Do Electric Vehicles Mean You Should Invest in Coal?
It will be a long time before wind and solar resources power our electric vehicle fleet — some might say never — and each EV purchased adds the equivalent of a new house to the electric grid, which necessitates more electricity production. This means burning more coal and spewing more greenhouse gases into the atmosphere is inevitable, right?
Not necessarily.
While meeting demand for EVs will be a challenge, the federal government and utilities are trying a number of tactics including smart-charging during off-peak hours and making gains in efficiency to offset the increase. In addition, natural gas appears to be making serious inroads in the nation’s energy portfolio, while coal is becoming less competitive. However, natural gas is fighting a growing perception problem because of the process used to extract it from the ground. Do an Internet search on the term “fracking” to learn more.
According to the Energy Information Administration’s 2010 annual carbon report, American power generation fell by 4% from 2008 to 2009 because of the recent recession. During that same period, coal-fired power generation fell by 11.1%, largely due to natural gas becoming a cheaper source of electricity. Use of renewable resources, on the other hand, made an 11.8% gain from 2008-09.
Coal remains 45% of the nation’s energy mix, but it will likely become less competitive as the EPA prepares to regulate the largest greenhouse gas emitters due to the failure of the climate and energy bill in the U.S. Senate. Natural gas produces roughly half the carbon emissions of coal for the same energy, and the federal government is subsidizing renewable research and implementation.
This produces some hope that as EVs add their burdens to the grid, the juice to power them will have less impact on the environment.
Previous
Subscribe to our feed
Email us your tips!
I wouldn't dive in to coal just yet.
Over the last few decades, over a hundred coal power plants have been planned in this country, and all but a handful have been canceled. Even without greenhouse gas regulation, the existing restrictions on other pollutants makes it VERY hard for a coal plant to meet the standards. Add to that a significant NIMBY effect and the fact that the economics of new coal plants just don't work out, and you have a massive case against new coal, which even the utilities see.
And if that isn't enough consider the fact the even the Chinese are shifting away from coal, and you have to start having doubts.
Natural gas, despite fracking concerns, is likely to increase in popularity due to the fast speed of construction, low upfront capital costs, high efficiency of generators, and cleanliness of exhaust. Wind is also incredibly popular for similar reasons, and today constitutes ~40% of all new capacity additions in the US.
And all of this ignores the considerable efforts and incentives made behind other forms of cleaner, domestically sourced, independent sources of energy. (natural gas and oil prices are tied, and coal is as well, to a lesser extent, due to the high amount of diesel fuel required to ship it. Sourcing from sun, geothermal, or even nuclear wouldn't fluctuate with the price of oil)If any of that comes to fruition, it could destroy coal in no time.
Well said, Dan. I would like to add to the fact that - it will probably take AT LEAST another 25-50 or more years (to be VERY optimistic, more like 50 I would say) before we'll see the effect of a gradual shift from fossil fuel ICE to electric (or other type of non-fossil fuel) vehicles. By then, I'll be lucky if I'm still alive. And even if most of us who can afford to buy energy stocks now with our spare money - in this economy - we'll most likely have cashed out of 401K / social security before we'll see coal going up in prices, like gold.
Novel idea anyhow, but not a practical one.
If someone would like to invest now - then invest on chemicals that can be made into battery. Many of those are rare metals and have gone up in price significantly. Lithium is a perfect example. Nickel may be next (so hang on to your pennies!!!)
That seems pretty...pessimistic, really, Amuro. I'd say 10-15 years, for sure!