Minnesota Should Keep Burning Clean, Beautiful Coal
With President Trump visiting Minnesota today, there is no better time to emphasize the fact that Minnesota would save $87.7 billion dollars through 2050 by continuing to burn clean, beautiful coal to generate electricity instead of pursuing more wind and solar. Despite claims to the contrary, coal-fired electricity is far more affordable than wind or solar.
Minnesota can only reap these massive economic benefits if we implement the Trump Administration’s proposed Affordable Clean Energy (ACE) rule, which requires coal plants to make common sense, and cost effective improvements to reduce carbon dioxide emissions.
A recent study by Center of the American Experiment, where I work, found upgrading Minnesota’s coal plants under the ACE rule would reduce electricity costs by $7.5 billion compared to today’s prices through 2050. On the other hand, even implementing a 50 percent wind and solar mandate would cost an extra $80.2 billion.
This means the policies advanced by the Trump Administration would save Minnesotans $87.7 billion through 2050, compared to the alternative, saving each and every Minnesota household more than $1,300 per year, every year, through 2050.
The ACE rule is such a massive opportunity for Minnesota because coal provides more electricity to our state than any other energy source. The Sherburne County coal plants powered the space heaters used by the Xcel Energy natural gas customers to keep their water pipes from bursting when they lost natural gas service during the polar vortex. Xcel Energy’s wind fleet was shut down because it was too cold to operate the turbines.
The Clay Boswell coal plants operated by Minnesota Power provide the iron mines and paper mills with the affordable and reliable electricity they need to keep rolling full steam ahead. Just these two industries use 8 percent of all the electricity generated in our state, a massive demand for power that the Boswell units have reliably served for decades.
It total, coal supplied approximately 39 percent of our in-state electricity generation in 2017. If you include the Coal Creek power plant owned by Great River Energy that provides electricity to much of western Minnesota, coal accounted for more than 42 percent of our total electricity consumption in that year.
Not only do these coal plants provide more reliable electricity than any other fuel source, but they do it a lower cost than wind or solar.
Form 1 data submitted to the Federal Energy Regulatory Commission (FERC) by Minnesota utilities show the cost of generating electricity at Sherburne County and Clay Boswell was $30.58 per megawatt hour (MWh) and $32.34 per MWh, respectively, in 2017, the most recent year for which data were available.
In contrast, Bloomberg New Energy Finance estimates the unsubsidized cost of generating electricity from new wind is $38 per megawatt hour, meaning it is 24 percent more expensive than electricity from Sherburne County, and solar was nearly $60 per MWh, twice the cost of coal.
These price estimates do not take into account the costs of transmission lines, additional property taxes, utility profits, or the costs associated with generating electricity with natural gas or coal when the wind isn’t blowing but you’d still like to watch television. Incorporating all of these costs brings the true cost of wind power to $113 per MWh, nearly four times more expensive than coal.
Continuing to burn clean, beautiful coal rather than pursuing more wind and solar power would be the equivalent of passing a whole other tax cut, which is something we should all be able to celebrate at the conclusion of this year’s tax season.
Isaac Orr is a Policy Fellow specializing in energy and environmental policy at Center of the American Experiment