Power Markets

EnergyWire's Kuckro talks 'war on coal,' generation forecast

With coal continuing to lead power generation in the United States, is coal under fire as the industry warns? On today's The Cutting Edge, EnergyWire reporter Rod Kuckro, discusses the market dynamics affecting coal-fired power generation and talks about key drivers responsible for moving the electric power sector toward other sources of generation.

Transcript

Monica Trauzzi: Welcome to The Cutting Edge. With coal continuing to lead power generation in the United States, is coal under fire as the industry warns? EnergyWire's Rod Kuckro is here to talk about the differing perspectives on the future of coal. Rod, you have a great story in EnergyWire that digs into some of the market dynamics at play with coal-fired power generation. What are the forecasts telling us about coal's future in the U.S.?

Rod Kuckro: Well, first of all, thank you for liking the story. Well, my reporting brought to mind that Mark Twain quotation about the reports of my death are greatly exaggerated. Now, we've heard a lot from politicians in particular about the war on coal that's being waged by the administration, but when you dig down to the numbers forecast both by EIA, which is a government agency, EPA, a government agency, and private forecasters like ICF International just issued a study, is that long term, coal's going to be pretty well-represented in electric power, at least for the next 15, 20, 30 years.

Monica Trauzzi: How accurate do these forecasts tend to be, and how are the stakeholders reacting to the predictions?

Rod Kuckro: Well, they are forecasts, so obviously the situation can change at any point, just as we've seen oil prices all of a sudden plummet, natural gas prices could rise, but it's funny, the stakeholders, the one thing they agree on, stakeholders on both the coal industry side and, say, the environmentalist side, the Sierra Club, they don't like the forecasts because they don't want to believe that long-term coal share in the case of the industry will be lower than it is now, and certainly Sierra Club doesn't want to believe that it will be higher than it is now, which is what the forecasts say.

Monica Trauzzi: There are some things changing in the electric power sector, though. What are the key things that are driving the sector away from coal and towards other sources of generation, and is it based on policy?

Rod Kuckro: Well, that's the argument. Opponents say that the government action is that it's based on policy, but it's really not. It's based on the market. Like most commodities, markets tend to determine which commodities are used, and right now, natural gas is so abundant, as you've reported many times here, that it's just a better alternative. But even cheaper than natural gas is renewables. In some parts of the country now, not just solar but wind are competitive with gas and cheaper. Remember, they have no fuel cost, whereas you've got to buy the fuel to run a natural gas plant or a coal plant.

Monica Trauzzi: There's a big question mark on the future of clean coal technology. Realistically, how might that keep coal relevant?

Rod Kuckro: Well, that might be the holy grail for the industry. You know, they didn't put much investment into CCS, carbon capture and sequestration, but now they're taking it very seriously because they see that long term that's going to be the way to keep these plants open for more than 30, 40, 50 years. And in fact, next Thursday, on the 29th, the National Coal Council, an advisory body to Secretary Moniz at DOE, will be issuing a significant study that they've been working on for several months about the potential for clean coal technologies, in particular carbon capture. And we'll see if that report sort of shows that they're very serious about putting money where their mouth is.

Monica Trauzzi: All right. Very interesting. A great read. Thank you for coming on the show.

Rod Kuckro: Thank you.

Monica Trauzzi: More Cutting Edge coming next Friday. We'll see you then.

[End of Audio]

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