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Coal exports may do us good

Friday, January 18, 2013

It seemed like such a safe assumption, that exporting U.S. coal to China will be an environmental catastrophe. China burns huge amounts of coal to power its massive industry. The burning of coal is the largest contributor of heat-trapping carbon to the atmosphere, so shipping unburned coal from the United States to be burned in China will add billions of tons of carbon to the atmosphere that otherwise would stay safely in the ground. And global warming will be that much worse, and so much harder to stop.

Given that prospect, it only makes sense to fight plans to ship Montana and Wyoming coal to Asia through ports in Washington and Oregon. That fight is well under way, and intensifying.

We’ve got it backward, say two Stanford University economists. Exporting coal to China will be good for the environment, and reduce, not increase the rise in atmospheric carbon. Every economic action has a reaction. You must consider economic motives, patterns in energy use and sources, and how coal exports affect them.

Frank Wolak and Richard Morse study issues at Stanford’s Program on Energy and Sustainable Development. In 2010 they published an op-ed in The Guardian with the headline: “Environmentalists who want to ban China’s coal imports are 100 percent wrong. Driving up the price of coal cuts carbon emissions.”

China will be burning a lot of coal regardless of where it comes from. It has built coal-fired power plants by the dozen. It has large coal reserves of its own. In 2009 it shifted from exporting coal to importing large quantities, primarily because importing coal was cheaper. At the same time, a revolution in drilling technology made the United States the world’s leading producer of natural gas, which subsequently lowered the price of gas relative to coal. Power producers switched from coal to gas for purely economic reasons, but burning gas produces half as much carbon per kilowatt. Carbon emissions in the United States have fallen because burning gas is economically attractive, and it is attractive because of its price relative to coal. Coal recently produced more than half of the United States’ electricity. Now it produces a third.

China will burn the same amount of coal whether they import it or not, the economists say. They have no alternative. Export coal to China and supplies tighten. The price stays up relative to gas. Less coal will be burned in the United States and Europe, with a net environmental benefit. Stifle exports, and the price of coal falls, and burning gas is less attractive. More coal will be burned in the United States and Europe, with a net environmental degradation.

Burning coal spews a ton of carbon for every megawatt hour produced, they said. “If 5 percent of these megawatt hours were produced using natural gas instead of coal due to China raising the international coal price, a 175-million ton drop in CO2 emissions is the result,” they said in The Guardian piece. “This is the equivalent of taking 32 million cars off the road in the U.S. and Europe.”

Speaking at a recent Stanford conference, Wolak said if coal export facilities are built on the West Coast, in places like Bellingham and Longview, the result will be beneficial economically and environmentally. “Perhaps counterintuitively, the United States selling coal to China, and Asia generally, likely will reduce greenhouse gas emissions globally,” he said.

Environmentalists won’t buy the reasoning. It will be nearly impossible to convince people that exporting coal is good. There are the local environmental issues to be concerned about, including the effects of mile-long coal trains passing by day after day.

Environmentally, blocking commerce is always more attractive than letting it go. That’s what they will earnestly try to do with coal exports, and they may be 100 percent wrong.

Tracy Warner’s column appears Thursdays and Fridays. He can be reached at warner@wenatcheeworld.com or 665-1163.

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douglas     4 months ago

One thing that probably should be noted (unless I missed it in the article) is that there are many kinds of coal, with many different properties, like sulfur content and heat levels. The coal mined in the Powder River Basin, although down on average btu/ton has an extremely low sulfur content. Assuming it's a given that China will burn coal regardless of where it comes from, I'd probably rather have it a reletively "clean" coal that they're burning.

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grbadave     4 months ago

What nonsense. First, suggesting that 1 study from 2 economists renders all of the environmentalists (as it is implied) "100% wrong". Would you like to bet that this one study is likely contradicted by multiple other studies? Second, only in a mad world would it ever make sense to mine coal and literally ship it to the spot on Earth farthest away, and have that beat the price of their own domestic supplies. Third, by keeping our coal in the ground and thereby making worldwide supply of coal scarcer, the price of coal would go up, making it less competitive. Fourth, as you already point out, even without this scheme, in N Amer gas is already undercutting coal and reducing its share of the market. Fifth, how can the prospect of major irreversible alterations to the future of life on this planet not scare the hell out of you? We cannot keep on dumping GHG into the atmosphere as we have for the last 150 years and even pretend we care about future generations, for we have no reason to think they will be able to reverse the consequences or simply adapt to them. This kind of fuzzy logic is a big part of what got us into this mess, and it must end soon.

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sourtellinme     3 months, 4 weeks ago

I'm with you Dave. How can anyone think that you can inject a toxic chemical into a closed system,and have no repercussions. Our planet and humans are very much alike. Both will have a begining and end. The atmosphere and skin protect us from death. Both get sick and then get better. If you introduce a foreign toxin into either system, something is going to go wrong. We realized that with humans smoking. Smokers won't die right away. Slowly over time the effects of smoking weakens the system. Colds get more common and severe. Organs stop funtioning like they were made to do,and they die earlier than they should. We are starting to see that with the earth. More frequent and severe storms,droughts,floods,fires. The earths organs are not funtioning like they were made to do. But the only difference is that no matter what we do to the earth, it will survive with or without us.

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