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NATIONAL COAL COUNCIL
NEWS NOTES
Ph: (202) 223-1191
Fx: (202) 223-9031
www.nationalcoalcouncil.org
Vol. 96
Thoughts as I gaze across the alley…
During the course of my 34 years in the
energy business, I have been afforded the
opportunity to speak publicly on enough
occasions that I have lost count. I have had
the pleasure to speak as a guest lecturer at
the Yale University Graduate School of
Forestry as well as several other colleges
and universities both here in the U. S. and
abroad. I have been a part of numerous
press conferences, technical symposia,
editorial board meetings and so on. Always
I have been as prepared as possible, based
my comments on the facts as I knew them
and been professional in my presentation.
One of my most memorable times was
when, at the height of the debate on what
became the Acid Rain Title the Clean Air
Act Amendments of 1990, I had the
opportunity to debate then-Senate Majority
Leader George Mitchell (D-ME) on CBS
radio. At the time I was still learning my
craft. Some would say I was a wet-behindthe-ears kid. They would not have been
incorrect. But the Senator treated me as his
equal in that discussion. He was the
consummate professional making his
arguments in a positive, factual fashion as to
what he believed were the needs of the
country on an extremely emotional issue. I
hope I did as well, but then my opinion is
most likely somewhat biased.
Now we have come to another
environmental debate on another extremely
January 2008
emotional issue – climate change and carbon
management. I have recently read a quote
attributed to a NASA scientist, James
Hansen, Ph. D. His position is well-known
as opposing the construction of any new
coal-based electricity generating plants, and
he is entitled to that opinion and to state it in
any public forum in which he speaks. But I
believe the quote attributed to him is totally
out of line and unprofessional. Moreover, I
believe that it is based on neither fact nor
history.
According to a reputable energy news
publication, “Coal Daily”, James Hansen
stated, “Most utilities are just saying they
will eventually install CCS equipment,
without really intending to do so.” He has
accused utility company executives, not one
or two individuals but the entire industry, of
lying.
The coal-based electricity generation
industry has never said they could not
accomplish any of the environmental goals
set out by the numerous and varied
environmental laws and policies of this
nation. They have always said these goals
would be achieved, but that it would be
expensive in the process. To find proof of
this one need only look at all the
electrostatic precipitators to collect fly ash,
flue gas desulfurization systems to control
SO2 emissions, selective catalytic reduction
processes to control NOx emissions and the
various systems to control mercury
emissions
that have been installed at
generation plants across our nation over the
past three decades. Coal-based generation
has always stepped up, met the challenge
and continued to supply over half of the
electricity needed to run our economy.
Based on the past performance of this
industry, I am outraged at James Hansen’s
accusation. I am equally outraged that not
one person has challenged him about it.
And I am extremely disappointed that a
NASA scientist would stoop to such a low
level.
I miss the professionalism, the courtesy and
the manors of people like Senator Mitchell.
While to this day I disagree with him on the
entire acid rain debate, I respect and admire
him in the way he conducts his business. I
wish I could say the same about others.
Robert A. Beck
Executive Vice President & COO
Climate Change
The New Year began with several measures
addressing carbon emissions and climate
change pending on both sides of Capitol
Hill. Carbon reductions figure prominently
in a pair of Senate bills, one sponsored by
Sens. Jeff Bingaman (D-N.M.) and Arlen
Specter (R-Pa.), and the other by Sens.
Joseph Lieberman (I-Conn.) and John
Warner (R-Va.).
The Bingaman-Specter bill would cap U.S.
greenhouse gas emissions, including carbon
dioxide, at 2006 levels by 2020 and at 1990
levels by 2030. It would establish an
emissions allowance-trading program, with
utilities and other emitters required to obtain
allowances, one for each ton of carbon
dioxide-equivalent greenhouse gas emitted.
Twenty-four percent of the allowances
would initially be auctioned and 53 percent
given to industry (29 percent to utilities)
without charge. The remainder would be set
aside for a range of purposes, including a
10-year program to bolster the sequestration
of carbon dioxide in geological formations.
As of 2017, the percentage of allowances
auctioned would increase by 2 percent
annually, while the free distribution would
fall by the same amount. Eventually, all
allowances, except those reserved for special
purposes, would be auctioned.
