Coal Age

DEC 2017

Coal Age Magazine - For more than 100 years, Coal Age has been the magazine that readers can trust for guidance and insight on this important industry.

Issue link:

Contents of this Issue


Page 7 of 51

6 December 2017 news continued d a t e l i n e w a s h i n g t o n During the President Barack Obama administration, serving in the Department of Energy's (DOE) Office of Fossil Energy was a thankless task, like being a stand-up comic in a penal colony. Clearly there is a need for comic relief, but the guards and conditions discourage a sense of humor. Definition of "thankless": the fossil energy office serving a president who campaigned to bankrupt the coal industry. At a time when coal was used to power up to half of the grid, the president's political minders were coal phobic. In those days, much good news about coal's value to the economy, or the potential of advanced coal technologies to reduce emissions, was stifled from the top. Today, we hear constant complaints that environmental science is being ignored or buried in the current administration. Now we're "shocked, shocked" to learn that this behavior began much earlier. For- mer staff at the fossil energy office complained bitterly of political inter- ference that blocked public release of favorable reports about coal from the National Energy Technology Labs (NETL) and other scientific sources. Fresh evidence of such meddling came to light last month when the DOE released five NETL reports — courtesy of "an anonymous source" — that appeared to have been deliberately suppressed. Three of the five were up on the DOE's website briefly before they were abruptly pulled down in July 2015. The other two never saw the light of day. And not because anyone quarreled with the factual findings; they were just the "wrong" findings. Or, put another way, the right findings but emerging at the wrong time. One report was especially relevant today. It examined the impact on the Eastern Interconnection of announced plant retirements from the Mercury and Air Toxics (MATS) rule. NETL estimated almost 42 GW would be gone by 2025, about 7% of the region's total — of which more than 30 GW were coal units. Contrasting two scenarios, retirement and no-retirement, NETL found that on-peak prices would increase under both. But here's the relevant part: By 2025, prices under the "retirement" scenario would shoot up much faster, up to 81% over the "no-retirement" scenario. The average on peak marginal price, based on a modest 1% increase in demand over the study period, would increase by 70%. In short, the MATS retirements would add $30 billion to meeting projected demand, a whopping 50% above the cost of the no-retirement scenario. As prices climb, grid reliability falls. NETL found that owing to trans- mission bottlenecks, retirements would make the regional grid less reli- able. To avoid more serious risks, significant capacity additions to those already in cue would be needed as early as 2020. A total of 60 GW would be required by 2025 when reserve requirements are factored in, said the report. By contrast, the no-retirement scenario would need no additional capacity to ensure timely and reliable power supply. "It would have been nice to know of these findings when [Secre- tary] Perry proposed his [cost recovery plan] to FERC," said a DOE official. He was referring to DOE Secretary Rick Perry's proposal last month to allow some utilities to capture the resilience value of base- load power plants that store fuel on site, minimizing their vulnerabil- ityto disruptive events. Perry's plan was savagely attacked by the re- newable fuels industry among others as cheap favoritism — unlike the costly favoritism they receive from production tax credits and renew- able fuel mandates. Another NETL report, examining the impact of coal retirements on the PJM, found that additional generating capacity would be required as early as 2020 and that short-term pipeline congestion is possible given long timelines for permitting new transmission. A third study, one never publicized, summarized the "Benefits of NETL's Clean Coal and Carbon Management Program." Wonder why this was never publicized? Federal regulators are expected to weigh Perry's proposal and this winter they'll suggest their own solution for bolstering the resilience and reliability of a grid that looks increasingly reliant on intermittent and less diverse sources of fuel. Luke Popovich is a spokesperson for the National Mining Association, the industry's trade group based in Washington, D.C. Science Dies in the Dark by luke popovich "'It would have been nice to know of these f indings when Secretary Perry proposed his [cost recovery] plan to FERC,' said a DOE off icial."

Articles in this issue

Links on this page

Archives of this issue

view archives of Coal Age - DEC 2017