At this point, one thing should be abundantly clear about the Trump administration’s theme on energy policy: the president will do whatever it takes to prop up coal, even if the market and the public choose otherwise. The Trump administration’s latest pro-coal gambit is the Environmental Protection Agency’s (EPA’s) so-called Affordable Clean Energy rule, an about face on Obama-era limits on greenhouse gas emissions from power plants. The energy produced as a result of this rule will be neither “affordable” nor “clean.”
We know why the president wants to support coal. His successful 2016 campaign promised to revive the struggling coal industry. Fighting for coal jobs in communities largely left behind by the evolving U.S. economy makes for great optics that reinforce the president’s pledge to “Make America Great Again.” His promises to “bring back affordable, clean coal” are a consistent applause line at his rallies.
But political choices should not be allowed to make rules under the Clean Air Act. In justifying the rule, EPA Administrator Andrew Wheeler said the EPA rule attempts to “level the playing field” and foster more investment in coal-fired power. But here’s the truth: coal isn’t losing ground because it’s under attack. Coal is losing to other energy resources because the market has spoken.
Consider some basic facts. More than half of the operating coal mines in the U.S. have closed since 2008, and coal consumption last year was the lowest in nearly four decades. This is due mostly to structural changes in the utility industry that favor other energy sources—both natural gas and renewable production—over less environmentally friendly and more expensive coal. Over the past several years alone, 29 GW of retiring coal plants in PJM—America’s largest wholesale electricity market—have been replaced with 23 GW of natural gas.
In short, the production landscape for electricity has seen a seismic shift away from coal and toward the cleaner combination of flexible natural gas and clean renewable energy. In 2018, for example, the percentage of coal used for energy production fell 2% from the year prior, while natural gas production grew 12% and renewable energy increased by 4%. Coal is hemorrhaging market share for powering America and that is likely to continue.
Electric utilities, once proponents of coal use, are embracing this new paradigm, with several large utilities announcing plans to open more gas-fired generating plants and close or convert more coal-based facilities. Drastic reductions in the cost of renewable power from wind and solar, combined with state-level renewable mandates, have cut into coal’s share, and convinced utilities that coal isn’t coming back. Utilities are taking advantage of abundant and affordable natural gas, attempting to satisfy federal air quality standards, and meet state-level mandates. For example, last year Xcel Energy—a behemoth with over three million customers in eight states—asked state regulators for clearance to close two aging coal plants in Pueblo, Colorado, and to replace those coal units with 1,807 MW of new wind- and solar-generation capacity.
What does all of this mean? Investment in coal isn’t coming back. Not because of rules, but because of the market. And also because of our need to act on climate change.
Acting on climate change means more utilities will turn to natural gas, a crucial part of our roadmap to a clean energy economy. Today, natural gas doesn’t force voters into a false choice between their economic and environmental concerns. The American natural gas boom saw carbon emissions decrease by 28% between 2005 and 2017 as the power generation industry realized what abundant natural gas could do for their bottoms lines. A new International Energy Agency report assessed CO2 and methane emissions, and found that, since 2010, switching from coal to natural gas has reduced emissions by 50% when generating electricity and by 33% when providing heat. Greenhouse gas emissions are now at the lowest level since 1992 because of more natural gas use.
At the same time, the natural gas industry is supporting 3 million American jobs, with nearly a million more possibly coming online by 2030 and almost half a million more by 2040 from shale gas-related manufacturing jobs. America’s natural gas exports have reached a record high, with the U.S. becoming a net exporter of natural gas for the second year in a row. These exports are not only a critical piece of helping other nations act on climate change, but a key driver for the U.S. export market. Furthermore, those exports support American foreign policy, as they support our allies and reduce the influence of energy producers like Russia or Venezuela.
It’s time the administration reads the writing on the wall when it comes to coal. No rule, even this latest one from EPA, will alter the nation’s trajectory away from coal, and toward natural gas and renewables. Rather than fight to prop up coal, the administration should focus on embracing the market’s preference for natural gas, a shift that helps both the U.S. economy and global climate.
—Andrew Holland is the chief operating officer of the American Security Project, a nonpartisan national security think tank.