Energy Economist Says Coal In Death Spiral – Targets Colstrip 1 And 2
There has been a mighty effort to save Colstrip Units 1 and 2 and stave off the elimination of hundreds of jobs, and millions in tax revenue, however one energy economist says the effort is futile because coal is in a death spiral.
David Schlissel is with the Institute For Energy Economics and Financial Analysis. During a nationwide seminar on Wednesday, Schlissel said the coal industry is in very deep trouble.
"The truth is, nothing can reverse the market forces that are pushing the U.S. coal industry into further decline," Schlissel said. "The market forces working against coal are inexorable. The increases in renewable resources cannot be stopped, costs have declined too much for that.The coal industry and its friends in Washington can maybe slow down, but not stop coal's decline."
Schlissel said bailing out the coal industry will become increasingly expensive as time goes on.
"Bailing out coal-fired generators and the fossil fuel industry will just become more and more expensive, and it won't work long term," he said. "For these reasons, it's prudent that communities, states and regions have planned for the transition away from coal."
Schlissel specifically targets Colstrip Units 1 and 2 as examples of coal's rapidly increasing decline.
"Last year we found out that bailing out Colstrip 1 and 2 in which the state dreamed that instead of having the units retire, it could somehow buy them itself, or somehow require one of the state's utilities, like NorthWestern energy to buy them," he said. "Our analysis showed that would cost the rate payers or the taxpayers in the range of $800 million between 2017 and 2030. If we redid the analysis today, we would probably have an even bigger bailout."
The Institute’s self-proclaimed mission is to accelerate the transition to a diverse, sustainable and profitable energy economy.