Coal imports costly to state

Coal imports costly to state

Tennessee spends $1.21B to transport resource, ranks eighth
in nation in dependency on fuel source

By Larisa Brass

Wednesday, May 19, 2010

Coal may be doing the lion's share of work powering homes and businesses in
Tennessee, but most of it comes from far outside the state's borders.

Tennessee ranked eighth in the nation in total net imports of coal, spending $1.21
billion in 2008 to haul in the fossil fuel from as nearby as Kentucky and West Virginia
and as far away as Wyoming, according to a report released Tuesday by the Union of
Concerned Scientists.

The organization analyzed available data reported by utilities to the federal
government. More than 99 percent of the coal burned in fossil plants throughout the
state came from other states, according to the report. Tennessee also is eighth in the
nation when it comes to dependency on coal as a power source, with 62.4 percent of
its electricity derived from coal in 2008.

Citing the study as the "first ever report" analyzing coal bought in one state for another
state's power production, "we maintain that ratepayers would be better served if the
money was kept at home and used to develop ready available renewable technology,"
said Barbara Freese, senior policy analyst and co-author of the report, "Burning Coal,
Burning Cash."

"We certainly look at this issue from all different directions," Freese said. "This (is a)
simple question of how much money leaves the state that doesn't have to leave the
state."

Sixty percent of Tennessee's power demand could be met with renewable generation,
according to the study, which also said:

n Up to 34 percent of the state's power could come from solar energy.

n 18 percent could come from biomass.

n 6 percent could come from small or low-power hydro sources.

n 1 percent could come from wind.

"To make sure TVA meets clean air emission standards and to ensure our customers have affordably priced power, TVA burns a wide variety of coals - some of which are not available in Tennessee," TVA spokesman Jim Allen said Tuesday via e-mail. "TVA is very interested in developing additional clean and renewable energy sources, however the notion that we could stop buying out-of-state coal and use that money to develop renewables is not realistic."

The report did not do a state-by-state cost analysis for investing in renewable sources of energy - although Freese said while the cost of many clean technologies remains high, environmental regulation and potential renewable compliance standards will drive up the price of coal as well.

The report focused more heavily on energy efficiency, citing power savings as the most cost-effective way to replace fossil power plants and noting that the states most dependant on coal tended to spend little on efficiency programs.

Where utilities don't necessarily have an incentive to promote energy efficiency or adopt renewable energy as major initiatives, Freese said state and federal policies need to be crafted that will cut back demand, spur clean energy growth and, in turn, stimulate the local economy.

"Unfortunately, there's a disincentive for utilities to do that, and that's why a strict market view of this doesn't work very well," she said. "That's why having policies that actually require your retail electricity providers to promote energy efficiency among their customers is so essential."

Larisa Brass is a freelance contributor to the News Sentinel.