26 February 2007

In a talk delivered at the National Press Club, James Hansen, director of NASA's Goddard Institute for Space Studies and a leading climate scientist, calls for a moratorium on the construction of coal-fired power plants without carbon sequestration technology. Hansen said that it makes no sense to build coal-fired power plants when we will have to "bulldoze" them in a few years.

James Hansen, "Why We Can't Wait," The Nation, 7 May 2007.

26 February 2007

Under mounting pressure from environmental groups, TXU Corporation, a Dallas-based energy company, agrees to abandon plans for 8 of 11 proposed coal-fired power plants. TXU officially requests remand of the air quality and Prevention of Significant Deterioration permits on 10 October 2007. Beyond preventing 56 million tons of carbon emissions annually, the decision catalyzes the shift from coal-based to renewable energy development in Texas.

TXU Corp., "TXU to Set New Direction as Private Company; Public Benefits Include Price Cuts, Price Protection, Investments in Alternative Energy and Stronger Environmental Policies," press release (Dallas, TX: 26 February 2007); State Office of Administrative Hearings, Applicant TXU Generation Company LP's Request to Remand Consolidated Applications, SOAH Docket No. 582-07-0614, at www.dallasnews.com/sharedcontent/dws/img/10-07/1016txurequest.pdf.

2 April 2007

In Massachusetts et al. v. Environmental Protection Agency et al., the U.S. Supreme Court rules that the Clean Air Act gives the Environmental Protection Agency (EPA) the authority to regulate carbon dioxide and that EPA's current rationale for not regulating carbon dioxide is inadequate. If EPA fails to provide a convincing rationale, then carbon dioxide will become a regulated pollutant. This decision increases the financial risk associated with investing in coal-fired power plants since coal releases more carbon dioxide per unit of energy than any other energy source.

Supreme Court of the United States, Massachusetts et al. v. Environmental Protection Agency et al., No. 05-1120, argued 29 November 2006, decided 2 April 2007, at www.supremecourtus.gov/opinions/06pdf/05-1120.pdf; Carbon Dioxide Emissions from the Generation of Electric Power in the United States (Washington, DC: U.S. Department of Energy and EPA, July 2000).

3 May 2007

Christine Gregoire, governor of the State of Washington, signs into law a climate change bill that prevents new power plants from exceeding 1,100 pounds of carbon dioxide emissions per megawatt hour of electricity generated. This is equivalent to the emissions of the most-efficient natural gas plant. Since carbon capture and sequestration is not yet a viable technology, this law creates a de facto moratorium on new coal-fired power plants in the state. It follows in the footsteps of similar legislation enacted in California in September 2006.

State of Washington 60th Legislature, Climate Change—Mitigating Impacts, Engrossed Substitute Senate Bill 6001, Chapter 307, Laws of 2007, 22 July 2007; Pamela L. Spath and Margaret K. Mann, Life Cycle Assessment of a Natural Gas Combined-Cycle Power Generation System (Golden, CO: National Renewable Energy Laboratory, September 2000), p. 27; Audrey Chang, "California Takes on Power Plant Emissions: SB 1368 Sets Groundbreaking Greenhouse Gas Performance Standard," fact sheet (New York: Natural Resources Defense Council, August 2007).

30 May 2007

Progress Energy, an energy company serving approximately 3.1 million customers in the Southeast, announces a two-year moratorium on the construction of new coal-fired power plants. The company is now promoting aggressive conservation measures and expects to increase demand-side management by 1,000 megawatts by 2010. In response to its new policy, Bob McGehee, chairman and CEO of Progress Energy, states, "our world has become much more aware of global climate issues and the factors that affect climate change."

Progress Energy, "Progress Energy Carolinas Sets Goal of Doubling Efficiency Savings to 2,000 MW," press release (Raleigh, NC: 30 May 2007).

2 July 2007

The Florida Public Service Commission (PSC) denies Florida Power & Light (FPL) the permits needed to move forward with the massive 1,960 megawatt coal-fired Glades Power Park. The PSC rules that FPL "failed to demonstrate that the proposed plants are the most cost-effective alternative available." The decision relied on expert testimony stating that it would be grossly irresponsible to ignore impending carbon regulation policies and that the economics of any future coal-fired power plant must factor in a carbon price of $30 per ton. Under such a price, coal-fired electricity generation in many markets becomes less economical than conservation programs or wind-generated electricity. 

