True cost of coal 'about double the price of the energy produced with it'

Counting the cost: the hidden price of coal power

By John Timmer
Ars Technica

Each year, the US sets off the equivalent of 20-30 atomic bombs worth of explosives, effectively obliterating entire features of its own landscape. Why? To get at the coal that's inconveniently located beneath the mountains of Appalachia.

That jaw-dropping figure came towards the end of a session at last month's meeting of the American Association for the Advancement of Science called "The True Cost of Coal." Most methods of resource extraction and use come with various forms of what are called externalities, or costs that aren't included in the final product, but distributed across society as a whole in the form of things like environmental degradation and damage to health.

Calculating these hidden costs is obviously a challenge, and the researchers involved doing so tend to produce a range of values to reflect the uncertainty. But for coal, most of the estimates suggests that its true cost is about double the price of the energy produced with it, and may be quite a bit more.

Melissa Ahern of Washington State University described some of the environmental impacts that have resulted from the mountaintop removal process in Appalachia: over 500 peaks gone, 2,000 miles of streams eliminated, and over 140 billion gallons of coal slurry currently held in storage ponds. But her research has focused primarily on the health costs of the mining.

(More here.)

Minnesota GOP legislators plan to ease coal restrictions

"Several young people testified to the House and Senate committees, saying they are concerned about the problems coal will cause to the world they inherit." — Capitol Chatter

By PATRICK CONDON
Associated Press

ST. PAUL, Minn. (AP) — Minnesota legislators moved Tuesday to lift state restrictions on carbon dioxide emissions from coal production that critics said has amounted to a moratorium on the construction of new coal plants.

Republican-controlled House and Senate committees passed matching bills to lift a state law passed just four years ago. The coal plant provision was one piece of a larger series of reforms meant to boost renewable energy production and clean up Minnesota's environment, which passed with wide bipartisan support and was signed by Republican Gov. Tim Pawlenty.

Under the current law, utilities can only build and operate new coal plants in Minnesota only if they can offset carbon emissions to a level that they don't add to the amount of carbon in the atmosphere. Critics said the options for achieving that offset are so expensive and burdensome they amount to an effective moratorium on new plants.

(More here.  See also the article from the Capitol Chatter.)

Coal-fired power plant on South Dakota-Minnesota border DOA

Utilities kill plans for Big Stone II power plant

Coal-fired facility falls to recession, pending new rules

By Leslie Brooks Suzukamo
St. Paul Pioneer Press

Developers of the controversial Big Stone II power plant in Milbank, S.D., said Monday they will not build the $1.6 billion coal-fired project, ending a four-year battle between utilities and environmentalists over a significant portion of Minnesota's energy future.

About half of the plant's 500 megawatts to 600 megawatts of power -- enough to supply about 580,000 homes -- would have come to Minnesota. But now the regional utilities that backed the plant must go back to the drawing board to find other sources of energy for the decades ahead.

The plant had made it through a series of environmental and other regulatory hurdles, only to stumble because of the recession and uncertainty about federal climate-change regulations that scared off banks and other potential partners.

The decision to kill the Big Stone II proposal also could delay transmission projects in Minnesota and the Upper Midwest, some of which already had been approved by regulators.

(More here.)

Another blow against coal

Otter Tail Power Company Announces Withdrawal From Big Stone II

FERGUS FALLS, Minn., Sept. 11, 2009 (GLOBE NEWSWIRE) -- Otter Tail Power Company today announced its withdrawal -- both as a participating utility and as the project's lead developer -- from Big Stone II, a 500-to-600-megawatt coal-fired power plant proposed for near Milbank, South Dakota, with related transmission upgrades in South Dakota and Minnesota.

According to Otter Tail Power Company President and CEO Chuck MacFarlane, the broad economic downturn coupled with a high level of uncertainty associated with proposed federal climate legislation and existing federal environmental regulation have resulted in challenging credit and equity markets that make proceeding with Big Stone II at this time untenable for Otter Tail's customers
and shareholders.

MacFarlane explained that Big Stone II contractual agreements require a commitment to proceed after the project receives all major permits, creating a financial obligation on each party that agrees to go forward. "Each Big Stone II participant is in a different position in terms of means and impact of raising capital and mechanisms for recovering those costs from customers," he said. "Given the legislative and regulatory uncertainties and current economic
conditions, Otter Tail Power Company is unwilling to create a binding financial obligation of approximately $400 million for its share of the project at this time."

(Continued here.)