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Cheap Shale Gas, Not EPA Rules, Is Driving Decline of Coal-Generated Electricity

Cheap Shale Gas, Not EPA Rules, Is Driving Decline of Coal-Generated Electricity

From R&D Magazine:Cheap shale gas produced by fracking has driven the decline in coal production in the United States during the last decade, researchers at the Great Lakes Energy Institute at Case Western Reserve University have found.

Power plants, which use 93 percent of the coal produced nationally, have been operating under the same EPA regulations signed into law by President George H.W. Bush in 1990. Proposed new rules since then have all been challenged in court and not implemented until June 2016, when the EPA’s restrictions on mercury and other toxic emissions were approved by the U.S. Supreme Court.

Consumption of coal continued to grow under those 1990-era EPA rules until 2008, and then went into steady decline, dropping by 23 percent from 2008 thru 2015.

The data show the drop in those years to be correlated with the shale revolution, as natural gas production increased by a factor of more than 10 and its price dropped in half, the researchers say. And, due to the continuing–and in some cases accelerating–technological and economic advantages of gas over coal, the decline in coal is expected to continue at least decades into the future.








Their study is published in The Electricity Journal.

“Some people attribute the decline in coal-generated electricity to the EPA’s air-quality rules, even calling it ‘Obama’s war on coal,’” said Mingguo Hong, associate professor of electrical engineering and computer science at Case Western Reserve and co-author of the study. “While we can’t say that the EPA rules have no impact–as, for example, discouraging the building of new coal power plants because of the expectation that tougher air-quality rules will clear the courts–the data say the EPA rules have not been the driving force.”

Hong, co-director of the Electricity Systems Research Lab at Case Western Reserve, and Walter Culver, a founding member of the Great Lakes Energy Institute Advisory Board at the university, say the data show that shale-gas competition is what’s been hurting coal as of today. They expect that, as wind and solar sources of electricity continue to improve, they will be tough competitors to coal in the not-distant future.

Bill Holland for SNL:While presidential candidate Donald Trump continues to blame the U.S. EPA for the fall of the coal industry, the real coal killer is cheap natural gas from U.S. shales, according to a new study by Case Western University in Cleveland.

“EPA rules have had little to do with coal’s decline,” the study said. “Shale-gas competition, however, has decimated coal.”

The current clean-air rules have been in place since President George H.W. Bush’s administration in 1990, supplanted only recently by the Mercury and Air Toxics Rule, the study said, which went into effect on June 13 after clearing the court system. The proposed Clean Power Plan is still in the regulatory process and will face years of court challenges, authors Walter Culver and Mingguo Hong said in the study published in the September edition of The Electricity Journal.

“EPA air-quality rules, largely unchanged since 1990, predate by 19 years and seem detached from the decline of coal,” the study said.

Regulations that have hurt coal are not federal rules, but efforts by the states, primarily the adoption of renewable fuel standards by individual states, the study noted, as well as the increasing efficiency and operational superiority of combined-cycle, gas turbine power plants, the authors noted.

From The Electricity Journal:The political rhetoric would have it that the dramatic decline in the use of coal in the U.S. since 2008 has been a result of ‘Obama’s war on coal’ – that is, the EPA’s Clean Air rules. But the data say otherwise. Rather, enabled by shale drilling, cheap natural gas is outcompeting coal markedly. An analysis that includes gas’s techno-economic pluses concludes the trend will continue.Full report ($): Coal’s decline: Driven by policy or technology?
















Source: IEEFA


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