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Any economist will tell you that when it comes to the price of coal-generated electricity there is a massive failure in the market. Significant costs are not tallied by the utilities when they calculate the cost of generating a megawatt of electricity from coal. These uncounted or “externalized” costs include staggering medical costs, premature deaths, losses in productivity due to illness, poisoned water resources, environmental harms from mining practices, and what may be the largest “due and payable bill” in human history – the immeasurable economic and social costs from unabated global climate change. All of these costs are directly related to coal power generation but are unknowingly absorbed by the public at large. Even without carbon constraints or increased pollution control, Coal power generation is more expensive than adding electricity to the grid by improving energy efficiency. With carbon constraints and increased pollution control, the costs are similar to or slightly higher than energy from wind and concentrating solar power. If one accounts for all the externalized costs associated with coal-fired power, it is the most expensive method of generating electricity. Each new coal plant amounts to a 50 year marriage to using coal for electricity generation. The economic concept of “opportunity cost” suggests that you measure an investment not only by whether it will make money, but you consider the results if you invested your capital in other activities. There is only so much money for energy research and financing for new generation. When you spend those resources on building a new coal plant or on 10 years of research and demonstration projects trying to prove that carbon capture and sequestration will work technically and economically, you are not spending that capital on efficiency programs or clean renewables. A compelling case can be made that spending massive resources to keep a 19th century power generation technology viable, and not on investments in 21st century energy generation technology, which has few if any of the harmful side effects of coal combustion, will be a costly missed opportunity.
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