Stephen Moore: “When It Comes To Electric Power, Coal Is No. 1”

That’s a title of a July 28 piece in IBD. He writes:

According to the Energy Information Administration, which tracks energy use in production on a monthly basis, the single largest source of electric power for the first half of 2017 was…coal.

Once again, I can’t replicate his results. But even more interesting, the conclusion is misleading.

Using data from the EIA website accessed today, I find natural gas share at 29.0% and coal at 29.3% — pretty close to what Mr. Moore obtained. But then I wondered why the first six months of 2017. How about the five complete months of the Trump administration as of Mr. Moore’s article? Then it’s coal 28.5%, natural gas 29.4%. Or the 12 months leading up to 2017M06. Then it’s coal 30.7%, natural gas 31.2%.

The sensitivity of the results to small changes in sample period suggests a high degree of seasonality. This is confirmed by examination of the data. First, the two shares; second the difference in the two shares.



Figure 1: Share of coal in total electricity generation (red) and of natural gas (blue). Light tan shaded area is sample period used by Stephen Moore. Source: EIA.



Figure 2: Share of natural gas in total electricity generation minus that of coal (blue). Light tan shaded area is sample period used by Stephen Moore. Source: EIA.

So is there anything particularly special about the first half of the year? One can formally answer that question by running a simple OLS regression of the variable in Figure 2 on a time trend and a dummy variable for the first six months of each year. This yields:

sharedif = -2.36 – 0.053×HALF1 + 0.002×TIME

Adj.-R2 = 0.84, SER = 0.054, DW=0.42. bold numbers denote significant coefficients using 5% msl, and HAC robust standard errors.

In other words, in the first half of the year, the share differential of electricity generation coming from coal is typically higher, by a 5 percentage point amount.

Mr. Moore may be right that coal will gain in importance relative to natural gas in terms of electricity generation. But his reporting of data makes one wonder exactly how robust is the rebound.

Mr. Moore also touts the surge in coal mining:

As for the drilling and mining industries, they have gained more than 50,000 jobs since Trump’s election with 8,000 added in June alone. Many of these were in the oil and gas industry, but some were in coal, whose output has increased 12% this year.

The “some” makes you wonder how many. I looked up the most recent vintage of “coal mining employment”, and from November 2016 to June 2017, the change was 1,100. I guess that’s why he didn’t give the number. Here for perspective is the coal employment time series.


Figure 3: Coal mining employment, 000’s, seasonally adjusted (blue), on a log scale. Source: BLS via FRED.

I have no doubt that with certain regulatory moves, and certain relative prices, coal will gain relative to natural gas in electricity generation (although EIA’s current Short Term Energy Outlook indicates constant coal share). But I’d want just a little more data before declaring coal once again “No. 1”.

94 thoughts on “Stephen Moore: “When It Comes To Electric Power, Coal Is No. 1”

  1. pgl

    Trump seems to think coal mining is high paying. It is not. Trump for some reason thinks that Obama regulation reduced the demand for coal when anyone with a brain knows that the driving factor was a market event – lower prices for natural gas, a substitute. Which is to say why in the world would Stephen Moore care about an alleged coal boom. Coal has more negative externalities than natural gas so we should be celebrating the market event that has increased the natural gas share. Oh wait – Stephen Moore’s job is support Trump’s absurd lies. Never mind.

    Reply
    1. PeakTrader

      Here’s what a coal miner said in 2010 – no formal education is needed to be a coal miner.

      “The larger the company, the better the pay. For example; I worked underground for both ICG and Teco in Hazard and the lowest man (which is normally a beltman) starts out around $19.00 an hour. Equipment operators are around $21.50 an hour and bolters and miner operators are mid 20’s. You usually work 60+ hours a week so the overtime money is time and a half. It’s good pay, but a dangerous job. But, once you become a miner it gets in your blood and you never want to do anything else.”

      Natural gas is much more expensive in Europe – the U.S. shale oil boom lowered natural gas prices substantially. Japan is even more expensive, although U.S. homes in square feet are much larger.

      “The winter fuel bill for US homes using natural gas last year was $598. In Japan that gas would have cost $2,500!”

      Reply
      1. PeakTrader

        It looks like natural gas prices in Europe fell from $11.1 per million BTU in 2013 to $4.1 per million BTU in 2016, while natural gas prices fell from $3.5 to $2.3 in the U.S..

        Reply
        1. PeakTrader

          European consumers benefited more from the U.S. shale oil boom than American consumers – European governments also likely benefited more from higher taxes.

          Reply
          1. pgl

            I guess you are not aware of the fact that Russia is selling a lot of natural gas to Europe. Easier for them to transport than us. Something about land and pipes versus oceans and ships. Let us all know when these simple matters finally are grasped by you.

          2. Ulenspiegel

            “European consumers benefited more from the U.S. shale oil boom than American consumers – European governments also likely benefited more from higher taxes.”

            How much of the US NG ends in Europe? Or which other sources are substitued with US NG and are delivered to Europe?
            Culd it be that you are talking nonsense?

          3. PeakTrader

            Could it be the U.S. shale oil boom caused an outward shift in world supply and lowered world prices that eventually created the world supply glut?

          4. Ulenspiegel

            “Could it be the U.S. shale oil boom caused an outward shift in world supply and lowered world prices that eventually created the world supply glut?”

            In principle yes. But now you have to provide data which are relevant for Europe and support your claim.

            1) Asia is the prime market for LNG. LNG is very expensive in Asia in comparison to European pipeline-NG. How could reduced US imports or exports of LNG by USA affect the market for Russian pipeline-NG?

            2) In Europe we had already before the shale boom a market that was called buyer market by experts around 2005.
            Hint: Some of the larger customers were able to drop the pegging of NG to oil price.

