A Moonshot Too Far.

Posted on Sat 07/19/2008 by



Last evening, at about 6PM, I finally got it. I worked it out.
I read this story on our Australian ABC online news outlet. It’s about Al Gore and his call to replace all the coal fired power plants in the US within ten years. No doubt it’s big news in the US as well.
Right then I understood just why economists are now running the ‘climate change’ scare campaign debate.
As some of you may be aware, I recently completed an exercise, constructing 51 separate long posts where I discussed the possibility of the US actually complying with the Kyoto Protocol, and getting emissions of the Carbon Dioxide (CO2) greenhouse gas back to a level 5% lower than what was produced in 1990. This calls for a reduction of 30% of the CO2 and because that’s across the board, then electrical power, being part of those emissions, because burning coal produces CO2, then that 30% reduction applies here as well.
Currently, the US produces just slightly less than 50% of all power from coal fired plants so a 30% reduction calls for a cut of 15% of that total power.
The total nameplate capacity of those coal fired plants is around 350,000MW of power. The nature of them is that for them to be economically viable, they must be large, and being large, they must burn a lot of coal to boil the water to steam that drives the turbine that then drives the generator.

There actually looks to be a minor anomaly here because that total nameplate capacity is only more than one third of the total nameplate capacity power in the US of 1,100,00MW. Why this is so is again the nature of those plants. Coal fired plants are large, and actually need to be running at close to 100% of that capacity all the time, while the other plants from all sources only run at much lesser percentage, most of those plants only running for shorter times to top up the total power needed, and this is measured in Kilowatt Hours (KWH). Those coal fired plants provide half the total power used in the US, or 2.1 trillion KWH of a total of 4.2 trillion KWH.

Replacing that mooted level of electrical power just to comply with Kyoto would mean the closing down of 50 large plants over 2,000MW each and a number of the mid range plants as well to total around 120,000MW of nameplate capacity.

I discussed trying to find ways to replace those coal fired power plants from all sources, and in some detail. So in reality, just to comply with the requirements of Kyoto, you would need to replace around 80 of those plants, and that’s conservative in nature.

Now, Al Gore is asking us to replace all those coal fired plants. There are just on 1500 generators in all in the US that use coal as the fuel. Now considering that the larger plants have 2 generators, then an average ball park calculation would say that there are around 900 to 1,000 of these plants across the US.
I canvassed replacing around 50 to 80, so now the scale of this Al Gore dream becomes a little less cloudy.

In the next post I’ll go into trying to replace all those plants in a little more depth, but what I want to do here is to just discuss the one point here, that concerning the coal industry.

To actually produce half the power requirements for the US, those plants burn 1.1 Billion tons of coal EACH AND EVERY YEAR. The coal that most of them use is the coal that burns at a higher temperature.
The cost of this coal is currently around $150 per ton. Because not all coal used is from this source, I’ll use a lesser figure and quote total coal used for just those coal fired power plants.
Using $140 per ton as the price, that means just to supply half the US electrical power, the dollar cost is $150 Billion.

Now, right at that point is where I finally got why the economists have now taken control of the debate.
Consider this.
If that much is not required any more, then the vast bulk of Coal Mining Companies will just cease operations. They can’t ramp up operations to export their coal overseas, and if they were to do that, isn’t that just moving the whole problem sideways from America to those other two huge consumers of coal, China and India, where they are busily constructing coal fired power plants to bring electrical power to their own people, currently running at only one household in six that actually has power, something we take completely for granted as a staple of life.

If those mining companies fold, then the economic ramifications are not worth even considering. The workforce might only seem small at around 150,000 but that’s 150,000 families with that many homes with mortgages to pay. There is an indirect workforce associated with the mining of that coal and that amounts to around 1.5 million people. Flow that on to the supporting community at a rate of around seven to one, and the number is closing on ten million families. There will be monumentally huge downturns in cities and towns all across the US. There’s billions of dollars tied up in machinery for all those mines. The ramifications just on that front now begin to look more difficult than a warm and fuzzy statement to replace coal fired power plants to save the environment.
I’ve only touched on the surface, because none of this is my field of expertise, but even I can see that the ramifications are not just spending the money to replace those coal fired plants with renewable sources.

I just cannot see how the coal mining industry can take a hit like that. That is a hit of $150 Billion each year, and forever. You also need to consider that State Governments in those coal mining States will also take a huge hit because they take royalties from the coal mined in their States. If that source of revenue is removed, then employment in that sector also suffers, and simple economics also tell us that revenue will need to be made up from other sources also.
So right now, today, coal mining companies are on the phone to their lobbyists, ramping up access to State representatives at all levels of Government to tell them of this madness, and believe me, this is just that, madness.
You’re talking millions of people in economic stress, not just from the coal mining industry, but across all sectors of the workforce.

It’s no good saying that these people can be moved sideways into that renewable sector, because with most of them, coal mining is all they have done, and is all they know.

Just blandly saying that in ten years we need to replace every coal fired power plant in the country will cost around $3 trillion, (and doesn’t that number just roll off the tongue) doesn’t take into account the flow on to every other corner of the whole of the United States.

This is not the equivalent of just putting a man on the moon, as Mr Gore so eloquently put it. It’s actually bigger than that. You can look at a picture on the TV screen of one, maybe two guys walking on the moon. You’ll feel a warm surge of pride that the US can actually do that. This, however, is a personal hardship on every man woman and child in the US. The Government can allocate money to send those guys to the Moon, but this is hard monetary hardship to all those families, sacrifices they all have to make, not just a few bucks added to their tax bill, but a struggle now from day to day.

In the second piece, I’ll canvass actually trying to replace those coal fired plants.