Florida Public Service Commission, Order Denying Petition for Determination of Need, Docket No. 070098-EI, Order No. PSC-07-0557-FOF-EI, 2 July 2007; David Guest, Managing Attorney at Earthjustice, Tallahassee Office, discussion with Jonathan Dorn, Earth Policy Institute, 24 January 2008.

13 July 2007

Governor Charlie Crist of Florida signs Executive Order 07-127, "Immediate Actions to Reduce Greenhouse Gas Emissions within Florida," that establishes "maximum allowable emission levels of greenhouse gases for electric utilities." Emissions from electricity generation must be reduced to 2000 levels by 2017, to 1990 levels by 2025, and by 80 percent of 1990 levels by 2050. Under the emissions cap, building new coal-fired power plants in the state seems unlikely.

Erin Isaac, "Governor Crist Signs Executive Orders to Reduce Greenhouse Gases," press release (Tallahassee, FL: Office of Governor Charlie Crist, 13 July 2007).

18 July 2007

Citigroup analyst John Hill downgrades the stocks of several prominent coal companies: Peabody Energy Corp., Arch Coal Inc., and Foundation Coal Holdings Inc. Hill states that Citigroup currently does not recommend buying stocks in the coal business. The decision reflects the growing uncertainty surrounding coal's future in the Unites States.

Jim Jelter, “Coal Stocks Tumble on Citigroup Downgrade,” MarketWatch, 18 July 2007.

18 August 2007

U.S. Senate Majority Leader Harry Reid, after speaking at the first Nevada Clean Energy Summit in Reno, says that he is opposed to building coal-fired power plants anywhere. This follows a letter he sent in July to the CEOs of four power companies in which he said he would "use every means at [his] disposal" to prevent the companies from building three new coal-fired plants in Nevada.

Martin Griffith, "Reid Opposes New Coal-Fired Power Plants Worldwide," Las Vegas Sun, 18 August 2007; Steven Mufson, "Coal Rush Reverses, Power Firms Follow," Washington Post, 4 September 2007.

18 October 2007

Roderick L. Bremby, Secretary of the Kansas Department of Health and Environment, denies Sunflower Electric Power Corporation air quality permits for two proposed 700-megawatt coal-fired generators. The decision cites that carbon dioxide is an air pollutant and should be regulated, as determined in the April 2007 U.S. Supreme Court ruling. Bremby states: "I believe it would be irresponsible to ignore emerging information about the contribution of carbon dioxide and other greenhouse gases to climate change and the potential harm to our environment and health if we do nothing."

Kansas Department of Health and Environment, “KDHE Denies Sunflower Electric Air Quality Permit,” press release (Topeka, KS: 18 October 2007); Paul J. Morrison, Kansas Attorney General, letter to Roderick L. Bremby, Secretary of the Kansas Department of Health and Environment, Attorney General Opinion No. 2007–31, 24 September 2007; Steven Mufson, “Power Plant Rejected over Carbon Dioxide for First Time,” Washington Post, 19 October 2007; Supreme Court of the United States, Massachusetts et al. v. Environmental Protection Agency et al., No. 05-1120, argued 29 November 2006, decided 2 April 2007, at www.supremecourtus.gov/opinions/06pdf/05-1120.pdf.

3 January 2008

Merrill Lynch downgrades the investment ratings of Consol Energy Inc. and Peabody Energy Corp., two leading U.S. coal companies. The decision results in a drop in the price of coal company shares and reflects the growing uncertainty surrounding coal's future in the United States.

Steve James, “Coal Shares Fall After Merrill Downgrade,” Reuters, 3 January 2008.

22 January 2008

The Attorneys General of California, Connecticut, Delaware, the District of Columbia, New York, Rhode Island, Vermont, and Massachusetts submit a letter to the South Carolina Department of Health and Environmental Control urging it not to issue a permit for the proposed 1,320-megawatt Pee Dee coal-fired power plant. The Attorneys General note that emissions from the Pee Dee coal plant would "seriously undermin[e] the concerted efforts being undertaken by multiple states to address global warming." This follows a letter in December 2006 from Attorneys General in a similar grouping of states who were opposing Sunflower Electric Power Corporation's proposal to add 1,400 megawatts of new coal-fired electricity generation in Kansas. Their opposition implies that the Attorneys General would also be opposed to building new coal-fired power plants in their own states.

