🔋From C To U
Can the US leverage the coal industry in alignment with their climate goals while maintaining grid reliability, jobs, and economic prosperity?
Last week in The Coald Truth, I discussed how the reduction of coal usage in favor of natural gas has been responsible for the overwhelming majority of US carbon dioxide emissions in the last decade. Further, because coal is the dirtiest burning fossil fuel, it presents the largest opportunity for emissions reductions in the sphere of energy production. While usage of coal in the US has been steadily decreasing, it remains 10% of total energy consumption, and 26% for the entire world.
While coal provides baseload power to the grid, a rapid replacement with wind/solar adds grid complexity due to intermittency as well as leaves the coal sites abandoned. While intermittency challenges can be offset in various ways, the geographical necessities of renewables are less flexible. Natural gas is currently the top replacement choice. With hurdles around domestic pipeline infrastructure and weird laws like the Jones Act, utilities are becoming more reliant on natural gas imports rather than domestic supply, adding complexity/unreliability. Further, natural gas is still a fossil fuel, so many are not in favor of it to begin with.
Given this backdrop, nuclear power presents utilities with the opportunity to make use of their current assets through a conversion. Coal to nuclear (C2N) transition means replacing a coal plant with nuclear reactor at the same site. A recent Department of Energy study suggested that 80% of coal sites were suitable for transition to nuclear power allowing for a decreased cost compared to a greenfield project (specifically advanced reactors, US is not interested in current reactors). Fundamentally, this transition is 1:1 because the reactor would be placed on the same site and produce baseload power similar to before. While there are added costs for construction, the end state is more similar to the way things were prior.
On top of reducing emissions as much as 86%, the study suggested that the transition could prove economically beneficial for the areas as well as add permanent jobs to the area. This contrasts to wind and solar which add temporary jobs and there would be a greater loss of permanent jobs. Somewhere like West Virginia which has already been hit in recent decades by the outsourcing of US manufacturing would also be hit hard by the coal phaseout. Manufacturing and coal production rank in the top 3 industries in the state. The economic burden and impact on people in these areas could be mitigated through C2N. Kentucky is another state in a similar position that could benefit as more of the coal jobs could be replaced in this scenario, an important factor they are currently considering.
The capacity factor of nuclear power is also superior to other energy sources. This is the actual energy generation divided by the theoretical, or very simply can be conceptualized as the amount of time that is actually spent producing energy. C2N would allow for smaller overall energy capacity installations since they are run much more efficiently. The capacity factor for nuclear is generally 90+% while the DOE estimates coal around 50%. These numbers encapsulate the intermittency problem that wind and solar face with average capacity factors of 35% and 25% in the US respectively. Only in certain regions do renewables compete and surpass fossil fuels along this metric. One such case I have touched on before is Hywind offshore wind farm boasting an impressive 57% capacity factor on Scotland’s coast. Places like Arizona in the US or Australia globally could also boast numbers exceeding that of this figure for solar.
Advanced nuclear reactors are not yet large scale in the US and until they are, there is uncertainty around the technology. This is one of the downsides. Estimates and theory aside, it is ultimately unknown how these projects would fare in terms of cost and operation until it is proven in the market. TerraPower is spearheading an advanced reactor C2N project in Wyoming, so time will tell how successful this concept is in time from a cost and technological perspective. Similar endeavors in Maryland and Colorado are on the horizon. Until then, utilities are unlikely to put big investments into this idea.
In another program, the Department of Energy is offering funding for the production of rare earth and critical minerals from coal-based sources. The the coal industry in the US is waning, but still strong to leverage supplies of materials for renewables and batteries according the government. If coal demand continues to decrease, mines may still be used to extract these other types of resources over time. Money for the projects are created through the infrastructure bill and West Virginia and North Dakota are likely beneficiaries. With this program, coal waste, mines, and jobs in the area can also be of use instead of forgotten or wasted.
At the end of the day, C2N transitions pose one of the most positive overall areas of the decarbonization efforts in my opinion. C2N replaces the dirtiest energy source with the cleanest in terms of emissions, continues baseload power and reliability, takes advantage of would be wasted infrastructure, and retains labor and economic benefits in the areas. Further, taking advantage of coal resources and mines provide economic benefits to the areas and supply benefits for other industries in need of materials. Until next week,
-Grayson
Leave a like and let me know what you think!
If you haven’t already, follow me at twitter @graysonhoteling and check out my latest post on notes.
Let someone know about Better Batteries and spread the word!
Socials
Twitter - @graysonhoteling
LinkedIn - Grayson Hoteling
Email - betterbatteries.substack@gmail.com
Archive - https://betterbatteries.substack.com/archive
Subscribe to Better Batteries
Please like and comment to let me know what you think. Join me by signing up below.