            I admit that I do not understand some of the fine but relvant nuances of the situation, however, we Europeans have observed an improved situation around 2010.

          5. PeakTrader

            Also, it could be, Russia, for example, lowered natural gas prices enough to prevent U.S. LNG exports, which are more expensive, to maintain market share.

          6. PeakTrader

            Moreover, one economist says:

            “Increased U.S. natural gas production has depressed our usage of coal, pushing the price of coal down on international markets. This, in turn, reduces European demand for natural gas.”

            Furthermore, Europe, over the past decade, focused on increasing the supply of renewable energy, at the expense of fossil fuels.

            So, lower demand in Europe also reduced natural gas prices.

          7. Ulenspiegel

            “Ulenspiegel, one mechanism is energy intensive industries in Europe moved or expanded to the U.S. to take advantage of lower natural gas prices”

            And how many companies reduced their production in Europe? Hint 45% of NG is used for space heating, 45% for industrial process heat, you have to reduce the latter to have an impact on the demand side, there is no exodus of companies. Your version still sounds like nonsense.

        2. Ulenspiegel

          “Increased U.S. natural gas production has depressed our usage of coal, pushing the price of coal down on international markets. This, in turn, reduces European demand for natural gas.”

          This is only an option in the field of electricity geneartion, only ~10% of the NG is used there. Your argument does not work, BTW the share of NG is increasing a little bit despite dirt cheap coal.

          “Furthermore, Europe, over the past decade, focused on increasing the supply of renewable energy, at the expense of fossil fuels.”

          Again, you are talking about a share of the 10% NG that goes into generation of electricity. Peanuts.

          Reply
          1. pgl

            Compensating wage differentials is Bottom Trader’s explanation for why women makes less than men doing the exact same job? I knew he is a troll but I never imagined he could be THIS dumb.

          2. PeakTrader

            Do men and women really do the exact same job?

            Obviously, liberal/socialists believe calling people names strengthens their arguments.

          3. baffling

            “Do men and women really do the exact same job?”

            in your career as a failed banker, i would imagine if there were any women bankers in your locale, they made less than you. why couldn’t they do the same work that you did? perhaps not tank the economy in the process?

      2. 2slugbaits

        PeakTrader “The winter fuel bill for US homes using natural gas last year was $598. In Japan that gas would have cost $2,500!”

        Please note that what’s being discussed is the amount of natural gas vs coal used to generate electricity. We’re not talking about how much natural gas costs to heat homes in the winter.

        As to the coal miners statement, who cares? Do I care that some old, poorly educated coal miner finds the work personally satisfying?

        In other posts you’ve taken the position that labor and capital are complements, so you might expect higher wages in a capital intensive industry. Now let’s do the arithmetic. Using the coal miner’s numbers, let’s say the base wage is $25/hr and a miner works 60 hrs/wk. That works out to ($25 * 40) + ($25 * 20 * 1.5) = $1750/week, or $91,000/year during peak earning years. Is that really a lot of money given the health issues and a lifetime of 60 hours a week? There’s a reason coal mining country is rampant with opioid addiction.

        Reply
        1. pgl

          Thanks for bringing this Bottom Trader nonsense up. Let’s see – natural gas is difficult to transport so there are regional differences in prices? Oh golly gee – NO ONE in the history of economics ever noted this. Of course if Bottom Trader had even the slightest clue, he might realize that Chevron, Exxon, and the other big boys are investing heavily in Australian natural gas to sell it to China and Japan.

          Reply
      3. baffling

        “no formal education is needed to be a coal miner.”
        so the folks doing the coal mining can be described in the same terms you use of the immigrants from latin america: uneducated. the career prospects of a coal miner are poor. future wages are falling due to market forces. why would you try to artificially support coal jobs? higher wages mean higher electricity costs for me. you seem to be embracing an approach which effectively taxes the consumer and subsidizes a career which has very little economic future. strange. next thing we know, you will advocate a tax policy which taxes a tax.

        Reply
  2. pgl

    Let’s note how Stephen Moore decides to trash liberals at every turn in this pointless oped:

    “That’s an amazing finding because liberals and especially environmental groups keep telling us that coal is a dead industry. They have ridiculed Donald Trump, and called him a liar, when he has said that he will revive the coal industry and the related jobs. “Coal Isn’t Coming Back,” a New York Times piece assured us a few weeks after the election. “Saving coal is one promise he (Trump) won’t be able to keep,” the author predicted. The Financial Times was even more blunt in its headline last month: “Coal Is Dead; Long Live the Sun.” Let’s see if the left issues a retraction. Don’t hold your breath…Liberals complain that coal activity isn’t a major producer of jobs because the industry is producing a lot more coal with a lot fewer workers. That is absolutely true. Ladies and gentlemen, that is called productivity.”

    I see no purpose in these taunts unless Moore’s mission was to be elevated to Trump’s top troll.

    Reply
    1. baffling

      but rick stryker believes that moore is some innocent bystander simply trying to tell the truth. and these evil liberals sucker punch him whenever they get the chance. moore would never be a troll, just like rick stryker would never be a troll.

      Reply
  3. pgl

    Bottom Trader is doing a lot of his usual hit and runs including the proposition that men should be paid more for women. OK – let’s skip his usual sexism and get down to where Europe is buying its natural gas:

    https://ec.europa.eu/energy/en/topics/imports-and-secure-supplies/supplier-countries

    “Norway is the world’s third largest exporter of oil and gas after Saudi Arabia and Russia. In 2012, it accounted for about 31% of all the EU’s natural gas imports and 11% of its crude oil imports. Norway also produces a large amount of hydroelectric power which it will be possible to export to the EU in greater quantities if new grid connections are built….Russia is one of the EU’s largest suppliers of energy. In 2013, it accounted for 39% of its natural gas imports. A number of individual EU countries are also heavily dependent on Russian supplies for certain energy resources, in particular natural gas. Natural gas supplies from Russia often go through transit countries such as Ukraine and Belarus.”

