Prominent environmental author Lester Brown predicted on Thursday that coal-fired power plants will be banned in the United States because of climate change concerns and the financial liabilities of greenhouse gas emissions.
In a conference call and paper, Lester, president of the Earth Policy Institute, compiled a number of setbacks for coal projects in the past year from governments, local opposition, and financiers.
A cheap but dirty power source, coal supplies about half of the electricity in the United States and is growing rapidly in China, India, and other developing countries.
The most recent investment barrier came from Bank of America, whose CEO on Tuesday said the company has decided to figure in the cost of carbon dioxide emissions when it evaluates new power plant construction projects, even in the absence of carbon-restricting regulations.
Last week, Citi, JPMorgan Chase, and Morgan Stanley announced the Carbon Principles, a set of guidelines for investors in power producers to weigh risks and business opportunities associated with climate change.
Brown said that one year ago, there were 151 proposed or planned coal-fired power plants. About two-thirds of those proposals have been challenged legally or canceled.
"This is an extraordinary turnaround here in the space of one year. The overriding reason for this shift has been mounting concern about climate change," Lester said. The other reason is because of soaring construction costs, which have gone up 76 percent in the last three years.
The uncertainly around the cost attached to carbon dioxide emissions is also making it difficult for Wall Street investors to finance projects.
In addition to grassroots opposition, Lester said that state governments have been increasingly bold in pushing back on coal-fired power plants. In Florida, for example, the state government turned down a project because its backers did not do an analysis comparing new plant construction to energy efficiency measures.
If the U.S. converted to compact fluorescent bulbs, it could decommission 80 coal plants operating at 500 megawatts, he said.
Even without a federal ban or moratorium on new coal plant construction, he forecast that a de facto ban could take place at the state level, as it has in other countries.
One technology often cited as the antidote to dirty power sources is carbon capture and sequestration, where carbon dioxide gas is pumped underground and removed from the atmosphere.
The U.S. Department of Energy-funded FutureGen demonstration project was scrapped because of rising costs late last month in favor of a new project which would go online in 2015.
Brown noted that Wall Street investors are staying clear of carbon sequestration projects because the costs are so high. Building pipelines for CO2, for example, requires huge infrastructure investments.
"Carbon sequestration has been something that the coal industry has leaned on to avoid facing the full force of climate concern. My sense is that it will never be a viable option," he said.
Kuhn said that the power generation industry is adjusting to climate change, but at the same time "we continue to have a business to run." He argued that some climate legislation proposals are too stringent and would unnecessarily impact consumers and business competitiveness.
"I would encourage you to keep an open mind to the variety of solutions and the use of all fuel sources--including coal--as you make decisions to finance new facilities. All options must be on the table if we are to make the transition to a low carbon future without major disruptions in the economy and our quality of life," Kuhn said in his speech.