Good news! California has moved to curb the spread of coal-fired power plants. This is a really big deal, since energy companies have been vying to build as many as 35 of the carbon-spewing facilities in western states, largely to feed California’s growing demand for electricity.
But California state regulators—justifiably concerned about the climate impacts of burning so much coal—got tricky: they prohibited the state’s utilities from buying power from any plant that emits more carbon than a super-efficient natural gas power plant.
In other words, new coal-fired power is a no-go for the California market, unless plant operators somehow figure out a way to burn coal without emitting CO2 into the atmosphere.
That’s the theory. But the western power market may actually work to undermine California’s good intentions.
You see, there’s nothing actually stopping California utilities from buying more climate-friendly hydropower from the Northwest. As far as I can tell, that wouldn’t fall afoul of the state’s regulations. But that could mean that Northwest utilities would have to start buying more coal-fired power from new, out-of-state plants, to replace the hydropower that we’re shipping south. The net effect: California’s rising demand for power would still pull more coal into the western electricity market.
Now, I don’t know for sure that this would happen; and even if it does, the indirect effects may be less dire than if California had done nothing.
Still, there’s no reason that the power market has to outfox us at all. All that Northwest jurisdictions have to do is adopt California’s rule, more or less verbatim. That’ll prompt change throughout the western power grid, tilting the whole system towards conservation, renewables, and perhaps even “cleaner” coal. Whee!
I’ve become something of a one-trick-pony on this issue—namely, that a voluntary decision to do the right thing, if taken by only one actor in the marketplace, can create incentives for other actors to do the wrong thing. It’s frustrating, but I think it’s a real problem. But it’s a problem with a fairly straightforward set of solutions—changing the rules of the market, so that incentives for responsible stewardship are built into all purchasing decisions, not just a handful of decisions by a handful of market actors. Of course, when I say that the solutions are fairly straightforward, I’m talking about the economic theory; the political reality of making this happen isn’t so straightforward at all.
Kevin Connor
Meanwhile, BC’s Liberal government, unburdened by any concerns about climate impact, is dragging the province backwards by approving coal-fired plants. Coincidentally, the coal industry contributes very generously to Liberal party coffers.
sf
So where is the electricity going to come from? Natural gas production in north America is plummeting. Nobody wants NGL terminals to import gas in their backyard. World gas production is close to peaking, even if terminals were not a bottleneck. Hydro production is going to decline as the climate warms, and greater value is given to anadromous fish. Nukes have their own problems, although many environmentalists are coming to see them as the lesser evil. Wind and solar are intermittent and probably not scalable enough to meet our needs. Biomass is a localized resource. The reality is that we will use our coal. I just hope we use it wisely. Shell wants to use 24 gigawatts of coal power to produce 2 million barrels of shale oil per day. It would be much more practical to use that power to charge electric cars and trains.
pricetags
Further to Kevin Connor’s comment above on the B.C. situation, I’ve added some more heat to this particular fire on my blog – Price Tags. You’ll find the post here at http://pricetags.wordpress.com/2006/12/18/more-fire-more-gas/
geotopia
With the correct tax incentives (e.g. reducing payroll taxes and making up the difference with taxes on carbon emissions) we will create many new ways of conserving and producing energy. Have you seen the Solar Tower being built by EnviroMission? http://www.enviromission.com.au/project/video/video.htm and http://www.enviromission.com.au/index.htm