    I presume Bottom Trader thinks Norway is part of the United States,

    Reply
      1. pgl

        I never said our increase in supply had nothing to do with world prices. Of course you were the one babbling about how their are regional differences in prices of natural gas. I can you lack the ability to make up your mind. You certainly lack any integrity with respect to what others have said.

        Pointless as always.

        Reply
      2. pgl

        From your article:

        “Experts point to Mexico as an example of how transformative gas can be in a matter of only a few years. As the American shale boom accelerated, producing more gas than its northern neighbor could consume, Mexico decided to import as much cheap gas as possible. ”

        I see your “point” – you think Mexico is in Europe!

        Reply
        1. Steven Kopits

          Relatively little US natural gas has been exported to Europe, although volumes are gradually growing.

          The greater impact comes from oil prices, as Russian natural gas exports have historically been priced as a function of oil prices. US shale oil collapsed global oil prices, and with it, Russian natural gas prices.

          Reply
          1. Ulenspiegel

            “The greater impact comes from oil prices, as Russian natural gas exports have historically been priced as a function of oil prices. ”

            Yes, this is historically correct, however, after 2005 some of the larger customers were able to remove this pegging. The bargain power of Russian and Asian supliers was reduced for some reasons I do not completely understand.

    1. Ulenspiegel

      ““Norway is the world’s third largest exporter of oil and gas after Saudi Arabia and Russia. In 2012, it accounted for about 31% of all the EU’s natural gas imports and 11% of its crude oil imports. Norway also produces a large amount of hydroelectric power which it will be possible to export to the EU in greater quantities if new grid connections are built…”

      To be fair, these arguements are nonsense:

      1) The production volume of Norwegian NG decreases, of Nethland NG of UK NG… Therefore, it can be expected, that the share of Russian NG will increase for some time.

      2) Norways electricity generation is limited by rain, of which ~90% is usually used to cover domestic demand. Therefore, the possible net electricity exports are very small.

      However, more transmission lines allow the storage of European generation in Norway, i.e. Norway becomes a huge battery. The net exports would still be zero, the gross exports could be large. 🙂

      The interesting question is why European NG demand does not increase as predicted ten or twenty years ago and how some developements in Europe erode in the long term (until 2050) the economic base of Russian NG.

      My amateurish take is that NG is one victim of REs in the field of electricity generation, expected increases of NG use does not occur. However, as only a small share of (German) NG, we are talking about <10%, is used in this field, the long term projection is dramatically effected by changes in industry (process heat share of NG demand 45%) and space heating (45% demand).

      Reply
  4. Steven Kopits

    “But then I wondered why the first six months of 2017.”

    He wrote the article in July. That would be an obvious time period, ie, the previous half year.

    Reply
    1. Menzie Chinn Post author

      Steven Kopits: But he could have tracked it from the election (which he did for mining), or he could have tracked it from the complete months of the Trump Administration (February to June). Or he could have done it for the previous year, to account for seasonality.

      Reply
      1. Steven Kopits

        Man, if you’re spending your time nitpicking articles from July, well, let me suggest some topics for blog posts.

        Reply
          1. pgl

            Brad DeLong started a series taking down the nonsense from Kevin Hassett but then he stopped – alas. Keep up the good work.

        1. baffling

          steven, do you believe moore was being quite selective in his choice of time in order to emphasize his agenda? was his choice deliberate, or bad luck?

          Reply
          1. Steven Kopits

            Well, everyone has a right to advocacy. Menzie is exercising his here.

            The question is whether statements made are false or materially misleading. In this particular Moore article, best I can tell, the answer is ‘no’.

          2. baffling

            steven, moore is advocating the rebirth of coal when we have had decades long trend of shrinking coal share of electricity produced. its the same argument some nut wings use when they see an extra cold day in january and claim global warming is not occurring. we are not working with technicalities in these instances. moore is in the wrong. is he permitted to advocate? yes. but he is also warping the truth to further that agenda. not acceptable, steven, and you should know better.

          3. CoRev

            Baffled is still confused by his bias: “its the same argument some nut wings use when they see an extra cold day in january and claim global warming (climate change-my add) is not occurring. ” Because Climate Alarmists did not claim that the 2015-16 temperature rise was due to Global Warming/Climate Change, when anyone with any knowledge knew we were in an el Nino.

            El Nino have no known relationship with AGW. The models, based upon that settled AGW science, can not predict/project them as well as changes to many other components of the climate.

            But only ones side is biased!?!
            There are five attributes of ideologues:
            1. Absence of doubt
            2. Intolerance of debate
            3. Appeal to authority
            4. A desire to convince others of the ideological “truth”
            5. A willingness to punish those that don’t concur
            Which side exhibits these attributes?

          4. Steven Kopits

            Actually, Baffs, Moore is not calling for the rebirth of US coal. Those of us who work in the energy sector — and Moore spends some time there — are well aware of the difficulties of permitting and constructing new coal-fired plants. It’s very hard, and not only for reasons to do with the Federal government.

            Moore is instead making a narrower point that coal remains an important — and on some days — the leading source of US power.

            As you know, for me, it all comes down to cost/benefit. Clean air is a — but not only — benefit. So it’s all about getting the balance right, about putting reasonable values on internalized and externalized costs, and about managing risks (outlier events) down the line.

          5. baffling

            steven, moore is extolling the virtues of coal, which has been in steady decline for decades. its importance is diminishing daily. moore does not want to acknowledge that fact. it will not return to its glory days.

