Monthly Archives: September 2017

Coal Related News from Around the Nation

Energy Supply for Our Citizens Must Transcend Politics

Via The Morning Consult:

The number of coal and nuclear power plants that have closed in recent years could power tens of millions of homes. In April, Energy Secretary Rick Perry asked for a report on whether continued closures pose a threat, and whether the markets are adequately compensating the resilience benefits these “baseload” or “always on” power plants provide. Energy supply is critical, especially in emergency circumstances. We need the most secure and reliable generation we can provide.

The DOE report is in, and it shows we have work to do: “Recent severe weather events have demonstrated the need to improve system resilience …  [L]ow average wholesale energy prices, while beneficial for buyers of wholesale electricity, represent a critical juncture for many existing baseload generation resources and their role in preserving reliability and resilience. . . . Markets need further study and reform to address future services essential to grid reliability and resilience.” The reference to “severe weather events” was even before Hurricanes Harvey and Irma, as severe cold weather is every bit as challenging.

As soon as the study was first announced, the political lines were drawn. “Rick Perry Thinks You’re Stupid,” screamed the headline of a Sierra Club article, claiming the study was “attempting to stop the renewable revolution.” Advanced Energy Economy wrote, “Though off base from the start, we can only expect that such a study, with its apparently predetermined result, will lead to policy action that will attempt to harm” wind and solar energy.

Let’s be clear – this study was about keeping the lights on. Its analysis was long overdue, even though much of the information was gathered during my tenure as assistant secretary of fossil energy in the first term of the Obama administration. Our information raised concerns that purposely were not made public at that time because it would have exposed flaws with regulations the Environmental Protection Agency ultimately imposed on CO2 emissions. That lack of forthrightness in government should disturb us all.

Since it’s impossible to store electricity in society-sized amounts, we need power generators that can run all the time. Coal and nuclear can run on demand to serve this need. So also can other power plants – natural gas, hydropower, geothermal and others.

But over recent years we have seen a steady decrease in coal and nuclear power and a rise of less reliable sources like wind and solar thanks to government incentives and tax credits. Wind and solar do sometimes produce more power than we need, but not nearly enough at other times. Ability to produce on demand is a fundamental pillar of the power system, but the country continues move away from sources that can do so without addressing the market and economic needs of “always on” baseload generators. That is a long-term formula for disaster.

The shale revolution has made gas plentiful and inexpensive. It certainly helps, but there are limitations. Some states have banned fracking. Many do not have pipeline infrastructure to deliver gas, and have created roadblocks and barriers to building gas pipelines. And unlike coal and nuclear, gas cannot be stored on site, making it more vulnerable to supply disruption and market variability. Should anything happen to those pipelines, there must be a way to secure fuel from elsewhere.

That’s exactly why we must keep coal and nuclear in the “all of the above” energy mix. The North American Electric Reliability Corporation, the overseer of grid reliability, reports, “The rapid changes occurring in the generation resource mix and technologies are altering the operational characteristics of the grid and will challenge system planners and operators to maintain reliability.”

I believe CO2 plays a role in climate change, but controlling its output cannot be the exclusive definition of environmental responsibility. We have to be honest about both environmental considerations and the necessity of power sources that can produce energy on demand.

Now that DOE has studied, the government must act. The Federal Energy Regulatory Commission has jurisdiction to oversee wholesale electricity markets and can help ensure that we make power increasingly environmentally responsible through technology while investing in solving all of the challenges that comprise reliability.

DOE has thankfully invested in and embraced the analysis and has the opportunity to influence and direct agencies such as FERC to act. Our public good demands that action.

Charles McConnell is executive director of Rice University’s Energy and Environment Initiative and previously served as assistant secretary of energy under former President Barack Obama from 2011-2013.

See the article here. 

Advancing Coal Technologies

Advancing Coal Technologies

September 27, 2017

From all the news coverage it’s getting, National Clean Energy Week appears to be a carefully kept secret, trumped by NFL protests, a Senate primary and Puerto Rico’s dystopia. That’s a pity. Exciting things are happening in clean energy technologies and the global market they serve.

Renewables understandably get star billing in this discussion, but maybe the more important but surely overlooked developments are occurring in the fossil energy sector.

Start here in the U.S. Thanks to scrubbers and other combustion technologies, U.S. coal plant emissions have plummeted 91 percent since 1970. Not because we’ve used less coal; over the same period (1970-2016) coal use climbed by almost 40 percent. So, fewer emissions from an abundant, reliable and affordable source of power.

We’re on the cusp of more dramatic reductions. For example, the Prairie State Energy Plant in Marissa, Illinois bristles with advanced technologies that remove 85 percent of NOx, 98 percent of SO2, 90 percent of mercury and 99 percent of PM. All the while using less coal per generated electron thanks to much higher plant efficiency.

(more…)

Attitude Shift from US Government Gives Coal Sector Hope

Via Platts:

The US coal industry has hope for its future where a year ago there was not any, according to Bill Raney, President of the West Virginia Coal Association.

