- The Washington Times - Thursday, August 24, 2017

The abundance and low cost of natural gas has been the main driver of coal-fired power plant closures across the country over the past decade, the Energy Department says, placing most of the blame for coal’s free fall on energy economics, not Obama-era federal regulations.

In a sweeping new report on the nation’s electric grid, the Trump administration says that Environmental Protection Agency rules and other government policies have played a role in coal’s downturn, but the study concludes that the real culprit has been the U.S. shale gas revolution. The past decade has seen the nation become the No. 1 producer of natural gas on the planet, and gas last year overtook coal as the biggest source of electricity generation for the first time.

The rise of natural gas also has had an adverse effect on nuclear power.

“The biggest contributor to coal and nuclear plant retirements has been the advantaged economics of natural gas-fired generation,” the report, ordered by Energy Secretary Rick Perry earlier this year, flatly states.

“The increased use of natural gas in the electric sector has resulted in sustained low wholesale market prices that reduce the profitability of other generation resources important to the grid,” the study continued. “Production costs of coal and nuclear plants remained somewhat flat, while the new and existing, more flexible, and relatively lower-operating cost natural gas plants drove down wholesale market prices to the point that some formerly profitable nuclear and coal facilities began operating at a loss.”

Analysts long have said that natural gas is largely responsible for coal’s shrinking footprint. But Republicans, including President Trump, have mostly blamed coal’s fall on the Obama administration and its host of climate-change regulations.

The report does say that government rules played a role in coal plant closures, but that the impact was less than that of market forces.

The study found that, in 2002, there was about 306,000 megawatts’ worth of coal-fired power in the U.S. By the end of last year, that had dropped to 270,000 megawatts, meaning roughly 12 percent of all coal capacity in the U.S. has disappeared over the past 14 years. More closures are scheduled in the coming years.

Still, coal provides about 30 percent of the country’s electricity, and proponents say the study proves that the fuel remains an indispensable piece of the nation’s energy portfolio.

“A reliable and resilient electricity grid is essential for public safety and health, a sound economy, and national security. We commend Secretary Perry and the Department of Energy for studying the challenges facing the electricity grid,” said Paul Bailey, president and CEO of the American Coalition for Clean Coal Electricity. “One of the biggest challenges is how to preserve the nation’s coal fleet so it can continue supporting a reliable and resilient electricity grid. We look forward to working with policymakers at the national, regional, and state levels to value the important attributes of the coal fleet.”



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