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    Stranded Capacity: Delays Banning Coal Plants Will Make Banning Them More Expensive Later
    By News Staff | March 31st 2014 10:18 AM | 1 comment | Print | E-mail | Track Comments

    In America, labor unions primarily donate money to the Democratic party and in return they want more union jobs. Recent history has been a bit of a concern. The President stalled approval of the Keystone XL, overriding both his supporters in science and in labor to do so and instead siding with environmentalists. Meanwhile, subsidies and mandates for solar power and wind have contributed little to the union work force.

    Natural gas, primarily opposed by Democrats, has caused greenhouse gas emissions to drop and so energy, the largest contributor to CO2, is back at early 1990s levels. Coal, which had runaway expansion after the Clinton administration eliminated nuclear science in America, is suddenly back at early 1980s levels of emissions again.

    If that trend continues, the federal government may need to start giving subsidies to coal companies, after spending all of this time trying to run them out of business. 

    But worldwide, coal is still popular and advocates insist that limiting climate change to 2°C (today is the day of another IPCC release, so it's the time to talk about limiting temperature gains) requires shutting down coal power plants - and they make the interesting claim that delaying climate policies would prove even worse for power plant owners than shutting them down now.

    Coal power plants are going online all of the time in India and China - they were exempt from the Kyoto proposal because they are developing nations and all of the gains in the west have been offset by developing countries that would like to have less disease and perhaps some air conditioning. New power plants are built to run for 30-50 years and are a heavy up-front cost so it takes decades of operation to pay for themselves, unless the public is going to have huge utility bills. 

    Stringent climate policies could make the cost of emission so high that coal power generation is no longer competitive, leaving new power plants sitting idle and their owners and investors with huge losses — a problem known as stranded capacity. Progressive policies will have sent us back to the 19th century, when only rich people had energy.  A new paper says that as much as 37% of global investment in coal power plants over the next 40 years could be stranded if action is delayed, with China and India bearing most of these costs.

    "If we are serious about meeting climate targets, then the reality is that eventually we will have to start shutting down coal-fired power plants. But the longer we delay climate action, the more stranded capacity we'll have," says IIASA researcher Nils Johnson, who led the new study, published today in the journal Technological Forecasting and Social Change. "Delaying action encourages utilities to build more coal-fired power plants in the near-term. Then, when policies are finally introduced, we have to phase out coal even more quickly and more investments go to waste," he says. 


    So ban new coal plants now and take the hit, the paper argues.Potential alternatives they list include shifting to other kinds of power plants, keeping old coal plants running, and improving energy efficiency. By reducing the amount of energy used, efficiency improvements also reduce the amount of energy that must be generated and, therefore, the need for new power plants.

    "The best strategy would be to stop building new coal power plants starting today," says Johnson.

    However, they also explored what would happen in a more realistic case, if governments are not yet willing to limit new plant construction. Johnson and colleagues in IIASA's Energy Program also examined two additional strategies with this limitation: grandfathering existing plants so that they are exempt from future climate policies, or retrofitting plants with Carbon Capture and Storage (CCS), a yet unproven technology that would capture greenhouse gas emissions and store them underground.

    However, both of these strategies create a major risk that average temperatures will rise above the 2°C goal—a target set by international agreement in order to avoid the most dire consequences of climate change. While the grandfathering strategy would allow power plant operators to keep the old ones running, it would lead to greater emissions and reduced chances of limiting climate change to the 2°C target.

    And while CCS could theoretically be used to retrofit coal power plants, the study shows that hundreds of power plants would need retrofitting in a short period of time—a lot of pressure on a technology that as yet remains both technically and politically uncertain. "CCS could buy us time, but what if it doesn't work? It's a risky strategy," says Volker Krey, a co-author on the paper.


    Comments

    MikeCrow
    Well if they streamlined the licensing, and throw out environmentalist's construction blocking lawsuits, we could start building Nuclear power plants instead of coal plants, let existing plants run and expand while we bring the nukes online. All the while let solar and wind grow up some more and see if they can actually compete.

    But, measurements and reconstructions show that the run up in temp was not all that  unprecedented and Climate Sensitivity is looking more and more like <1.5C, based on actual temps, not models. And I think the Continental US just had the coldest winter since 1917, and if it stays cold, it wiped out most of the modern warming. Which makes the run up due to the warm PDO and AMO shifting the jetstream, the recent switch of the PDO (to it's cold mode) brought back the cold, and the AMO is due to switch back to it's cold mode(for the northern hemisphere anyways). It's quite possible we're heading into an extreme multi-decade long cold period. There's good history of these types of cycles/swings, but as always the proof will be what the climate actually does, not what the models say its going to do.

    So the question is, is it better the planet warms adding trillions in taxes to energy costs trying to battle warming, or it cools all on it's own proving the scare was made up all along, both of which will kill potentially millions of the energy poor?

    The only way to save at least some of these poor people, is to provide them inexpensive energy.
    Never is a long time.