The simple Number that will Defeat Trump’s attempt to Roll back Obama Energy Policies

By Juan Cole | (Informed Comment) | – –

Trump’s Executive Order deregulating dangerous gas emissions is being signed today at the Environmental Protection Agency. This is the greatest mean-spirited reversal since the Red Coats, defeated in 1783, returned in 1812 and burned down the White House.

Trump can use the might of the Federal government to increase harmful emissions (thus making Rex Tillerson and his cronies even more fabulously wealthy, at our cost and that of all future generations).

He cannot, however, stop the march of history. And, as usual, some basic economics underlie the march of history. In this case, everything hangs on a simple number. What is the cost per kilowatt hour of generating energy with a newly built power plant?

It is because of that number that planned new coal-fired electricity plants in the world fell by 2/3s last year. Coal is in freefall.

So if you had ten hundred-watt light bulbs, that would be a thousand watts or a kilowatt. And if you burned them for an hour, that would be a kilowatt hour.

h/t Electric Saver

If you went out and built a new coal plant today to generate the electricity to power your light bulbs, how much would it cost you to keep 10 hundred-watt bulbs on for an hour?

Between 8 and 15 cents. So your electricity would cost $0.08 to $0.15 a kilowatt hour. When you get that $200 bill from your electric utility, that’s the basis for what they’re charging you. (There are also extra charges, including for maintaining the transmission wires e.g.).

So what if I told you it is possible to cut your electricity bill from $200 a month to $50 or less? That would be like getting a $1800 annual pay raise.

So a huge, real-life energy utility, Xcel, has just announced that it is investing several billion dollars in building 11 wind farms in a seven-state area that includes Colorado. These wind farms will generate enough electricity to power a million households. There are only 124 million households in the US, so this will be 1/124th of them. We just need more wind farms like these 11 and in theory we could power the whole country.

How much will it cost this company to generate that electricity by wind in 2017?

2 cents a kilowatt hour. 2 cents.

A wind farm can be built in 18 months, and the fuel is free. Admittedly, Xcel is here making extra money through a Federal offset for wind farms that will go away over the next 5 years. But at 2 cents a kilowatt hour, the wind farms would be competitive with coal in any case. More than competitive. Like you’d have to have your head examined to build a coal plant at these prices.

Utility scale solar plants are another competitor with coal (and with natural gas). The US added 10 gigawatts in large scale solar production last year, enough to power 2 million homes. It will add another 8 gigawatts in 2017, and the amount of electricity from large scale solar will triple over the next five years.

chart

New solar electricity generation in the cloudy Midwest is as low as 6 cents a kilowatt hour. Note that that price is below that of coal, as well. And in sunny states like North Carolina, the price is as little as 4 cents a kilowatt hour. Dubai recently let a large scale solar utility bid for 2.4 cents a kilowatt hour, nearly as inexpensive as the electriticy being generated at Xcel’s planned wind farms.

Coal, natural gas and petroleum are actually much more expensive than they seem on the surface. Coal should probably be figured at at least 44 cents a kilowatt hour because of the deadly air pollution and climate change effects caused by burning it. Economists typically don’t take these “externalities” into account.

Also, we need a new electric grid in order to send cheap electricity around the country. Xcel has its 7-state wind corridor, but there is almost no wind in the deep South. On the other hand, there is lots of solar in the deep South, though it is not being exploited because so many Southern politicians have been bought and paid for by Big Carbon. In any case, we need to be able to bring the electricity from where it is generated to the cities where it is used.

So, Trump can try all he likes to undo Obama’s EPA rules that disadvantage coal plants because carbon dioxide is a damaging emission. Not only will the courts strike him down if he tries to go too far but the market and technological change are already making coal a dinosaur, and gas and oil will soon follow it into the Chicxulub crater.

What we remember about Nero is that he fiddled as Rome burned. But what we remember about Rome is all the other history that happened there when Nero wasn’t emperor. Trump will be remembered as a dumpster fire of a president. A green, sustainable United States of America will leave him behind in the dust.

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Related video:

ARIRANG NEWS: “Trump to sign order to scrap Obama’s Clean Power Plan: EPA chief”

19 Responses

  1. Basically, all human economic systems, and all the “modern industries” have depended on the ability to dump their waste products into the air, waters and lands of our globe, without incurring any economic cost, or any social disapproval.