Speaking Tuesday at the S&P Global Platts Coal Marketing Days Conference in Pittsburgh, attendees highlighted the improved relationship with the federal government, rather than any major policy changes, since the election of Donald Trump to the US presidency.

Raney said the Obama administration launched a “war on coal” in 2008 that crippled the West Virginia coal sector, leaving 60% of the state’s production in bankruptcy and causing production to drop to a 40-year low.

“I don’t know if we’ve totally survived it or not but we’re a hell of a lot closer than we were before November 8,” he said, noting the date of Trump’s election.

Raney said the appointment by Trump’s administration of several government officials with ties to the coal industry to prominent mining and energy policy roles should also prove helpful.

David Stetson, Chairman of Alpha Natural Resources, was more cautious in his evaluation of the new president’s impact, but agreed cooperation from the regulatory environment has improved.

“We have seen some movement back to what I would consider a normal working relationship with the authorities,” said Stetson.

Speaking on the sidelines, an Alaskan miner told Platts, “you could see the change in tone at the federal agency within two months [of Trump’s inauguration]. We had an application approved that had just been sitting there for two years to broaden our mining operation.”

Moving forward, Raney called for the government to incentivize plant upgrades and introduce a requirement for power plants to have at least 30-60 days supply of coal to ensure mine production.

He also suggested there should be more support for domestic rare earths production, as China’s dominance in the space could become a security question. The same argument has been used by US steel producers to call for a section 232 order to limit imports of steel.”

See the article here.

Warmed Again by Coal

Via The Washington Times:

Gentlemen, start your thermostats. Ladies, too. The Obama war on coal, which cost Hillary Clinton the vote in once-reliably Democratic West Virginia, is over. Maybe the war on nuclear energy, too. Americans might soon heat their homes without choosing between the warmth and food and medicine.

It’s not quite a “so long, solar” moment, but common sense on energy is clearly making a comeback, summed up in the headline in The New York Times, “Under Trump, Coal Mining Gets New Life on U.S. Lands.” The White House is looking for ways to encourage more mining, too — not less, as in the Obama years — on the nation’s federally managed land. Beyond that, the U.S. Interior Department is looking to reduce the size of some of these federally managed properties and national monuments. This would restore more private investment in mining.

The pro-coal movement is already having a good effect. About 85 percent of the nation’s coal on federal lands is extracted from the Powder River Basin, which runs through Montana and Wyoming. President Trump intends to roll back moratoriums on new coal leases on these lands.

Exports of coal has fallen steadily over the past eight years, falling from 28 million short tons in 2013 to 12 million short tons in three years later. Since the Trump inauguration, coal exports have surged to 22 million short tons, a remarkable increase in just eight months.

“For the past eight years,” said Paul Bailey, president of the American Coalition for Clean Coal Electricity, told Congress, “we’ve had a fair amount of environmental overreach from the Obama administration and that has contributed, we believe, to the majority of coal retirements that have happened in the past.”

Those “retirements” have led to increased electricity costs for consumers. The average American’s electric bill rose 11 percent under Mr. Obama, according to government data cited by the Daily Caller.

West Virginians suffered most. The average West Virginia homeowner watched electricity costs rise from 7.27 cents per kilowatt-hour in November 2008 to 11.72 cents in 2016 — a 62 percent increase. Customers in Kansas, Michigan, South Dakota and Nebraska experienced rate increases of 40 percent or more during that time. Overall, 42 states and Washington, D.C., watched electricity costs spike during the Obama years.

“We are all affected by this constant regulatory quagmire,” says Bill Cadman, vice president of Whiting Petroleum, which drills mostly on leased public lands. But maybe under the new administration, not so much. The cold months are coming, and lower power and light bills will warm everyone.

See the article here.

Coal CEO Says Trump Made New Mine Possible

Via Fox Business News:

Paringa Resources is taking the rare step of building a new coal mine in the U.S., as the Trump administration rolls back regulations on the struggling industry.

The coal company is building a coal mine in Kentucky and expects to begin producing coal in mid-2018. It will construct another mine that’s scheduled to be in action by early 2019.

In an interview with Maria Bartiromo on the FOX Business Network’s “Mornings with Maria,” CEO Grant Quasha said President Donald Trump pushed the project over the goal line.

“All we had to do was raise the money,” he said. “On the back of the Trump administration coming into the Oval Office and ending the war on coal, we were able to successfully raise approximately $40 million worth of financing in the Australian equity markets to help build out this mine.”

The Poplar Grove Mine will produce nearly 3 million tons of thermal coal for a local power utility. The Cypress Mine will provide an estimated 3.8 million tons following its construction, according to Paringa Opens a New Window.. The mines are located in the Illinois Basin, a coal-producing basin that stretches across parts of Indiana and Kentucky.

Paringa is hiring 200 people over the next 12 months to support Poplar Grove. Quasha said the company plans to hire another 300 people for its second mine.

Coal production in the U.S. has decline in recent years under pressure from new regulations imposed by the Obama administration and low prices for natural gas. Paringa is betting on a turnaround. Quasha believes natural gas, which is trading around $3 per million British thermal units, will rise to $4. He also sees international demand improving through 2030.

