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Will the USA’s new power plant pollution limits kill coal?

EPA emission reduction proposals will require power stations to be 40% cleaner than current coal plants

(Pic: Beemwej)

By Sophie Yeo

The US has unveiled its plans to limit the pollution from new power plants, in a key part of Obama’s climate action plan to severely cut carbon emissions by 2020.

Gina McCarthy, the administrator for the Environmental Protection Agency (EPA), announced new regulations for America’s coal industry in a speech at the National Press Club in Washington on Friday.

The new proposals mean that new coal fired plants are limited to emitting 1,100 pounds of CO2 for each megawatt hour of power they produce, while most gas plants would not be allowed to exceed 1,000.

It is a significant cut. The dirtiest of all fossil fuels, coal-fired power plants currently spew out 1,600 and 2,100 pounds of CO2 per hour.

“These carbon pollution standards are flexible and achievable,” said McCarthy. “They pave a path forward for the next generation of power plants.”

While the gas plants should be able to meet this target without the introduction of any new technology, the more polluting coal-fired plants will need to install carbon capture and storage (CCS) equipment to meet the EPA’s demands.

Since CCS has yet to be implemented on a commercial scale, the new regulations will likely feed into the perception that Obama is waging a “war on coal”, and could potentially launch a series of legal objections.

“Today’s announcement … is direct evidence that this Administration is trying to hold the coal industry to impossible standards,” said Joe Manchin, a Democrat Senator from the coal producing state of West Virginia.

Climate Action Plan

Obama’s environmentalist credentials, along with his decline in popularity with those with an interest in the coal industry, were boosted last June when he delivered a speech at Georgetown University, laying out his Climate Action Plan.

He directed the EPA to take direct action on tackling climate change, bypassing the obstinate Congress, in order to cut US emissions by 17% from 2005 levels by 2020.

Many have interpreted the new coal plant regulations as a sign that he is serious about hitting this target. Kevin Kennedy, director of the U.S. Climate Initiative at the World Resources Institute, said sending this signal to the coal industry was a “very important step”.

But he added that the real test would come next June, when the administration has said it will face the much more difficult battle of regulating the emissions from existing power plants.

“If you look at what’s currently being built, there are very few new coal plants in the pipeline, so it probably won’t have a lot of effect on the new builds over the next five to ten years,” he said.

“But if you really want to look at what’s going to get emission reductions in the electric sector, it’s the rules that they’ll be proposing next June to take a look at the existing power plant fleet that are going to be much more important in getting near term reduction, and there’s lot of opportunity for cost effective reductions out of the existing power plant fleet.”

Problems for coal?

China has also recently indicated a serious intention to tackle the problem of air pollution in the country, further signposting that the end may be nigh for the coal industry.

Last week, the central government published plans to ban new coal-fired power plants in the provinces surrounding Beijing, Shanghai and Guangzhou, as well as listing targets to ensure overall coal consumption peaks by 2017.

Recent decisions by the World Bank and the European Investment Bank are also adding volume to coal’s death toll, as they announced that they were to stop almost all lending to coal projects.

The upcoming IPCC report, the UN document which brings together the most recent climate science, is expected to say for the first time that the world has a “carbon budget” if it is to stay within the limits of “safe” global warming.

It could warn that less than a quarter of the planet’s coal, oil and gas reserves can be burnt if we are to stay within this allowance.

But in a recent article, Ben Caldecott, Head of Government Advisory at Bloomberg New Energy Finance (BNEF), says it’s foolish to write off King Coal too soon.

Long term pressures are likely to see its share of the global energy mix fall, but the scale of legacy coal assets means it is embedded into the energy plans of many countries for some time to come.

Models run by BNEF indicate global installed generation capacity using coal will only fall from 36% in 2013 to 21-23% in 2030.

“A Roman Empire-like decline and fall looks the most likely scenario, though with significant disparity between Asia (particularly China) and the rest,” he says

“If governments get their act together internationally and agree a timetable for coal’s phase out, this could bring about a quicker phased end to coal, but that depends on international climate negotiations in desperate need of rejuvenation.”

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  • Urbane_Gorilla

    No. It won’t kill coal, irrespective of the Industry and Sen McConnel’s flapping their gums over it.

    42% of our energy production is already using coal and that isn’t affected by the new regulations: http://www.epa.gov/cleanenergy/images/pie_chart_fuel_mix.png

    he US only consumes 27% of the world’s coal. There is nothing to stop shipping it out to the other 73% of the world that not only uses it, but in many cases (notably China and India) are actively building new coal fired power generation plants : http://rankingamerica.files.wordpress.com/2009/03/chart-of-coal-consumptionxlsx.jpg?w=595

    Lastly,exporting is already occurring. Since 2009, our imports of coal have dropped to about 5% of our usage, while our exports have skyrocketed 3 1/2 times (from 10 to 35 short tons) : http://www.eia.gov/coal/production/quarterly/

    In essence, the coal industry may be a dying dinosaur, but not only will it be around a long time in the US, but if managed properly, it should do quite well through exports.