
Some Still Love Coal as Exchanges Battle to Dominate Market - jessecred
http://www.bloomberg.com/news/articles/2016-02-19/some-still-love-coal-as-exchanges-battle-for-market-dominance
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qrybam
Something that most people will miss in this article is the acquisition of
Trayport by ICE. Trayport is a UK based software company which provides the
technological trading backbone for the European OTC Natural Gas and Power
markets as well as global Wet/Dry freight, Iron Ore and Coal.

The financial coal market has found great success on Trayport which
facilitated increased clearing volume for both CME and ICE. Most volume is
traded OTC. This partially explains why ICE bought them. Another reason is
likely because ICE wants to get into markets which have been primarily broker
led, and historically powered by Trayport's network.

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graeham
Coal is cheap and plentiful. It does have one of the highest carbon densities
relative to energy produced, but there are developing ways around that:

Capture and sequestration

-CO2 from large source power plants is scrubbed from emissions, captured, and stored underground

-In some cases, this can be used to make oil wells more productive (and is economically positive, without considering carbon taxes or credits)

-There are some questions around long-term durability and resistance to leaking of underground storage

[https://en.wikipedia.org/wiki/Carbon_capture_and_storage](https://en.wikipedia.org/wiki/Carbon_capture_and_storage)

Coal Gasification

-Convert coal to natural gas, which has a higher energy to CO2 ratio

[https://en.wikipedia.org/wiki/Coal_gasification](https://en.wikipedia.org/wiki/Coal_gasification)

I'd be more put off coal by low energy (oil) prices at the moment, but these
will turn around on a longer time scale.

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rayiner
Coal is not cheap. Accounting for externalized environmental and health costs,
coal is more expensive per kWh than solar or wind. Failing to internalize
those externalities is a $300-500 billion annual implicit subsidy in the
United States alone:
[http://www.chgeharvard.org/sites/default/files/epstein_full%...](http://www.chgeharvard.org/sites/default/files/epstein_full%20cost%20of%20coal.pdf)

Widespread CCS is also science fiction at this point, and does not address the
primary harm from coal: particulate matter and heavy metals. Coal use is
extremely expensive even if you ignore carbon dioxide emissions.

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graeham
The cost comparison is flawed if it is accounting for secondary costs of coal,
but not solar or wind. (Which will probably be lower than coal, although
perhaps not if accounting for vast land areas needed for generation and some
rather nasty materials used in solar).

Does solar and wind have capacity to replace fossil fuel demand? These also
have limitation is ability to match production to demand - perhaps storage
technologies will reduce this limitation.

My understanding is current technologies in scrubbers can do a quite good job
of removing particulates, and probably improve further with gasification. Not
as familar with heavy metals.

The question the original article raises is why, when energy production is
more sensitive to environmental issues, would people invest in coal. My points
are that there are developments that could in the future lead to a much
cleaner coal. Science fiction can and often does become reality.

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toomuchtodo
I believe you're making the wrong comparison.

Coal is not to be compared to wind and solar. Coal is to be compared to
natural gas. Natural gas produces far less CO2 per MW generated, and can be
throttled quickly at combined cycle generation facilities. Coal _should_ be
deprecated quickly for natural gas, as natural gas can backfill solar and wind
generation. Coal is now down to about 30% of US generation capacity, and will
continue to dwindle as coal plants are decommissioned or retrofitted to burn
natural gas.

As wind and solar continue to be deployed (which will only speed up with the 5
year production tax credit extension in December 2015), natural gas usage can
be reduced (or even eliminated with utility scale battery storage).

> The question the original article raises is why, when energy production is
> more sensitive to environmental issues, would people invest in coal. My
> points are that there are developments that could in the future lead to a
> much cleaner coal. Science fiction can and often does become reality.

Clean coal has _never_ been proven to be cost competitive [1].

[1] [http://energy.gov/fe/science-innovation/clean-coal-
research/...](http://energy.gov/fe/science-innovation/clean-coal-
research/major-demonstrations/futuregen-20)

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chris_wot
The previous Prime Minister of Australia is on record as saying that coal is
good for humanity.

Then again, he is also on record as saying global warming is "crap", that a
tax on carbon seemed like a good idea and then immediately scrapped it,
knighted Prince Phillip and once ate a raw onion on TV. Go figure.

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saryant
Coal was one of two available and abundant energy sources for most of the past
200 years (the other being oil). Without coal humanity's development could not
have accelerated as quickly as it has in the past few generations. Without
energy, you don't have an economy and without an economy, you don't get the
amazing advances in medicine, technology and standards of living that we've
seen in the 20th century.

The Prime Minister wasn't necessarily wrong.

~~~
chris_wot
Not disagreeing, but it also has some terrible downsides. We have much cleaner
energy sources now, so it's not so good for humanity now!

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timthorn
Good BBC Radio 4 documentary on this topic, earlier this week:
[http://www.bbc.co.uk/programmes/b070dkt9](http://www.bbc.co.uk/programmes/b070dkt9)

