The US is known as “The Saudi Arabia of Coal”. We have massive amounts of coal deposits within our borders.
If you look at photos of Dubai with all the skyscrapers and massive construction or read about Russia, likely the most expensive place to live today in the entire world, you see countries whose economies and wealth are being buoyed by commodity wealth. While there are also downsides to riding on commodities, there are positive instances of well run countries (i.e. the UK with North Sea gas and oil) benefiting from their commodity wealth.
The US has basically stopped building coal plants due to environmental concerns. Sure, there are a few coal plants being built here and there (I profile an Illinois coal plant under construction at this post) but the energy is basically dead in its tracks. According to this excellent analysis (which I highly recommend reading in full) from the National Energy Technology Laboratory, here is a summary:
“Actual plant capacity, commissioned since 2000, has been far less than new capacity announced; the year 2002 report of announcements reflected a schedule of over 36,000 MW to be installed by 2007, whereas ≈ 4,500 MW (12%) were achieved. The trend over several years has reflected the bulk of power plant developments shifting out in time due to project delays Delays and cancellations have been attributed to regulatory uncertainty (regarding climate change) or strained project economics due to escalating costs in the industry.”
Beyond typical NIMBY activities and our broken deregulation system, a key factor stopping construction of new plants are the emissions and ties to warming by environmental groups.
However, this recent article by the BBC (a fairly reliable source, historically) says that China is now the world’s top carbon polluter, and probably passed the USA back in 2006-7. China, of course, has no problem whatsoever in putting up coal plants and sensibly (from an economic perspective) utilizes coal heavily since they have their own deposits and don’t have to import fuel, while coal is also a proven technology for power generation. There are various accounts of their coal construction but I continuously see the reference to “a plant a week” but I would have to do more research to verify those claims; in any case many sources point to a massive construction boom of coal plants in China.
Given that warming is supposed to be a world wide phenomenon, why does it make sense for the US to use expensive imported fuel (we are moving to natural gas for almost all of our recent generation, and starting to import natural gas through LNG terminals) or tap all of our natural gas which is needed for residential heating (and whose price has gone up significantly, pinching many home owners and renters during winter in recent years), rather than build coal plants? Our newest coal technologies, while not “clean” coal, are certainly far cleaner than the average plant in China (their newest plants are probably pretty clean, but their overall fleet on average is likely far dirtier because coal “scrubbing” technology is expensive), so nothing is accomplished except for high prices locally which run through everyone’s pocket who tries to heat their home as well as pricing energy-intensive industry out fo the market.
Not investing in coal plants will indisputably make the US a poorer country in the future, as higher energy prices (all the other technologies except for the hated nuclear and hydro plants are more expensive on the margin than coal) for other alternatives make industry in the US less competitive and pull away money that would otherwise be available for consumer spending.
All this for what? So that we reach the same end state, because China is burning what they have, and what they have is lots of coal. They already passed us in emissions and it will just soar from here.
Cross posted at LITGM