Frank Clemente Ph.D. Senior Professor of Social Science & Energy Policy Penn State University

Transcription

1 Empowering The Central Humanity Role Of Coal Through in Coal America s Future The importance of coal in the global energy mix is now the highest since It remains the backbone of electricity generation and has been the fuel underpinning the rapid industrialization of emerging economies, helping to Frank Clemente Ph.D. Senior Professor of Social Science & Energy Policy Penn State University fac226@psu.edu raise living standards and lift hundreds of millions of people out of poverty, Fatih Birol, Chief Economist, International Energy Agency, 2013* Frank Clemente Ph.D. Professor Emeritus of Social Science Penn State University fac226@psu.edu Presented at the Coal Forum, Longworth House Office Building, December 5,

2 Key underlying premises 1. Electricity is the lifeblood of modern society and the key to a higher quality of life for all. 2. At least 1.3 billion people have no electricity and another 2 billion lack adequate access to power 3. Coal is the leading resource to affordably meet electricity demand and alleviate electricity deprivation 4. Coal conversion to liquid fuel and substitute natural gas will be a global advantage going forward 5. Clean coal technologies work: (a) higher efficiency generation and (b) carbon capture,use and storage are the technological pathways to sustainable energy, economic growth and climate change goals

3 ELECTRICITY IS GOOD More People, Living Better, Living Longer Source: developed from The World Bank, 2010b 3

4 A Transmission Line for Much of the World 4

5 Scale Sets the Context : Global Electricity Demand Increase of 670% in Demand in Two Generations Source: IEA; WEO 2012 (Current Policy Scenario), WEO 2002, WEO

6 The Scale of Electricity Deprivation In Sub-Saharan Africa, there is only enough electricity to power one light bulb per person 3 hours a day (800 million people) Sources: CIA, World Factbook, 2012; World Bank, 2012; Alan Pasternak, Global Energy Futures and Human Development: A Framework for Analysis, Lawrence Livermore National Laboratory, 2000

7 The Coming Wave of Rising Expectations Millions Age 24 or Younger Source: CIA World Factbook

8 Everything, Everywhere, All the Time: Increases needed by 2035 to meet demand Nuclear power 42% Oil production 23% Hydro 56% NG production 60% Coal production 59% Plus a 61% increase in renewables and biomass 8 8

9 Coal s Ever Growing Role People dependent on coal for at least 40% of electricity 2,300 Million 3,000 Million 4, 000 Million IEA Current Policies Scenario 9

10 Incremental Electricity Generation by 2035 Terawatt Hours 1,082 USA 11,770 17,874 Developing Asia World (non-u.s.) Source: EIA

11 Supercritical Technology has Significant Environmental Benefits 429 GW On Line and Under Construction China and India house 50% of the World s Developing Advanced Coal Fleet China 175 GW ROW 45 GW U.S. 96 GW Other EU 11 GW India 37 GW Japan 20 GW Germany 12 GW S. Korea 17 GW Russia 16 GW

12 Out of Poverty: Coal Based Energy has Propelled China Forward China is an example for the developing world IEA, 1, Note: Poverty measure follows World Bank Definition of $1 per day income Source: IEA, 2007; EIA,

13 Unprecedented urbanization drives demand for coal Urban households in developing Asia consume three times more commercial energy than their rural counterparts. (World Bank) Billions of People

14 Coal Provides the Building Blocks of Cities Power Steel Cement

15 PUDONG IN

16 PUDONG TODAY 16

17 The Future of Shanghai 17

18 The Scale of Latent Demand for Coal-Based Electricity in India Millions of Indians Sources: IEA; World Bank

19 India Will Drive the Next Generation of Global Urban Growth Millions of People Incremental Urban Population, A new Mumbai every year. Source: UN

20 Coal as the Continuing Cornerstone of India s Power Generation Total: 960 TWh Total: 3,565 TWh Total: 66 TWh Coal 49% Other 51% 1970 Coal 68% Coal Other 69% 32% 2,446 TWh Other 31% 1,119 TWh Coal 69% Other 31% 2010 Sources: IEA, WEO, 2002, 2012 (current policies) 2035

21 ASEAN: Association of Southeast Asian Nations Brunei Cambodia Indonesia Lao Malaysia Myanmar Philippines Singapore Thailand Vietnam Over 600 million people live in the ASEAN countries almost twice as many as live in the United States. GDP growth is projected to increase at over 4.6%/y through 2035 (IEA Southeast Asia Outlook, 2013, p. 30)

22 The Continuing Rise of Coal Power in ASEAN Terawatt Hours (TWh) of Generation TWh Through 2035 Coal Gas Other Hydro Coal emerges as the fuel of choice in the power sector as it is relatively cheap and abundant. A shift towards coal is already underway IEA* Source: IEA, Southeast Asia Energy Outlook, pg. 37, 2013

23 ASEAN Population Without Access to Electricity 15 million 25 million million 66 million 134 million Rest of ASEAN Myanmar Philippines Indonesia TOTAL Source: IEA, Southeast Asian Energy Outlook, pg. 27, 2013

