Utility blows $7.5 billion only to prove clean coal is a cruel hoax
Investing in the technology for “Clean Coal” never made sense. Ten years ago, when coal was still cheaper than natural gas and renewables, coal boosters saw it as a way to keep the mines open for a little while longer. But we’ve always known that wind and solar would come down in price as mass adoption kicked in, and coal just can’t compete any longer. Imagine if they’d spent that money on developing renewables, instead of a sooty pipe-dream?
By Steve Hanley
Trump campaigned on a promise to reinvigorate the coal industry in America by “putting an end to the war on coal” and providing America with “clean coal, really clean coal.” This from the man who incorrectly says wind turbines “kill all the birds” and that solar power is “very expensive.” It looks like the Trumpenator’s tendentious tirades are no different than the vast majority of his pronouncements — nothing but hot air.
Beginning in 2010, Southern Company, one of the nation’s largest utilities, began construction of a new electricity generating facility in Kemper County, Mississippi. Its sole mission was to prove once and for all that clean coal technology worked. Projected to cost $3.5 billion, the project is now 3 years overdue and $4 billion over budget.
Now the company has run up the white flag of surrender. It announced this week that it is “immediately suspending start-up and operations activities” for coal gasification at the Kemper County plant. After years of being pushed by the Mississippi public utilities commission to rein in the runaway project, it is abandoning the whole idea and will operate the facility on natural gas instead.
According to Power Magazine, “The Kemper County IGCC Project is a lignite-fueled 2 x 1 integrated gasification combined cycle (IGCC) facility that uses the air-blown Transport Integrated Gasification (TRIG) technology jointly developed by Southern Co., KBR, and the Department of Energy (DOE) at the Power Systems Development Facility in Wilsonville, Alabama.”
Lignite — also known as brown coal — is one of the lowest forms of coal, just a few steps above peat. The gasification process was supposed to allow it to be burned while producing 65% fewer carbon emissions than normal — making it equivalent to the emissions from burning natural gas. The process works more or less as advertised, but the machinery to make it happen is far more complex than originally planned and the cost is significantly higher than projected. The Global Warming Policy Foundation maintains that as the plummeting cost of renewable energy continues, carbon capture schemes will always remain too expensive to be commercially viable.
One of the dirty little secrets of the utility industry is that its failures are paid for by its customers. In exchange for being granted a monopoly, utilities are guaranteed a fixed rate of return on their investments. When an investment turns out to be an expensive boondoggle, as is the case with the Kemper County facility, ratepayers pick up the tab.
In this way, the utilities are insulated from the consequences of their mistakes while their executives get to keep their lucrative compensation packages, bonuses, retirement plans, and other perks. So customers of Mississippi Power Company, the owner of the Kemper County facility and subsidiary of Southern Company, will have the privilege of paying for this expensive mistake for years if not decades to come. In the process of making America great again, The Donald and his supporters are only too happy to stick the little people with the financial burdens their policies create.
One way to get around the chokehold monopolistic utilities have on you, it should be highlighted, is to go solar.
Check out Cleantechnica’s new 93-page EV report.