From: Beth Little <blittle@citynet.net>
To: James Kotcon <jkotcon@wvu.edu>; ec@osenergy.org; Jim Sconyers <jim_scon@yahoo.com>
Sent: Thu, March 10, 2011 2:14:42 PM
Subject: RE: [EC] Fw: Released today: A Risky Proposition: The Financial Hazards of New Investments in Coal P
Do you mean the planning meeting? We settled on Mar 21, which is a Monday.
-----Original Message-----
From:
ec-bounces@osenergy.org [mailto:
ec-bounces@osenergy.org] On Behalf Of James Kotcon
Sent: Thursday, March 10, 2011 11:18 AM
To:
ec@osenergy.org; Jim Sconyers
Subject: Re: [EC] Fw: Released today: A Risky Proposition: The Financial Hazards of New Investments in Coal P
This is a dynamite report, and very timely. We need to make this a
centerpiece of our campaign planning. Are we set for Saturday?
JBK
>>> Jim Sconyers <
jim_scon@yahoo.com> 3/10/2011 10:51 AM
>>>
Jim Sconyers
jim_scon@yahoo.com 304.698.9628
Remember: Mother Nature bats last.
----- Forwarded Message ----
From: LuCinda Hohmann <
LHohmann@UCSUSA.ORG>
To:
COAL-COMBUSTION-WASTE@LISTS.SIERRACLUB.ORG Sent: Wed, March 9, 2011 6:17:03 PM
Subject: Released today: A Risky Proposition: The Financial Hazards of
New
Investments in Coal Plants
FOR IMMEDIATE RELEASE
Contact: Randy Rieland, 202-331-6959
NEW REPORT WARNS AGAINST INVESTMENTS IN NEW OR EXISTING COAL-FIRED
POWER PLANTS
REPLACING COAL PLANTS WITH CHEAPER, CLEANER, LESS RISKY ALTERNATIVES
WOULD SAVE
LIVES AND
CURB CLIMATE CHANGE EMISSIONS
WASHINGTON (March 9, 2011) – The cost of constructing or retrofitting
coal-fired
electric power plants and the rising cost of coal have made coal power
an
extremely risky long-term investment, according to a report released
today by
the Union of Concerned Scientists (UCS). The report, “A Risky
Proposition: The
Financial Hazards of New Investments in Coal Plants,”also identified
a number of
other factors that make investing in coal a gamble, including its
continuing
threat to public health and the environment.
“We have a fleet of ancient, dirty coal plants in this country that
are
increasingly unreliable and long past due for retirement,” said
Barbara Freese,
a co-author of the report and senior policy analyst for the UCS Climate
and
Energy Program. “Plant owners have to decide whether to sink more
money into
retrofitting
those old plants or replacing them with much cleaner
energy
technologies. But even if they retrofit them with the pollution
controls
available today, the plants will still emit massive amounts of carbon
pollution.
“Replacing old, dirty coal plants with cleaner, cheaper, less risky
alternatives
would be a much better bet,” she added. “And it would save lives,
protect our
health and reduce the emissions that cause climate change.”
More than 70 percent of U.S. coal-plant-capacity is already more than
30 years
old—the operating lifetime for which coal plants were typically
designed—and a
third went online before 1970. Some plant operators have announced they
will
retire old plants. Others are planning to retrofit their plants with
modern
pollution control technology—which would reduce emissions of several
dangerous
pollutants, but not carbon.
Such investments would not only make it harder to protect the climate,
the
report concluded, but also expose investors and ratepayers to a host of
financial threats.
The factors that make coal power such a precarious investment include:
· U.S. coal prices are rising and could be driven much higher
by soaring
global demand, especially from Asia. Spot prices for Appalachia coal
spiked
dramatically in 2008, largely due to international demand, and those
prices are
steadily rising again with the global economic recovery. And the price
for a
one-month contract for coal from Wyoming’s Powder River Basin rose 67
percent
between October, 2009 and October, 2010. While western coal has been
less
exposed to volatile global markets, that situation appears to be
changing since
major coal producers in the West have announced plans to increase
their
exports
to China and other Asian markets.
