Solar or coal - Which source is truly the way forward?

Marcela Otero
Mar 24, 2017

There’s a misperception in the coal-mining world that the Obama administration’s environmental policies, the so-called “war on coal”, were responsible for the industry’s decline. In truth, coal’s struggling fortunes owe more to the air quality regulations established during George W. Bush’s years in office, as well as to its own inability to compete with cheap natural gas and other renewables. The weaker than expected demand in Asia hasn’t helped, either.

The recent decline in coal began more than thirty years ago during the Reagan administration,  due to the increased role of automation. This threat is still very real today. Despite Trump campaign promises of revitalizing the industry, and his claim that “the miners are coming back”, the most labor-intensive form of coal mining —underground, mainly in Appalachia— has been in decline since the 80s. The deregulation of the railroads, as well as the decrease in freight charges, around the same period placed an additional strain on Eastern coal, which made cleaner, cheaper Western coal easier to obtain. Today, surface mining in the western United States encompasses about 66 percent of total production, and is rife with automation and mechanization.

The aging array of coal plants has been instrumental in coal’s decline. More than ninety percent of the total coal power plants in the United States were built in, or before, the 1980s, which --due to simple chronology-- indicates many are due to face closure sooner rather than later. Few new coal plants are being built to replace them. This isn’t simply a ‘blue-state’ phenomenon, either. Wind and solar farms are generally installed in rural Republican districts, which may welcome coal’s demise as a harbinger of possible economic growth.

Opposition to the coal industry may come from unexpected quarters. Exxon Mobil, the world’s largest publicly traded international oil and gas company, has operations in several countries, many of which are focused on reducing carbon emissions. It’s doubtful they’d be supportive of a push for coal that might cut into their profits from natural gas. In any case, the demand simply isn’t there. In the past decade, coal consumption has gone down 28 percent in the U.S., and the International Energy Agency’s (IEA) Annual Energy Outlook predicts that natural gas will become America’s energy source of choice by 2020, with renewables overtaking coal by 2030.

Solar Panel Array (skeeze)

The renewable most likely to take that position is solar energy. If the current trend continues —since 2009, the cost of solar power has gone down more than 62 percent— it’s probable that by 2027, it will be cheaper than coal all around the world. In 2016, countries like Chile and the United Arab Emirates made record-breaking deals to generate electricity for less than three cents per kilowatt-hour, effectively halving the global price of coal. The key to this rapid boost has been technological innovation, from better cells that optimize sun absorption to the use of diamond-wire saws that cut wafers more efficiently. In the United Kingdom, solar panels generated more electricity than coal between April and September 2016.

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Source: Bloomberg

Proponents of coal contend that, regardless of the cheaper upfront cost, any renewable power source is too dependent on fickle weather conditions, and therefore will always require a backup supply. Though energy storage systems are being used to great effect in the United Kingdom to combat precisely those environmentally dependent factors, coal industry officials argue that it effectively makes renewable energy sources more expensive than coal, if only by a small margin. However, solar’s recent plunge in prices is a trend that may well reverse that balance, and cement it as a plausible competitor.

“We are witnessing a transformation of global power markets led by renewables”, said Fatih Birol, head of the IEA, in October 2016. Government policies, however, still play a huge part in the green energy revolution. The fact that countries like Mexico, China and the United States have been backing renewable energy as a crucial part of public policy has been key in driving down the costs. For the world at large, even this unprecedented growth in renewables cannot offset the rise in greenhouse gasses. In fact, no country has yet to enact the proper emission cuts consistent with the objectives set forth in the Paris Agreement of 2016.

For the average American, this means little more than that energy prices will be kept low and air quality will keep improving. It’s important to note, however, that waiting around for your utility company to switch to renewable energy sources isn’t the only way to get solar power. To that end, it’s worth finding out what your state and the federal government can offer in terms of tax incentives for obtaining solar panels for your home. Incorporating solar energy can reduce your carbon footprint by an average of 35,180 pounds of carbon dioxide per year. It might not even be as expensive as you think. The national average for installation of a home solar system can be anywhere from $15,000 to $20,000 upfront, but it can halve your monthly electrical bill, and pay for itself in the long run. To find out how what your options are, call one of those listed on our list of top 10 solar energy companies.

Cover Image: Surface Coal Mine Detail - Gillette, Wyoming (Greg Goebel)