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Americas: Peabody CEO blames Texas blackouts on lack of coal-fired capacity

https://www.chemnet.com   Mar 14,2011 Platts
The head of Peabody Energy, the largest US coal producer, Thursday blamed the rolling blackouts that hit Texas earlier this winter on a lack of coal-fired baseload generating capacity in the state.

"If we go for a long time without building baseload coal [generators], you'll get an unreliable electricity supply like the state of Texas now has," Gregory Boyce CEO of the St. Louis-based company told the CERAWeek 2011 conference in Houston.

Boyce made the case for coal as the fuel of choice for generation for the foreseeable future and used the February blackouts and outages in Texas as a cautionary tale.

"Texas found itself in the surprising position of having to import power from Mexico because of a lack of reliance on coal-fired baseload and problems with gas and wind and transmission," Boyce said.

In early February, cold weather and windy conditions in Texas knocked offline more than 50 generating units -- fired by both coal and gas -- representing more than 7,000 MW of capacity, forcing the grid operator to institute rolling blackouts as demand soared on the colder weather. During this time, the state pulled in about 250 MW of capacity from Mexico.

Boyce argued for the advantages of coal in terms of cost and,ultimately, environmental cleanliness.

"The delivered cost [of power from coal] is one-half to one-sixth that of natural gas," he said, adding that higher fuel prices "choke economic recovery, punish family budgets, send jobs overseas and determine the winners and losers in the global economy."

Boyce did concede that other fuels were necessary in the overall energy portfolio.

"We have to realize other fuels are not our foes," he said. "Rather than turning our swords on each other, we have to help our growing world live better."

Despite that, Boyce said he does not welcome the industry's embrace of shale gas as a coal-displacement fuel.

"We ought to be using that gas to attract industry back into this country instead of arbitrarily displacing the coal that we have in abundance," he said.

Boyce also touted carbon capture and sequestration and emerging clean-coal technologies as ways of ultimately achieving zero-emission goals in the decades to come, despite the fact that CCS has yet to prove its feasibility on a commercial scale.

Pointing to the preponderant use of coal in the skyrocketing economies of China and India and the fact that other fuels, namely oil, are mostly found in politically volatile regions of the globe, Boyce said "coal is the only sustainable fuel at scale that can meet the world's growing electricity needs.

"Coal is here to stay."

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