Is Rentech right industry for Natchez?
Published 8:36 am Monday, June 18, 2007
As Congress works on energy legislation with the purpose of reducing greenhouse gases and global warming, environmentalist have called attention to the liquid-to-coal technology that several aspiring companies and the coal industry are proposing as an alternative fuel and as the path to “energy independence.” One of these companies, Rentech, Inc., is slated to establish a facility in Natchez by 2011 if Natchez officials get their wish. This coal-to-liquid fuel may be an alternative to gasoline, but it certainly isn’t a renewable fuel, nor is it a clean or green fuel. The truth is that coal-to-liquid fuel, to be used in buses, trucks and jets, releases almost double the global warming emissions per gallon of regular gasoline. Sierra Club representatives have said: “Liquid coal, touted as a solution to our dependence on oil, is arguably the dirtiest, most expensive energy gamble we could take.”
Coal companies are spending millions lobbying in congress to get government subsidies to build these liquid coal companies. Peabody Energy, the world’s largest coal company, has huge stakes in the liquid-to-coal industry. Gregory H. Boyce, chief executive of Peabody, which has $5.3 billion in sales, told an industry conference nearly two years ago that the value of Peabody’s coal reserves would skyrocket almost tenfold, to $3.6 trillion, if it sold all its coal in the form of liquid fuels. Peabody has quadrupled it’s annual lobbying budget to about $2 million since 2004.
Coal industry executives insist their fuel can be cleaner than oil, because they would capture the gas produced as the liquid fuel is being made and store it underground as well as using some to inject into oil wells. None of this has been done at commercial volumes, and many analysts say the economic issues are major concerns. Analysts suggest that such sites must be used over a few decades to justify the investment. There is no operating liquid coal plant in the U.S. at this time, which means this new industry would require enormous government incentives to develop the technology.
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Not only would liquid coal emit twice the carbon dioxide as regular gasoline, but it requires more than 4 gallons of water for every gallon produced. There are already serious water shortages in the West where, unfortunately, a growing interest in coal-to-liquid plants exist.
The New York Times recently reported that researchers at M.I.T estimate that it will cost $70 billion to build enough coal-to-liquid plants to replace 10 percent of American gasoline consumption. This is the coal industry’s answer to energy independence?
“This is the snake oil of energy alternatives.” said Peter Altman, a policy analyst for the National Environmental Trust. “The promises are just as lofty and the substance is just as absent as the first snake oil salesmen who plied their trade in the 1800’s.”
Is Rentech, Inc. the kind of industry in which Natchez should be investing? The Department of Energy has said the construction cost for one plant will be $7 billion. Coal executives will tell you that the coal-to-liquid technology has been around since the 1920s, which is true; it was used in Germany during World War II when the country was blocked from buying oil. There is not one facility in the United States using this technology. They are telling us the carbon dioxide will not be emitted during the process, and it will be stored underground, but can we trust that this technique has been tested and that it works ? It has never been tested on a large commercial scale. How will the company market a product that emits twice the amount of carbon dioxide as regular fuel when our government is attempting to pass bills limiting the amount of C02 released into our atmosphere?
The coal industry wants the government to funnel billions in subsidies and tax breaks to artificially create an entirely new industry so coal can remain king and maintain its status as the most polluting industry in our nation. This is simply a way for the coal and mining industries to get richer at taxpayers’ expense. I think Natchez will not only be left in debt from this coal-to-liquid scheme, but I think we will be left with another deserted dinosaur plant. The coal-to-liquid industry is not good for the country nor is it good for Natchez.