Quasha also expects the coal industry to continue reaping the benefits of President Trump’s regulatory reform for years to come. By rescinding coal rules through the Congressional Review Act, future administrations must go through Congress to seek a renewal of Obama-era regulations.
See the article here.

The Coal-Terminal Debate: A View From Japan

Via The Seattle Times:

It has been more than six years since Japan suffered the devastating earthquake and tsunami that triggered a meltdown at the Fukushima Dai-ichi nuclear power plant. The world is well-aware of the massive destruction caused by this unprecedented natural disaster. Perhaps less well-known is that the disaster also radically changed Japan’s energy options.

Japan lacks meaningful domestic natural energy resources and consequently imports 96 percent of such resources. Nuclear energy was seen as a viable way to be more self-sufficient in meeting our energy needs. But Fukushima changed all that with the ensuing suspension of nuclear power generation and loss of public support. Despite a concerted national effort to deploy additional renewable resources, the loss of nearly one-third of power generation capacity was difficult to replace. We were suddenly more reliant than ever on imported fossil fuels to generate electricity.

Today, we are one of the world’s top importers of coal. It is a major, indispensable source of energy in Japan for electricity. Our economy and society depend on it as a stable, reliable energy source. A stable energy supply is also a matter of national security. In a region that is becoming increasingly unfriendly and unstable, this has never been a harsher reality.

Coal has always been an important part of Japan’s energy mix, but this dependence increased dramatically after the Fukushima disaster. In fact, Japan is currently building two new advanced technology gasification-based coal plants in the Fukushima area — called “the Fukushima Revitalization Project” to ensure energy security and revival of local economy.

To stabilize and secure our supply, Japan is highly interested in importing coal from the United States, a trusted ally and reliable trading partner. We do not import any appreciable energy resources from the U. S. today. As major trade partners with Washington state, we see the proposed Millennium terminal in Longview as a solution in meeting our energy, national-security and economic-growth needs.

Japan is committed to honoring its Paris Climate Accord commitments. We all recognize that coal is a major source of greenhouse gases, but it is also one of the world’s most accessible, abundant and reliable energy sources. The 2016 International Energy Outlook concludes that coal will remain the second-largest energy source worldwide until 2030. World coal consumption is projected to increase by more than 20 percent by 2040. Knowledgeable and responsible energy planners, economists and humanitarians agree that this reliance on coal is a reality that will not change for decades.

There is a viable path forward with coal: reducing emissions through advanced coal technologies and more efficient consumption. By significantly reducing CO2 emissions from coal, we can move the needle in the right direction as we also work to bring new technologies online.

Japan is a global leader in aggressively pursuing high-efficiency/low-to-zero-emission technologies for generating electricity from coal. This includes some of the most technologically advanced coal-fired power generation plants in the world. We also want to import the highest quality coal possible to optimize our substantial investments in coal technology infrastructure.

Coal shipped through the Longview terminal is Powder River Basin coal. Due to its unique qualities, this coal is the most suitable fuel for the highly efficient gasification-based technologies we are developing at Fukushima and elsewhere. Japan needs a reliable supply of high-quality coal to support economic growth and national security while also meeting our stringent environmental requirements.

The Millennium project brings substantial benefits to Longview and the state of Washington — and it also offers Japan a sound solution to its pressing energy-security challenges.

The Japanese people are already warmly familiar with such Pacific Northwest icons as Boeing, Starbucks, Microsoft — and, of course, the Seattle Mariners. Millennium represents a mutually beneficial opportunity to further extend our trade relationship and friendship with Washington state, and encourages people in Fukushima Prefecture with a brighter future.

Shozo Kaneko is a fellow of the Japan Society of Mechanical Engineers. He has recently retired from the faculty of the University of Tokyo.d

See the article here.

What Happens When the Coal and Nuclear Plants Close?

Via The Houston Chronicle:

When future policy makers go back and study the U.S. energy industry in the 2010s, one of the defining trends will be the sudden decline of coal and nuclear plants.

Whether this is the beginning of a great new era of American energy or a disaster in the making is the subject of much debate.

And now add another voice to the mix, as the research firm IHS Markit warned in a report released Tuesday that the shift away from coal and nuclear is likely to leave the U.S. grid overly reliant on natural gas and renewable forms of energy and prone to more expensive and volatile electricity prices than we currently enjoy.

“Over the last three years, the problem only seems to have gotten worse,” said Lawrence Makovich, chief power strategist at IHS and the study’s lead author.

The report is funded by the trade groups U.S. Chamber of Commerce, the Edison Electric Institute and the Nuclear Energy Institute – groups that have a lot at stake in what the power grid becomes in the decades ahead.

What Makovich sees is a confused energy market with criss-crossing and contradictory incentives for carbon-free energy that favors wind and solar energy through tax incentives but does not do enough to incentivise carbon-free nuclear.

The study comes as the Federal Energy Regulatory Commission weighs whether to take action to keep afloat a raft of nuclear plants in danger of closing in the years ahead. A report by the Department of Energy last month put the majority of the blame on the flood of cheap natural gas due to the fracking boom and recommended changes to the power market to help the coal and nuclear sectors.