    There’s been some consciousness and positive social movement, German product-life-cycle laws are the direction we have to go. But do we still have decades to change these attitudes that still infect us all, from tenant farmers in distant lands through large chunks of basic business in America, before climate change really begins to bite with massive crop failures or fisheries failures or Gaia-knows-what ? This climate thing could surprise in 2 to 5 years, I’m worrying, maybe we’ve still got 20 or more.

    Either way, I’d like to see future humans existing and prospering, and not hating our whole 20th-21st Century “modern civilization” with a vigorous passion.

  2. Think of the US as Bedford Falls from It’s a Wonderful Life and Mr. Potter has just been elected president. This time it’s not a bad dream.

    Yesterday on NPR, that network Trump would like to do away with, experts concluded the pipeline will not create jobs, will not use US steel (Both claims made by our former reality show host/ president) and is totally out of step with the future. They also pointed out most of the oil will be shipped overseas.

  3. In Australia, where we have a federal government that doesn’t like renewables, ordinary householders are putting solar photovoltaic panels on the roof at a rapid rate. At last count 16.5% of houses had photovoltaic panels. As the price of panels drops more and more homeowners are getting them. Some people who want to make a statement are using batteries and disconnecting from the grid. Coal, gas and other fossil fuels as well as nuclear look doomed but we shouldn’t forget that making photovoltaics also has an environmental cost.

  4. At 9:27 am Chicago time March 28—
    Um… typo alert? I think you meant a raise of $1800, not $7800. I’m thinkin’: ($200 – $50) x 12 = $1800.

  5. In Canadian history of the War of 1812, the British burned Washington in retaliation for the Americans burning Toronto, then called York. Probably not quite that simple, but not irrelevant either.

  6. Juan,

    Nero did not fiddle while Rome burned. Several years ago Frontline did a documentary where they produced documents proving that Nero was actually leading the fire brigade attempting to put out the fire. The fiddling propaganda was produced by Josephus who was not an unbiased historian but rather a Christian apologist. The Christians hated Nero and Josephus produced this fake history to try to discredit him. Christians at that time were a Jewish cult. On the other hand George W. Bush actually did pretend to play the guitar while New Orleans drowned during Katrina. This fact seems to have gone down the memory hole leaving us with the fake history regarding Nero. As a historian surely you are aware of how bad our historical knowledge is in many instances. Propaganda did not just come onto the scene yesterday.

    • Hi John – I’m a Roman historian by profession. Other sources include Tacitus and Suetonius (among others). Yes, Nero’s role in the fire is fraught, and one tell about the possible guilt of Christians is twofold: many were burned as punishment (how you execute arsonists in Rome), and Christianity at the time was big on the Apocalypse for which they were waiting . . . and waiting . . . and waiting . . . ok dammit, if it won’t come maybe we can start it! There is a school of thought these days that sees the Christians as guilty. I’m still agnostic on this – Rome was a crowded city with LOTS of material for burning, and to make matters worse, had (to hear Tacitus tell it) lots of narrow winding streets.

      One tradition is that he sang from the Tower of Maecenas on the Esquiline Hill about the destruction of Troy as it burned. But he did provide for relief for Rome’s citizens afterwards. For an outstanding discussion about this (and about Nero in general) check out Ted Champlin’s biography simply entitled Nero. It is exemplary. And yes, the sources for Nero’s reign are fraught.

      • The problem I have with the accounts of Nero is that they all come via the Flavian dynasty which had more than enough reason to justify the coup that removed Nero from power. While it is possible that Nero and Caligula behaved in similar fashion, our only accounts come from historians with a vested interest in blackening his name.

        As for the fire, the term ‘Chrestians’, as in followers of Chrestus is problematic as there is another Chrestus who is certainly not Christ. And there is really no reason to think that Christians were numerous enough or prominent enough in Rome at the time of the fire to merit persecution. And if they had, it would have been as a Judaic cult.

        The fire broke out on one of the dates that can be extrapolated from Daniel as the beginning of the end of the world. So if the fire was set deliberately Jewish messianic fundies would be more likely culprits. And it is easy to see how an over-reaction by Nero leading to persecution of Jews would set off unrest in Judea and the start of the first Jewish war.

