With cheap natural gas substituting coal for electricity production, a sustained downturn in coal demand in China, and tough new regulations on greenhouse gas emissions in the United States, pure play coal companies like Peabody Energy (NYSE: BTU) and Arch Coal (NYSE: ACI), are having a horrible run of it.
Rather, a shale - gas boom flooded the U.S. market
with cheap natural gas, offering utilities a cheaper, less risky alternative to nuclear technology.
It has all the hallmarks of a new industry with ups and downs, but it is clearly here to stay — even
with cheap natural gas coming from hydraulic fracturing (fracking) in shale formations.
The simple reason is because the fracking boom has flooded the market
with cheap natural gas.
Many of these plants are struggling to compete
with cheap natural gas and renewable energy in power markets, and granting them cost recovery would keep them from retiring, the agency argued.
[W] ith the inability of the Connecticut House to pass a bill that would have allowed the state's only nuclear power plant, Millstone, to compete on equal footing
with cheap natural gas and heavily subsidized renewables earlier this month, Connecticut is now in danger of losing its largest source of zero - carbon energy.
Nuclear facilities are struggling to compete as the market is glutted
with cheap natural gas.
Nuclear and coal - burning power plants across the state are struggling to compete
with cheap natural gas and some have announced closures in recent months.
Nuclear facilities are struggling to compete
with cheap natural gas.
Not exact matches
Combine that
with the glut of
cheap natural gas from fracking, and coal production has plummeted:
Natural gas is still so
cheap that solar has trouble competing
with existing plants, but when it comes to new
gas plants, solar is getting within striking distance, especially if
gas prices rise more than forecasted.
Calpine's deal comes at a time when the U.S. wholesale power generation industry is struggling
with margin pressure as
cheap natural gas from shale fields in recent years has been driving down electricity prices.
Utility - scale solar is now cost - competitive
with wind and
natural gas — and it's
cheaper than coal, even without subsidies.
Greg Biryla
with the chamber of commerce - affiliated Unshackle Upstate said better access to
cheap natural gas can boost manufacturing and create needed jobs in New York.
And
with ever
cheaper natural gas widely available now, paying a premium for ethanol or biodiesel seemed frivolous.
Although SynGest's price isn't yet competitive
with natural gas ammonia, Oswald believes there's substantial demand for a lower - carbon source of ammonia - based fertilizer: «
Cheap natural gas won't fix that.»
They never caught on, however, because they could not compete
with those powered by
cheap electricity and because their heat source — burning biomass or
natural gas — is difficult to manage.
People's beliefs tend to align neatly
with their interests, and in the absence of indisputable proof (and to non-scientists that means the equivalent of a ten - foot rise in sea level inundating South Beach) it is more «convenient» for people to use
cheap oil,
natural gas and coal.
The decline in the United States has mainly been due to market forces shifting electricity generation from coal to abundant and
cheaper natural gas, along
with environmental regulations built around the traditional basket of pollutants that even conservatives agreed were worth restricting.
Subsidies were biggest in Russia,
with about $ 40 billion a year spent mainly on making
natural gas cheaper, ahead of Iran
with $ 37 billion.
Compare this
with the coal industry, which peaked in jobs creation in the 1980's, before automation and
cheap natural gas; coal now employs 160,000 people directly and indirectly (54,000 coal mining jobs).
As an economy reduces its emissions it will start
with the
cheapest abatement measures (energy savings) and then move to the more expensive measures by replacing energy - using equipment and switching from high - emission sources such as coal to low emission sources such as
natural gas and nuclear power.
The average U.S. price of coal and
natural gas power is still
cheaper than renewables at $ 65 a megawatt - hour, compared
with wind at $ 80 and photovoltaic solar — generating electricity from sunlight — at $ 107.
CategoriesCSP News & AnalysisTagsArizona, Arizona Public Service (APS), California,
cheaper than
natural gas, csp competes
with natural gas, Solar Dynamics LLC, solar for after dark, solar for evening peak load, solar peaker
So as California was doubling its share of electricity from costly renewables, its retail electricity prices rose in line
with the rest of the nation as the
cheaper natural -
gas - generated electricity covered for the more expensive green energy.
These findings align
with PJM's broader assessment of its future grid reliability as more and more coal and nuclear plants find themselves economically uncompetitive in the face of flat demand,
cheap and plentiful
natural gas, and a rising share of zero marginal - cost clean energy.
Koch informed his audience that «coal is relatively low in price, that oil has been «pretty
cheap» until recently and that there is an abundance of
natural gas, available at a price almost competitive
with coal,» the Palm Beach paper reported.
But
with coal - fired power plants already beleaguered by
cheap natural gas prices and other environmental regulations, experts said getting there won't be easy.
Apparently,
with the latest discovery of huge deposits of
natural gas, the US has the potential to have a large additional supply of
cheap energy that emits only half as much greenhouse
gasses as traditional fuels.
