It's happening: Here comes the EPA's de facto ban on new coal plants

We’ve known this was coming for quite some time now, but that doesn’t make it any more pleasant. Via the NYT:

Following up on President Obama’s pledge in June to address climate change, the Environmental Protection Agency plans next week to propose the first-ever limits on greenhouse gas emissions from newly built power plants.

But even before the proposal becomes public, experts on both sides of the issue say it faces a lobbying donnybrook and an all-but-certain court challenge. For a vast and politically powerful swath of the utility industry — operators of coal-fired plants, and the coal fields that supply them — there are fears that the rules would effectively doom construction of new coal plants far into the future.

While details of the E.P.A.’s proposal remain confidential, experts predict that it will include separate standards for carbon dioxide emissions from plants fired by natural gas and by coal. Plants using comparatively clean gas would be permitted to emit perhaps 1,000 pounds of carbon dioxide per megawatt-hour, a ceiling within easy reach using modern technologies.


Coal-fired plants may be allowed to emit up to 1,400 pounds of carbon dioxide per megawatt-hour, but that threshold is probably still too high for coal to meet without adding very expensive carbon-capture technology — meaning that the construction of new coal plants will no longer be a cost-effective endeavor in many cases.

Coal plants have already begun shutting down in anticipation of the new regulations, and get ready to see a lot more of that:

When the Longview plant went into operation in 2011 – the first new coal plant to go online in West Virginia in 18 years – its owners wanted to show that there is a future role for coal in the U.S. energy mix.

Located in Maidsville, 10 miles from the Pennsylvania border in West Virginia’s coal heavy northern panhandle, Longview was built to generate electricity cheaply, efficiently and with a smaller carbon footprint than a traditional coal-fired plant.

But on August 30, the 700 megawatt supercritical pulverized coal plant filed for Chapter 11 bankruptcy protection along with its coal supplier, Mepco Holdings. It is in the process of financial restructuring.

Longview’s bankruptcy filing cited construction and design issues that led to extended outages as a reason for the bankruptcy. But it also pointed to unfavorable market conditions that made the plant uneconomical.


Eco-radicals and advocates of the administration’s regulatory route will quickly point out that natural gas is proving a highly competitive and ready substitute for coal and that it’s probably destined to take over a large market share from coal in the near future. While that is true to a degree, the point is that the Obama administration is doing an end-run around the naturally efficient free-market process and forcibly bringing about a transition in the way that they deem to be acceptable. That’s going to lead to a lot of job losses and opportunity costs, and of course, “necessarily skyrocketing” energy prices. Ahem.

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