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Coal-to-Liquid Is a Boondoggle

With necessary carbon caps in place, a wasteful large-scale carbon-to-liquid industry will be uneconomical, testifies Senior Fellow Joe Romm.

Download the testimony as a PDF

“We are simply running out of time to avoid catastrophic warming, and we no longer have the luxury of grossly misallocating capital and fuels to expensive boondoggles like coal to liquid,” Center for American Progress Senior Fellow Joe Romm told the House Science and Technology Subcommittee on Energy and Environment yesterday. Proponents claim that coal-to-liquid technologies can reduce our dependence on foreign oil.

Romm emphasized that “Congress should only promote those [energy] strategies that promote net societal benefits.” Coal-to-liquid is not one of those strategies. The environmental harm it would cause is not worth the additional fuel, and when Congress implements effective carbon caps, the process may simply fade from economic viability.

Coal-to-liquid technology liquefies coal into conventional fuel for diesel, jet, or car engines. The process itself is expensive, and it also requires large energy inputs that are often derived from fossil fuels that release C02, along with large water inputs. This costly process produces gasoline that releases C02 when it is burned.

From production to combustion, CTL fuel could release as much as 2.5 times as much greenhouse gas into the atmosphere as conventional diesel fuel, according to an analysis by the Argonne National Laboratory cited by David Hawkins of the National Resources Defense Council.

Coal-to-liquid advocates point to Carbon Capture and Sequestration technology as the solution to minimize additional greenhouse gas emissions created during the conversion process. But CCS technologies are not yet in use on large industrial scales, and Romm warned that, “there is no evidence whatsoever that this country is serious about CCS.” Carbon dioxide captured during the carbon-to-liquid process could be pumped into saline aquifers and other geologic formations for indefinite storage, or into depleted oil wells, forcing out unreachable stores of oil, which refiners could then turn into additional fuel. From the perspective of reducing greenhouse emissions, Romm pointed out that at the end of the latter process, “you’ve accomplished nothing.”

Even with CCS, the emissions from coal to liquid could still be 19 percent higher than conventional fuels. These emission levels, Romm explained, will not get us to the 60 to 80 percent reductions all industrialized nations need to make by 2050 in order to curb the effects of global warming.

Representatives from the coal and energy industries, including past president of the American Coal Council John Ward, testified that the industry requires federal support for commercialization of coal-to-liquid production. Yet Hawkins pointed out that taking a fuel-specific approach to addressing United States energy needs makes little sense. “If the objective is to back out of oil or reduce greenhouse gas emissions,” he said, “then don’t pick a fuel or technology, but implement regulations that benefit all comers.”

Fortunately, in order to avert the disaster that would result from widespread coal-to-liquid production, all Congress has to do is proceed with capping national carbon emissions. Citing a January 2007 report from the U.S. Energy Information Administration examining the impact of the proposed Bingaman bill, Romm explained in written testimony that, “In the EIA analysis, the permit price starts around $4 a ton of carbon dioxide in 2012, rises to $7.15 in 2020 and reaches only $14.18 in 2030. This is a relatively low price for carbon dioxide. … In short, a relatively low price for carbon dioxide wipes out the vast majority of projected CTL.”

If our objective is to reduce carbon emissions, the regulations necessary to hit reduction targets will simply render some technologies too expensive to provide consumers with fuel at competitive prices. “The future of coal in a carbon-constrained world,” explained Romm, “is electricity generation with carbon capture and storage, not CTL plus carbon capture and storage.” The best use of coal is burning it for electricity, and the best use of coal for transportation is using that electricity to charge the power cells in hybrid cars.

Carbon caps will work. Freon and other chlorofluorocarbons were cheap, readily available coolants tearing holes in the ozone layer until international treaties banned those chemicals. Industry responded and now alternative refrigerants, propellants, and solvents are widely available and inexpensive. Straightforward carbon regulation will likewise open new routes to energy independence like biofuels, and in particular cellulosic ethanol, which can reduce carbon emissions dramatically while reenergizing U.S. agriculture.

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