Fossil

EPA Proposes Affordable Clean Energy Rule as Replacement for Clean Power Plan

September 5, 2018

On August 21, the Environmental Protection Agency (EPA) proposed the Affordable Clean Energy (ACE) rule as a replacement to the 2015 Clean Power Plan (CPP). The EPA had been expected to repeal the CPP ever since the former head of the department, Scott Pruitt, announced the agency’s intention to do so in October 2017.1 The new rule aims to create guidelines for states to reduce greenhouse gas (GHG) emissions from existing coal-fired power plants and is subject to a 60-day comment period. The proposed rule will likely lead to legal challenges from environmental and clean energy groups. The EPA is hoping to finalize the ACE rule by early 2019.


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FERC Resignation May Mean More Gridlock

August 30, 2018

Federal Energy Regulatory Commission (FERC) Commissioner Robert Powelson recently concluded the shortest term of any leader in the regulator’s history. His departure leaves a considerable challenge for the remaining four commissioners to avoid gridlock with several critical policy discussions on the docket.


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Will Coal-Fueled Energy Exist in the United States in 2050?

April 16, 2018

In the last 10 years, coal power generation has fallen from providing more than half of the electricity in the United States to less than 30% today. While that number held steady for 2016 and 2017, coal plant owners have announced 13 GW of planned retirements for 2018, the largest since a record 15 GW retired in 2015. Another 10 GW of capacity is already planned for retirement over the next six years; including more than 2 GW by Duke Energy alone, with more announcements likely. The only coal plant that will begin operating this year is a 17 MW unit being installed at a campus microgrid in Fairbanks, Alaska. If shutdowns were to continue at this rate of more than 10 GW per year with no replacements coming online, coal power generation would cease to exist in the United States in less than 25 years. Before we rush to write the epitaph for coal power, let’s take a step back and look at what is driving some of these retirements.


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The Digital Power Plant – How Leveraging Data for Better Decision-Making Is Improving Performance, Safety, and Reliability

April 3, 2018

The concept of the digital power plant has been receiving a lot of attention and calls for an assessment of what it really means and what the maturing technologies have to offer power generation companies. At the December 2017 POWERGEN Conference, Mitsubishi Hitachi Power Systems President and CEO Paul F. Browning announced they had broken ground on a combined-cycle power plant capable of fully autonomous operation slated for completion in 2020. Emerging digital analytics platforms are transforming how power generation companies collect, use, and learn from their data to realize new opportunities for reducing costs, improving efficiency, and managing risk. In a market environment with exceptionally lean margins, the oldest legacy generating units can benefit from this digital transformation just as much as the newest cutting-edge construction.


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Billion Dollar Petra Nova Coal Carbon Capture Project a Financial Success But Unclear If It Can Be Replicated

March 7, 2018

NRG Energy and JX Nippon’s joint venture Petra Nova project, the world’s largest operating post-combustion carbon dioxide (CO2) capture system, is set to receive another big boost from ongoing bipartisan enthusiasm for “clean coal.” The U.S. budget bill passed by Congress in early February included the FUTURE Act (S.1535) that extends tax credits for carbon capture, utilization, and storage (CCUS) projects and raises the credit from $10 to $35 per ton used for enhanced oil recovery. This certainly raises the prospects for further investment in an expensive and nascent technology.


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EPA Announces Repeal of Obama’s Clean Power Plan

October 11, 2017

The Environmental Protection Agency (EPA), under the new leadership of former Republican Attorney General for Oklahoma Scott Pruitt, is expected to officially repeal the Clean Power Plan (CPP). The EPA asserts that the CPP’s justification under Section 111 of the Clean Air Act (CAA) was flawed, and the proposed repeal would return to a more traditional reading of the act where Section 111 was applied narrowly to single sources of emissions (e.g., individual power plants). This reversal will likely lead to legal challenges from environmental groups as they will assert that the EPA is legally required to do something to regulate carbon dioxide (CO2) levels as Section 111 also directs the agency to implement the “best system of emission reduction” for pollutants.


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Outlook for U.S. Coal and Oil Electric Generation Industry with Exit out of the Paris Climate Accord

July 11, 2017

President Donald Trump, as expected, pulled the United States out of the Paris Climate Accord negotiated and agreed to in late 2015. Does it matter? Will doing so have ramifications for the U.S. coal and/or oil electric generation industries?


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Energy Markets and Fossil Generation, Not Competitive or Not Fair?

June 22, 2017

Some market participants are expressing concerns over “around-market” or “extra-market” energy policies, such as zero-emissions credits for nuclear generators and subsidies for renewable generators. These policies are found in energy markets, including independent system operators (ISOs) and regional transmission organizations (RTOs), which are accountable for administering their regions’ wholesale electricity markets and providing reliability planning for the regions’ bulk electricity system.


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Fossil Has More than 50% of Energy Industry Jobs yet Renewables Drive Future

June 21, 2017

In 2016, according to a U.S. Department of Energy and Employment report, 56% of energy industry jobs involved in power creation stemmed from oil, natural gas, and coal. Solar had the most jobs in the renewables space and was second only to oil in total jobs. Future energy sector job growth will be driven primarily by renewables.


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Department of Energy Orders Study Examining the Impact of Clean Energy Policies on Baseload Power Resources

May 18, 2017

Last month, Department of Energy (DOE) Secretary Rick Perry directed his department to conduct a 60-day study to “explore critical issues central to protecting the long-term reliability of the electric grid.” Specifically, the study is aimed at the impact on the grid from the recent wave of closures/retirements of baseload resources (over the past five years, 44.3 GWs of coal and 4.6 GWs of nuclear baseload generation capacity has been retired). The memo cites unnamed “grid experts” that are concerned “about the erosion of critical baseload resources,” “the manner in which baseload power is dispatched and compensated,” and “the diminishing diversity of our nation’s electric generation mix, and what it could mean for baseload power and grid resilience.”


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An America First Coal Plan: Will Changes in U.S. Policy Favor Coal?

March 3, 2017

Several weeks into the new administration, Trump’s energy policies, including those expressed in the “An America First Energy Plan,” are showing favor to the use of fossil fuels, indicating the potential for a rebound in coal use within the energy sector. While many in the coal industry have expressed a promising future, analysts have questioned whether the changes in direction from the Obama administration, including the repeal of the Clean Power Plan and other regulations, will result in any sustainable gains for coal.


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Market Conditions, Unseasonably Warm Weather, and Environmental Regulation Drove Coal’s Share of the U.S. Generation Mix Below 25% in March

September 20, 2016

Coal’s share of the U.S. generation mix fell 9.6% from the prior year to 23.7% in March as the shares of natural gas, nuclear, hydro, and non-hydro renewables grew 3.5%, 1.9%, 1.3%, and 2.7% respectively. This shift was caused by the confluence of coal plant retirements and mothballing resulting from the protracted downturn in power prices due to low gas prices, weather-subdued demand, and the ongoing effects of the EPA’s Mercury and Air Toxics Standards (MATS) rule.


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