Four Proposed Coal Export Terminals Have Now Failed This Year Due To ‘Diminished’ Market

[kristopher]

Four Proposed Coal Export Terminals Have Now Failed This Year Due To ‘Diminished’ Market
BY EMILY ATKIN ON DECEMBER 10, 2013 AT 12:49 PM

As coal continues to decline in the U.S., plans to export it to overseas markets are going south. On Tuesday, the Port of Corpus Christi announced that it was ditching plans to build a major coal export terminal there after two years of development, citing a “seriously diminished” international interest in coal. Ambre Energy North America Inc., who entered into the $2.5 million lease in 2011, will pay a one-time fee to cancel it, according to a meeting agenda released today by the Port.

From the agenda:

Over the past four years interest in exporting coal at the Bulk Terminal has gone from no interest to a high of 40 million tons per year and then back to seriously diminished interest. Currently the export coal market has shrunk substantially. The domestic market has seen older coal fired power plants closed with some being refitted to burn natural gas. Wind and solar power driven by regulatory incentives have created additional pressure on coal. The enthusiasm for export terminals among coal producers has diminished.

The announcement is a major victory for environmentalists, and marks the fourth time in 2013 that a proposed coal export terminal has been canceled due to a deteriorating market. Of the proposed terminals still on the table, local opposition to the three remaining projects in the Pacific Northwest continues, as well as to a proposed terminal in Louisiana slated for construction next to a wetlands restoration project.

“This is the third coal export project that has been canceled in this region,” Hal Suter, chair of the Lone Star Chapter of the Sierra Club and a lifelong Corpus Christi resident told Public Citizen. “Ambre’s failure is a huge relief for Corpus Christi residents and it’s a clear sign of an accelerating shift away from coal. Texans don’t want coal, Gulf states don’t want coal and international markets don’t want it either.”

Indeed, the decision to scrap the project seems almost like deja-vu...

http://thinkprogress.org/climate/2013/12/10/3043591/coal-export-terminals-failed/

[pscot]

1. China wants it.

So does India. Plans for ports on the Columbia and Puget Sound are still alive.

[kristopher]

2. Yes, but (and it is a big but)

Although this article shows movement in exactly the wrong way, I don't think it should be read as anything except the denial stage of authoritarian grief for the inevitable death of king coal. It took us quite a while to gather the momentum to pass the Clean Air and Clean Water Acts, but when we did it made a huge difference. Given existing alternatives to coal, adding in the cost of pollution control will destroy its remaining economic viability.

Shanghai Officials Lower Standards Of Clean Air After Embarrassing Week Of Pollution
BY REBECCA LEBER ON DECEMBER 11, 2013 AT 2:08 PM

The next time the largest city in the world has as embarrassing a week of pollution as the last, the world may be less likely to hear about it. In the middle of the off-the-charts week of smog, Chinese officials announced changes to the city’s alert system so fewer hazardous air quality notices will be sent.

Moving forward, Shanghai’s Environmental Protection Bureau will issue alerts when concentration of PM 2.5 (the smallest and most dangerous particulates) is above 115 microgram per cubic meter, nearly five times maximum 25 level World Health Organization officials recommend as safe. Before, a 75 level warranted an alert.

The situation hit a crisis point Friday when concentrations of the pollutant had blown past Shanghai’s official scale. While some of the air pollution has lifted, this Wednesday, Shanghai was still well past recommended PM2.5 levels, hovering around 100 micrograms per cubic meter. Shanghai calls this “lightly polluted.”

State-owned media described the previous standard as “too strict, given that haze is common in the Yangtze River Delta region in winter.” Some Chinese media have also downplayed the smog’s dangerous health impacts, arguing it has had a positive side, like making city residents more creative, humorous, and united.

But it is hard...

http://thinkprogress.org/climate/2013/12/11/3049351/shanghai-pollution-standards/

[FBaggins]

3. A missing factor

Gas prices have been rising - enough to push some consumption back to coal.

IIRC, the 2014 projection for coal generation is up 5% from this year (even after closing almost 4GW of coal plants).

[kristopher]

4. Are you saying the article is incorrect?

If you are you'll need to make a better case.

Domestically there are the forces the article below. It informs the point you're raising to a degree, but it also shows that natural gas isn't the only factor at play. Also, in many areas the price of natural gas isn't linked to the decisions regarding coal because of distribution and supply constraints on NG.

329 U.S. Coal Units Are No Longer Cost-Effective
BY JEFF SPROSS ON DECEMBER 10, 2013 AT 1:30 PM

Aging and inefficient plants, competing energy sources, and the looming reality of climate change are all catching up with the coal industry.

According to a new report from the Union of Concerned Scientists — updated from 2012 numbers — as much as 17 percent of coal-fired power in the United States is already uncompetitive, just compared to natural gas and using mid-range estimates.

The report looked at the operating costs for current coal plants, which are older and have largely paid off their capital costs, up against natural gas plants that have also paid off their capital costs. The operating costs also included all the necessary upgrades to bring the coal plants in line with pollution and carbon dioxide regulations. That yielded 329 coal units that are economically uncompetitive, or a total of 59 gigawatts of electricity-generating capacity — 17 percent of the 347 gigawatts of coal power throughout the United States.

That number of uneconomic coal units could also get considerably larger depending on what the future holds. If a price of $20 per ton of carbon dioxide emissions were to be put in place, 131 gigawatts would be uncompetitive. If the production tax credit (PTC) for wind energy is preserved, 71 gigawatts of current coal capacity will be uncompetitive by comparison, versus just 22 gigawatts if the PTC is allowed to expire.

More at
http://thinkprogress.org/climate/2013/12/10/3044961/coal-uncompetitive/

[FBaggins]

5. Not at all.

I'm saying that there's an additional factor.

Keep in mind that the export boom was largely a search for alternative markets as US demand slowed. Gas was cheaper, but exported coal was still cheaper (even after transport costs) than gas in other markets. As gas prices rise, they make coal marginally more competitive and shift some demand to domestic markets - further drying up expectations of needing export capacity growth.

329 U.S. Coal Units Are No Longer Cost-Effective

There's a difference between a demand for coal plants... and a demand for coal. One way to make coal plants marginally more competitive is to run fewer of them at higher capacities. It can't continue forever, but they certainly can run fewer plants, but burn more coal while doing it.

In fact, that's what's predicted for next year.

[kristopher]

6. Not disputing it, but a link would be helpful

You are the one always insisting on links, so I'm sure you can point me to the same page you're reading from.

[FBaggins]

7. I didn't give one because I didn't have one.

I was going from memory on something I read earlier (which is why I said "IIRC&quot

But here's what I just found:

http://www.platts.com/latest-news/coal/washington/us-coal-exports-likely-to-total-118-million-st-21933323

Domestically, the EIA said despite the retirement of 3.8 GW of coal-fired generating capacity through the first 10 months of 2013, it expects power generation from coal plants will grow by roughly 5% compared with last year, as plant operators increased their use of existing capacity in response to higher costs of generating electricity from natural gas.