There has been an increased investment in sustainable energy sources such as solar and wind, as well as research into carbon capture technologies (CCP) in recent years. Carbon capture involves “capturing” carbon dioxide emissions from processes such as steel production and burning fossil fuels for energy, and then storing the CO2 in geological formations deep underground.
Over the past decade, the fossil fuel sector has spent millions of dollars lobbying federal lawmakers to provide billions of dollars for investment into carbon capture and sequestration (CSS) technologies in the 2021 Infrastructure and Jobs Act (IJA) and the 2022 Inflation Reduction Act (IRA). A recent International Panel on Climate Change (IPCC) report found that the best way to reach climate change targets would be to either close all coal-fired power plants or invest in CSS technologies to clean up emissions from industrial processes that generate carbon dioxide.
But even though CCP has been around for decades, it is simply too expensive to be economically feasible on a large scale; in addition, it takes too long to build. Evidence shows that investing billions in CCS technologies would be a waste and that the investment would be better spent elsewhere.
The U.S. Department of Energy has spent close to $700 million on eight CCS projects from 2009 to 2020 with little success. Additionally, the coal industry invested hundreds of millions into coal capture and sequestration, but all CCS projects failed. The only project that was ever built was discontinued before it could reach its financial and environmental goals.
A 2021 U.S. Government Accountability Office report revealed that the DOE was at risk of spending significant taxpayer funds on CCS projects that had little chance of success.
The most affordable and most effective way to reduce emissions from coal would be to simply shut down coal mines instead of spending billions of dollars on carbon capture technology that is yet to prove its effectiveness. Rather than digging up coal, burning it, and then spending billions of dollars to capture the subsequent emissions, cutting off the cycle right at the beginning would be much more cost effective, says Mercy Corps senior climate advisor Scott Brown.
A buyer that purchases a coal mine at an estimated 5 to 10 times its profitability and then closes it would have spent less than $3–$6 per ton to permanently sequester carbon compared to the more than $100 that it would cost to sequester carbon using CCS technologies.
Companies such as Amazon, Google and Microsoft that are spending over $500 per ton to capture carbon dioxide using experimental technologies could invest that cash into buying and shutting down coal mines.
Carbon sequestering may be feasible in the future to capture emissions from industries such as steel and cement production that can’t be replaced easily, but in the meantime, our top priority should be to reduce the amount of emissions escaping into the atmosphere in the first place, Brown asserts.
The lack of clarity regarding the best way to phase out coal shows just how integral this fuel had become and why it will not be easy for extraction firms such as Alliance Resource Partners LP (NASDAQ: ARLP) to just close shop when energy shortages are looming or actually being experienced in different parts of the developed world.
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