal burners and miners in the world, like the Southern Co. and storied miner Peabody Energy, who Prine also mentions.
By the end of 2017, over 500-units with a combined capacity of 55 GW were shuttered. In 2018 another 14 GW were expected to be taken off-line too, based on data reported to EIA by plant owners and operators, the second-highest year for coal retirements after the 14 GW switched off in 2015. And the bleeding is set to continue as at least another 4 GW of capacity is slated to retire through 2019 based on the U.S. Energy Information Administration prediction of coal’s share of the domestic electricity market further declining to just 26 percent.
With so much wind, solar and cheap fossil gas flooding the system, coal-dependent electricty producers are looking for the exits regardless of all of Donald Trump’s promises and pandering to coal country voters. Despite essentially rolling back environmental protections to Nixon-era pre-EPA levels, big coal burners like PacifiCorp, the quasi-federally owned TVA and others are accelerating planned shutdowns.
Renewables, not coal, provide cheap energy
Going forward, virtually no analysts expect new coal plant openings, said Toby Shea, vice president at Moody’s Investors Service. Even “existing coal plants are being challenged by low-cost natural gas and renewables,” even with the easing of environmental regulations.
With so much cheap wind and renewables coming on line, billionaire Warren Buffet’s Berkshire Hathaway-owned utility giant, PacifiCorp has concluded that most of its 10 coal fired plants, with a nearly 6,000 MW combined capacity, are no longer economically competitive.
Selling power to almost two million customers across six western states (California, Idaho, Oregon, Utah, Washington, and Wyoming), and generating some 40 million tons of CO2 annually, PacifiCorp’s recently made public an internal unit-by-unit review that found 13 of 22 units could be replaced with cheaper alternatives. Additionally, the review found that they could save consumers money by retiring 16 of its 22 coal units early, pegging 2022 as a hypothetical retirement date. The study is reflective of “the continued cost pressure on coal generation driven by market forces and regulatory requirements,” said PacifiCorp spokesman Bob Gravely in an email.
The debate over PacifiCorp’s coal plants comes as the utility gears up for a major increase in its renewable portfolio. The company’s plans call for building enough wind generation to power 400,000 homes by 2020. Two more important takeaways from the PacifiCorp news is that, despite how close most of their units are to Wyoming’s Powder River Basin, the largest and lowest coalfield in the U.S, they still are not competitive. Secondly, Berkshire Hathaway also owns outright the BNSF Railroad, the largest in the U.S., and the nation’s biggest coal hauler (and second largest user of diesel fuel in the world, after the U.S. Navy), which originates and delivers a good portion of the PacifiCorp’s coal burn. Essentially a vertical monopoly, if those units aren’t able to make money at that point, what about every other coal plant across the country?
In another sign of King Coal’s demise, just a few days after the November midterm elections, in sunny Colorado utility giant, Xcel Energy, announced its new clean energy vision that will see it deliver 100 percent carbon-free electricity to customers by 2050. Serving 3.6 million customers across eight states –the Minnesota-based company has already reduced its carbon emissions 35 percent since 2005, as part of its previous goal to cut carbon 60 percent by 2030. Long a clean energy leader, even though the company believes that its 2030 goal can be achieved affordably with renewable energy and other technologies currently available, achieving the long-term vision of zero-carbon electricity requires technologies that are not yet cost effective or commercially available today. Because of that, the company is working closely with laboratories and other think tanks to get the rest of the way there.
However, like California’s recent SB 100 law, Xcel explicitly did not promise 100 percent renewable electricity. It promised 100 percent carbon-free electricity, allowing it to rely on advanced nuclear and fossil fuel power plants with carbon capture and sequestration. Additionally, the state of Colorado, where Xcel is the biggest energy producer, has also announced plans to achieve carbon neutrality before mid-century.
“Xcel Energy’s ground breaking climate commitment is an act of true leadership…and will help speed the day when the United States eliminates all such pollution from its power sector,” said Fred Krupp, president of Environmental Defense Fund. Though the first major US utility to pledge to go completely carbon-free, given the ever-cheaper economics of renewables plus storage, it won’t be the last.