  5. rtd

    After a little bit of research (and attempting to comprehend Moore’s article), I may have found the discrepancies (but who knows w/o speaking to Mr Moore).

    I noticed Mr Moore’s article was published 07/28/2017 and as such, I don’t *think* EIA would have data to support the claim that “the 2017 breakdown of U.S. power generation by source is: Coal 31.3%, Natural Gas 31.1%, Nuclear 19.6%, Renewable 9.3%, Hydroelectric 7.3%, Wind 6.1%, Solar 1.2%” at that time. For example, as we can see from Menzie’s attempt at recreating Moore’s claim, EIA’s ‘Data Browser’ currently only has data through October2017 – missing a full two months. As such, I doubt Mr Moore could make a firm claim about Q2 data in July (caveat in my last paragraph).

    It looks that July 2017’s EIA SEO (released July 11 2017) had a forecast of 31.3% in 2017 for coal and 31.1% in 2017 for natural gas. (e.g. https://www.reuters.com/article/us-usa-natgas-eia-steo/coal-to-surpass-natgas-as-main-u-s-power-generation-fuel-in-2017-eia-idUSKBN19W23K). Surprisingly I can’t locate the full EIA SEO for July 2017. I’ll let Menzie calculate the probability that Moore’s numbers would equal EIA’s by chance.

    Is he “lying” or did he “mistype”??? I don’t know but I bet it’s a mistyping. Why? Because in the same article, Moore states: “According to the EIA’s July report,‎ “EIA estimates that the share of total U.S. generation fueled by natural gas during the first half of this year averaged 29%…In contrast, coal’s share of generation rose from 28% in the first half of 2016 to 30% in first half of 2017.” I wonder if Menzie just missed that line or he neglected to list it (see, Menzie, that could be considered “disingenuous” and not necessarily “lying” – as you’ve recently learned that there’s a difference). To answer Menzie’s question a/b why the focus on the first half of 2017… I wouldn’t be surprised if the numbers were (intended???) to reference EIA’s forecast of the entire year of 2017 and not the 1st half of 2017 but rather. At the minimum, it was sloppy writing and editing.

    I’ve had a long day of work so there could very well be some points that don’t make sense in the above.

    Reply
    1. Menzie Chinn Post author

      rtd: He wrote first half of 2017, so I took him at his word. But I did not write that he lied in this particular case. I was merely pointing out the fragility of his inferences.

      Reply
      1. rtd

        Seems that you selectively took him at his word.
        Also, why would you take someone who you think is a liar at their word?
        Menzie being Menzie.

        Reply
    2. baffling

      “Is he “lying” or did he “mistype”??? I don’t know but I bet it’s a mistyping. ”
      this seems to happen to moore quite often. so the question is, how many times must it occur before you begin to doubt him? this behavior has reached epic proportions with trump without a challenge from the conservative side.

      Reply
      1. rtd

        I think this instance is more towards mistyping, but it certainly could be nefarious. I also believe that both mistyping and lying continually are enough to “doubt him” but once it becomes obvious, and particularly with someone such as Moore (is he important enough to focus on???), why read him anymore? Although, if he’s as bad as Menzie seems to suggest (or desire him to be), why is he on CNN? You mention Trump, but that’s obviously (to me at least) a different story entirely.

        Maybe we should all do as “our host” and take him at his word?

        Reply
        1. baffling

          “but once it becomes obvious, and particularly with someone such as Moore (is he important enough to focus on???), why read him anymore?”

          but then why continue to defend him, as some on this blog actively do?

          rtd, rather than try to create doubt, step up to the plate. if trump and moore have become serial liars, or are serially inept at producing valid data, why not step up and call them on it, rather than create an enabling environment?

          Reply
          1. rtd

            I can’t speak for others, but I am not commenting in defense of Moore… rather, my comments are against Menzie’s partisanship, sloppy analysis, and subjectiveness. I really enjoy economics and I feel that Menzie continually gives the subject a bad name.

            I have called out Trump numerous times, maybe not much on this blog (although I do recall commenting disparagingly over one of the Trump administration’s first economic policy statements), but elsewhere and am happy to do so as warranted.

  6. Steven Kopits

    Best I can tell, there is nothing wrong with Moore’s piece on coal power. There is a small error in paragraph 2. This should read., instead of “Renewable: 9.3%” should be “Other renewables: 2.0%”

    Thus, for full year 2017 (Dec estimate), the shares of US power generation are:

    Natural gas: 31.6%
    Coal: 30.4%
    Nuclear: 20%
    All renewables: 16.9%
    of which:
    – Hydro: 7.5%
    – Wind: 6.2%
    – Solar: 1.3%
    – Other renewables: 2.0%

    Other than this minor error, I believe the remainder is all materially, factually correct.

    Reply
    1. Michael Cain

      As I always point out, the contiguous states don’t have a single grid, they have three grids with minimal exchanges between them. Through October (most recent breakdown by state), the states of the Western Interconnect 2017 shares collectively are

      Renewables: 37.64%
      — hydro 27.16%
      — wind 7.06%
      — solar 2.09%
      — other 1.33%
      Natural gas: 26.45%
      Coal: 22.43%
      Nuclear: 7.65%

      Renewables would be somewhat higher except that the Bonneville Power Administration lacks sufficient transmission capacity to take it all elsewhere in the spring when the dams are doing big releases and the Columbia Gorge wind turbines are also running high. The Western is down to four nuclear reactors. If it were put to a vote in Washington State the Hanford reactor would almost certainly also be retired. Over the next 20 years, Arizona may have to make tough choices about water sources to keep their three reactors cool.

