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Coal on the Ropes: In One Week, 4,099 MW of U.S. Coal Plants Are Set to Close or Hung Up in Court

By Stephen Lacey on February 1, 2012 at 2:18 pm

"Coal on the Ropes: In One Week, 4,099 MW of U.S. Coal Plants Are Set to Close or Hung Up in Court"

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In less than one week, eight U.S. coal plants representing 4,099 MW of capacity have been put on the chopping block for closure or have been delayed in court due to environmental concerns. It is yet more proof of the major changes taking place in the American coal industry.

The dirtiest and oldest coal plants are being shut down in greater numbers because of

  • cheap natural gas
  • rising coal prices
  • strengthening environmental standards
  • more utilities embracing energy efficiency and demand response
  • improving cost-competitiveness of solar and wind and other renewables

At the same time, a strong movement against coal is preventing new facilities from going forward.

The latest round of closures started last week when FirstEnergy said it would close six plants in its portfolio totaling 2,689 MW of capacity. The plants are getting very old, making them some of the dirtiest in the country. The average age of the six units is 55 years, with the oldest facility built in 1947. Five out of six of the plants had been relegated to reserve plants, FirstEnergy spokesman Mark Durbin told Politico:

“The bottom line,” Durbin said, “is the plants haven’t run all that much in the last three years,” and the company doesn’t “think they’re going to be running much” in the years to come, so it “didn’t make business sense” to keep them open. Now that they know the plants have no future, “we couldn’t justify spending any additional money.”

Rather than clean up the plants to meet new standards for mercury and other air pollutants, FirstEnergy made the business decision to close the facilities.

And this week, the power company Dominion made an equally big announcement, saying it would close one of the oldest coal plants in America — an 80-year old facility (constructed in the 20′s and updated in the 60′s) worth 515 MW of capacity. Dominion spokesman Dan Genest told the Indianapolis Star than the price of gas and improved mercury standards didn’t make it feasible to keep such an old plant running:

“When we looked at the projected cost of installing environmental controls to continue to operate State Line, it did not make economic sense to do so because of expected market prices, primarily driven by the low cost of natural gas,” he said.

The plant’s current owner, Richmond, Va.-based Dominion Resources Services, warned Wall Street last year that the plant with its 1950s and 1960s technology would be just too expensive to keep open if the Obama Administration pushed tougher air pollution standards.

These “new” air pollution rules established by the EPA have actually been in the works for the last decade — and they are far from the only reason causing plant closures. According to the utility industry’s advocacy organization, the Edison Electric Institute, “retirements [for old coal power plants] are taking place for a variety of reasons, including plant age, fuel price drop from low natural gas prices, and decreased demand, among other reasons.”

While a variety of forces are causing a phase out of old coal plants across the country, it is getting extraordinarily difficult — if not almost impossible — to build new coal in America. A combination of rising fuel costs, less expensive alternatives, and increasing legal challenges from environmental groups is putting “coal on the ropes,” according to Bruce Nilles, senior director of the Sierra Club’s Beyond Coal campaign.

This confluence of factors came together in Kansas yesterday, when a U.S. district judge ruled that an 895-MW coal plant planned for the state should not go forward without more environmental and health impact assessments. Environmental groups challenged the expansion project because the U.S. Department of Agriculture had skipped such a study before allowing the project to move forward. The environmental law firm Earth Justice responded to the decision:

In his decision, Judge Emmett Sullivan emphasized that the expansion will need additional approval from the federal government as a result of changes to the project from earlier configurations. He enjoined the government from issuing any additional approvals pending a full “environmental impact statement” (“EIS”) disclosing all of the environmental and human health impacts of the project, which includes harm to human health as well as contribution to climate change. An EIS must also discuss “alternatives” to a proposed project, such as renewable energy projects and energy conservation.

“From a public health and environmental perspective, coal-fired power is the most expensive option available,” said Scott Allegrucci of Sierra Club’s Beyond Coal Campaign. “We are confident that once the environmental impacts of this plant are considered in light of alternatives, the project’s impacts will be unacceptable and it will be rejected.”

The environmental and economic forces working against American coal generation appear to be getting stronger. And this week was a sign of things to come.

