Coal has always been cheap and dirty. And the dirty part was justifiable because it was so cheap. Now, gas prices are dropping, threatening coal’s dominance in the North American energy market. Which means gas could take over before coal gets a chance to clean up its act.
Natural gas dropped in price last week, trading at under $4 per million British thermal units-the unit used to measure energy output. The price is competitive with coal on a Btu basis, David L. Goldwyn of the U.S. Department of State announced last week.
Coal is still cheaper at $2.25 per million Btu in 2010, according to the U.S. Energy Information Administration. Even so, the coal market is starting to feel the burn from gas on its heels.
Coal stocks are down, across the board. Bloomberg recently reported that the largest U.S. coal producer, Peabody Energy Corp., fell 5.2%, to $40.96. The second biggest producer, Arch Coal Inc., fell 5.9 % to $21.08. Massey Energy Co., the largest Central Appalachia coal producer, plunged $1.40, or 4.6 percent, to $28.75.
In both new projects and business expansions, power producers have also already started choosing gas over coal. A company called American Municipal Power Inc. planned to build a coal-fired plant on the Ohio River last year. In early August, the company announced that it would build a 600-megawatt gas-fired plant in that location instead. NRG Energy (NRG, Fortune 500) signed a $1.9 billion deal to buy five power plants in California from the Blackstone Group. Four out of the five plants will burn gas.
Also, the Tennessee Valley Authority announced last week that it was going to idle nine coal-fired generating units at three plants, starting in 2011. The TVA plans to build natural gas generators to replace several of the coal-fired units.
Scott Brusaw, an electrical engineer in Idaho, also the founder of Solar Roadways, (that we’ve written about earlier this month) has come up with an interesting idea that might just catch up if some key issues will be solved: making roads out of solar cells that would produce electricity and pay for themselves.
Usually implemented on rooftops and specially-designed areas, the solar panels can theoretically be put anywhere there is sunlight. Having in mind that electric cars evolve every year and there will be plenty of them in a short time, the need for electric charging spots along highways will be increasing steadily.
According to an article in the New Scientist, citing some numbers from the American Geophysical Union, highways and open-air parking lots in the lower 48 US states make up for more than 100,000 square kilometers of surface area.
If implemented in that amount of space, 15 percent efficient (considered moderate) solar cells having 3.7 square meters each would produce 7.6 kilowatt-hours of energy a day. This figure is calculated using an average of 4 hours of sunlight per day. Brusaw proposed 3.7 square meters because that’s the US interstate highway standard lane width.
PV cells are usually fragile devices, shattering at the smallest mechanical forces. Making them withstand the weight of cars and trucks really is a challenge that could be solved by lying thin film PV material onto flexible plastic and laminate it onto glass toughened by borrowing tricks used to make it bullet and blast-proof.
Investors should favor shares of Chinese solar companies and avoid developers as the government promotes cleaner forms of energy and maintains property curbs to restrain prices, Shanghai Elegant Investment Co. said.
“China’s shift away from energy-intensive and polluting industries to a low-carbon economy is one of the key investment opportunities in the next three years,” Shi Bo, who oversees about $400 million as general manager of Shanghai Elegant, said in a phone interview today. He declined to say if he’s buying or selling stocks.
China, the world’s biggest polluter, is striving to reduce its reliance on growth driven by energy-intensive industries and avert asset bubbles after stimulus spending and record loans last year fueled a jump in property prices. The nation may spend about 5 trillion yuan ($738 billion) in the next decade developing cleaner sources of energy, Jiang Bing, head of the National Energy Administration’s planning and development department, said in July.
European Union countries must drop their biofuels targets or else risk plunging more Africans into hunger and raising carbon emissions, according to Friends of the Earth (FoE).
In a campaign launching today, the charity accuses European companies of land-grabbing throughout Africa to grow biofuel crops that directly compete with food crops. Biofuel companies counter that they consult with local governments, bring investment and jobs, and often produce fuels for the local market.
FoE has added its voice to an NGO lobby that claims local communities are not properly consulted and that forests are being cleared in a pattern that echoes decades of exploitation of other natural resources in Africa.
In its report “Africa: Up for Grabs”, the group says that the key to halting the land-grab is for EU countries to drop a goal to produce 10% of all transport fuels from biofuels by 2020.
A subsidiary of Chevron Corp. spent $3.9 million in the second quarter to lobby the federal government on climate change, oil industry taxes and other issues, according to a disclosure report.
That is far less than the $6 million Chevron U.S.A. Inc. spent during the same quarter last year, but it is an increase over the $3.1 million Chevron spent in first quarter, according to the report filed on July 20.
In the April-to-June period the San Ramon, Calif., oil giant lobbied Congress, the White House, the National Security Council, the office of the U.S. Trade Representative, the EPA, the Office of Management and Budget, and the departments of the interior, state, commerce, energy and treasury.