      Reply
      1. Michael Cain

        I hate it when I can’t copy numbers from one place to another

        Renewables: 42.80%
        — hydro 27.16%
        — wind 7.06%
        — solar 5.19%
        — geothermal 2.09%
        — other 1.33%

        And technically there are still six reactors, but the owners of the Diablo Canyon pair have withdrawn their renewal application and will close them in the early 2020s. Coal will continue its sharp decline: the operators of the 2.2 GW Navajo power plant will close it in 2019, and LADWP will convert the 1.9 GW Intermountain plant to NG in the early 2020s.

        Reply
  7. CoRev

    I think this article best explains the angst emanating from the angry liberal commenters and article authors.
    http://www.nationalreview.com/article/455051/trump-obama-compare-results
    The article compares the results and expectations from the past two, progressive and conservative, administrations. Some pull quotes:
    From Hard Progressive to Hard Conservative Ideolog
    Whatever Donald J. Trump’s political past and vociferous present, his first year of governance is most certainly as hard conservative as Barack Obama’s eight years were hard progressive….”
    and
    “The nation did not suddenly become liberal in 2008 or conservative in 2016. Rather, in both years it rejected blasé centrism — first trying out a left-wing deviation from establishmentarianism, then in frustration turning to a right-wing antidote to both the failed medicine and the original diseased status quo.”
    and concluding with
    “We have been given a great gift in seeing two ideologically opposed solutions back to back, and both may end up adjudicating rhetoric through deeds.”

    Reply
    1. Steven Kopits

      Moore is arguing a narrow case, pointing out that coal is by no means dead, and for the first six months of 2017 was actually the leading source of US power generation, if only by a hair. The data back that up, if only by a hair.

      It is certainly true that coal has lost market share, both for cost and regulatory reasons. I think the relative cost disadvantage is likely to reverse, at least in part, during 2018.

      The long term issues remain. Permitting a new coal facility is just brutal, well-nigh impossible in many parts of the US. Further, many of the older plants in the US are coal, and these will be retired over time. In this sense, the mentioned NYT op-ed, “The Coal Industry Isn’t Coming Back” (I’d note this is incorrectly referenced in Moore’s piece) is arguably correct.

      Notwithstanding, Moore takes the opposite side of that argument, and I think his view is similarly defensible. They are not arguing exactly the same thing. Moore is arguing about the current state of the power generation industry and pointing out that, despite all the efforts to kill coal, at least at certain times, it still remains the primary source of electric power in the US.

      I’d add that the FT piece referenced, “Coal is dead; long live the sun”, a somewhat inexplicable op-ed by Felipe Calderon, the former President of Mexico, is arguably wrong or misleading in certain material respects. It vastly over-estimates the scope for renewables, for example. That’s a topic for another time. Moore is correct to object to it, in my opinion.

      In some regards, Moore understates the case for coal. We have been talking about the various EIA STEOs, and if you check tab 7a, lines 31 and 32 of the July 17 STEO spreadsheet, you’ll see that natural gas was 72% more expensive than coal on a kWh basis from 2013 through H1 2017. Natural gas prices were arguably depressed in the post 2014 period, and thus even a 72% premium probably shows natural gas in too favorable a light. This very much does matter for energy intensive industries, for example, steel, cloud computing and bitcoin mining (to the extent one thinks this is a good thing).

      Thus, Moore is right when he states: “But coal jobs are not just tied to the actual mining of coal. Coal is tied to steel jobs, trucking jobs, and manufacturing jobs. Using cheap and efficient energy makes every other American industry more productive, and thus makes American employers far more competitive in global markets. Productivity creates higher paying jobs in America, it doesn’t destroy them.”

      If anything, Moore understates the case for coal.

      Reply
      1. baffling

        coal is not the only energy source that has derivative jobs. same applies to basically all of the energy sources. somebody must build the wind turbine, the distribution lines, etc. somebody must maintain the turbines on site. we will continue to develop improved energy storage mechanisms, and need to build them. but comparing all the derivative jobs (i.e. costs) between coal and other sources, one should understand those are simply inefficiencies of the coal energy process. they are a COST to the consumer. why not find an energy source that eliminates those costs? coal is inefficient because we need to transport the fuel source to the powerplant. wind eliminates that cost-nature delivers the fuel source for free. electricity is cheaper to move than coal.

        Reply
        1. Steven Kopits

          The conservative case against wind and solar comes down to subsidies, not to their essential nature.

          If wind and solar are competitive unsubsidized — without RECs, RESs, PTCs, ITCs, FITs, or the rest — then bring them on.

          Reply
          1. baffling

            actually steven, the conservatives have come out against wind and solar because they are considered renewable and environmentally friendly. conservatives have backed themselves into a corner on the environmental issue, and become the party of anti.

            basically all energy sources have developed due to subsidies and government support through the years. it is just that the existing energy (coal, oil) do not want to do the same thing for new energy. but long term, it is in the interest of our nation to have renewable energy sources. coal and oil have had a history of subsidies. they have been given a pass on pollution costs. and the military has protected oil lanes for decades. your subsidy argument is not valid.

          2. CoRev

            Another biased baffled misconception: “actually steven, the conservatives have come out against wind and solar because they are considered renewable and environmentally friendly.” Most conservatives, especially this one, oppose renewable energy because of their intermittence. Because of that issue every kilowatt produced from renewables requires backup to reduce and preferably eliminate blackouts.

            There are many other problems, but intermittence trumps all of them.

          3. baffling

            corev, if you were not anti-renewable, you would see the intermittence issue is simply a technical problem to overcome. instead you use it as an excuse to disparage renewables. we have continued to develop energy storage solutions to overcome this issue. by your approach, those storage solutions would have never even been developed because you would not let renewables get off the ground. again the party of anti. you present a very weak argument.