· Coal prices could also be driven higher by constraints on
supply. The
amount of economically-recoverable coal reserves may be smaller than
previously
thought.
· Major coal projects face high, unpredictable construction
costs. The
cost of building a new coal plant in the United States has roughly
doubled in
the past five years.
The cost advantage coal power traditionally enjoyed over
cleaner
energy options has largely disappeared when it comes to new plants.
Power from
new coal plants now costs more than power from new gas plants, wind
facilities
and the best geothermal sites, and much more than investing in energy
efficiency.
· Coal power is the largest U.S. carbon
pollution
source—contributing
about one-third of all energy-related emissions and more than the
entire surface
transportation sector. Coal-fired power plants inevitably will face
increasingpressure to dramatically cut emissions to help curb climate
change.
The cost of generating electricity from new coal plants could increase
11 to 37
percent under a range of carbon prices in the future.
· Carbon-capture and storage (CCS) retrofits cannot be counted
on to
affordably cut emissions. Federal studies show that adding CCS to a new
plant
could increase the cost of generating electricity 36 to 78 percent,
while
retrofitting an existing plant could increase its costs by 330 percent.
· Federal and state governments are promoting energy efficiency
and
clean energy sources, which will cut demand for coal
power.
Twenty-seven states
have energy efficiency standards or a standard pending, and several
states now
require annual reductions in electricity use of at least 2 percent.
Twenty-nine
states now have a standard requiring utilities to increase their
reliance on
renewable energy sources, more than doubling since 2004.
· Coal plants also face new costs associated with such harmful
emissions
as sulfur dioxide and nitrogen oxide, which are associated with
thousands of
deaths annually, and mercury, which threatens the brain development of
infants
and children.
The owners of the most damaging older coal plants have been taking
advantage of
a legal loophole for decades, Freese pointed out. Clean air legislation
and
rules put in place in the 1970s did not require existing plants to
install
pollution control equipment until their next
major modification. It was
assumed
that they would either modify or shut down within a few years.
“But coal operators kept these plants running well beyond their
expected
retirement dates and never installed the pollution controls newer
plants were
required to use,” Freese said.
Even with this loophole, federal air regulations have gone a long way
to protect
the public health.
The Clean Air Act Amendments of 1990, for example, signed into law by
George
Herbert Walker Bush, prevented as many as 160,000 premature deaths last
year
alone, according to the
Environmental Protection Agency (EPA). The amendments also were cost
effective.
According to the EPA, they’ve cost $65 billion to implement, but
their overall
financial benefit could reach $2 trillion by 2020.
“The success of the 1990 Clean Air Act Amendments shows that
requiring coal
plants to cut their pollution leads to public health and economic
benefits many
times higher than the cost for old coal plants to comply with the
law,” Freese
said. “The amendments have done a lot of good, but we need to do
more. Coal
plants are still linked to the deaths of thousands of Americans yearly
and many
other health threats.”
Finally, according to the report, the electric power industry could
retire many
old coal-fired plants without causing reliability problems with the
power grid,
Freese said.
“First, there is a lot of extra generating capacity on the grid right
now. And
second, energy efficiency and renewable energy investments are reducing
the need
for coal. It’s a good time to retire coal plants.”
###
The Union of Concerned Scientists is the leading U.S. science-based
nonprofit
organization working for a healthy environment and a
safer world.
Founded in
1969, UCS is headquartered in Cambridge, Massachusetts, and also has
offices in
Berkeley, Chicago and Washington, D.C. For more information, go to
www.ucsusa.org.
LuCinda Hohmann
Midwest Outreach Coordinator
Union of Concerned Scientists Midwest Office
1 North LaSalle St, Suite 1904
Chicago, IL 60602
312-578-1750 x12
LHohmann@ucsusa.org www.ucsusa.org - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - To
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