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13 Responses to Coal on the Ropes: In One Week, 4,099 MW of U.S. Coal Plants Are Set to Close or Hung Up in Court

  1. Leif says:

    Good to see Stephen, but I would like to see a reference to how much off-setting clean renewable energy has come on line in the last year or two in these kind of reports as well.
    Perhaps gains in energy efficiency also.

    • John Tucker says:

      In real numbers not nameplate capacity either. (And no, im not saying its all bad news – Gas MAY actually be better than coal for GW, as it is for pollution but just dont hold your breath).

  2. rjs says:

    that’s alright…china will take all the coal we dont use…buffett is buying coal; he already has the railroads & ports..

  3. Paul Revere says:

    The Sourcewatch site on Google says that in 2009 there were 594 coal powered plants in the United States with power capacity of 2,133,000 GWh.
    This list of closures/delays is more analogous to a 90 pound weakling hitting a 200 pound heavyweight with little effect than to having coal “on the ropes”.

  4. Sasparilla says:

    With regards to this statement:

    “..it is getting extraordinarily difficult — if not almost impossible — to build new coal in America.”

    While this is definitely what the audience would love to hear (myself included if it was true) as well as the Obama 2012 Re-election campaign (targeting climate change folks), its important to realize that according to the DOE there were 23 new Coal Plants (17GW) getting permitted or under construction in the US in 2011 (an increase over 2010 levels) with 30 more announced (14GW).

    This isn’t almost impossible to build at all. This is – you’re actually still loosing the carbon battle on the coal front badly, just not quite as badly as you would be without the confluence of factors affecting coal at this point.

    The longer term future for Coal doesn’t appear good of course, but in the short term there’s still a boom (the biggest one since the 1980′s) in new Coal Plants being permitted and built – its only at the end of this decade that it looks like new installations might end.

    BTW, it would only take an opening of US natural gas market to the international market prices which are much, much higher (like we have with oil and the natural gas industry wants to make happen via LNG for profit motives) to make this all change (and Coal would become the low cost producer again with new plants to come).

  5. Mike Roddy says:

    It’s a small victory, but worth celebrating. Thanks to Bruce Hamilton and Bruce Nilles of the Sierra Club for their years of hard work here, much of it under the radar.

    The next big battle will be gas (much of it fracked) vs wind, solar, and geothermal. We need a new study to compare with Howarth’s, and better data on fracked watershed toxicity. The gas companies are powerful, and now include recent acquisitions from the likes of Koch and Tillerson. New gas plants need to be opposed, too. It’s much too late in the game to keep screwing around with mass combustion of fossil fuels for electricity and heat, since there now are so many alternatives.

  6. Lou Grinzo says:

    The debate about how much worse fracked gas is than conventional gas is a huge sideshow that we shouldn’t get sucked into. Building brand new natural gas-fired power plants is a very bad idea, simply because it locks us into a level of emissions for that piece of our generating capacity that will be too high long before those plants reach the normal end of their service life.

    Yes, replacing coal with gas gives us a nice drop in CO2 emissions for those plants in question today, but in 20 years when those plants are at most halfway through their useful life they’ll be the filthy carbon sources we’re desperate to replace.

    And for those who want to see what a fuel transition looks like, we made one in the US decades ago. Check this figure from the Annual Energy Review (http://www.eia.gov/totalenergy/data/annual/showtext.cfm?t=ptb0802a), and notice the sizable portion of the US’ electricity that came from petroleum(!) as late as 1978, when it was about 20% more than the share from NG. Now it’s down to about 1%, although you can still find a lot of journalists assuming it’s a much bigger number.

    • Sasparilla says:

      Lou that was interesting regarding the amount of power that was Petroleum based (till after the 2nd oil shock in the late 70′s – guess we didn’t learn after the 1st one) I knew we were generating some electricity from oil back then, I had no idea how much, nor the fact that it took the 2nd oil shock until much started happening on reducing that source.

      You’re totally right about the fact that we shouldn’t be doing natural gas plants or coal plants etc… I just wished we lived in a country that wasn’t such a living model of crony capitalism so that we could make such intelligent decisions on the national level.

  7. David B. Benson says:

    A small but cheerful GOODY!