          4. CoRev

            Baffled, you forgot to use a couple of meaningful terms: successful, long term related to solving the intermittent energy storage. Regardless, renewable energy sources have always been based upon pie-in-the sky claims.

          5. baffling

            corev, you are making arguments that were a concern 30 years ago, not today. catch up with the modern world. intermittence is a problem that is fading away daily. we have smart grids, battery systems, hydro storage, etc. it is no longer the problem it once was. the biggest problem with todays renewable is the cost of new transmission lines.

            look, i can buy a tesla home battery to store power as needed-no problem. the state of the art in 2018 is further along than you realize.

          6. CoRev

            Baffled, the best definition of your energy backup beliefs is gullible. They all have severe limits. So let me repeat for your energy storage: “renewable energy (storage) sources have always been based upon pie-in-the sky claims.”

          7. baffling

            corev, do you know that Texas is leading the way in renewables? perry subsidized the distribution lines to the wind sources, and now the state supplies over a fifth of its energy from wind. yes texas, that conservative bastion of independence and oil! they subsidized renewables and exceeded expectations! in texas, the consumer can purchase electricity plans that are completely renewable-and pay about the same as fossil fuel based electricity plans. go figure. as i said before, you need to quit living in the world of 30 years ago. if renewables are so popular in texas, what is a conservative to do?

            https://www.bloomberg.com/news/features/2017-06-20/texas-is-too-windy-and-sunny-for-old-energy-companies-to-make-money

            https://www.cbsnews.com/news/texas-is-leading-the-way-in-renewable-energy/

          8. CoRev

            Baffled, as I said earlier your beliefs are just plain gullible. This graph dissputes your claim: https://www.eia.gov/state/?sid=TX#tabs-4 Please note the date and the source. NO!, ” the state (Texas) supplies over a fifth of its energy from wind.” it does not supply over 1/5th of its energy from wind. It does snot supply 1/5th of its electricity from wind.

            But, the most gullible of your comments/beliefs is: ” the consumer can purchase electricity plans that are completely renewable-and pay about the same as fossil fuel based electricity plans.” Really?!? Just how do they separate those electrons from renewables at the receiving end? MORE MAGIC thinking. I do believe that the prices would be about the same, except for gullibility surcharge for those who believe it even possible to differentiate electrons at the receiving end.

            That ole smart grid sure is smart to identify the source of each and every electron flowing?????

          9. baffling

            you are correct, i meant “electricity” rather than “energy”. that was the focus in the rest of the comment as well.

            your graph is for one month only. your dispute is with bloomberg rather than me. however, a more recent article indicates coal is falling behind wind in texas.
            http://www.chron.com/business/energy/article/Wind-power-blows-past-coat-in-Texas-12386751.php

            “except for gullibility surcharge for those who believe it even possible to differentiate electrons at the receiving end.
            That ole smart grid sure is smart to identify the source of each and every electron flowing?????”
            i can buy electricity from sources that are renewable only. it really does not matter where the electrons come from, only the source of the power. if i have a gullibility surcharge and it is still as cheap to obtain renewables, then what does that say about those insistent on remaining on fossil fuels.

            you are correct i cannot track the electrons from the source, but only by accident. electrons are indistinguishable particles-their lifetime trajectory can never be followed. hence your comment has no real meaning.

            look corev, you need to square your conservative ideology with what has happened in conservative texas. as i said before, you are living in a world 30 years ago. the modern landscape is vastly different.

          10. CoRev

            Baffled, your gullibility index has gone up. Unless you are buying electricity off grid or from a dedicated grid, you are buying whatever is flowing in the grid. So you are falling for a “marketing ploy” thinking it is from renewable source(s).

            You provided another link but failed to read it. In it is this little nugget of truth: “While ERCOT still gets most of its power from natural gas and coal, wind power generation now accounts for 15 percent of the power mix — up from just 2 percent a decade ago.” 15% is not 20%, your claim, and this article was – Updated 10:17 am, Monday, December 4, 2017.

            That two levels of gullibility, marketing claims and supply claims/estimates, in just this series of comments. Texas is a special case for wind power in that it provides power in normally lax periods.

          11. baffling

            as i said, you can argue with bloomberg on the 1/5 of electricity comment.

            as for a marketing ploy, you fail to understand how energy distribution works. fine, i understand your ignorance. you are basically in denial on the contribution renewables have to the electricity market. but lets be very clear. in the state of texas, coal is losing market share to nat gas and renewables. and the renewables have become a major contributor due to the state subsidy to provide high voltage transmission lines from wind to urban areas. wind already has greater capacity than coal, and will surpass it in production next year.

            i am not sure why you are trying to argue so much. it is a simple fact of life that in a conservative state like texas, the green renewable movement is front and center in the energy landscape. people have choices in the deregulated texas electricity market, and many are choosing renewables. and costs are falling. why is this so hard for you to accept? again, quit living in the world of 30 years ago. the modern energy landscape is dramatically different.

          12. CoRev

            Gullible Baffled, I picked 100% renewable source, Infuse Energy, for Dallas, and this is what I found on their site:
            “What kind of energy sources does Infuse Energy use?

            Infuse Energy purchases power generated from a variety of sources such as wind farms, natural gas, coal, and nuclear. We do not generate the energy ourselves. Understand that electrons on the grid that get delivered to your house or business are indistinguishable from each other whether they were created from a wind farm, a coal plant or a nuclear facility. As a result, it is impossible for anyone to ensure that the electrons that reached your house were generated from a specific resource (no matter what they may say on their website). https://www.infuseenergy.com/faqs/

            Does that sound like you are buying renewable energy or does it sound more like what I have been trying to tell you??? You are confused with buying on-grid versus living off-grid. I’ll repeat what this claimed 100% renewable electricity source actual says: As a result, it is impossible for anyone to ensure that the electrons that reached your house were generated from a specific resource (no matter what they may say on their website).

