Coal isn’t dying – it just can’t compete – by Christina Simeone (Penn Live: The Patriot News – June 9, 2014)

Christina Simeone is the director of the PennFuture Energy Center at PennFuture, a Harrisburg-based advocacy group.

Last week, the U.S. Environmental Protection Agency (EPA) released a proposal to reduce carbon pollution from existing power plants, the nation’s number one source of these emissions. In Pennsylvania, opponents of the rule are saying this is a “war on coal” aimed at killing the coal industry and destroying jobs. So, what is really going on?

First off, coal isn’t dying.

Coal is being out-competed in the domestic electric power markets by cheaper, relatively cleaner natural gas. However, at the same time, coal is breaking records in the international export markets, indicating economic viability.

Second, there is no “war on coal.”

There is a market correction under way. Historically, energy markets have been artificially cheap because the economic costs of pollution have not been factored into market prices — rather, these costs have been externalized to the public in the form of health-harming pollution. This externalization is called a market failure. If you like competitive markets, then you should support correcting market failures.

Third, old coal plants retire when they can’t compete in current power markets.

The oldest, dirtiest coal plants are closing because they can’t compete with relatively newer coal plants, natural gas plants and other more competitive electric power resources. Coal plant retirements are occurring only in the oldest plants, with the Energy Information Administration (EIA) pegging the average age of retiring coal plants at 51-68 years. Many of these plants were grandfathered (i.e. given special exemptions) from having to install modern pollution controls under the 1990 Clean Air Act amendments and have survived through a deferred investment strategy that is no longer viable. Newer plants can invest and still compete, while the older ones can’t.

Ability to compete can change, but pollution will always be harmful to human health. Coal may one day be more competitive in the markets (e.g. if gas prices go up or if power market dynamics change). However, science shows that reducing pollution will always improve public health.

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