Energy producers already have begun to prepare for coming CO2 regulations. As a first step, many companies are implementing internal trading schemes. In this article, we have focused on...
A new future for small coal-fired plants.
Small coal-fired plants are particularly vulnerable to economic and environmental pressures, putting some plant owners in what seems like a no-win position. But an emerging option—biocoal from crop wastes—might give small coal units a new lease on life.
The United States has roughly 1,400 operating coal-fired generating units, producing almost 2 billion MWh of electricity a year. These units produce almost 50 percent of our electric power, along with almost 35 percent of our CO 2 emissions 1 and up to 40 percent of our ground-level air pollutants such as SO 2 and NOx.
These 1,400 units are quite a diverse group. For example, Figure 1 shows the distribution of units by initial operation date and capacity. 2 The age of these units covers a span of almost a century and the capacity covers more than three orders of magnitude from less than 1 MW to more than 1,000 MW.
Given their economic and environmental significance, there is considerable discussion both in private strategy and public policy circles regarding management decisions affecting these units. Should an older unit be shut down or refurbished? Should environmental controls be added to an uncontrolled unit? Should a unit in a suitable location be converted to natural gas? And so forth. These management decisions can have substantial impacts locally, nationally and even globally.
Since larger units play a dominant role in the coal portfolio, it isn’t surprising that most of this discussion involves such plants. However, smaller units—those 100 MW or less in capacity—are important as well. There are roughly 150 units totalling over 800 MW that are each 10 MW or less in capacity and roughly 600 units totalling 20,000 MW that are each 100 MW or less in capacity (see Figure 2) . These 600 smaller units annually produce more than 100 million MWh in electric power and more than 100 million tons of CO2, along with a substantial amount of ground-level air pollutants. While these units are well under 10 percent of the total U.S. installed coal capacity, they play a significant role both economically and environmentally. The 20,000 MW in installed capacity is more than the installed U.S. biomass, geothermal and solar capacity combined. The annual fuel bill and the value of the power produced totals tens of billions of dollars.
Some of these smaller units are older, moderately sized and operated by major utilities solely for power generation. Others are newer, very small, and operated by industrial firms, governments or universities for both power and steam. Despite their considerable differences, most of these units share two characteristics. First, roughly 60 percent of the 20,000 MW is located in 14 states in the Upper Midwest and Great Lakes region (see Figure 3) . Leading states include Michigan, Wisconsin, Iowa and Ohio. Second, most of these