The legislation was supported by numerous
utilities, conservation groups and unions, but
criticized by green groups, who termed the
emissions reductions targets excessively
lenient.
The Lieberman-Warner bill cleared the
Environment and Public Works Committee
in December. It also would require electric
utilities and other entities, including
manufacturers and oil refiners, to cap their
emissions of greenhouse gases.
The bill would originally have capped such
emissions at 2005 levels by 2012 and
lowered them to 15 percent below this level
by 2020. Further reductions would have cut
these emissions to more than 50 percent
below 2005 levels by 2050.
However, as amended, the measure would
mandate that emissions be reduced to 7
percent below 1990 levels by 2020 and by at
least 60 percent below 2005 levels by 2050.
It would also require the Environmental
Protection Agency to recommend that
Congress strengthen the cap if new scientific
evidence supported such a move.
The legislation as amended would give
utilities 20 percent of the allowances they
would need to meet reduction targets, at no
cost, although this allocation would be
phased out over time.
Coal-dependent utilities have contended that
the cost-free allowances were necessary to
allow them to develop and deploy carbon
capture and sequestration technology even
as an emissions cap drives up coal prices.
Two major utilities, Duke Energy and
American Electric Power, opposed the
Lieberman-Warner bill, saying it would
cause large increases in ratepayers’ bills.
Jim Rogers, Duke CEO, condemned the
measure, saying an auction for allowances
for existing coal plants represented “nothing
more than a carbon tax.” He branded the
Senate bill “a disproportionate tax on
consumers in the 25 states that depend on
coal,” according to Argus Coal Daily.
Rogers favored an allocation of allowances
to utilities based on their traditional
emissions, providing a transition period that
would protect consumers and regional
economies until cleaner technologies come
on line, Argus added.
An AEP representative told the newsletter
that two-thirds of the bill’s implementation
costs stemmed from its auction format,
saying that customer rates could rise by 40
percent in its service territory.
On the House side of Capitol Hill,
legislation to reauthorize the Energy
Department’s research and development
programs, and specifically authorize largescale demonstrations of both carbon dioxide
capture technologies and containment, has
cleared the Science Committee.
The bill defines large-scale injection of
carbon dioxide as one million tons annually,
and provides that DOE require that not less
than 20 percent of the cost of an R&D
activity be provided by non-federal sources.
Its sponsor, Rep. Mark Udall (D-Colo.), said
that the key to addressing the climate change
challenge without causing irreparable harm
to the economy – and the coal industry – in
the process was the creation of safe, sound
and economical capture and storage
strategies.
Meanwhile, House Energy and Commerce
Committee Chairman John Dingell (DMich.) has said he will introduce a bill to
impose a substantial, double-digit, tax on
carbon dioxide emissions to put the nation
“on track” to reduce greenhouse gas
emissions by 60 percent to 80 percent by
2050.
“In addition to an economy-wide cap-andtrade program, which would mandate a cap
on carbon emissions, a fee on carbon is the
most effective way to curb emissions and
make alternatives economically viable,” the
congressman said.
The prospective tax on carbon content
would be $50 per ton, Dingell said, phased
in over five years and then adjusted for
inflation. It would be imposed on coal,
including lignite ad peat; petroleum and
petroleum products; and natural gas.
Meanwhile, what The Washington Times
termed “a star-studded cast of energy and
environmental brokers and investors” is
launching “The Green Exchange” for
trading credits to offset greenhouse gas
emissions.
Participants include Nymex
Holdings, the parent of the New York
Mercantile Exchange; Evolution Markets,
the largest broker of environmental credits;
and several investment banks.
The Times said experts forecast that
prospective cap-and-trade legislation will
boost the price of U.S. carbon credits from
$2-$5 per ton of carbon to $30-$50 per ton.
The Green Exchange will handle a wide
range of products, including European
allowances, voluntary U.S. pollution offsets,
and renewable energy credits that help
subsidize wind farms or solar energy plants,
the newspaper reported.
The U.S. market for voluntary credits is
$100 million per year, but the worldwide
market for carbon allowances is about $60
million annually, the Times said.
