Will Sky-Clearing Coal Regulations Mean a Cloudy Outlook for Electricity Generation? Probably Not.

There is no questioning that the heat this summer has been extreme. In Washington, D.C., home of Worldwatch’s headquarters, this July was the warmest on record. In the U.S., 2,712 cities’ high-temperature records were tied or broken in the month of July alone, compared to 1,444 last year. And even if we ignore this extreme weather’s connection to climate change, one thing is for sure: people have definitely been using their air conditioners. Annual peak demand for electricity in the U.S. occurs during the summer primarily due to the use of air conditioning units. In most areas, electricity usage peaks between noon and 8 pm. A recent New York Times article discusses the potential ramifications Environmental Protection Agency (EPA) regulations of power plants may have for the U.S. grid’s ability to meet peak demand during the height of the summer cooling season. The author argues that although no one experienced blackouts or power shortages during this July’s heat wave when power demand hit record-breaking levels, new EPA regulations may change that in the future. Specifically, he contends that these new regulations will reduce the reliability of our grid through the shutdown of power plants and the increased development of wind power.

The argument that EPA clean air regulations will force the shutdown of a large number of power plants does not seem to be the case. A 2010 report authored by M.J. Bradley and Associates commissioned by several of the nation’s major utility companies held that the industry was well-poised to comply with EPA regulations without reducing system reliability. As of 2010, over half of the nation’s coal capacity had already installed pollution-reduction mechanisms such as scrubbers – scrubbers use a chemical solution to remove particulates and gases from the exhaust pipes of combustion facilities – and more control technology installations are planned for the near future. In March 2011, the EPA proposed regulations that would require power plants to install pollution-control technologies to reduce emissions of mercury, arsenic, chromium, nickel and acid gases. These rules provide toxic pollutant limits for coal, gas and biomass in terms of pounds or concentrations of the pollutant per unit of energy. For example, the mercury limit is 4.6*10-6 pounds per million British thermal units (lb/MMBtu) for existing coal plants and 3.5*10-6 for new coal plants. The standards were written in March and will be finalized by the EPA in November.

A coal-fired power plant in Utah.

Officials from many large utility companies have long been preparing to deal with anticipated stricter air regulations . A June 2011 analysis by the Center for American Progress (CAP) contended that the fact that so many plants have already implemented measures that put them in compliance with tighter air pollution standards demonstrates that the new regulations are cost-effective and can be met with available technology. The EPA estimates the cost of compliance for the new regulations to be $10.9 billion annually, while total health and economic benefits from fewer premature deaths, illnesses and sick days is estimated to be as much as $140 billion annually.

Despite much of the industry’s ability to bring plants into compliance with EPA regulations, some of the older and least efficient coal plants will indeed be taken offline in order for the industry to comply with new regulations. Because the EPA’s regulations limit pollution in terms of pounds per unit of energy, plants that produce less energy while emitting more dirty exhaust will have more difficulty complying with regulations. The M.J. Bradley report indicated that between 2010 and 2015, approximately 2 to 4 percent of the nation’s least efficient coal generating capacity will be taken offline.  But many of the generators that will be shut down are over 40 years old and are already experiencing economic difficulties, and would likely be retired soon regardless of new EPA regulations. And because these old coal plants are also among the nation’s least efficient, their retirement will have greenhouse gas mitigation benefits in addition to removing dangerous toxins from the air. These retired plants will likely be replaced with other, cleaner sources of electricity.

While natural gas-fired generation will be the most likely replacement for the retiring coal plants, the New York Times article warns, the growing amount of new wind capacity around the country could create more reliability problems than it solves, because peak wind generation does not tend to coincide with peak electricity demand. However, this blanket statement is not true across the board. Not all wind farms fail to peak during periods of peak demand. Depending on the location and specific conditions of the turbines, certain peak wind producing capacity may in fact coincide with peak demand. For example, many offshore wind sites have demonstrated an ability to operate near full capacity during times of extreme heat.

According to a 2007 report , Cape Wind, a wind farm off the coast of Cape Cod that just completed the federal permitting process, will produce on average 321 megawatts during times of peak demand in the summer, 76 percent of its total capacity. This is due to the sea breeze effect in which heating of the land surface and the sharp temperature gradient between it and the relatively cooler ocean creates an air temperature differential. This occurs primarily during the day when electricity demand, driven by air conditioning use, is highest. This sea breeze effect holds for many northeastern offshore sites, including the locations of proposed offshore wind farms in New Jersey, New York and Delaware, as well as other coastal and offshore sites around the country.

Offshore and coastal wind farms' strong daytime generation potential allows them to meet peak demand, particularly in the summer.

Recently, coastal wind turbines in Texas experienced similar success during the heat wave, producing near their full capacity. Recent research out of Stanford has shown that offshore wind production in California would be very successful. Coastal sites have strong winds in addition to close proximity to major urban areas like Los Angeles and the San Francisco Bay Area. In a modeled wind scenario off the northern coast of California, wind generation peaked in the summer months with a capacity factor, the ratio of output to potential capacity of a generation facility, of 53 percent. Additionally, winds were consistently fast throughout the day, with speeds all over 9 meters per second during July and around 8 meters per second during other seasons. Consistency in wind generation is what helps utilities meet peak demand. Ensuring that the wind is fast throughout the day, not just during certain periods, allows wind farms to produce efficiently. While there are technological and economic questions that need to be addressed regarding offshore wind development, it is clear that this renewable energy source will work well to meet peak demand in the summer months.

Moreover, as Worldwatch has reported, coal plants can actually hinder the integration of wind and solar power. Coal plants cannot be easily or efficiently powered up and down, making them clumsy partners for wind and solar power, which produce variable electricity output. If, as this article suggests, new natural gas plants replace much of the retiring coal capacity, grids will become more flexible and able to accommodate more variable generation. In the medium to long-term, improvements in energy storage and other smart grid technologies will enable a transition to an energy system dominated by renewable energy.

At the root of the summer peak demand issue is our reliance on wasteful and inefficient air conditioning. Improved efficiency in cooling systems, more thermostat controls distributed throughout buildings (particularly in office settings), relaxed office dress codes and more flexible work schedules can all help to reduce the demand for electricity. This critical fact aside, the evidence so far does not seem to support the concern that stricter EPA protections for our air will come at the expense of affordable, reliable electricity.


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