NEW YORK - US power companies are rushing to build coal-fired plants, in part because they are hoping to get them on the books ahead of potential US regulations on greenhouse gases, the author of a book on the coal industry said in an interview.
"There's a dawning awareness in the coal industry that it is as good as it's going to get right now," Jeff Goodell, author of "Big Coal," to be published by Houghton Mifflin next month, said in a telephone interview. "Changing politics in America are not going to favor the coal industry," he said.
US companies have submitted plans to build 120 plants that burn coal -- which emits more carbon dioxide than any other fuel -- though even the power industry says costs and permitting could pare that figure.
Unlike the European Union, whose members signed the Kyoto Protocol, the United States has no market for emissions of CO2 and other gases most scientists believe cause global warming.
President Bush favors voluntary means of cutting heat-trapping emissions, and in 2001 he pulled the United States out of the Kyoto agreement. In its first phase, the pact requires rich countries to cut CO2 by about 5 percent under 1990 levels.
But politicians thought to be mulling a run for the White House in 2008, including US Sen. Hillary Clinton and perhaps former Vice President Al Gore -- both Democrats -- and Republican US Sen. John McCain, support greenhouse gases regulations.
"Once you get a price on carbon ... that changes the whole competitiveness of coal plants," said Goodell, a contributing editor at Rolling Stone magazine, whose book stemmed from a 2001 cover story he wrote for the New York Times Magazine. "All of a sudden other things look more competitive and (coal plants) make less sense," he said about the potential for wind and solar power.
For its part, the US power industry doesn't see the coal rush related to a potential CO2 regime. "It's far more a response to... natural gas prices and concerns about fuel diversity, than ... companies trying to predict what the future may look like in terms of CO2 regulation," said Dan Riedinger, spokesman for the Edison Electric Institute.
To be sure, many things are sparking interest in coal. While US oil imports have been rising since the 1970s, the country won't have to ship in coal any time soon. It has more coal than any other country, more than double China's, and nearly eight times Western Europe's.
And a rush in the 1990s to build power plants that run on natural gas have led to record prices for the fuel in each of the last three years.
PLANS
The planned US plants could lead to greater emissions of greenhouse gases especially as few of them would be equipped with a new, more efficient technology, Goodell said. The technology, called integrated gasification combined cycle, trims CO2 emissions, but costs about 10 percent more. Even so, equipment that captures the gas can be added to it more cheaply than traditional coal plants.
American Electric Power Co Inc. and Cinergy Corp. are planning to build IGCC coal plants. But the lion's share of the plans call for dirtier conventional plants, including TXU Corp.'s plans for eight of them in Texas.
How any new US coal plants would fit into a US carbon scheme is anybody's guess. To create a market the EU handed down emissions allocations to power plants. Companies that cut emissions under set limits sell credits to those who could not cut them. The market traded US$7 billion in credits last year and is expected to grow much more.
If a market operates in a similar way in the United States -- the world's largest emitter of greenhouse gases -- utilities that squeeze in plants now instead of after the regulations are set up could save money.
"The question is how plants will be grandfathered in and what kind of allowances will be made for plants under construction and in permitting stages, " said Goodell. "That's going to be a huge battle."
Story by Timothy Gardner
REUTERS NEWS SERVICE