            You bought a marketing ploy. BTW, Texas is no different than any other state where the billing has been broken into 3 major categories, 1) Generation, 2) Transmission, and 3) Fees and taxes. Distribution is where those OLE electrons get mixed from each source. But, even in Texas generation may be a misnomer. The Diffuse Energy site says this:
            “Infuse Energy purchases power generated from a variety of sources such as wind farms, natural gas, coal, and nuclear.We do not generate the energy ourselves.” So is your 100% renewable energy provider actually generating any energy?

            I’m done with you on this subject. You have show yourself to be totally ideologically driven, and ignorant of the actual facts.

          13. baffling

            green mountain energy is headquartered in texas and works exclusively with renewables. they only buy power generated from renewables, and that is the entity you would purchase your power from. how it gets delivered is really irrelevant. as i said, electrons are indistinguishable. it is impossible for you to tell me where my electrons did or did not come from, so the question is really irrelevant. you cannot say with any certainty that any electron from the production site makes it to any consumer home. you cannot even distinguish them from the electrons in the transmission line. but i can say with certainty how much power was produced from each source.

            look corev, you are continuing to try to provide imaginary barriers to renewables. according to your world, the only way renewables could prove themselves is if they ran on a completely independent grid-and that is a ridiculous requirement. you do not like the fact that renewables are doing well and having a significant impact on the energy landscape in texas. conservative texas has embraced renewables and that bothers you tremendously. but renewables in texas are a fact, not an ideology. deal with it.

          14. CoRev

            Poor Gullible Baffled, Green mountain energy take a look their Tx ratings:
            https://www.consumeraffairs.com/texas-electricity-companies/green-mountain-energy.html
            You have failed to dispute my first claim against your ideological misconception:
            “Most conservatives, especially this one, oppose renewable energy because of their intermittence. Because of that issue every kilowatt produced from renewables requires backup to reduce and preferably eliminate blackouts.”

            If any thing you have well supported the core of my claim: “… every kilowatt produced from renewables requires backup to reduce and preferably eliminate blackouts.”

          15. baffling

            and here is a major provider, reliant energy, also in texas. notice the poor ratings as well.
            https://www.consumeraffairs.com/utilities/reliant.html

            what a stupid rebuttal you just made corev. when all else fails, go find an online complaint forum to support your position against renewables! its like talking to a broken brick wall with you corev. your commentary gets more absurd by the response.

            look, if renewables are such a bad deal, why are they continuing to grow in conservative texas, while coal market share continues to decline? maybe its time you reconsider your decision making paradigm corev.

        2. CoRev

          Baffled, I have graduate you from gullible to just plain ignorant. Saying: “you are correct i cannot track the electrons from the source, and then claiming: ” you fail to understand how energy distribution works. ” if proof of pure ignorance and overwhelming ideological belief. Your ideology drives you to stop logic and believe, thus repeat claims such as Bloomberg’s and then apply your own ideologically deficit thinking wit comments such as this: ” people have choices in the deregulated texas electricity market, and many are choosing renewables. ”

          Are the elctrons’ sources discernible or not? If not and being fed off the grid: “people (do not) have choices in the deregulated… electricity market, (by) many are choosing renewables. ” All they are doing is falling for marketing ploys and most often paying higher fees for their own ignorance.

          I have not argued with Bloomberg, just you, about your gullible ideologically driven beliefs. One of the often quoted green power experiments is Germany, and they are in the process of removing themselves from 2020 CO2 limits, while opening more coal plants.

          BTW, my first comment was to the need to back up renewables with consistent base load sources. Wind is one of the worst for this need, because it i not only intermittent but grossly unstable for the grid. Wind has frequent and rapid amperage/cyclic peaks and valleys that make is nearly impossible to stabilize the grid.

          Keep believing and paying to make you personally feel better. I’ll just sit on the side lines laughing.

          Reply
          1. baffling

            if i pay a producer of green energy x dollars for y kilowatts of green power, and i use the y kilowatts to run my household, what is the problem? if the distribution company decides they can distribute the power in a different manner, so be it, as long as i get my energy at the price requested, and the green producer actually generates y kilowatts allocated to my contract specifically. it really does not matter where the electrons flow from (because you cannot track them), the only relevant point is where the power originated. again, you do not seem to understand how the deregulated electricity market works in texas, or are not really interested. you do seem to argue out of spite and ignorance.

            “I have not argued with Bloomberg, just you, about your gullible ideologically driven beliefs.”
            you have argued with bloomberg. your argument is their data is incorrect and your data is correct. send them an email.

        3. CoRev

          Baffled, the gullible ideologue! You are paying for something not delivered, or impossible to measure whether ever delivered, when buying renewable energy. You even admit that! Moreover, your gullibility is based upon thinking the unique Texas example can be implemented everywhere. Paying that “feel good” renewable surcharge is always your option.

          This chart shows state’s rankings for electricity rates. Note, Texas’ and California’s positions. Both embrace renewable electricity generation, but one differs in embracing using local energy sources. You might also note the rates for states which embrace both, or are largely supported by hydro renewables.

          Or we can compare Germany, the world’s example of renewables adoption.: Late in 2017 this article https://www.reuters.com/article/germany-electricity-retail/german-household-power-prices-at-record-high-verivox-idUSL8N1MZ30X
          said: ““The price of a kilowatt hour (kWh) on average has reached a new all-time high of 28.18 euro cents (33 US cents) … this means power has become 3 percent more expensive compared with the previous year,” Verivox said in a statement. ” That’s much higher than even our highest state, Hawaii.

          But, you, a gullible, ideologue, can keep believing the hype and paying extra to feel good. Just don’t demand it of the rest of us.