“Our study is saying there is a clear economic argument behind making these additional  interventions because we’re not dealing with a clear market operating without distortion,” Makovich said. “You have favored technologies.”

See the article here.

Coal-fired Power Plants

Via The Bluefield Daily Telegraph:

U.S. Rep. Morgan Griffith, R-Va., has introduced a welcomed measure in the U.S. House of Representatives that could help in further boosting coal’s future.

The legislation would allow a coal-burning power plant or related facility to retrofit or upgrade without meeting new environmental emission standards. Under the proposed measure, the plant or facility would only have to show an improvement in efficiency with less pollutants.

“That would allow some of those folks who have aging coal facilities to retrofit without a big expense,” Griffith told the Daily Telegraph last week. “It would still cost money, but not nearly as much. They only have to show that it (emission standards) would be better than they were.”

 That way, rather than being forced to shut down, a plant or facility could stay open. And the plant could continue to use coal.

Griffith believes the measure will pass the Republican-controlled House and will be supported by President Donald Trump.

Under the Obama administration, a number of coal-fired power plants that provided good-paying jobs were forced to close as a result of unrealistic and overly stringent federal regulations. The Trump administration has since rolled back a number of those burdensome rules.

 Still, in many cases, the damage is already done. A good example was the coal-fired power plant in Glen Lynn, which was forced to close in 2015.

Griffith says he would also like to see a certain percentage of Appalachian thermal coal, which is used in power plants, set aside as a reserve in case of a natural disaster or terrorist attack that would impact the natural gas supply or the supply of coal from western states.

That’s a good idea.

We welcome the ongoing efforts of Griffith, and other congressional Republicans, to boost coal production. The industry is rebounding, and this helps our regional economy. Every new job that is created in the coal and related service industries strengthens our region.

See the article here.

An Argument Out of Touch with Today’s Coal Mining Industry

Via The Pittsburgh Post-Gazette:

The Sept. 10 Forum article “The War on Coal Communities: Strip Mining” is out of touch with today’s coal mining industry. Its author fails to acknowledge that the Surface Mining Reclamation and Control Act of 1977 is not a one-size-fits-all program. Each U.S. mine has detailed plans on how the mined land will be restored — which must be then approved by the government.

The piece devotes much of its time to describing techniques that “started in earnest during the 1940s” but ignores that mining has changed significantly in the 80 years since. Technological advancements, higher industry standards and increased state and federal oversight have contributed to a safer, cleaner responsible industry that cares about the communities in which its employees live and work. Further, mountaintop mining accounts for less than 0.6 percent of coal mining today and continues to be on the decline.

Coal continues to be an important source of electricity. The public deserves an accurate picture of how the industry has changed and advanced to ensure environmentally responsible, affordable and reliable energy for all.

HAL QUINN
President and CEO
National Mining Association
Washington, D.C.

See the article here.

Poll Shows Voters Want a Diverse U.S. Energy Grid

Eighty-five percent of American voters agree that the U.S. should act to protect the diversity of its energy grid to minimize potential impacts from natural disasters like the devastating hurricanes that have struck the U.S. and the Caribbean in the past several weeks, according to a new poll by Morning Consult for the National Mining Association (NMA).

On the supply side, Hurricane Harvey disrupted natural gas production and impacted operations of several pipelines. Even before Irma made landfall in the continental U.S., nuclear power plants across Florida began to shut down.

During and after the hurricanes, damages to infrastructure were catastrophic, with millions expected to be without power for weeks. The U.S. Department of Energy has already announced $50 million in grants to support research and development of next-generation tools and technologies to further improve the resilience of the nation’s critical energy infrastructure.

“With millions of Americans in the dark from Texas to Florida, the U.S. government and the American people acknowledge a need to do more to secure America’s energy grid,” said Hal Quinn, NMA president and CEO. “One way to address potential supply challenges is to utilize a mix of different fuels, including coal, natural gas, nuclear power and renewables. Diversity in the energy market minimizes disruptions when any one fuel source is challenged. At the same time, we need to invest in our infrastructure and support the advanced technologies that make all energy sources as efficient as possible.”

The poll was conducted September 7-11, 2017, of 1,975 registered voters, with a margin of error of +/-2 percent.

See the press release here.

Pennsylvania Coal Production Up by 20 Percent from 2016

Via Trib Live:

Pennsylvania continues to mine about a fifth more coal this year than it did last year, according to the Energy Information Administration’s weekly coal production report.

For the week that ended Sept. 9, the state’s bituminous coal production for the year was up 20.4 percent from the same period last year, maintaining the gain it held throughout August.

Bituminous coal production since January was 35.1 million short tons compared to 29.2 million tons produced by Sept. 9, 2016, according to the agency’s data.

Year-to-date production in the Eastern Pennsylvania anthracite fields also held steady at a 9.1 percent gain from the 2016 totals. The region had mined 1.2 million tons as of Sept. 9 compared to 1.1 million in 2016.

National coal production for the year was 548 million short tons as of last week, a 13.5 percent increase from the same period in 2016.

