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FUEL FROM THE SKY: SOLAR POWER’S POTENTIAL FOR WESTERN ENERGY SUPPLY While coal production from mines outside the West has stagnated, western coal mines and, in particular, the mines of the PRB have seen a tremendous increase in production. From 1970 through 2000, coal production in the PRB increased from 50 million to 362 million tons, or ten- fold. The reasons for this increased U.S. market share are the easy access to coal in the PRB through surface mining and the low sulfur content of the coal. At sulfur contents as low as 0.40 lb/mmBtu, coal from the PRB is compliant with the Clean Air Act and its amendments, which define “compliance coal” as coal with a sulfur content of less than 1.2 lb/mmBtu. Therefore, PRB coal is preferred by many power plants around the country since it complies with the act even without sulfur emissions control equipment. Western coal plants account for 27% of the capacity (61,840 MW) in the West and provide 44% of western electric energy. Coal-fired power plants in the West are generally newer than their counterparts in the East. Because of access to competitively priced coal from western mines, the coal’s low sulfur content, and growing demand, coal-fired power plants in the West run at some of the highest utilization rates (capacity factors) in the country. For example, coal plants in the Southwest, Northwest, and Colorado and Wyoming (no large coal-fired power plant exists in California) operate at an average 83% capacity factor. Coal plants in the Prairie States, which fire mostly lignites and PRB coal, have capacity factors of 60% to 75%. Texas coal plants oper- ate at a 79% utilization rate. Because these capacity factors, except in the Prairie States, come close to the plant operational availability, little additional energy can be obtained from existing coal plants. If western states decided to obtain more power from coal plants, new capacity would have to be built or existing plants would have to be up-rated. Western coal resources are vast and provide no limits to the amount of capacity and energy that could be provided from coal-fired power plants. Exhibit 46 shows RDI Consulting’s estimate of economically recoverable coal reserves in western states. The starting point of our analysis is the demonstrated reserve base of coal by potential mining methods. We then derated the demonstrated reserves in order to arrive at estimated economically recoverable reserves. In our view, about one-third of the underground reserves and 70% of the demonstrated surface reserves are economically recoverable. Exhibit 46: Estimate of Economically Recoverable Coal Reserves in the West Region Million Tons Avg. Heat Content Btu/lbs Avg. Sulfur Content lbs/mmBtu Underground Surface Northwest 21,693 36,584 9,062 1.2 Prairie States – 8,052 9,592 2.2 CO&WY 16,332 22,598 8,938 0.8 California – – – – Southwest 3,569 4,949 11,413 0.8 Texas – 9,698 6,413 3.1 TOTAL/AVERAGE 41,590 81,889 9,034 1.3 SOURCE: Energy Information Administration (EIA), “U.S. Demonstrated Reserve Base of Coal by Potential Mining Method,” January 1, 2001, and RDI Consulting analysis NOTE: Assumes that 30% of underground and 70% of surface demonstrated coal reserve base is economically recoverable. 113PDF Image | Solar Fuel From The Sky
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