Even without the Clean Power Plan, coal's share of national electricity generation has been in steep decline for over a decade, dropping from 49 % in 2007 to 33 % in 2015, due largely to hydraulic fracturing, which has flooded the market
with cheap, lower carbon
natural gas.
Comparatively, fossil fuels are still dramatically
cheaper than solar - based energies,
with photovoltaic energy costing anything from 35 - to - 50 cents per kilowatt - hour, compared
with coal and
natural gas at 5 - to - 6 cents per kilowatt - hour.
Steven Hamburg, chief scientist
with the Environmental Defense Fund, a nonprofit organization that cautiously supports
natural gas development, said that the new research is «asking the right questions,» but questioned some of the paper's assumptions, including the idea that people would use so much more energy as a result of
cheap natural gas that it would cancel out the benefits.
Adjusted for inflation,
natural gas has not been this
cheap for the past 35 years,
with the price this year three to five times lower than it was in the mid-2000s.
Supermarkets
with these HFC - free systems have found that
natural refrigerant
gases are generally
cheaper than HFCs and more energy efficient
with energy savings between 10 - 50 percent.
What if a off shore wind power generates
cheap electricity and innovators in selling heat pumps figure out how to replace
gas heat
with ground source heat pumps for less than
natural gas connection and usage costs over the first ten year of the 20 year life of the heat pump and 50 - 100 year life of the ground source?
Natural gas is still so
cheap that solar has trouble competing
with existing plants, but when it comes to new
gas plants, solar is getting within striking distance, especially if
gas prices rise more than forecasted.
But a combination of new federal and state environmental policies and a glut of
cheap natural gas (mostly from hydraulic fracturing, or fracking) have led to a dramatic shift during the past decade,
with coal dropping from 50 percent to 32 percent of our electricity generation and
gas increasing from 18 percent to 33 percent.
In fact,
with current technology, the cost of a wind - generated kilowatt hour in the American Midwest is now effectively
cheaper than a kilowatt hour generated by
natural gas.
Cheap and clean
natural gas, thanks to fracking technologies developed since the 1970's
with significant support from taxpayers, has rapidly displaced coal.
This will further flood world markets
with cheap American domestic oil and fracked
natural gas.
It takes six decades between the time the decision is made to go
with a particular energy generation form and the time it's end of life; committing to coal or
natural gas right now, today, is the less economical choice, and fiscally irresponsible, because by the time the plant is built, there will be a 50:1 ratio of
cheaper solar / wind / hydro / geothermal / wave years of service committed to.
In fact, they're pretty happy about all this oil and
natural gas, the jobs that are coming along
with it, and the
cheaper energy costs.
Natural gas and electric cars are now both fairly cheap to fuel, though fueling with electricity can be time consuming and fueling up with natural gas will be a new experience for con
Natural gas and electric cars are now both fairly
cheap to fuel, though fueling
with electricity can be time consuming and fueling up
with natural gas will be a new experience for con
natural gas will be a new experience for consumers.
Carbon combustion generated 80 % of someone's energy, but it sure as heck doesn't constitute much of the energy of people who can take advantage of
cheaper geothermal, hydro or
natural gas (which is largely hydrogen combustion); and as the price of solar and wind plummet and the practicality of extracting fossil other than
gas drops like a stone in lock step
with the advances of competing technologies, what sort of backwards knuckle - dragger actually wants the choking and fumes and leaks and inconvenience and dust and soot and sulfates?
FACT CHECK: wind power contributes about 6 % of Ontario's electricity supply, at four times the cost of other power sources; wind power is not the «lowest - cost» option — the turbines are
cheap to build but there are many other costs associated
with wind power and its intermittency; wind power can not replace hydro and nuclear — the fact is, coal was replaced by nuclear and
natural gas, a fossil - fuel - based power source.
They compete
with cheap coal and currently,
with very
cheap natural gas for a place in the electricity market.
A recent report from the Institute for Policy Integrity shows that the rapidly falling cost of renewable energy technologies (wind and solar, but not only wind and solar), coupled
with the stubbornly low price of
natural gas, mean that CPP compliance is likely to be
cheaper than anyone projected.
«
Cheap unregulated
natural gas would compete
with coal, but also
with renewables,» Davis summarized.
Then there's «intermediate load,»
with the next -
cheapest tier of power plants, and at the top of that second hump, «peak load,» satisfied by (usually
natural gas) «peaker plants» that are expensive to run but easy to ramp up and down quickly.
But he wholly fails to explain what the implications of the variability problem is (the need for overbuild of generation capacity and expensive / unfeasible large - scale energy storage), nor whether, if an effort is made to deal practically
with these problems in real national electricity grids, the «increasingly
cheaper» renewables will ever become
cheap enough (when all relevant real - world factors are considered) and reliable enough (without
natural gas «backup»), to actually substitute for and displace fossil fuels (or nuclear) at the scale required.