When a coal company chief executive officer offers a decarbonization plan, it means one of two things.
One, he has finally seen the light, and realizes that coal is irremediably dirty.
Or two, this is just “green talk” intended to paper over business as usual.
Once you know that the CEO in question is Gregory Boyce of Peabody Energy, who has released what he called a “Five-Point Plan to Accelerate Transition to a Low-Carbon Economy,” you probably know the answer.
And if you also know that Peabody is entering the final round of its struggle against the Environmental Protection Agency’s Clean Power Plan, intended to cut carbon emissions by 30 percent by 2030, and that the rule is to be finalized this summer, you understand the timing of Boyce’s manifesto, which was addressed directly to “Congress and political leaders.”
Boyce issued his five point plan just before his company’s annual shareholder’s meeting on May 4, and just after he took a small pay cut in a tacit acknowledgment of the fact that his company managed to lose 94 percent of its value in the last four years, a period Boyce likes to call “challenging.” The pay cut and the carbon plan were two of Boyce’s final acts as head of the company as he makes way for a new CEO, Glenn Kellow, an Australian.
“Challenging” is a word that gets twisted in unnatural ways at Peabody. Normally,“challenging” implies the possibility of survival. Here, the challenge is figuring out how that word could possibly apply to a situation where the world has turned decisively against coal and is driving your company out of business because the world is threatened by global warming caused very largely by the product you’re selling.
Which brings us back to Peabody’s Five Point Plan.
Remember, this is the company that proudly proclaims on its website that it is “the only global pure-play coal investment” – as though that was a good thing.
If you sell lumps of impurity-riddled carbon and you decarbonize, aren’t you left selling…well, nothing?
The answer lies in the fact that the Five Points actually have nothing to do with decarbonizing, but are merely a repackaging of Peabody’s global Advanced Energy for Life messaging campaign for domestic consumption in a desperate last-ditch effort to slow or kill the EPA rule.
Remember that AEfL is supposedly dedicated to the proposition that coal is cheap and plentiful and can bring power to billions of people around the world suffering from energy poverty.
“Energy poverty” is an emerging slogan for a real issue others refer to “energy access”. That is, the puzzle of how to supply energy to the billions of people who currently don’t have electricity without torching the planet by following the same dirty energy path that the fueled the industrial revolution. This is an issue that has everyone from the United Nations to anti-poverty NGOs to the Pope mobilizing to address it. But only Peabody’s Advanced Energy for Life campaign claims that imposing anti-carbon regulations and shifting to renewable sources of energy will deny the needy access to life-saving coal. Everyone else, including the UN Intergovernmental Panel on Climate Change, has identified coal as part of the problem as a warming earth will hurt the poor far more than the rich.
The target of Boyce’s five-point manifesto is of course the Environmental Protection Agency’s forthcoming Clean Power Plan, which Peabody has previously attacked as impossibly burdensome and based on flawed science, among many other criticisms.
Let’s also remember that Peabody’s senior vice-president for government relations is Fred Palmer, a global warming denier, and Palmer is keeping his job under new CEO Kellow.
That doesn’t bode well for this decarbonization plan.
Palmer was once quoted saying when you “burn fossil fuel and put CO2 in the air, you are doing the work of the Lord. It is the ecological system we live in.”
A slightly different message than that coming from the Vatican Pontifical Academy of Sciences just last week.
The five points themselves would be familiar to anyone who watched the Advanced Energy for Life campaign unfold. Familiar rhetoric about poor, energy-deprived people derived from AEfL, which was launched with the expert assistance of PR giant Burson-Marsteller
was flogged mercilessly by Boyce in a speech in Houston at which he unveiled his grand plan.
“High electricity costs put pressure on families, forcing what are too frequently becoming painful sacrifices. No parent should ever have to make the terrible choice of putting food on the table, buying medicine or paying for power, yet these are very real issues for tens of millions of Americans,” said Boyce.
For that reason, point number one of Boyce’s plan stresses “the tremendous impact of energy policy on all citizens and the importance of keeping energy available, reliable and affordable.” The second calls on the government to recognize that every fuel has “quantifiable benefits and limitations.” Nothing very objectionable in either of these on first blush, except for the fact that coal has many more limitations than benefits.
Clean Coal at Any Price
But the third is a plug for “continued investment in clean coal technologies to minimize emissions and drive down costs, which offer a dramatic success story in the United States,” the last part of which is a real howler. Peabody’s Fred Palmer himself helped oversee the recent National Coal Council report, which made it very clear that clean coal has so far been a dismal failure and that the technology won’t survive without many more billions in federal investment. (The original title of the report was “Bridging the CCS Chasm,” which was withdrawn at the very last minute in favor of the less gloomy “Fossil Forward.”) http://www.nationalcoalcouncil.org/newsletter/Bridging_the_CCS_Chasm.pdf
The fourth calls for development banks to fund electricity access in the developing world: “Electrification through coal is an answer to stop degradation of the natural environment and help alleviate energy inequality.” Touting coal as a way to prevent environmental destruction ignores not only combusted coal’s unmatched arsenal of pollutants, but lax environmental enforcement in poor countries that will ensure emissions are regulated lightly or not at all.
And finally, point five is a plea for an unnamed someone to “accelerate development of next generation carbon capture and utilization and storage that will achieve large emissions reductions.” Boyce claims CCUS will have to be part of the answer to lowering CO2 emissions “for both coal and gas.”
The Mississippi Experience
Boyce might want to ask the residents of Mississippi, who have borne much of the burden of building a non-functional carbon capture and storage “clean coal plant” in Kemper County whose projected cost has skyrocketed to over $6 billion, how they feel about footing the bill for developing CCUS. The entire state is in an uproar over rate hikes of almost 20 percent and even bigger projected increases needed to pay for Kemper. And that’s after the Department of Energy stepped in with a $270 million grant.
Indeed, while Boyce insists that wind and solar need too much subsidizing to take a bigger place in America’s energy portfolio –no longer true in many markets – nothing beats CCUS for sucking up subsidies.
Meanwhile, Five Point Plan or no, Peabody has never paid out a penny for energy poverty anywhere in the world. http://www.tai.org.au/content/all-talk-no-action-coal-industry-and-energy-poverty
In fact, when the company does take the lead on a power project, people tend to get even poorer. Ask Hermann, Missouri, whose mayor says his town is being “strangled” by the exorbitant electrical rates needed to pay for the Prairie State coal plant. This is a newly-built underperforming and very conventional – no advanced decarbonization technology here – coal plant. Peabody pushed for Prairie State with promises about the efficiency of modern coal plants, then cut its stake to five percent when construction costs doubled to some $5 billion, leaving ratepayers in the lurch.
Peabody’s five points are all about the world adapting to Peabody. Because it’s pretty clear Peabody isn’t adapting to the world it lives in.