A Free-Market Energy Blog

Archive

Posts from December 0

Time to Repeal New Source Review? (Up to 30 GW of coal-plant upgrades hangs in the balance)

By Robert Peltier -- February 4, 2010

The typical pulverized coal power plant in the U.S. is about 35 years old, yet the fleet will continue to operate for many years to come. New coal-fired plants, meanwhile, will continue to enter service but at a slow rate. There may not be a future price for carbon dioxide (CO2) given the dramatic scientific and political developments that we are going through, but cheap natural gas makes it difficult to justify the higher up-front costs of a new coal plant.

Still, there is significant new electricity generation capacity is possible from these older plants, perhaps as much as 30,000 MW–twice EIA’s projected growth of coal power over the next two decades. In addition, new technology upgrades have the potential of improving the operating efficiency by 3% to 5%. But the impediment for such win-wins is the risk of a New Source Review violation, years of litigation, and possibly fines.

Air Quality Compliance: Latest Costs for SO2 and NOx Removal (effective coal clean-up has a higher–but known–price tag)

By Robert Peltier -- June 13, 2009

Editor Note: Robert Peltier, Ph.D., PE, is editor-in-chief of POWER magazine. His bio is at the end of this post.

Environmental retrofits at coal plants have experienced costs greater than estimated by the Energy Information Administration. That is the bad news. The good news is:

  • There are no significant technical problems with flue gas desulphurization (FGD) or selective catalytic reduction (SCR) technologies.  Utilities are not buying “serial number one” so the performance or compliance risk is negligible.  Completion risk for any project also appears to be minimal.
  • The costs to construct either technology are reasonably well understood so that project capital cost estimates should be on the money.
  • The cost escalation (updated below) during the boom is now subsiding.

The overall result is that the “dirtiest” power plants have been and are being cleaned up to current stringent air-emission standards via the Clean Air Act and other pollution regulation.…