Once People Did Note Downwind, Downstream Damage
The Hidden Cost of Coal
| What do you pay for coal? When you add the damage it does, then coal power is not so cheap. Our taxes and subsidies hide the true costs -- and make clean alternatives unfairly expensive. This 2009 article is from Sightline Institute’s the Daily Score, posted Oct 26. |
by Clark Williams-Derry
Over at Grist last week, Dave Roberts blogged about a recent study by the National Research Council on the hidden costs of energy consumption. The study is fact-rich, sober, and completely non-ideological -- and, at the same time, it's an incredibly damning indictment of the nation's energy system.The National Research Council operates under the umbrella of the National Academies, a Congressionally-chartered non-profit that also houses the National Academies of Science and Engineering and the National Institute of Medicine.
Their report looks at a variety of "external" costs of energy -- that is, the costs that energy consumers themselves don't pay, but pass on to the public at large. The costs they could pin down were largely related to air pollution, including the impacts on human health, crop and timber yields, and visibility. And the researchers find a big culprit: coal-fired power. From the NRC press release:
- In 2005 the total annual external damages from sulfur dioxide, nitrogen oxides, and particulate matter created by burning coal at 406 coal-fired power plants, which produce 95 percent of the nation's coal-generated electricity, were about $62 billion; these nonclimate damages average about 3.2 cents for every kilowatt-hour (kwh) of energy produced. A relatively small number of plants -- 10 percent of the total number -- accounted for 43 percent of the damages.
These numbers suggest that the "hidden" costs of coal-fired power in 2005 were roughly twice as high as the cost of the coal itself. And those costs, according to the NRC, don't even include "damages from climate change, harm to ecosystems, effects of some air pollutants such as mercury, and risks to national security, which the report examines but does not monetize."
The tally of damages that the NRC could calculate came to $156 million per coal-fired plant per year. The biggest culprits seem to be in the Midwest. According to a map in the NRC report, the Centralia and Boardman plants, in Washington and Oregon, respectively, don't rank particularly high for the kinds of costs the NRC was looking at. But if you added in the costs for mercury emissions and climate risks, then the Northwest's coal plants might rank a bit filthier.
So any time someone tells you that coal is "cheap," just remember that in 2005 the real, comprehensive cost of coal was well over three times as high as the price utilities pay. To see the NRC press release, click here
JJS: The damages cited above are brought to you not just by industry but also by government that puts (sadly) industry profit above your lungs and those of life in general. How do politicians do that? Besides creating limited liability for the businesses putting others at risk, it’s mainly with subsidies and taxes.
Here are 10 Ways the Present Tax Policy tilts the playing field for coal.
Taxes, whether levied or not, tend to favor coal in particular and entrenched ways in general.
Coal miners and burners (and extractors of any resource in general) do not pay:
1, permit to modify an ecosystem and
2, Ecology Security Deposit and
3, Restoration Insurance.
These three would total coal's assimilable “external” costs.
Nor do miners and burners often pay:
4, fines for exceeding ecosystem constraints; and
5, tax on private mines or lease for public deposits equaling the market value of the coal in situ.
1-5 leave coalers with too much capital to undercut competitors and to lobby politicians to tilt the playing field.
Owners of land do not pay:
6, a tax or lease (or deed fee or whatever) equal to the annual rental value of the site; the absence of a land tax allows sprawl development which ups demand for energy sources such as coal.
Yet building owners do pay:
7, a tax on structures (property tax); that levy penalizes quality construction, so buildings are less efficient, exacerbating demand for fuels, including coal.
Business owners do pay:
8, a tax on business and/or sales; that levy is harder on a start-up just scraping by than on an institutionalized player with deep pockets; entrepreneurs trying to open a store or mail-order business to sell energy-saving devices and other apt-tech have a harder time than a big old business like coal;
9, a tax on wages; that levy makes labor more expensive, so a labor-intensive enterprise, such "house-doctoring", becomes more expensive, missing a chance to reduce demand for fuel and coal; and
10, a tax on profit; that levy thins the reward for taking risk and makes familiar "blue chips" (so-called conservative investments) more attractive than cutting-edge technology, such as photovoltaics, which leaves a greater market share to coal.
Hence for “eco-librium”, level the playing field with geonomics: replace taxes with public recovery of natural values and replace subsidies with "rent-shares", a “Citizens Dividend”. Then solar and things we've never heard would be the norm, and would've become so long ago.
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Jeffery J. Smith runs the Forum on Geonomics.
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Also see: People in power can also make sense
Could other taxes on use of nature get passed this way?
How Much Has Changed? |
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