Dirty, but cheap

While looking for some information on the Energy Information Administration site, I came across some numbers that show why we have a love affair with coal. At least, people who have a love affair with cheap electricity do.

In February 2007, it cost about $1.75 in fuel costs to generate 1 million Btu from coal. For petroleum liquids, it was $8.11, and from natural gas, $7.87.

However, from 2008 through 2010, more new power generation that is planned to come on line is from natural gas instead of coal. But that's heavily loaded in the near future. As you get farther out from 2007, more new capacity is planned for coal than for natural gas.

That's the what. I need to do some more checking to verify why. I assume it has to do with natural gas prices. Here's why I say that: In 2004, the average cost to generate 1 million Btu from coal was $1.351. For natural gas, it was $5.961. In 1994, the cost from coal was $1.355, or virtually the same as 2004. But for natural gas in '94, it was $2.23, meaning the price per million Btu from natural gas was about 2.67 times higher in '04 than in '94.

On another part of the EIA site, I was surprised to see that a clean-coal technology called IGCC with carbon sequestration is almost as expensive to build as a nuclear power plant.

Anyway, I plan to weave all of this together for a piece in the paper. Or more than one piece. It depends on how much the boss likes it.