Coal Power Plants Less Economically Feasible Compared to Renewables
A new report details 99% of coal power plants are significantly more expensive than renewable energy. It is now cheaper to build new renewables than to maintain existing coal plants.
In the United States, coal mining and energy production had been a cheap and reliable means of creating electricity and powering our lives. So much so that for nearly 50 years, states have been creating and maintaining more and more coal-fired power plants.
However, it’s now no secret that coal, along with other fossil fuels, has been and continues to be a major contributor to global climate change. In fact, 60% of all emissions created by energy production can be traced back to coal power plants. The scientific community has known this for years. However, governments and businesses have been slow to embrace the change as renewable energy wasn’t economically viable. According to a new study, this is no longer the case.
Energy Innovation has just released a new report detailing how 99% of all coal power plants are significantly more expensive than renewable energy. This means that it is now cheaper to build new solar farms and wind turbines and connect them to the energy grid than to maintain the existing coal power plants. On average, coal plants cost roughly $36 per megawatt, whereas new solar is $24, a third less.
With renewable energy becoming more cost-effective, new opportunities are arising. For landowners, this presents an opportunity to lease land to solar farm as an additional revenue source, taking advantage of the cost savings of renewable energy. By leasing unused land, landowners can establish a supplemental income stream as demand for solar farm locations grows. Additionally, the falling prices of renewable energy infrastructure like solar panels and wind turbines make adoption more accessible.
Not only do the environmental benefits provided by solar and wind energy make sense, but now so do the economic benefits. Not only does coal cost more to run, but it also costs more to maintain. Most of the 210 coal power plants in the United States are aging and constantly need maintenance and repairs. Not to mention their fuel source being displaced by oil and gas, which has had a large impact on the coal industry in the past few decades. These increased costs are made worse because environmental regulations for chemicals such as mercury and sulphur dioxide are being enforced, making the cost of running coal plants simply not competitive in this new market.
With that being said, proponents of coal mining and power are pointing out that during the invasion of Ukraine by Russia, many coal power plants were heavily relied on due to the surge in gas prices. They say that coal remains a reliable energy source, especially in crises. They say that the infrastructure needed to make a widespread change out from coal and into a new future in renewable energy isn’t here yet, and while they may not be wrong now, they will be soon.
The Inflation Reduction Act passed last year has poured significant money into renewable energy sources. The projected effect is a 40% decrease in greenhouse gas emissions from 2005 levels in 2030. It’s no debate that the United States is a global leader in policy and culture, but its coal track record is a stain on its legacy that will last for a long time.
As businesses begin to see that the costs are outweighed by the benefits of renewable energy, perhaps in our lifetimes, we will see that change.