See the article here. 

Quinn: ‘Coal is Rebounding’

Via The Bluefield Daily Telegraph:

BLUEFIELD — The 22nd biennial Bluefield Coal Show at the Brushfork Armory officially kicked off with optimism this morning, welcoming 195 exhibitors to the “coal show for coal people” and to a renewed growth in the market.

“We have worked to make it a good show every year of the show,” said Charlie Peters, who has been general chairman of the event since its start in 1976.

Peters spoke at the traditional Media Appreciation Breakfast, held immediately before the ribbon-cutting to open the show.

Special guest speaker Hal Quinn, president and CEO of the National Mining Association, said the industry has been subject to “disabling” federal policies over the last eight years, but that has changed with a new administration in Washington.

“Recent federal policies under the last administration … with the regulatory burden penalized the coal industry and consumers,” he said. “Driving coal out of the market had little to do with emissions.”

All of the excessive regulations are now being reviewed and that has allowed optimism in the industry and the market place, he said.

“Coal is rebounding,” he said, citing statistics that show in an increase in the tonnage being produced and shipped overseas.

“It is providing some much needed stability that would have remained out of reach without some changes in Washington,” he said.

After the breakfast, Quinn participated in the ribbon-cutting in front of the armory to officially open the show as exhibitor after exhibitor lined the inside of the armory and the area outside the armory.

“This is a great show for the coal industry,” Quinn said.

See the article here.

EIA: Coal Production Increases Will Continue Through 2018

Via Utility Dive:

Dive Brief:

  • Coal production is up and will continue to rise through next year, according to the U.S. Energy Information Administration’s latest Short Term Energy Outlook.
  • Coal production for August was the first month since October 2015 where production topped 70 million short tons (MMst).

Dive Insight:

EIA’s monthly outlook is a mixed bag, showing growing gas and coal production as well as rapidly increasing renewables capacity. Coal is expected to remain the top generating source through the end of next year, in part due to rising gas prices, but after that its share may decline.

The agency expects the share of U.S. utility-scale electricity generation from natural gas to fall from an average of 34% in 2016 to about 31% this year. During the same period, coal’s forecast generation share rises from 30% to 31% in 2017. Looking ahead, EIA says projected generation shares for natural gas and coal in 2018 average 31% and 32%, respectively.

It’s positive news for coal, particularly along with production data.

Coal production for August 2017 was estimated to have been 74 MMst, or about 8% higher than August 2016. Production for the first eight months of this year was 14% higher than the same period last year, EIA said, and full-year production is expected to increase by 8% in 2017 and by 2% in 2018.

See the full article here.

Forest Service Backs Expansion of Colorado Coal Mine

Via The Olympian:

The U.S. Forest Service is backing the expansion of Colorado’s largest coal mine over the objections of environmentalists.

The Daily Sentinel reports that Forest Supervisor Scott Armentrout announced Thursday that that the benefits of expanding the West Elk Mine near Somerset outweighed the potential environmental threat.

The mine got initial consent to expand under a 2012 state-federal compromise for managing roadless areas but environmentalists sued, saying officials didn’t take the full environmental impact, including climate change, into account. A federal judge threw out the consent but the Forest Service took a first step toward re-allowing the expansion last year under the Obama administration by proposing that Arch Coal be allowed to build roads to facilitate the expansion.

The Forest Service will accept comments on its latest decision for 45 days.

See the article here.

America’s Electricity Supply — Better Safe than Sorry

Via Fosters.com:

Few things are more essential to the way we live than electricity. And yet few are more often overlooked than the electricity grid that supplies it. Most of us simply assume that the power needed to keep our AC going and the lights on will always be there, and at an affordable price. That may be true for now, but it may not be in the very near future.

For one thing, market forces and government regulations have combined to shrink the number of electricity-generating power plants. Nuclear energy that supplies a fifth of our electricity is struggling. Nuclear plants are financially distressed. And bankruptcies and cost overruns have stymied new construction.

Coal power plants that just a decade ago provided more than half of the nation’s electricity now generate just a third. Government regulations and booming natural gas have decimated the coal fleet.

Meanwhile, environmental activists strongly oppose building either nuclear or coal plants, believing that wind and solar power can fill the gap. But replacing the 50 percent of electricity now supplied by coal and nuclear energy won’t be easy when wind and solar power meet less than 7 percent of our current demand.

That leaves natural gas to fill the gap. Optimists reassuringly point to our enormous supplies of natural gas. Experts who just a decade ago thought we would be helplessly reliant on imported gas now fret about a glut. Thanks to fracking technology that unlocked shale gas, the U.S. will become a net energy exporter next year if not before.

And that has some experts very concerned: won’t exporting natural gas, the fuel we’re relying on more than ever, raise its price here? It will if markets respond normally. That’s because exports offer producers a new, higher-value market. Last year, U.S. liquefied natural gas (LNG) found its way to more than 20 different nations and the U.S. Energy Information Administration expects U.S. LNG export capacity to grow sevenfold by 2019.

