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The real cost of coal

As Congress moves haltingly forward with health care and energy reforms, the National Research Council has released a very interesting peer-reviewed report on the Hidden Health and Environmental Costs of Energy Production and Consumption.

The report, done for the Department of Energy, examines the “hidden costs” of energy, such as the damage done to human health through air and water pollution. Not all societal costs are reflected in market prices. Based on 2005 numbers, the report was able to quantify about $120 billion in extra costs, mainly health damage, associated with electricity generation and motor vehicles. These are costs that don’t show up in energy prices, but actually amount to the early death and added health costs for thousands of Americans every year. Total early deaths due to indirect energy costs were estimated at 18,000-19,000 per year. These costs do not include damages from climate change, national security risks, or the direct effects of some pollutants.

In 2005, the report found that annual damages from coal-fired electricity amounted to just over half, or $62 billion. Damages were due mainly to the health effects of air pollutants such as, sulfur dioxide, nitrogen oxides, ozone and particulates from 406 coal-fired power plants which produce 95% of the nations coal-generated electricity. Costs are about 3.2 cents for every kilowatt-hour of energy produced. Coal plants also emit about a ton of CO2 per megawatt-hour of electricity.

energycostOther electricity-producing sources show slightly less nonclimate damage. Natural gas is responsible for $740 million in damage each year. Nuclear power produces just over 20% of our electricity and produces little direct damage, but the report points out that many risks are borne by other nations as we mine only about 5% of the world’s uranium. Potential risks of long-term storage of radioactive waste could not be quantified in this report.

Nonclimate and health damages generated by motor vehicles amounted to about $56 billion per year. Operation of the vehicles accounted for less than one-third of the damages. Most of the damages came from mining and drilling the fuel. Nonclimate damage per vehicle-mile traveled ranged 1.2 to 1.7 cents per mile. Damages from corn-grain ethanol were similar or greater than gasoline because of the energy needed to produce the corn. Interestingly enough, electric and hybrid vehicles showed somewhat higher nonclimate damages. These vehicles produce little or no emissions, but the power used to produce the electricity to charge the batteries is heavily reliant on fossil fuels. Damage due to energy produced for manufacturing the batteries and electric motors accounts for about 20% of the life-cycle damage.

One final note; nonclimate and health damages due to the use of diesel fuels produced by converting coal using the Fischer-Tropsch process was one of the dirtiest ways to make vehicle fuel and produced the highest life-cycle amount of greenhouse gases. Governor Schweitzer would like to build a Fischer-Tropsch plant to produce diesel fuel from the coal in the Otter Creek tracts in southeastern Montana.

The report estimates that their numbers represent a minimum cost due to nonclimate damage because many factors could not be evaluated due to lack of data. Coal remains the dirtiest way we can produce electricity and this report only points out that we pay considerably more than the per-ton price that we pay for our dirty fuel. Large advertising campaigns about “Clean Coal” and all the energy company hype don’t make it any cleaner and won’t save any lives. Moving away from dirty energy sources will not only save money in the long run, it will save lives.


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