attempts to regulate carbon dioxide via the Clean Air Act. Despite Congress’s inability to pass cap-and-trade to date, the Administration has barreled forward with regulations to limit carbon dioxide emissions. The Administration was under no obligation to regulate carbon dioxide using the Clean Air Act, but it has voluntarily chosen to use that tool against fossil fuels, the very energy that powers 85 percent of our economy. That the Clean Air Act is ill-suited to regulate a global issue like world-wide levels of carbon dioxide is a fact conceded even by those who support the strategy. The act was written to deal with local and regional pollutants, not something every human exhales when they breathe. As a result, trying to regulate carbon dioxide with the Clean Air Act will result in the regulation of many sources of carbon dioxide emissions such as over one million buildings, farms, large churches, universities, hospitals, and office buildings. The EPA understands the Clean Air Act, as currently written, would greatly increase its work and force it to regulate many small emitters of carbon dioxide. As a result, the agency is proposing not to regulate the small carbon dioxide emitters for five years and instead focus on regulating coal-fired power plants and other large emitters. EPA’s plan is of dubious legality, and it shows how the Administration has focused on regulating and, ultimately, eliminating the use of coal. One thing that helps explain the psychology behind the president’s enmity toward coal can be found in the White House’s newly-released budget blueprint. The Administration wants to eliminate tax credits for coal, oil, and natural gas because, according to the Administration, it “encourg[es] the overproduction of coal” and promotes “more investment in fossil fuel production than would occur under a neutral system.” In other words, the Administration believes that Americans’ energy prices are too low and we produce too much coal. It would likely come as a shock to Americans struggling to get by that the official position of the executive branch of the U.S. federal government is simply this: Energy is too cheap. Interestingly, though, the Administration’s odium toward energy subsidies appears not to apply to some of the most inefficient, unreliable sources of energy in existence. It’s true that coal, oil, and natural gas 42
receive modest incentives, but on a per unit basis of energy, these incentives are tiny compared to renewables. Da t a p u b l i s h e d by t h e En e r g y Information Administration in 2008 shows that solar energy was subsidized at $24.34 per megawatt hour and wind at $23.37 per megawatt hour for electricity generated in 2007. By contrast, coal received 44 cents, natural gas and petroleum received 25 cents, hydroelectric power 67 cents, and nuclear power $1.59 per megawatt hour. Wind and solar producers argue that renewables are infant industries that need special help. But one has to wonder if wind and solar will ever mature as industries at all, given the billions of dollars that have already been poured into their research and development. In addition to the Administration’s actions to date, the New York Times recently reported that President Obama is looking to use “executive powers” to achieve his energy goals. It isn’t clear what those goals are, but one option would be to follow the example of President Clinton and declare National Monuments to stop future mining. In 1996, President Clinton declared an area in southern Utah as the Grand
Staircase-Escalante National Monument. This designation banned coal mining on the Kaiparowits Plateau. In the future, there will be other threats to coal. One example is low-carbon fuel standards. California and northeastern states are in the process of implementing a regulation that requires the reduction of carbon dioxide emissions associated with the production, manufacture, transportation and combustion of transportation fuels. Effectively, a low-carbon fuel standard makes fuels that require a lot of processing and energy to make, such as oil from oil sands, more expensive. But such a policy would also make a future fuel, like using coal to produce liquid fuel, prohibitively expensive. Coal is under attack like never before. The United States is home to the world’s largest coal reserves and coal produces the lowest-cost electricity. We are hampering our ability to compete in a global economy by implementing policies that artificially make it harder to mine and use coal. u Thomas J. Pyle is president of Institute for Energy Research (www.instituteforenergyresearch.org).
AmerenEnergy Fuels and Services Company (AFS) provides a full range of fuel-related and business development services to the Ameren group of companies. AFS also provides assistance to some unaffiliated business, assisting with specific fuels, ash management and emission related issues. AFS procures over 40 million tons of coal from the Powder River and Illinois Basins for use in the Ameren generation fleet. In addition to procurement, AFS provides transportation services related to negotiation and administration of rail, barge and truck contracts, as well as the management of over 5000 system railcars. Management and marketing of coal river terminals on the Mississippi River is another area of expertise for AFS. AFS has the ability to provide blending and rail to water trans-loading services for both in-house and third party users. Combustion by-product services for beneficial use such as flowable fill projects as well as ash disposal options are additional services provided by the AFS team. AFS provides all procurement of natural gas on both the wholesale and retail level to over 925,000 customers in the Ameren UE, Ameren Energy Generating Company, Ameren CILCO and AmerenIP territories. Market research is an additional function of AFS, providing senior management as well as plant operations with the necessary information required to keep on top of the ever-changing fuel and transportation markets. The Business Development group of AFS is also responsible for activities related to renewable energy resources and the development of “green generation projects.” Visit our web-site at www.ameren.com. american coal council