Natural gas producers see a rosy future. The CEO of oil and natural gas giant Continental Resources predicts U.S. natural gas exports could reach 30 billion cubic feet per day, equivalent to exporting 40 percent of current production.

That could potentially leave U.S. consumers, especially those who are heavily reliant on natural gas for their electricity and heat, with bigger utility bills and more volatile gas prices. A 2015 study for the Department of Energy concluded that “greater LNG exports raise domestic prices and lower prices internationally.”

Costlier electricity at home becomes even likelier if coal and nuclear power are no longer available to fill the gap. The U.S. Department of Energy is so concerned it has launched a study to examine the reliability of the nation’s power grid. Its report is expected soon.

With natural gas exports surging and the EV revolution now here, the safest course is to keep our coal and nuclear plants operating. It’s a recommendation the Energy Department would be wise to make.

We are better at preparing for the future than we are guessing what it will be. But we know we will be surprised. Let’s at least lower the risk that surprises may bring.

See the article here.

Coal Critical to Power Future in Illinois

Via The Illinois Times:

Electricity is easy to take for granted. But imagine the disruption to our lives if we could not charge our iPhones that connect us to the rest of the world or flip a light switch with the guarantee that power was at our beck and call.

Power reliability, however, has been top of mind for Department of Energy (DOE) Secretary Rick Perry, who recently called for a report on the reliability of America’s electric grid. Because of changes brought about by federal and state policies, Secretary Perry is concerned about the health of the electricity grid. Scheduled to be published in the coming days, this report is expected to highlight the challenges that face our electricity grid, as well as provide suggestions for policymakers like me who are working to ensure that recent changes to the grid do not jeopardize reliable power in the future.

One major challenge to grid reliability already seems clear. The U.S. coal-fired electric generating power plant fleet has gradually been eroded in recent years by new regulations and other factors. Today, a third of America’s coal fleet has either retired or has announced plans to shut down, due in large part to aggressive federal rules aimed at reducing coal’s use. In our state alone, 22 coal-fired electric generating units have already shut down or announced plans to close. Illinois isn’t alone. Other states are experiencing the same disturbing developments.

Historically, the U.S. electricity grid has relied on a diverse mix of electricity sources – coal, nuclear, natural gas and renewables. This strategy relies heavily on baseload sources, like coal-fired power plants, that are capable of producing power virtually around the clock. As a member of the Illinois House of Representatives, I recognize the value of coal to our state’s energy mix and support its continued use. Today, coal provides almost one-third of our state’s electricity, helping to keep Illinois’ electricity prices more than 10 percent below the national average.

Grid operators like PJM Interconnection, which serves the Chicago area, point out that depletions to our coal fleet make the electric grid less resilient. This means the grid we all count on is less capable of withstanding events like the Polar Vortex of 2014 and natural gas infrastructure outages. On the other hand, coal-fired power plants, with their stockpile of 85 days’ worth of fuel, have dependable supplies of fuel at the ready. This distinguishes coal from other sources of electricity, like natural gas power plants, which rely on pipelines to deliver their fuel on an as-needed basis. Having robust coal supplies onsite has proven critical to protecting the reliability of the grid in recent years. In fact, coal has been one of the few energy sources capable of delivering uninterrupted power when states like Illinois have been impacted by extreme winter weather events.

In the same way that diversifying an investment portfolio reduces risk, relying on a diverse mix of electricity sources that include coal, natural gas, nuclear and renewables makes the grid more stable and dependable. As policymakers make decisions about electricity sources, it is important they keep in mind the importance of the coal fleet to Illinois and the U.S.

State Rep. John M. Cabello is a Republican from Machesney Park.

See the article here.

Column: Include Coal in Energy Mix

Via The Detroit News:

Michigan will continue to need electricity produced at coal plants in the years ahead for a number of reasons. One is that while renewable energy is making large advances, it will still require coal-fired plants due to the intermittent generation of wind and solar power. Another is that nuclear energy will be a smaller source of power in the state. Finally, natural gas prices can fluctuate sufficiently that the movement to natural gas plants could be reversed at some time.

Solar and wind power are increasingly competitive with fossil fuels due to advances in technology. As an example, the price of solar panel installation has fallen by over 60 percent since 2008, from $8.82 per watt to $3.36 per watt. Solar panel efficiency has been increasing at a remarkable rate. The U.S. Department of Energy’s goal is to reduce the price of solar power to 6 cents per kilowatt hour by 2020. Moreover, Improvements in the structure of the electric utility industry in Michigan are possible that will increase the incentives for innovation and improve the renewable energy market.

However, there will still be a need for coal-fired power plants. The fact that wind and solar power are intermittent means that, for the near future at least, peak-load generating capacity from fossil-fuels must be there to meet the difference between electricity demand and generation from non-fossil fuel sources.

While the percentage of power generated by coal has declined in Michigan, coal plants still account for more than a third of the state’s energy. And it is quite possible that electricity being wholesaled into Michigan will continue to come from coal-fired generators.