24 The Scale of ASEAN Urbanization to 2050 Incremental Urbanization in Millions by 2050 New Urbanites in Millions ASEAN nations will add 239 million people to urban areas by 2050 the equivalent of one St. Louis every 19 days for the next 37 years. *Western plus Northern Europe. Data source is UN Urbanization Prospects,

25 The United States is a Developing Nation The Boom is Still Ahead of the U.S. New Population in Millions Source: U.S. Census Bureau

26 The Continuing Urbanization of America Millions of Americans Through 2050 the urban population will increase each year more than the population of Chicago. Rural Population Source: U.S. Census Bureau

27 The EIA projects coal will still be the leading source of power generation through 2040 Terawatt Hours (TWh) ,398 1,829 Wind Hydro Nuclear Gas Coal 27

28 Our lack of institutional memory even to 2008 Westar (Kansas) officials.. said the fuel charge is increasing because of the increased costs of natural gas The rising price of natural gas is one of the reasons why Southern California Edison, the largest utility in California, recently warned customers it would be requesting a sharp increase in rates increased natural gas prices already have resulted in electricity bills jumping twice since March for customers of Milwaukee-based We Energies About 60 percent of New England power plants run on natural gas or oil, and sharp increases in the costs of these fuels passed through to electricity prices Summer wholesale market prices for electricity in New York City may exceed last summer's prices by 89%. Driving this increase is the major increase in the price of natural gas The 260,000 customers of Virginia Natural Gas will see a 35 percent increase in their annual bill Retail electric companies blame rising natural gas prices, since most of Texas' electricity comes from natural gas-fueled plants Florida Power & Light, the state's largest utility with 4.4-million customers, is also asking for a 16 percent increase (and) estimates that utilities this year will pay 33 percent more for natural gas Note: All quotations from 2008 news releases.

29 The skewing of America s power system Probable U.S. Generating Capacity by 2020 in GW By 2020, gas generating capacity will exceed that of coal, nuclear, and hydro combined. NERC has warned that increased gas dependence is a risk to electric reliability. Demand from the gas fleet could exceed 35 Bcf/day compared to 21 Bcf/day in This would require an additional 4.5 Tcf twice the production of the Gulf of Mexico. Source: EIA,

30 Where Will We Get the Gas by 2025? 4,700 Bcf 14,800 Bcf Incremental U.S. Gas Production Potential Incremental U.S. Gas Demand (PIRA, 2013) Note: Incremental dry gas production per EIA AEO Table A.14

31 Our lack of institutional memory even to 2008 Westar (Kansas) officials.. said the fuel charge is increasing because of the increased costs of natural gas The rising price of natural gas is one of the reasons why Southern California Edison, the largest utility in California, recently warned customers it would be requesting a sharp increase in rates increased natural gas prices already have resulted in electricity bills jumping twice since March for customers of Milwaukee-based We Energies About 60 percent of New England power plants run on natural gas or oil, and sharp increases in the costs of these fuels passed through to electricity prices Summer wholesale market prices for electricity in New York City may exceed last summer's prices by 89%. Driving this increase is the major increase in the price of natural gas The 260,000 customers of Virginia Natural Gas will see a 35 percent increase in their annual bill Retail electric companies blame rising natural gas prices, since most of Texas' electricity comes from natural gas-fueled plants Florida Power & Light, the state's largest utility with 4.4-million customers, is also asking for a 16 percent increase (and) estimates that utilities this year will pay 33 percent more for natural gas Note: All quotations from 2008 news releases.

32 Nuclear is too Expensive: 2,200 MW Levy Plant in Florida (CANCELLED) Projected to Come Online in 2016; Cancelled in 2013 Due to Cost Estimated Cost in Billions Billions $ Levy Plant in Florida: cost estimates increased fivefold in just seven years. The likelihood of someone else going ahead with a new nuclear plant today is very low indeed. Jonathan Arnold, Utility Analyst, Deutsche Bank, August 2013 Year of Estimate

33 Clean Coal Technologies Work Total Emissions Have Declined While Coal Consumption Increased + 146% + 103% - 89% - 93% Source: USDA 2011, EIA 2012, NETL

34 CCUS-The EOR Opportunity: Proven and Profitable at $80/bbl Oil Over the next 30 years: 87 billion barrels in stranded oil could be recovered in the U.S. alone CO 2 is a necessary feedstock for EOR Maximum needed: 14 billion tons of CO 2 7 billion tons of coal Carbon is a product not a problem. Source: National Energy Technology Laboratory, U.S. Department of Energy, Storing CO 2 and Producing Domestic Crude Oil with Next Generation CO 2 -EOR Technology, Jan. 9, 2009; International Energy Agency: Coal-Fired Power Generation: Replacement/Retrofitting Older Plants, 2008; Management Information Services and Peabody analysis. Source: DOE/NETL_2012/1540-Figure

35 A Better Way: The Clean Coal Path to Achieve Our Economic and Environmental Goals Efficiency improvements at Existing Plants Building New Supercritical Plants Demonstrating and Deploying IGCC and Carbon Capture, Utilization and Storage The Goal: Near-Zero Emissions Advancing Carbon Capture, Utilization and Storage and Btu Conversion Retrofitting Existing Coal-Based Generation with Carbon Capture/Storage Up to 90% Lower CO 2 CO 2 -Enhanced Oil Recovery, Producing 4 Million b/d years