Rising uncertainty over possible federal or
state greenhouse gas controls was cited by
the Southern Company and Orlando’s
municipal utility as they cancelled recently
announced plans for a 285-megawatt
integrated gasification combined cycle
power plant in Florida. DOE had planned to
provide $294 million of the project’s
estimated $855 million cost under the
Administration’s Clean Coal Power
Initiative, The Energy Daily reported.
While pulling out of the project, Southern
said it remained confident that its coal
gasification technology had the potential to
be among “the cleanest, most efficient coalbased generation options available for the
foreseeable future.”
An Energy Department spokesperson said
that the cancellation demonstrated the
importance of steady and predictable
policies that enable industry to invest in a
variety of power supply options, including
coal, and noted that “coal must continue to
be a critical component of our energy mix.”
DOE will continue to expand investments in
advanced coal technology R&D, the aide
added.
Elsewhere, The Energy Daily said, NRG
Energy and Powerspan Corp. have entered
an agreement for a commercial-scale
demonstration of the latter’s technology to
capture carbon dioxide from a coal-fired
power plant’s flue gas and release it in a
form suitable for transportation and
permanent geological storage.
The companies said the process to be used
differs from other techniques due to simpler
capital equipment design and significantly
lower energy consumption. It is suitable for
retrofitting existing coal plants as well as for
use in new ones, they added.
The demonstration will be conducted at an
NRG plant in Texas, and will capture and
sequester about one million tons of carbon
dioxide annually, the companies said. It is
expected to be operational in 2012.
Internationally, the United States agreed at a
United Nations-led conference in Bali,
Indonesia, to participate in new negotiations
on a post-Kyoto pact aimed at global
warming. Kyoto expires in 2012, and the
new agreement is to be concluded at a 2009
meeting in Copenhagen. Ratification by
signatories would follow.
Conference documents referred to scientific
reports that suggest a range of greenhouse
gas emissions cuts between 25 percent and
40 percent by 2020, but prescribe no such
target, The Washington Times reported.
While the U.S. dropped opposition to a
proposal for developed nations to do more to
help developing ones address rising
greenhouse gas emissions, it emphasized
that negotiators “must give sufficient
emphasis to the important and appropriate
role that the larger emitting developing
countries should play.”
“The time had come to open a new chapter,”
commented James Connaughton, chairman
of the White House Council on
Environmental Quality.
A new report from the Pew Center on
Global
Climate
Change
said
the
phenomenon is already underway and will
have a major effect as time progresses. The
United States must begin adapting, it added.
Regionally, effects will include an increase
in the number of heat-wave days in the
Midwest; heightened fire dangers and
severity in the West; reduced protection
against storms on the Gulf Coast; and a
larger summer dead zone in the Chesapeake
Bay, the report warned.
“Every planner, developer and policymaker
will need to factor climate change into their
plans – now,” said Eileen Claussen, Pew
Center president.
According to an article in The Washington
Post, the effects of climate change are
“diverse and sometimes contradictory,” and
generally favor “instability and extreme
events.” In the view of scientists, generally,
“they tend to harm health rather than
promote it,” the newspaper said.
Researchers tend to put the effects of
climate change into five groups, including
heat stress, extreme weather, air pollution,
waterborne and food-borne disease, and
vector-borne disease, the article said.
The largest tolls have been in Africa, on the
Indian subcontinent and in Southeast Asia, it
said, with about 160,000 lives lost annually,
according to the World Health Organization.
By 2020, this is expected to nearly double,
to about 300,000 lives lost annually, the
group said.
Discussions in the United States have
focused on ways to slow the phenomenon
rather than to dampen or prevent alreadyinevitable effects, the article said. Health
consultant Kristie Ebi counseled efforts to
design and develop adaptations that will
“decrease our vulnerability and increase our
resilience,” on the local as well as federal
level.
“In other words, all weather variations are
evidence of global warming,” Deming
commented. “I can’t make this stuff up.”
In another Times column, journalist Jay
Ambrose condemned the recently concluded
Bali conference for seeking “an immediate
industrial-nation commitment to emissionreduction goals that could throttle
economies and create vast misery if met.”
Despite the protestations of former vice
president Al Gore, the U.S. is accomplishing
more on the climate front than “a long list of
European and other Kyoto-signing poseurs,”
Ambrose wrote.