Nuclear power is not likely to replace coal. Last year 28 percent of the state’s net electricity generation was from Michigan’s three nuclear power plants. But Consumer’s Energy faces the loss of 10-20 percent of its electricity due to the scheduled shutdown of the Palisades nuclear plant next year. The Michigan Public Service Commission is asking Consumers where this power is going to come from. It is likely that at least a noticeable portion will come from coal.

One of the primary reasons for the decline in coal-fired generation has been the availability of low-cost natural gas resulting from advances in horizontal drilling and fracking. Natural gas prices have fallen substantially over the past years. However, natural gas prices have recently been on the rise, up more than 50 percent in the past 14 months.

This could be the beginning of price volatility in natural gas due to increase in demand and reductions in supply. U.S. exports of liquified natural gas have been rising exponentially. Exports have increased to 253,874 million cubic feet in May of this year from 17,776 million cubic feet in January of 2000. The dramatic increase in LNG exports has been good for the U.S. economy, and it’s been important for geopolitical reasons. It has enabled Ukraine, Poland and other countries that rely heavily on Russia for natural gas to break its grip on their economies.

Additional increases in demand for natural gas are coming from the manufacturing sector. Other factors, such as growth in the use of electric vehicles could also increase demand for electricity generation and put upward pressure on prices.

Meanwhile, natural gas production declined in 2016 from what it had been in 2015. This was the first time since 2005 that natural gas production fell from one year to the next. At the same time, some states have imposed regulations on fracking that will further reduce production. So it is conceivable that natural gas prices could be increasing over the next few years increasing the economic feasibility of coal-fired degeneration.

Our nation’s transition to renewable energy is probably inevitable — technology, cost, and consumer preferences are driving us there. However, in the meantime, we still need our lights to come on and assembly lines to run, and coal will continue to be part of our energy mix.

See the article here.

Montana Coal Mine Production Up 2 Million Tons

Via the Billings Gazette:

Montana coal production is more than 2 million tons ahead of where it was this time last year, although analysts say the future is far from bright for the fossil fuel.

Most of the production is coal mined from Spring Creek, a Cloud Peak Energy mine in southeast Montana. The Montana Coal Council compiles the production numbers.

“Certainly what we’ve seen is an increase in our sales to our Asia customers primarily in South Korea and Japan,” said Rick Curtsinger, Cloud Peak Energy spokesman. “Last year by the end of the second quarter, we had shipped 200,000 tons of coal to our Asia customers. This year as of June 30, we shipped 1.8 million tons to customers in South Korea and Japan.”

Coal production is running away from a historically bad 2016 — the nation’s lowest coal production year since 1978. But the first seven months of 2017 still trails 2015 production by about 6 million tons. Montana mines produced 20.7 million tons through June two years ago.
Montana mines produced 3.36 million tons of coal in July. Almost half of the production increase came from Spring Creek Mine, said Bud Clinch, Montana Coal Council director. Nearby Decker Mine, owned by Lighthouse Resources, was the second-largest contributor. Decker production was up 155,000 tons.

“I think both Decker and Cloud Peak are because of export markets. They both have capacity at Westshore Terminal and demand is stronger,” Clinch said.

Westshore Terminal is a British Columbia coal port off the shore of Vancouver. It’s where most of Montana’s export coal is shipped.

In late 2015, with prices driven down by a glut of coal in the Asia Pacific market, Montana mines suspended exports entirely. Cloud Peak agreed to pay Westshore to reserve space, rather than ship coal at prices that wouldn’t cover the cost of delivery.

Those sluggish prices suppressed coal exports into 2016, when production was in a downward spiral until late in the year when supply tightened again and the market improved. In 2017, the growth has been steady.

“We’ve been up every month for the last five months,” Clinch said.

The only way for coal production to go from 2016 was up, said Tom Sanzillo, analyst for Institute for Energy Economics and Financial Analysis. Last year was a bruising one for coal, with cheap natural gas outcompeting coal to become the dominant power source in the United States for the first time ever.

The number of coal-fired power plants because of age, non-compliance with pollution standards or both also increased.

Natural gas hasn’t gone away and the United States isn’t building new coal-fired power plants, Sanzillo said.

In the Asian Pacific, the same forces that clobbered Powder River Basin coal exports in 2016 still exist, which means coal market improvements aren’t likely to last. Cloud Peak is doing better, but the trend is still downward, Sanzillo said.

“I think they had a reasonably good half year,” he said. “A company that lost 30 percent of its market in the last couple years and gains back two points is technically doing better.”

But coal prices haven’t really returned to the heyday of 2010 and 2012, when United States mines saw good prices and potential in the Asian Pacific.

Companies have cut costs and found a way to do business with lower coal market prices, Sanzillo said. The Institute for Energy Economics and Financial Analysis favors an energy future with less coal-fired power and more development of cleaner, renewable energy sources.

Curtsinger points to a recent report by SNL Analytics that indicates that plans for more coal-fired power plants in South Korea and Japan could boost demand for coal. Coal politics abroad are no less active than in the United States, SNL points out. There is political pressure to cut back on the plans to build new power plants in South Korea over the next decade.

There’s also no guarantee that South Korea and Japan will use U.S. coal to meet their needs. Just like in 2016, prices could fall and these coal buyers could be shopping elsewhere.

