SACE | Southern Alliance for Clean Energy
New Study Shows FL Coal Units Ripe for Retirement
JACKSONVILLE, Fla. (November 13, 2012) – Florida is fourth on a list of states with the most coal-fired generating capacity that should be considered for closure, according to a new analysis released today by the Union of Concerned Scientists (UCS) in partnership with Southern Alliance for Clean Energy (SACE). The analysis indicates that the coal units will likely be more expensive to operate in the long run than switching to natural gas, wind power, or investing in energy efficiency. The peer-reviewed study, based on publicly available data on the U.S. coal fleet, used an economic test to evaluate whether every coal units nationally, including those in Florida, could compete – after being upgraded with modern pollution controls – with available cleaner, lower-cost energy resource. (Most power plants have multiple electricity units.)
The report, “Ripe for Retirement: The Case for Closing America’s Costliest Coal Plants ,” found that as many as 11 units at seven plants in Florida may no longer be economically viable if they are upgraded with modern pollution controls. The plants, which together represent up to 3.8 gigawatts (GW) of electric generating capacity, include Scholz, Deerhaven, C.D. McIntosh Jr., Cedar Bay, Lansing Smith, Crystal River, and Crist. The power they produce will cost more than electricity generated by natural gas power plants and wind power in many cases.
“Our analysis shows that switching to cleaner energy sources and investing in energy efficiency often makes more economic sense than spending billions to extend the life of these obsolete coal plants,” said Steve Frenkel, report co-author and director of UCS’s Midwest office. Gulf Power and Duke Energy, which own most of the out-of-date units in Florida, should work with state regulators to carefully consider whether retiring them and boosting electricity generation from natural gas, renewables and implementing energy efficiency measures would best serve ratepayers and shareholders. Spending billions to upgrade old coal plants may simply be throwing good money after bad.”
In 2021, Duke Energy is scheduled to retire two of the four units at its Crystal River facility – the largest Florida coal plant identified in the report. The UCS analysis found the remaining units at Crystal River should also be considered for closure.
“With seven coal units no longer economically viable, there is an imperative in Florida for a transparent utility planning process to make good planning decisions which foster the most cost effective solutions such as energy efficiency. Duke Energy – now the biggest utility in the country – has a unique opportunity to be leaders by shifting away from dangerous coal and to meet the energy needs of their customers with cleaner, less costly and less risky resources.” said Susan Glickman, Lobbyist for Southern Alliance for Clean Energy.
At its Crist Plant near Pensacola, Gulf Power installed scrubbers on the facility’s four units in 2009 and 2010 to reduce sulfur dioxide emissions (one of these units is now slated for retirement). But the UCS analysis found that the estimated cost of producing electricity at each of the units would likely cost more than power generated by a natural gas plant. And that is before accounting for the cost of upgrading the facility with adequate equipment to limit mercury and soot emissions. Further, Gulf Power’s parent company, Southern Company has, by far, the most generation capacity that should be considered for closure nationwide.
“Local and regional considerations must be taken into account before deciding whether to retire and replace any specific coal units,” said Jeff Deyette, a UCS senior energy analyst and report co-author. “With appropriate planning, the vast majority of these coal units could be closed and replaced with cleaner, more affordable resources while maintaining reliability.”
“Ripe for Retirement” ranks the states and utilities with the most coal-fired power capacity that should be considered for closure. Georgia tops the state list, followed by Alabama, Tennessee, Florida, Michigan, South Carolina, Wisconsin, Indiana, Mississippi and Virginia. Southern Company, one of the nation’s largest private utilities, owns the most coal-fired capacity ready for retirement, followed by government-owned Tennessee Valley Authority. Duke Energy, American Electric Power and FirstEnergy, though high on the list, have fewer economically vulnerable units, in part, because they each have already announced they are closing several coal units.
Nationwide, the UCS study found that as many as 353 coal units in 31 states, representing 59GW or 18 percent of the country’s coal generating capacity, should be considered for closure because they will likely be more expensive than energy from lower cost natural gas or wind power. Plants that are candidates for retirement are typically older, less efficient, underutilized, and more polluting than the rest of the nation’s coal fleet. These units average 45 years in age, well beyond the 30-year expected life span for a typical coal unit. These plants are less efficient, operating only at 47 percent of capacity, compared with 64 percent for the total U.S. coal fleet. In addition, 70 percent of these units lack adequate equipment to control the emissions of at least three of the four harmful pollutants examined in the analysis (sulfur dioxide, nitrogen dioxide, mercury, and soot).
“This is an historic opportunity to accelerate the transition to a clean energy economy. Decisions we will make in the next three to five years can improve public health, reduce global warming, and create a more resilient energy system,” said Frenkel.
Shuttering the 59 GW of coal-fired units the study identified along with 41 GW already slated for closure would reduce the electric power sector’s annual carbon dioxide emissions up to 16.4 percent, or 410 million tons, depending on what resource replaces coal. Besides emitting pollutants associated with asthma, neurological damage, heart attacks and cancer, coal-fired power plants are the nation’s largest single source of heat-trapping carbon dioxide emissions, the primary cause of climate change. In Florida, closing the 11 units at the seven plants identified in the report would mean eliminating as much as 18 million tons of carbon dioxide emissions each year, equivalent to removing 2.7 million cars from the road. # # # The Union of Concerned Scientists is the leading U.S. science-based nonprofit organization working for a healthy environment and a safer world. Founded in 1969, UCS is headquartered in Cambridge, Massachusetts, and also has offices in Berkeley, Chicago and Washington, D.C. For more information, go to www.ucsusa.org.
Founded in 1985, the Southern Alliance for Clean Energy is a nonprofit organization that promotes responsible energy choices that create global warming solutions and ensure clean, safe, and healthy communities throughout the Southeast. Learn more at www.cleanenergy.org.