This nation’s efforts include a clean-air
partnership with two countries, China and
India, which soon will emit more
greenhouse gases than does the U.S., the
Ambrose column specified, as well as
supplying most of the funding for U.N.
climate change programs.
Energy Issues
“The impact of climate change really
depends on your local context,” Ebi told the
newspaper.
However, two Washington Times columns
called into question the reality of, and
current approaches to, climate change. In
“Year of Global Cooling,” geophysicist
David Deming said warnings about warming
are countered by the 2007 incidence of
record low temperatures in some areas,
including South America, South Africa, and
parts of the Untied States.
The slight warming in mean global
temperatures recorded since the midnineteenth century is not unusual, and this
figure hasn’t increased significantly in
nearly nine years, Deming wrote. However,
he added, global warming believers cannot
be convinced to the contrary. He pointed
out that a Greenpeace representative had
said that “global warming can mean colder,
it can mean drier, it can mean wetter.”
In an action The Energy Daily characterized
as “bucking a recent nationwide regulatory
trend against new coal-fired generation,”
Indiana regulators have approved Duke
Energy Indiana’s proposal for a 630megawatt integrated gasification combinedcycle plant. If other state approvals are
received and construction begins, the plant
could be operational by early 2012, the
newsletter reported.
The IGCC facility “could very well be the
cleanest coal-fired power plant in the world
once it’s completed,” the utility’s president
said. It will be able to generate as much as
four times the power of an old pulverized
coal plant on the site, using less coal, he
said. The existing plant will be shut down
and removed once the IGCC is in operation,
he added.
One of the nation’s largest solar
photovoltaic plants, at 8.22 megawatts, has
opened in Colorado.
Its operator,
SunEdison LLC, will operate the facility
under a long-term contract with Xcel
Energy.
Under a law signed by Colorado’s governor
last March, utilities in the state must get 20
percent of their power from renewable
energy sources by 2020.
The U.S. Air Force has flown an aircraft
powered by a synthetic fuel blend coast-tocoast for the firs time, The Energy Daily
reported. The C-17 transport was fueled
with a mix of 50 percent traditional JP-8
aviation fuel and 50 percent Fischer-Tropsch
kerosene, a synthetic fuel derived from
natural gas. The Fischer-Tropsch process
can convert many types of carbon-based
material, including coal, to liquid synthetic
aviation fuel, the newspaper said.
The service intends to certify the fuel for use
by its entire fleet early in the next decade to
help reduce dependence on foreign fuel
sources, the newspaper said. Air Force
officials have said they hope that half of its
aviation fuel purchases, about 400 million
gallons, will be this synthetic blend,
supplied by domestic producers, it added.
The Web site of the environmental group
Appalachian Voices is offering viewers
what it says is a look at the connection
between coal used at power plants and
mountaintop removal mining. It says that by
entering a zip code, a user can see their
primary power plant and whether its owner
is connected with the mining practice.
The group acknowledged that not every
plant
identified
on
the
site,
www.appvoices.org, uses coal that came
directly from mountaintop mining, but said
that the tool shows when plants use coal
from companies that operate such mines.
People on the Move
Stanley Suboleski, a former coal industry
executive, has been nominated to serve as
the Energy Department’s assistant secretary
for fossil energy. Suboleski, currently a
consultant, previously served as a member
of the Federal Mine Safety and Health
Review Commission and as interim chief
operating officer and executive vice
president of Massey Energy Co.
David Hill, general counsel at the
Department of Energy, has been nominated
to serve as Environmental Protection
Agency assistant administrator for air and
radiation, with responsibility for clean air
and other key issues. Before assuming his
current duties, Hill was DOE deputy general
counsel for energy policy, and previously
was a partner in law firms in Kansas City
and in Washington, D.C.
Kurt Kost has bee named president and chief
operating officer of Foundation Coal. He
had been executive vice president since last
June and previously served as senior vice
president for Western operations and
process management. He has been with
Foundation and its predecessor companies
since 1980.
Bert Bolin, Swedish climate scientist and
co-founder of the U.N. Intergovernmental
Panel on Climate Change, died in
Stockholm on Jan. 3. He had stomach
cancer. Bolin’s research in the 1950s on the
circulation of carbon in nature laid the
groundwork for much of the current
knowledge of climate change. He served as
the IPCC’s first chairman from 1988 to
1998.