See the article here.

Abandoning Coal Could Mean Blackouts for U.S. Power Grid

Via Lifezette: 

There’s plenty of talk these days among energy advocates and environmentalists about the need for natural gas to replace coal as the workhorse producer for America’s daily electricity needs. And coal has undoubtedly been on the ropes in recent years, with both expanded natural gas production and a host of federal regulations cutting coal plants and closing mines. But is the quest to end coal power a sound idea? And can natural gas really supplant coal in providing nationwide base load power generation?

For years, coal produced roughly half of America’s electricity. And it wasn’t until the start of the Obama Administration that the fracking revolution began to unleash more abundant and lower-priced natural gas.

But in tandem with increased natural gas production, President Obama issued a grab bag of federal regulations that greatly hampered coal production. A stringent rule on mercury emissions in 2012 imposed $10 billion in costs, while eliminating roughly 20 percent of America’s coal fleet. A subsequent “Clean Power Plan” in 2015 aimed at ending “carbon pollution” targeted another 25 percent of America’s coal plants. A bureaucratically complex stream rule issued in late 2016 threatened half of America’s coal reserves. And a three-year moratorium on federal coal leases further reduced the nation’s coal supply.
It’s no wonder that coal’s share of nationwide electricity generation has fallen to roughly one-third of overall power production. But alongside this solid 30 percent, natural gas now supplies another one-third of total electricity, and nuclear power a further 20 percent.
What’s particularly relevant here is the concept of “base load power.” The United States is a high-energy nation, and it depends on robust power plants to continuously meet minimum daily electricity needs. By and large, these demands are met by a sturdy coal and nuclear fleet.

Why are coal and nuclear so particularly suited to meeting base load power requirements? For one thing, both can run continually, day in and day out, to keep churning out megawatt after megawatt. Part of this ability comes from a built-in benefit of maintaining steady, on-site fuel supplies. A typical coal plant, for example, will stock up on a month’s worth of coal at a time — making it a self-contained bunker of ongoing electricity production. Nuclear is likewise self-sufficient — though admittedly more expensive than coal.

The modern U.S. coal plant is also notably cleaner than its predecessors of 30 and 40 years ago. Equipped with expensive, high-tech scrubbing mechanisms and emissions controls, newer coal-fired facilities can trap almost all of the sulfur, mercury, and particulate matter that once plagued the early cities of the Industrial Revolution.

There’s still the issue of carbon dioxide (CO2) emissions, though, and concerns about man-made global warming. Encouragingly, newer HELE (high-efficiency, low-emission) coal plants run at higher temperatures and pressures, generating more power and emitting less CO2 per gigawatt generated. It would be nice to see China and India — two countries currently racing to build new coal plants — adopting similar, advanced technologies.

Global warming critics have been quick to demonize coal while enthusiastically urging a brave jump into wind and solar power. Here again, however, base load power matters greatly. Both wind and solar yield only intermittent electricity (because the wind doesn’t always blow, and the sun doesn’t always shine). And in such cases, grid operators can thankfully call on coal and nuclear plants to ramp up at a moment’s notice to supply fill-in power. And so, without such gap-filling assistance from coal and nuclear, the “renewable” adventure of wind and solar would inevitably lead to power shortages and blackouts in heavily taxed grids.
And this brings us to natural gas’s emerging role as the presumed steppingstone to a “low-carbon” future. Because natural gas produces less CO2 than coal, environmental advocates see it as the bridge to a “clean energy” infrastructure.

But natural gas has been prioritized for home heating in the United States. And while its share of electricity generation has risen from 17 percent in 2001 to 34 percent in 2016, there are some notable constraints against its mass-adoption.

First, in order to make natural gas the ubiquitous power producer that some envision, the United States would need to build a massive new set of pipeline and delivery systems to accommodate additional power plants. The costs of such investment alone are daunting. But unlike coal supplies delivered by rail, natural gas also remains a high-pressure commodity. The vulnerability of new pipeline systems to extreme weather events, or to malicious attack, means that any service disruptions could interrupt power delivery across wide swaths of the nation.
Natural gas also remains captive to an intricate arrangement of market sales. Grid operators continually hedge their bets in the gas market, splitting their purchases between firm and “interruptible” gas supplies. This can lead to question marks as to whether they have sufficient gas supplies coming in each day to keep power plants running. Typically, natural gas serves as a fill-in producer, supplying extra electricity as needed during peak demand. But such spotty availability would need to be fundamentally revised before the nation could shift away from coal and nuclear power production.
Overall, natural gas now serves as one of a trio of bedrock power producers for America’s electric grid. And while natural gas prices have grown more volatile in recent years — and could rise significantly as the U.S. begins to export more supplies to Europe — it supports a diversity of energy production that makes the United States an enviably affluent, safe, first-world nation.
Any rush to completely eliminate coal power and embrace natural gas as the bridge toward a renewable energy future, though, could bump into formidable obstacles. It’s admirable to aim for a cleaner energy sector, but real-world problems need to be patiently sorted out, if America is to make such a leap.
See the article here.