          Reply
          1. baffling

            in the world of corev, a kilowatt of power generated by a renewable simply does not exist. the electricity model in conservative texas works, and does so with growing contributions from renewables. this does not fit your narrative, so you continue to find ways to complain rather than acknowledge the importance and use of renewables in texas.

            “But, you, a gullible, ideologue, can keep believing the hype and paying extra to feel good. Just don’t demand it of the rest of us.”
            i don’t demand it from you-buy whatever expensive coal fired power you desire. i can buy renewables in texas for the same price as standard power generation plans-sometimes even cheaper. you do not understand the electricity market in texas, yet you continue to make ignorant comments about the texas market. educate yourself. or continue to be a flat earther. it still doesn’t make you right.

          2. Ulenspiegel

            Electricty was always very expensive in Germany. This led to a low consumption and a monthly bill that is not higher than in the US, where higher consumption (over-) compensated low kWh-prices.

            What is the projection of power prices, what is the impact on the economy?

            Without putting the numbers in a useful context you provide in best case entertaining propaganda, in worse case bad propaganda. 🙂

  8. joseph

    Steven Kopits, fuel prices are only one part of the cost of power generation. Natural gas beats coal significantly on efficiency, operating costs, maintenance and construction (LCOE).

    Levelized cost of electricity (LCOE) has shown natural gas to be cheaper than coal for almost a decade. Coal plants are headed for the ash heap of history, in more ways than one.

    Reply
    1. Steven Kopits

      LCOE is a stylized forward-looking measure. Many factors influence the choice of plant.

      On the other hand, if Option A is bringing me power for 100, and Option B is delivering it for 172, then I’m going to take a look at Option A.

      This whole argument seems a bit misplaced to me. I think the relevant question revolves around gas pipelines in the Northeast. These are very difficult to get permitted and construct, and an increasing dependence on gas means higher risks of blackouts at extreme events. Exhibit A is pipelines to New England, where power prices at some times have increased thirty-fold in the last week. That’s what we should be discussing.

      Reply
      1. Steven Kopits

        To my point:

        Fuel price spikes add to weather misery in US north-east (FT)

        “The situation in New England is due to a lack of adequate natural gas pipeline capacity, despite repeated efforts by pipeline companies to boost capacity,” says a spokeswoman for the Interstate Natural Gas Association of America, a pipeline industry group. “This lack of capacity has cost New Englanders dearly.”

        https://www.ft.com/content/9e26193c-f3d6-11e7-88f7-5465a6ce1a00

        Reply
  9. dwb

    You really need to be adding heating and cooling degree days to the regression – which explains most of the seasonality. Hotter or cooler than normal weather are going to cause higher electricity demand, typically fulfilled from gas generation. Peak demand is July/August, lowest demand Oct & April. Secondary peak is Dec/Jan due to winter heating electricity demand. The seasonality does not conform to months – most practitioners use weeks or days instead. If you dont feel like doing seasonality correctly, use the whole year.

    My educated guess -never bucketed by half years – latter half of the year (July-dec) has more electricity demand because the major (july/August) and minor peaks are both in that bucket. Higher demand = higher gas share.

    Due to the limitations of transmission and commodity supply, generation is an extremely regional phenomenon. In the midwest, coal is still huge. In Texas, natural gas has always been big driver (cheap, local natural gas). in PA a lot of new gas plants are being built to take advantage of cheap local Marcellus shale. . . On the other hand… 30% of New England generation in the winter is oil! (see here https://www.bloomberg.com/news/articles/2017-12-28/oil-tops-gas-in-new-england-power-mix-as-temperatures-plummet)! That is because gas transportation into New England is expensive and limited, natural gas is used for heat as well as electricity so its a double whammy of expensive gas and expensive transport. Unfortunately, regulations and public attitude on pipeline and generation construction prevent supply from being built. Ostensibly for the sake of the environment. But the result is that a lot of dirty diesel generation runs in the winter.

    Reply
  10. Barkley Rosser

    I stand to be corrected, but it is my understanding that the increase in coal jobs in the last year or so is overwhelmingly due to increased demand from steel mills, with steel production rising recently with rising economic growth and fewer alternatives to coal in that industry as a power source. Basically no new coal fired electric power plants are being built, and it is highly unlikely any more will ever be built in the future. Coal is obviously very important in the electricity production sector and will continue to be for a long time, but it is going to continue to gradually decline in importance, with natural gas probably definitively moving ahead of it in importance in the fairly near future.

    Reply
    1. CoRev

      Barkley, your assumption: ” Basically no new coal fired electric power plants are being built, and it is highly unlikely any more will ever be built in the future.” is mostly only true for the US. Other parts of the world, Europe, Africa and China etc. are building or planning large increases in coal power plants. If they are smart or economically capable they can build multi-fuel plants to take advantage of the fuel price changes.

      Reply
      1. Ulenspiegel

        “Other parts of the world, Europe, Africa and China etc. are building or planning large increases in coal power plants.”

        For Europe this is wrong, we see a net decrease of coal capacity and electrcity generated by coal power plants. E.g. in Germany there was no coal power plant added to the pipeline after Fukushima.

        In other countries coal power projects are dying like flies.

        Reply
    2. dwb

      Could be, yes. Higher coal jobs is does not contradict lower coal share of electricity generation. Both can be true for various reasons. Heck, lower coal share of electricity generation does not even mean lower coal generation (electricity consumption generally grows with economic growth absent energy efficiency).

      I am not sure offhand if we have increased coal exports. Lots of other countries like Germany and China are heavily coal dependent and will take our coal if we can ship it.

      Reply
  11. Vasyl

    A lot of funny arguments in the comments how “the moon was brighter than the sun during the night, so don’t concentrate on seasonality”

    Reply

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