Peabody Energy’s Bankruptcy Shows the Limits of “Clean Coal”

[OKIsItJustMe]

https://www.technologyreview.com/s/601270/peabody-energys-bankruptcy-shows-the-limits-of-clean-coal/

[font face=Serif][font size=5]Peabody Energy’s Bankruptcy Shows the Limits of “Clean Coal”[/font]

[font size=4]Investments in carbon capture and storage technology have largely been failures.[/font]

by Richard Martin April 13, 2016

[font size=3]Peabody Energy, the world’s largest private-sector coal producer, filed for bankruptcy Wednesday after a long decline in prices and demand for coal in the U.S. When I spoke to Peabody CEO (now executive chairman) Greg Boyce in his St. Louis office two years ago, he enthusiastically detailed the two strategies that would send Peabody to greater heights: sending coal to China and building so-called “clean coal” plants.

Peabody’s plan to export coal to China via huge coal terminals on the West Coast never materialized, because environmental groups and local governments opposed the terminals and coal use in China has fallen dramatically. The second play, so-called “clean coal,” has faltered because capturing the carbon dioxide from coal plant smokestacks and burying it far underground has proved stubbornly cost-prohibitive, particularly in an era of cheap natural gas.

Peabody invested hundreds of millions of dollars in clean coal technology, setting up a research center at the University of Wyoming (the Powder River Basin, in eastern Wyoming, is the home of Peabody’s huge North Antelope-Rochelle mine) and funding research projects in the U.S. and China. It wasn’t alone, either: despite some $13 billion in worldwide R&D investment over the last decade, carbon capture would still add 30 to 40 percent to the cost of power generation from coal plants—a nonstarter if it’s to be competitive with inexpensive natural gas.

Those carbon capture projects that made it off the drawing board have mostly been busts. Last year the U.S. Department of Energy canceled funding for the FutureGen project, a coal-fired power plant with carbon capture in Illinois that had been under development for more than a dozen years. And the New York Times reported last month that a similar effort in Canada, the Boundary Dam project, “has been plagued by multiple shutdowns, has fallen way short of its emissions targets, and faces an unresolved problem with its core technology.”

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[eridani]

1. 4 Things to Know About the Peabody Energy Bankruptcy

http://www.commondreams.org/views/2016/04/13/4-things-know-about-peabody-energy-bankruptcy

For 133 years, Peabody has been the bedrock of the U.S. coal mining industry. While coal CEOs have tried to downplay the emerging clean energy economy and the power of grassroots activists globally, the fall of a coal titan speaks for itself.

Here’s what you need to know.

Why did Peabody declare bankruptcy?

There two big reasons. First, the entire U.S. coal industry is in free-fall, and second, Peabody executives made some fairly terrible business decisions.

Peabody is the latest in a long string of coal bankruptcies. In the last couple of years, more than 50 coal companies have declared bankruptcy. And in the last six months, two once-giant coal miners — Alpha Natural Resources and Arch Coal — added their names to the list.

It turns out, people are just not as into coal as they used to be.

Grassroots activists throughout the United States have halted the construction of more than 150 new coal-fired power plants since the early 2000s, and more recently started hastening the retirement of hundreds of existing plants. And globally, concerns about air pollution, water use, and climate change have slowed coal’s rise in places like China and India.

In response to these developments, a rational actor might have started developing a thoughtful exit strategy to ensure workers got paid and mines were cleaned up. Instead, Peabody took out loans for $5 billion to buy new mines in Australia, leased a couple billion tons of coal from the U.S. government, and hired an expensive PR firm to try convince the world that coal was a solution to poverty.

Now, those debtors are asking for payment, and Peabody can’t foot the bill. So, bankruptcy!