Attorneys General of California, Connecticut, Delaware, the District of Columbia, Massachusetts, New York, Rhode Island, and Vermont, letter to Joseph C. Eller, South Carolina Department of Health and Environmental Control, 22 January 2008, at media.charleston.net/2008/pdf/letsc.peedee.pdf; Attorneys General of California, Connecticut, Delaware, Maine, New York State, Rhode Island, Vermont, and Wisconsin, letter to Rick Bolfing, Kansas Department of Health and Environment, 15 December 2006, at kansas.sierraclub.org/Wind/8-StateAGsOpposeHolcomb.pdf.

30 January 2008

Citing escalating costs, the Bush administration pulls the plug on federal funding for FutureGen, a joint project with 13 utilities and coal companies to build a demonstration coal-fired power plant that captures and sequesters carbon. The cancellation effectively moves the date for commercial implementation of carbon sequestration technology so far into the future that this technology now has little immediate relevance.

U.S. Department of Energy, “DOE Announces Restructured FutureGen Approach to Demonstrate Carbon Capture and Storage Technology at Multiple Clean Coal Plants,” press release (Washington, DC: 30 January 2008); Matthew L. Wald, "Higher Costs Cited as U.S. Shuts Down Coal Project," New York Times, 31 January 2008.

4 February 2008

Investment banks Morgan Stanley, Citi, and J.P. Morgan Chase announce that any future lending for coal-fired power plants will be contingent on the utilities demonstrating that the plants would be economically viable with the higher costs associated with future federal restrictions on carbon emissions. Under the new requirements, financing new coal-fired power plants will still entail significant risk since demonstrating economic viability would require speculation of future costs.

Citigroup, “Leading Wall Street Banks Establish The Carbon Principles,” press release (New York: 4 February 2008).

8 February 2008

The U.S. Court of Appeals overturns two EPA mercury rules covering coal-fired power plants. The Court rules that the EPA violated the Clean Air Act when it exempted coal plants from the strictest emission controls for mercury. The ruling requires every new coal-fired power plant in the country to immediately adopt the most stringent controls for mercury as well as other toxic substances such as arsenic, lead, nickel, and chromium. Presently, the ruling affects 32 proposed coal-fired power plants, some already under construction. The implementation of state-of-the-art control technologies is expected to raise the already considerable expense of building coal-fired power plants.

United States Court of Appeals for the District of Columbia, State of New Jersey et al. v. Environmental Protection Agency, No. 05-1097, argued 6 December 2007, decided 8 February 2008; John Walke, "NRDC's Walke Discusses Impact of Court Decision Rejecting EPA Emissions Regulation," OnPoint, 5 March 2008.

12 February 2008

Ken Lewis, Chairman and CEO of Bank of America, announces that the bank will start factoring in a cost of $20–40 per ton of carbon emissions in its risk analysis when evaluating loan applications from utilities.

Bank of America, "Remarks to the North Carolina Emerging Issues Forum, 'North Carolina's Energy Futures: Realizing a State of Opportunity'," press release (Charlotte, NC: 12 February 2008).

19 February 2008

The Rural Utilities Service (RUS) in the U.S. Department of Agriculture suspends a low-interest federal loan program for rural utilities seeking assistance for new base load power plants. The RUS first announced the policy change in a letter to Southern Montana Electric and reaffirmed the change in a letter to Representative Henry Waxman of California on March 11, which read that RUS is "not funding any new coal fired power plants." The White House Office of Management and Budget had requested that RUS suspend the loan program until financial risks associated with rising construction costs and the future costs of controlling carbon emissions can be better quantified.

Steven Mufson, "Government Suspends Lending for Coal Plants," Washington Post, 13 March 2008; Matthew Brown, "Loans Program for Coal Plants Suspended," Business Week, 5 March 2008; U.S. Representative Henry Waxman, Chairman of the Committee on Oversight and Government Reform, letter to James M. Andrew, Administrator of the Rural Development Utilities Program of the USDA, 14 February 2008; James M. Andrew, Administrator of the Rural Development Utilities Program of the USDA, letter to U.S. Representative Henry Waxman, Chairman of the Committee on Oversight and Government Reform, 11 March 2008.

11 March 2008

Representatives Henry Waxman (D-CA) and Edward Markey (D-MA) introduce the "Moratorium on Uncontrolled Power Plants Act." The bill blocks the EPA and states from issuing permits to new coal-fired power plants lacking state-of-the-art carbon capture and storage technology. Since carbon capture and storage technology is at least a decade away from commercial viability, if this bill passes it would essentially place a near-term moratorium on all new coal-fired power plants.

Congress of the United States, "Rep. Waxman Introduces the 'Moratorium on Uncontrolled Power Plants Act'," press release (Washington, DC: Office of Representative Henry Waxman, 11 March 2008).