Coal and Climate Change Facts

Coal and Climate Change Facts

One of the most significant challenges in addressing global climate change is reducing greenhouse gas (GHG) emissions resulting from the use of coal.

• Coal use, primarily for the generation of electricity, now accounts for roughly 20 percent of global GHG emissions.
• Rising energy demand will continue to drive up coal consumption, particularly in countries with large reserves such as the United States, China and India.

Coal is cheap.

• Coal can provide usable energy at a cost of between $1 and $2 per MMBtu compared to $6 to $12 per MMBtu for oil and natural gas, and coal prices are relatively stable.
• Coal is inherently higher-polluting and more carbon-intensive than other energy alternatives.
• However, coal is so inexpensive that one can spend quite a bit on pollution control and still maintain coal’s competitive position.

Coal plays a major role in meeting U.S. energy needs, and is likely to continue to do so in coming decades.

• 50 percent of the electricity generated in the United States is from coal.
• U.S. coal-fired plants have over 300 GW of capacity. Of these, approximately one-third date from 1970 or earlier, and most of the rest from 1970-1989.  Only 12 coal-fired plants have been built in the United States since 1990.  
• Steep and volatile natural gas prices and high nuclear power costs have led to an estimated 130 new coal-fired plants now on the drawing boards
• Energy security concerns are driving growing interest in using domestic coal for producing transportation fuels and chemicals.

The United States is the Saudi Arabia of Coal.

• At current consumption rates and with current technology and land-use restrictions, the U.S. coal reserves would last well over 250 years.
• With improved technologies, estimated recoverable coal reserves, at current consumption rates, are estimated to be sufficient for 500 years or longer.

GHG emissions from coal-fired power are significant and growing rapidly.

• One 500-MW coal-fired power plant produces approximately 3 million tons/year of carbon dioxide (CO₂).
• The United States produces close to 2 billion tons of CO₂ per year from coal-burning power plants.
• GHG emissions from coal-fired electricity, now 27 percent of total U.S. emissions, are projected to grow by a third by 2025.

Carbon Capture and Storage (CCS) is the key enabling technology for a future in which we can continue to use our vast coal resources and also protect the climate.

• CCS involves the separation of CO₂ from other gases emitted in the coal combustion or gasification process and the injection of the CO₂ deep underground into geological formations.
• CCS is still under development, but many experts are optimistic about its advancement.
• The United States has the geological capacity to store the emissions from its coal-fueled plants in depleted oil and gas reservoirs for several decades.
• Capacity in other geological reservoirs is estimated to be in the hundreds of billions of tons (500 billion tons of capacity), enough to store current levels of domestic emissions for over 300 years.

To meet their rising needs, China and India are certain to burn more coal.

• It is estimated that 86 percent of incremental world coal demand between now and 2030 will come from China and India.

China’s coal output increased from 1.3 billion tons in 2000 to 2.23 billion tons in 2005 making China by far the world’s largest coal producer (next largest is the U.S. with 1.13 billion tons produced in 2005).

• About half of China’s coal use is for electricity; and 80% of electricity generation is fueled by coal.
• China reportedly added over 90 gigawatts of new coal-fired power plant capacity in 2006 alone – the equivalent of almost 2 large coal power plants a week, and more than the entire fleet of generating plants in the United Kingdom.

India’s coal consumption increased from 360 million tons in 2000 to 460 million tons in 2005 (5.5%/year over this period).

• India currently consumes a fifth as much coal as China
• The Indian economy has been growing at twice the rate of electricity capacity additions
• 68 percent of India’s CO₂ emissions are from coal.

Because coal plants are long-term capital investments, the new coal builds will likely “lock in” significant GHG emissions for several decades unless they are retrofitted with CCS.

• China’s new plants in 2006 alone will add about 500 million tons of carbon dioxide (Mt CO₂) to China’s annual emissions. That’s about 13 percent of China’s current coal-fired emissions, and 5 percent of the world total.

 

What we need to do in the face of these facts:

Domestically, we need a multi-pronged approach to advancing CCS.

• We need to conduct some 10-30 demonstrations, at scale, of commercial-sale coal plants of a variety of configurations capturing and storing their CO₂.
• We also need multiple demonstrations of CO₂ injection in a variety of geological formations in a variety of geographic regions across the country.
• We need a national, economy-wide policy such as “cap and trade” that requires greenhouse gas reductions from all sectors, including electric power.
• Most recent estimates indicate that a price of at least $25 to $30 per ton of CO₂ would be needed to drive coal-based electric power plants to install CCS_.
• We need a requirement or incentive that will result in demonstrations of CCS at power plants within the next 10-15 years.
• We need clear regulations governing injected CO₂.
• Because states have substantial authority over electricity generation and environmental protection, they can play an important role in demonstrating, incentivizing and requiring CCS. However, they are no substitute for a nationally consistent program that promotes CCS for all large sources of emissions.

For China and India to use coal in a climate-friendly way will require stronger domestic policies (focusing first on efficiency), a more effective multilateral agreement, and assistance from developed countries.

 

References

International Energy Agency (2006). World Energy Outlook 2006 [1].
Energy Information Administration (2007). Annual Energy Outlook 2007 [2].
USEPA (2007). Inventory of U.S. Greenhouse Gas Emissions and Sinks: 1990-2005 [3].
MIT (2007). The Future of Coal [4].