The Ongoing War on Coal
New EPA regulations will have negligible impact on global CO2 emissions.



Robert Bryce

On Monday, the EPA unveiled a 645-page document detailing regulations aimed at cutting carbon dioxide emissions from the electricity-generation sector by 30 percent by 2030 when compared with 2005 levels.

While the Obama administration may get kudos from the green left for its attacks on coal, the hard reality is that the EPA’s new rules will have negligible impact when it comes to soaring global carbon dioxide emissions and surging global demand for coal. Just as important, the new rules are merely repeating the policy mistakes of the past and, in doing so, risk making the U.S. too dependent on a single fuel source. And this new policy mistake is happening even though the U.S. leads the world in carbon dioxide reductions.

Let me start by reminding readers about one of the worst energy-policy mistakes in American history: the Powerplant and Industrial Fuel Use Act (FUA). Passed by Congress in 1978, the FUA restricted the use of natural gas for electricity generation. Given that the U.S. is now producing record quantities of natural gas, it’s hard to imagine a time when natural-gas shortages were common. But during the mid and late 1970s, shortages were a frequent occurrence. Those shortages weren’t caused by a lack of gas resources. As we now know, America sits atop decades-long supplies of the fuel. Instead, the shortages were caused by a briar patch of federal regulations that hampered the development of interstate markets for natural gas.

Nevertheless, political leaders were convinced that a crisis was at hand. (Sound familiar?) And the solution was . . . more coal-fired power plants. In April 1977, President Jimmy Carter declared that an “energy crisis” was at hand, that we were running out of oil and gas, and that “too few” domestic electric utilities “have switched to coal, our most abundant energy source.”

There’s no small bit of irony that the EPA is now trying to shut down some of the very same coal-fired power plants that were built in the 1970s and 1980s as a result of the congressional restrictions on natural-gas-fired electricity production. Although FUA was in effect for less than a decade, it significantly distorted the power sector. In 1978, natural gas was generating 13.8 percent of U.S. electricity. By 1988 — a decade after FUA was passed — natural gas’s share of the U.S. electricity business had fallen to a modern low of just 9.3 percent. By contrast, between 1978 and 1988, coal’s share of the U.S. electricity-generation market soared, going from 44.2 percent to 56.9 percent, the highest level of the modern era.

Today, the claimed crisis isn’t a shortage of energy; instead the claim is that we have too much. The climate crisis, the regnant political consensus insists, is due to excessive use of hydrocarbons. And it’s clear from the language in the EPA’s new regulations that the agency expects a significant shift away from coal and toward natural gas for electricity generation.

I’m adamantly in favor of natural gas. But the EPA’s move risks putting too many of our energy eggs in the natural-gas basket. We need a diverse energy portfolio. If policymakers want more low-carbon electricity, they should be encouraging construction of more nuclear plants. And if they want to keep the lights on, they must realize that coal should remain part of the nation’s array of available energy sources, particularly given that the U.S. has more coal resources than any other country. America’s coal deposits total 900 billion barrels of oil equivalent; that’s nearly as much as the 1 trillion barrels of proven oil reserves held by OPEC.