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Coal exports: There could be a twist on the global warming argument

A coal-powered generating plant in China. Credit: Klineolive/Wikimedia Commons

It seemed like such a safe assumption, that exporting U.S. coal to China will be an environmental catastrophe. China burns huge amounts of coal to power its massive industry. The burning of coal is the largest contributor of heat-trapping carbon to the atmosphere, so shipping unburned coal from the United States to be burned in China will add billions of tons of carbon to the atmosphere that otherwise would stay safely in the ground. And global warming will be that much worse, and so much harder to stop.

Given that prospect, it only makes sense to fight plans to ship Montana and Wyoming coal to Asia through ports in Washington and Oregon. That fight is well underway, and intensifying.

We’ve got it backward, say two Stanford University economists. Exporting coal to China will be good for the environment, and reduce, not increase the rise in atmospheric carbon. Every economic action has a reaction. You must consider economic motives, patterns in energy use and sources, and how coal exports affect them.

Frank Wolak and Richard Morse study issues at Stanford’s Program on Energy and Sustainable Development. In 2010 they published an op-ed in The Guardian with the headline: “Environmentalists who want to ban China’s coal imports are 100 percent wrong. Driving up the price of coal cuts carbon emissions.”

China will be burning a lot of coal regardless of where it comes from. It has built coal-fired power plants by the dozen. It has large coal reserves of its own. In 2009 it shifted from exporting coal to importing large quantities, primarily because importing coal was cheaper. At the same time, a revolution in drilling technology made the United States the world’s leading producer of natural gas, which subsequently lowered the price of gas relative to coal. Power producers switched from coal to gas for purely economic reasons, but burning gas produces half as much carbon per kilowatt. Carbon emissions in the United States have fallen because burning gas is economically attractive, and it is attractive because of its price relative to coal. Coal recently produced more than half of the United States’ electricity. Now it produces a third.

China will burn the same amount of coal whether they import it or not, the economists say. They have no alternative. Export coal to China and supplies tighten. The price stays up relative to gas. Less coal will be burned in the United States and Europe, with a net environmental benefit. Stifle exports, and the price of coal falls, and burning gas is less attractive. More coal will be burned in the United States and Europe, with a net environmental degradation.

Burning coal spews a ton of carbon for every megawatt hour produced, they said. “If 5 percent of these megawatt hours were produced using natural gas instead of coal due to China raising the international coal price, a 175-million ton drop in CO2 emissions is the result,” they said in The Guardian piece. “This is the equivalent of taking 32 million cars off the road in the U.S. and Europe.”

Speaking at a recent Stanford conference, Wolak said if coal export facilities are built on the West Coast, in places like Bellingham and Longview, the result will be beneficial economically and environmentally. “Perhaps counterintuitively, the United States selling coal to China, and Asia generally, likely will reduce greenhouse gas emissions globally,” he said.

Environmentalists won’t buy the reasoning. It will be nearly impossible to convince people that exporting coal is good. There are the local environmental issues to be concerned about, including the effects of mile-long coal trains passing by day after day.

Environmentally, blocking commerce is always more attractive than letting it go. That’s what they will earnestly try to do with coal exports, and they may be 100 percent wrong.

This article originally appeared in the Wenatchee World and is reprinted with permission.

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