Eco-Living Magazine

Coal and Natural Gas Are King

Posted on the 22 March 2011 by 2ndgreenrevolution @2ndgreenrev

Coal and Natural Gas Are KingHere is a chart that compares the strictly financial costs of different energy types based on an EIA (Energy and Information Administration) study that looked at costs in dollars per megawatt hour in 2008 for plants going into service in 2016.

If you divide the total system levelized capital cost (explanation below) in the far right column by 1000, you will get the cost of energy by kilowatt hour. You can see that conventional coal is around 0.10 cents kw/h compared to offshore wind power which is over 0.19 cents kw/h. Notice how cheap natural gas is.

Coal and Natural Gas Are King

This helps show the overall picture of the differences in the cost of energy and how far renewable energy, especially solar (even more so PV), has to go to become main stream. I think we’ll get there but coal and natural gas will continue to dominate our energy use for some time, perhaps while being developed together as coal bed natural gas. Developing these resources is still, in my opinion, better than relying on foreign oil to power our cars, and is one reason I support electrifying the nation’s car fleet. The grid will get greener over time as we add wind, solar, geothermal, and find cheaper and better ways to tap the abundant renewable resources found in nature.

The following is taken from the EIA report: 

Levelized costs represent the present value of the total cost of building and operating a generating plant over its financial life, converted to equal annual payments and amortized over expected annual generation from an assumed duty cycle. The key factors contributing to levelized costs include the cost of constructing the plant, the time required to construct the plant, the non-fuel costs of operating the plant, the fuel costs, the cost of financing, and the utilization of the plant.
The availability of various incentives including state or federal tax credits can also impact these costs. The values shown in the table do not incorporate any such incentives. As with any projections, there is uncertainty about all of these factors and their values can vary regionally and across time as technologies evolve. When evaluating actual plant proposals, the specific technological and regional characteristics of the project must be taken into account.


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