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Politics : Politics of Energy

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To: Brumar89 who wrote (67914)1/14/2016 11:21:48 AM
From: Brumar891 Recommendation

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TimF

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Great Moments in US Energy Policy: In the 1970's, The US Government Mandated Coal Use For New Power Plants

January 11, 2016, 10:18 am

What does government energy policy have in common with government food advice? Every 30-40 years the Federal government reverses itself 180 degrees and declares all the stuff that they said was bad before is now good today.

Case in point: Coal-fired electrical generation. Coal is pretty much the bette noir of environmentalists today, so much so that Obama actually pledged to kill the coal industry when he was running for office. The combination of new regulation combined with the rapid expansion of cheap natural gas supplies has done much to kill coal use ( as illustrated by this bankruptcy today).

But many people may not realize that the rise of coal burning in power plants in the US was not just driven by economics -- it was mandated by government policy

Federal policies moved in coal's favor in the 1970s. With the Middle East oil crisis, policymakers began to adopt policies to try and shift the nation toward greater coal consumption, which was a domestic energy resource. The Energy Supply and Environmental Coordination Act of 1974 directed the Federal Energy Administration to prohibit the use of oil or natural gas by electric utilities that could use coal, and it authorized the FEA to require that new electric power plants be able to use coal. The Energy Policy and Conservation Act of 1975 extended those powers for two years and authorized $750 million in loan guarantees for new underground low-sulfur mines. Further pro-coal mandates were passed in the late-1970s.


[ I was hired by an energy company during this period of coal industry expansion. The company I worked for enjoyed no loan guarantees nor did I ever hear of any mines financed by such. I'm sure forcing utilities to burn coal certainly created additional customers for us though. Now the government is working to drive out of business the coal plants and mines that were created decades ago .... in response to previous federal government mandates.

My company got entirely out of the coal business in the 1990's. Engineers and accountants etc had skills useful elsewhere, it's the miners and foremen that are really hurt by these policies. Plus the businesses in the communities the miners live in. Utter economic devastation. ]


I was aware of the regulations at the time as I was working in an oil refinery in the early 80's and it affected us a couple of ways. First, it killed demand for low-sulphur heavy fuel oil. And second, it sidelined several co-generation projects that made a ton of sense (generating electricity and steam from wasted or low-value portions of the oil barrel) but ran afoul of these coal mandates.

http://www.coyoteblog.com/coyote_blog/2016/01/great-moments-in-us-energy-policy-in-the-1970s-the-us-government-mandated-coal-use-for-new-power-plants.html
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