Coal in His Stocking
- Dec 21, 2021 12:44 pm GMT
The stockings were hung by the chimney with care
In hopes that Saint Nicholas soon would be there.
There is some question regarding the origins of the practice of placing a lump of coal, rather than candy or other treats, in someone’s Christmas stocking. Today the practice is typically regarded as a punishment for bad behavior. Reviewing his year as President Biden’s “Climate Czar”, I believe John Kerry has earned at least one lump of coal in his stocking.
At COP26 in Glasgow, Scotland Kerry announced that “the US won’t have coal by 2030”. He did not mean that the US would run out of coal by 2030, but rather that the US would no longer use coal, at least for the generation of electricity, but possibly also for the manufacture of iron and steel and the production of cement. Kerry did not reveal any plan for this transition, as has been the case with all Biden Administration declarations regarding actions intended to slow and ultimately halt climate change.
Kerry did not address which sources of dispatchable power would replace the power generated by existing coal generators. He also did not address how the Administration would force the closure of existing coal generators, or if and how the owners of these generators would be compensated for the financial losses associated with their closure. State utility commissions typically use a “used and useful” test for inclusion of facilities in a utility’s rate base. Closed plants would no longer meet the “used” test, even if they were not dismantled and remained potentially “useful”.
It is not very likely that the coal generating capacity would be replaced by new natural gas combined-cycle generators, since the Administration has “committed” to net zero emissions by 2050 and any new natural gas generators would be expected to retain substantial useful life beyond 2050. Administration and UN pressure is also being exerted on lenders to deny funding to new fossil fuel generators. Private investors would likely be reluctant to provide funding for new fossil fuel generators in this environment and state utility commissions would likely also be reluctant to approve such investments in a utility’s rate base.
Electric utilities will require additional sources of dispatchable power, both to replace existing coal generating capacity and to meet the anticipated growth of electric demand and consumption. Neither wind nor solar is currently a source of dispatchable power, since the storage capacity required to supply the grid when the wind is not blowing and the sun is not shining are currently not available. The recent 10+ day “wind drought” in the UK and parts of Europe demonstrate clearly that limited storage capacity capable of supplying the grid for one or more hours is insufficient.
Storage must be capable of supplying the grid for periods of hours, day, weeks or even seasons to compensate for variations in renewable generation availability. The use of storage also requires installation of additional generating capacity to charge storage while also meeting grid demand. Electricity storage is currently extremely expensive for short duration systems and not currently available for longer duration systems.
Climate Czar Kerry appears to be guilty of “putting the cart before the horse”.
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