The US Power Grid is supported by a number of power-generation technologies, coal, oil, wind, hydro, nuclear, to name a few. According to the US Environmental Protection Agency [EPA], 3.9 million gigawatt-hours [Gwh] of electricity was generated by all US power plants in 2009.
Close to 1.8 million GWh of that electricity was produced by coal-fired plants, which reflects about 44% of the total. These coal plants alone generated some 1.9 billion tons of carbon-dioxide [CO2], adding to the global warming phenomenon.
In order to clean up power generation in the US, coal plants, and other dirty plants, are being phased out in favor of cleaner technologies, such as wind and solar. In a 2012 study conducted by Brattle Group, economists forecast that between 59 and 77 gigawatts [GW] of coal plants would be retired over the next five years. This is about 25 GW more than they had forecast just two years ago.
New environmental regulations being phased in during the next few years are having a big impact on plans for coal plants. As of July 2012, power companies had already announced the retirement of 30 GW of coal capacity by 2016, but with the EPA still finalizing regulations, covering emissions, cooling water, and coal ash, the scenarios could change drastically.
While the closing of CO2-generating coal-fired power plants sounds like a good idea to environmentalists, economists warn that prices of other power sources will most likely increase. It could cost the industry up to $144 billion to replace their coal capacity with cleaner alternatives.
“Everything else being equal, this amount of retirement will be enough to increase prices in both electric and gas markets for a few years, but we do not envision that impact to be large or persistent enough to alter retirement decisions,” Frank Graves, Brattle principal and co-author of the study, said.