74% of US coal mills threatened by renewables, but emissions continue to rise



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Wind turbines near a coal plant.
Extend / The wind turbines spin as the steam rises from the cooling towers of the Jäenschwalde coal plant.

The International Energy Agency (IEA) released a report on Monday saying that by 2018 "global CO2 emissions rose 1.7 percent to 33 gigatons. "This is the largest growth in emissions the world has seen since 2013.

Coal use contributed to one-third of the total increase, mainly from new coal-fired power plants in China and India. This is worrying because the new coal plants have a useful life of approximately 50 years. But the consequences of climate change are already upon us, and the carbon emissions profile of coal compared to other energy sources means that globally, carbon mitigation will be much more difficult to solve than it may seem from here in the US.

Even in the US, carbon emissions grew by 3.1% in 2018, according to the IEA. (This closely follows estimates by the Rhodium Group, which released a preliminary report in January stating that US carbon emissions increased by 3.4% in 2018.)

"By country, China, the United States and India together accounted for almost 70% of the increase in energy demand," he wrote to Reuters.

74% of coal power is not economical in the US?

The numbers remind us that the economy alone is probably not enough to contain carbon emissions in the United States. Last week, the Energy Department of the Energy Information Administration (EIA) said that, save for some significant and unpredictable changes, US carbon emissions will likely remain virtually unchanged by 2050.

This estimate takes into account the large carbon-cutting measures already in place in many states in late 2018, including California's promise to meet 100 percent of its energy needs with carbon-free electricity. (This does not take into account very recent political decisions, like the New Mexico pledge that was signed in March.)

Energy Information Management

EIA projections assume that coal will be phased out aggressively, but despite this elimination, the EIA expects 17 percent of the country's energy mix to come from coal power in 2050.

There is some hope that EIA projections will be overly conservative. Vibrant Clean Energy (VCE) analyst and non-partisan think tank Energy Innovation released a report (PDF) on Monday saying that 74% of coal capacity in the US is not economical compared to new renewable sources. That is, the report compared the Marginal Cost of Energy (MCOE) to continue to operate coal-fired power plants with the Cost of Lean Energy (LCOE) to replace that capacity with new wind or solar energy.

The result was that, megawatt-hour per megawatt-hour, brand new renewable energy was cheaper than continuing to operate existing coal plants 74% of the time. By 2025, the researchers found that 85% of the US coal fleet was not economical compared to the new renewable energy.

So why do coal-fired power plants not face more pensions if they are too bad to continue to work compared to the newer and cleaner energy? Ultimately, the cost of running a coal-fired power plant is different from the price paid by the plant owner, and in many markets, old plants may continue to profit from the tariffs they charge. Utility Dive specifically notes that many coal-fired power plants in the Northeast benefit from the regional power operator's market power capacity, which is a marketplace for energy companies to sell their electricity years ahead of time.

VCE and Energy Innovation concede that simply comparing MCOE of coal and LCOE of renewable energy is not sufficient to determine if a coal plant will be deactivated. But the companies' report says any coal-fired power plant that does not have such a comparison should trigger "a wake-up call for policymakers and local stakeholders that there is an opportunity for productive change in the immediate vicinity of the plant."

Could the batteries catch the slack?

On Tuesday, Bloomberg New Energy Finance released a report saying that the lCOE of lithium-ion batteries (ie the cost of batteries and installation divided by the amount of usable energy they will provide during their lifetime) dropped 35 percent from the first half of 2018 to $ 187 per megawatt-hour.

For comparison, the VCE and Energy Innovation report released on Monday noted that most coal-fired power plants have an MCOE of $ 33 to $ 111 per megawatt-hour. If the price of batteries continues to fall as much as in 2018, lithium-ion battery banks could soon be competitive with a number of expensive but still operational US coal-fired power plants. And, unlike wind and solar energy, large battery banks offer dispatchable energy, which can be used regardless of whether the wind is blowing or the sun shines.

Still, waiting for the economy to go its course and killing coal does not solve the problem of natural gas, which is extremely cheap and growing in the United States. Natural gas was partly responsible for the increase in carbon emissions last year. To solve this problem, it now seems that policy or technology will have to intervene.

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