The Loss of Dispatchable Fuel Diversity Reverberates in Europe

U.S. coal generation came roaring back last year, rebounding 17% from 2020 and grabbing market share from higher priced natural gas. The U.S. coal fleet is proving to be an invaluable price shock absorber amid energy-driven inflation here at home and coal is also an equally important missing price shock absorber in Europe.

The U.S. hasn’t been immune to higher energy prices – with the U.S. Energy Information Administration pointing to rising natural gas prices as driving higher wholesale rates – but the pain for U.S. consumers hasn’t come close to the shock now facing European households.

The European energy crisis – driven largely by soaring natural gas prices and the unfortunate unavailability of renewable power at key moments – has seen wholesale electricity prices jump 300% since last winter. Households are set to pay an average of 54% more for energy than they did two years ago, according to Bank of America. The average European residential consumer will spend 1,850 euros ($2,095) on energy this year, up from 1,200 euros in 2020, an eye-watering increase despite government assistance. And that’s the average—price increases in some nations, such as the U.K., will be far higher.

So painful are soaring bills in Britain that some utilities (unbelievably) are recommending cuddling the cat to stay warm since many consumers won’t be able to afford turning up the thermostat. Eat porridge and other complex carbohydrates one note suggests because they take longer to digest and create more body heat in the process. This may all seem surreal in the year 2022 but the sobering reality is that millions are having to choose between soaring energy bills and other necessities, and they’re doing so because of glaring policy missteps.  

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Net-Negative CO2 Baseload Coal Generation

By Steven E. Winberg, Former Assistant Secretary for DOE, Office of Fossil Energy and Chair & CEO, Net-Negative CO2 Baseload Power, Inc.

Steve Winberg

As we go into the new year, there are even more compelling reasons to bring coal into the public policy debate.  Energy prices have skyrocketed around the world, rolling blackouts are frequently discussed as the new norm, and now there are riots in Kazakhstan over high energy prices, with troops being ordered to “kill without warning”.  In the U.S., gasoline prices remain high; Texas and California have recently seen major disruptions in their electricity supply linked to systemic infrastructure issues; and natural gas prices have steeply increased.  Due to high energy prices and low electricity reserves, coal saw a remarkable comeback in 2021 that will likely continue into 2022.  However, as the world clamors to keep the lights on, and do so at reasonable cost, climate change concerns are causing many to turn their back on coal.  We can reconcile the world’s thirst for affordable, reliable energy, and address environmental concerns, with Net-Negative CO2 Coal Technology.  Net-Negative CO2 Coal Technology involves retrofitting existing coal plants with CCUS (carbon capture, storage and utilization) and using a coal/biomass blend as fuel.  This converts existing coal plants, which are otherwise CO2 emitters and frequently targeted for premature retirement, into coal plants with net-negative CO2 emissions.

In Saturday’s Wall Street Journal (January 8, 2022), there is a major story on the California need for “firm power” and that CO2 -neutral nuclear power could meet this need.  The story identifies a recent study by the Environmental Defense Fund and Clean Air Task Force concluding that California needs not just ‘’clean energy’’, but also “firm energy” or electricity sources that “don’t depend on the weather”.  The same discussion on the need for “firm power” should include Net-Negative CO2 Coal Plants.  With an existing fleet of western U.S. coal plants standing ready to supply firm power into California and other markets, these plants could be retrofitted with technology to address concerns about their CO2 emissions.  Using the coal fleet’s existing infrastructure in this way is a far better solution than premature retirement of these plants and building new nuclear infrastructure from scratch.  Solution-focused environmentalists should consider this pragmatic approach to address “firm power” needs and CO2 emission concerns.

In 2008, coal consumption for electricity generation in the United States peaked at close to 1 billion tpy.  Today, consumption levels are approximately half of that.  With the drop in consumption, and thus production, coal states have seen significant job losses, and the reliability of the nation’s electricity grid has become compromised due to insufficient firm baseload power.  The nation does not need to lose the energy and economic benefits of the remaining coal fleet through premature retirements.  There is a better path forward that can ensure firm baseload power while addressing climate change concerns.  This should be part of the ongoing policy discussions in Congress and in the States. 

The first step is to establish an incentive-based (not regulatory-based) federal program to retrofit the existing coal fleet to use a coal/biomass blend as fuel and install CCUS (carbon, capture, utilization and storage).  Existing transmission lines, transformers and other power infrastructure can continue to provide our nation with affordable electricity.  One significant additional benefit, while perhaps ironic, is that these net-negative CO2 coal plants will help the Biden Administration meet its aggressive climate targets. 

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