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Goldman: Expect Another Bull Run In Oil

Goldman: Expect Another Bull Run In Oil

While oil prices are tumbling,…

Big Coal Urges FERC To Fix Seven-Year Long “Catastrophe”

Coal

In a statement sent to the Federal Energy Regulatory Commission (FERC), two coal industry groups have urged the authority to fix the “catastrophe” that happened over the last seven years in U.S. coal. FERC should start doing this by supporting Energy Secretary Rick Perry’s proposal for the grid, the National Mining Association and the American Coalition for Clean Coal Electricity said.

Secretary Perry’s proposal envisages higher payments to coal and nuclear power plant operators for maintaining the grid during severe weather conditions. According to him, the payment increase will help ensure that the plant operators have 90 days worth of fuel stocked on site, which will in turn ensure that they have the capability to guarantee grid stability.

In their statement, the two industry groups said FERC has the responsibility to support Perry’s proposal as a way of mitigating the effects of anti-coal regulation approved over the last seven years that led to the retirement or plan for retirement of 101 GW of installed coal power generation capacity.

"This catastrophic pace of retirements has caused cascading effects throughout the coal industry and industries that support coal, like railway and barge transportation, not to mention coal producing communities. The country is at a crossroads, and urgent Commission action is required before the value provided by critical baseload generation capacity is lost forever," the two organizations warned.

Related: Can India Overtake China In The EV Revolution?

Coal accounted for 30 percent of the U.S. energy mix in the first half of the year—just one percentage point below natural gas. Production in the first two quarters of the year averaged 192 million short tons – a decline from the second half of 2016, but higher than in the first two quarters of last year.

According to a recent report from the Union of Concerned Scientists, the share of coal in the U.S. energy mixed used to be 51 percent in 2008 and the current 30-percent share will continue to fall as about a fifth of the existing coal-fired power plants are uneconomical amid lower electricity prices.

By Irina Slav for Oilprice.com

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