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Report: Immediate Reduction of Coal-Fired Electric Generation is Feasible

A new report suggests that immediately phasing down coal-fired generation and replacing it with natural gas generation is feasible, cost-effective, and could provide significant emissions reductions to help meet climate goals.

In the working paper “On the Feasibility, Costs, and Benefits of an Immediate Phasedown of Coal for U.S. Electricity Generation”, recently published by the National Bureau of Economic Research, economists from the University of North Carolina, Dartmouth, and Yale developed several models that looked at regional energy generation capacity, demand, emissions, and cost.

The authors make the argument that phasing out coal generation is vital to reducing carbon dioxide emissions and meeting global climate goals. “The replacement of coal with other sources of energy for electric generation – renewables and even natural gas – is considered a near-term priority because coal has the highest carbon dioxide (CO2) emissions rate and is associated with greater emissions of local pollutants that adversely affect human health,” the report states.

While a transition away from coal has been a goal, and coal use is declining, this paper looks at the feasibility of immediately replacing coal generation with spare natural gas capacity now available at electric generating facilities across six regions of the nation’s electric grid. Natural gas is also a fossil fuel, but emits only about one-third as much CO2 as coal. Natural gas now accounts for more than 40 percent of U.S. energy, while coal provides less than 20 percent, according to the U.S. Energy Information Administration, as plants have shifted away from it.

The results suggest that a significant reduction in coal generation and resulting emissions is feasible. “Based on preferred scenarios, we find that 66 to 94 percent of coal generation could be replaced immediately while still satisfying demand,” the authors conclude. “The net effect on CO2 emissions is a reduction of 18 to 29 percent of the combined coal and natural gas emissions in the electricity sector. This quantity translates to between 5 and 8 percent of all U.S. energy-related CO2 emissions in 2022 according to the EIA’s estimate of 5.472 million tons.”

The paper acknowledges that there is insufficient gas capacity to meet demand in most regions during the summer months, and that Midwest and Mid-Atlantic regions also have shortages during some hours in cold months, but concludes that for most hours of the year there is potential for a substantial amount of replacement.

Current U.S. energy policies, including recent investments in clean energy contained in the Inflation Reduction Act, will still fall short of the nation’s 2030 emissions commitment by 12 to 18 percent, requiring the need for consideration of other methods, including the near-term phasedown of coal generation, the paper argues.

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