        Easy to see how the loss of a province would lead to being deposed in Roman society.

  7. Here in California, because of solar power, there is an excess of power during the day. They have more than they can use. So, whereas in the past you were urged to use your appliances during night time hours, now we are being urged to use them during the middle of the day. And solar installations keep growing in number installed every year.

  8. Keep up with these posts on energy Juan – they are important and much appreciated! However I am afraid that little or nothing will happen to change the mentality about how important this issue is until climate change starts to have a serious impact on food prices in the US. We have already seen climate change contribute to events in Syria, Egypt, and Tunisia (in part due to a heat wave’s impact on Russian wheat a little over a decade ago). When people can no longer afford bread then the shit will really hit the fan. I am glad I live on a farm -I have enough land for animals to graze, I can store water, and my family will have something to fall back on if things get really bad.

    At some point a six pack of beer is going to end up out of reach for people. Then we will see riots. Pace your area of interest, I unfortunately doubt most Americans give a damn about Egyptians or the people of Bangladesh displaced by floods – which will be beyond horrific. But this is going to hit their pocket books at the grocery store one of these days. It will be chaos: Syria is just the canary in the coal mine (I know I know – it’s not just climate change in Syria, but it is, as we would call it, a “stressor”).

  9. Trump is not the only Republican sacrificing the real economy to the myth of fossil-based prosperity yanked from our hands by evil environmentalists. The state of Ohio just severely rewrote its regulations involving the spacing between wind turbines to make it impossible to economically build new wind farms. The picking of winners by Koch-bought legislators is blatant, destroying any pretense that we ever operated under free markets or that Republicans ever actually gave a damn about them.

  10. “Economists typically don’t take these ‘externalities’ into account.”

    Economists are the guys who typically point out that (negative) externalities exist, and *should be* taken into account.

  11. Carbon based energy is nothing more than stored sunshine and we now have the CHEAP technology to harvest solar energy directly making “stored” carbon energy a very EXPENSIVE energy form.

    China and Europe are BIG drivers of non-carbon energy because carbon energy has always been very expensive in those areas since much of the carbon energy was imported from other places.

    Chinese leaders understand that for China to continue exist and thrive, requires millions of gigawatts of cheap energy and there is no way for carbon energy to meet that need because all the “cheap” carbon energy has already been used up. Sure technology and robotics can slow the rise in carbon energy extraction and transportation costs, but not by much and the investment is a waste of money in the long run. One of the reasons the USA oil companies pulled out of the arctic region is because the extraction and transportation costs far, far exceed the costs of non-carbon energy that is available today and as the non-carbon energy technology improves exponentially over time (years not decades), the costs will go down even further.

    The trump energy plan is a false future that will deliver the global energy markets to Chinese and European technology companies on a golden platter with a nicely embossed “T.” Once again , trump screws Americans and Americans are thrilled with their “action president.” Such dumb rubes (and yes, I know they hate being called dumb, but their actions are really, really dumb).

    BTW – Energy storage is the next big market and Tesla is the only USA company playing in that market but the Chinese are rapidly catching up and will soon be able to under-sell Tesla which wants to be the Tesla of energy storage not the corolla of energy storage. While there can be a profitable niche market for “high-end” stuff, the major profit is selling lots of low profit stuff.

    So, the USA is “investing” in dying industries (carbon energy, etc.) while China, Korea, Asia and Europe are investing in the future – I wonder how that will work out?

  12. Thanks for the article-let us hope the “magic of the marketplace” wipes out high-priced carbon fuels soon.
    Although soon may be too late for the drought-afflicted regions of Africa where 16 million are facing death by starvation.

    One clarification about the spitefulness of the British burning D.C. in 1814. In the war of 1812 several cities were put to the torch before Washington. For example, when American troops invaded Canada in 1813, they burned down government buildings in capital of the province of Upper Canada, York (present-day Toronto). Many think the burning of Washington was revenge for this.

    Perhaps someone who is a scholar of that place in time can recommend a book or an article.

  13. The British did not return to burn down the capital in 1812 because they were mean spirited. The US started the war with the idea of invading Canada while the Brits were busy with the Napoleonic wars and lost.

    Of course the US school history books state it differently.

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