March 18, 2010

Long Live Coal? In Kentucky: Part 2
by Allison Adams

              Mountaintop Removal Mining Site

Can Kentucky, which ranks seventh among states in per-capita carbon dioxide emissions from fossil fuels, reduce its dependence on coal? While the state’s economy is perhaps inextricably intertwined in the coal industry, it has begun looking to energy efficiency to shift the balance, and the reasons are clear.

Some 38 percent of Kentucky’s coal is extracted by mountaintop removal, a method that blasts the tops of mountains off for easy access to coal. The debris from the removal buries forests and streams in nearby valleys. After prodding by the Sierra Cluband U.S. Senator Barbara Boxer(D-California), chair of the Senate Committee on the Environment and Public Works, the U.S. Environmental Protection Agency released a list last summer of 44 “high hazardous potential” coal ash sites that could cause loss of human life. Seven are in Kentucky.

Moreover, despite the relative expediency of mountaintop removal, the costs are high and likely to rise. The carbon emission reduction targets proposed by the Obama administration, pending federal energy legislation, and the rising costs of mining and production will impact the industry’s bottom line.

Those costs will be passed to the consumers, though Kentucky residents now receive some the lowest electricity rates in the nation. Plus there are the less transparent health and environmental costs. A recent study by theMountain Association for Community Economic Development, a group targeting Appalachian communities, revealed that with all factors considered, the coal industry costs the state’s taxpayers more than it brings in, with a net loss of $100 million.

So it’s no surprise that Kentucky’s utilities are looking to a mixed portfolio for cost-effective solutions. E.ON U.S., a subsidiary of a German corporation that owns several regulated utilities in and around Louisville and Lexington, has begun to employ energy efficiency practices common in Europe. The utility recently started offering businesses free energy audits to help customers find untapped energy cost savings. E.ON is also offering commercial customers rebates to help replace old, less efficient heating, ventilation, and air conditioning equipment.

At the same time, Kentucky has invested in the future of “clean coal” technologies that aim to produce power from coal without the environmentally damaging byproducts. Last April, The University of Kentucky’s Center for Applied Energy Research created a consortium with government agencies, electric utilities, and their research organizations to seek cost-effective technologies to reduce and manage carbon dioxide emissions from coal-fired power plants. Kentucky state government and the industrial partners plan to provide $24 million over 10 years to support the research.

“Most of the work we do is directed at the environmental issues of coal utilization,” says Rodney Andrews, the center’s director. “The reason we are working on [carbon] capture and utilization quite honestly is because in Kentucky we need to figure out what we’re going to do with our existing pulverized coal combustion generation fleet. We don’t have a lot of other options.”

While Andrews points to predictions that the current national rate of coal consumption will not drop any time soon—in fact, consumption has been growing faster than the rate of housing and population—not all agree that coal will reign supreme. “As we move into a carbon-constrained economy, it’s reasonable to believe we’re going to see coal become a less important part of the economy,” says Wallace McMullen, the energy chair of the Cumberland Chapter of the Sierra Club.