Re: Coal fired power plants
Author: Dave Smith
Date: 10-25-2007 - 23:57
What if you built a coal-fired generation plant and nobody wanted to buy your cheap efficient power?
Don't expect the investor-owned utilities to fight for coal-fired generation. On the contrary, they are giddy with expectation that they will finally be rid of the Prime Directive for Electric Utiities - the requirement that utilities buy the lowest cost generation source for electricity, a directive that has basically been in place since the days of Edison and Tesla.
Now all the state regulators are redirecting purchasing requirements from "lowest cost" to "most environmentally friendly", ostensibly to "fight" climate change. So basically you'll see an eventualy shift of basic electricity wholesale cost from around $0.03/KwH (aka, the usual array of hydropower plus coal fired power) to $0.06/KwH and higher as so-called "environmentally friendly" generation such as wind and solar is added to the power matrix. Since utilities generally sell their power to consumers at around 10% regulated markup, they now see the prospect of doubling up their revenues - after all, 10% of 0.06/KwH is twice the income compared to 10% of 0.03/KwH.
The ironic thing is that all these Average Joe rate payers probably voted in the politicians who in return are legislating in the the doubling of the electricity rates.
Why do people do that to themselves?