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Coal’s Unpaid Bills: $345 Billion Annually

Posted by Barbara Gottlieb on March 2, 2011

A recent report estimates that coal’s impacts – including its effects on health and the damage in inflicts on the environment -- cost the U.S. about $345 billion annually.  According to the report, a full rendering of coal’s costs would double to triple the price of coal-generated electricity. 

The true cost of coal would show wind, solar, and other carbon-free, clean forms of power to be economically competitive.

The report was written by Paul Epstein, M.D., M.P.H. Associate Director of the Center for Health and the Global Environment at Harvard Medical School, and a team of coauthors.

So-called “externalized costs” of coal are real, but they are not paid by coal or utility companies and don’t show up in the price we pay for electricity.  Rather, we pay for externalities when we buy health care and insurance, when we pay for environmental clean-ups, and when we calculate the value of environmental assets spoiled, days lost from school and work, and lives lost prematurely.

Readers of PSR’s report Coal’s Assault on Human Health will be familiar with the impacts of coal, especially in regard to health impacts of air pollutants.  Epstein’s report goes several steps farther, examining in detail a wider range of coal’s effects and then quantifying them.  Here’s a sampling:

  • Health effects of underground mining:  These include accidents, both fatal and nonfatal, and black lung disease (pneumoconiosis), which leads to chronic obstructive pulmonary disease, is the primary illness in underground coal miners. According to the report, in the 1990s, over 10,000 former U.S. miners died from coal workers’ pneumoconiosis, and the prevalence has more than doubled since 1995.
  • Mountaintop removal (MTR) and climate change:  Besides reporting the amount of greenhouse gases emitted by coal over its life cycle, the report calculates that those emissions increase by up to 17% when the greenhouse gases released by deforestation and land transformation from MTR are included.
  • Coal transport:   The report notes that 70% of U.S. rail traffic is devoted to transporting coal, creating are strains on railroad cars and lines, and increasing lost-opportunity costs, given the great need for public transport throughout the nation.

The report also builds on the ground-breaking research of coauthor Michael Hendryx, who correlated levels of coal mining and health and economic well-being in Appalachia.  It notes that in Appalachia, as levels of mining increase, so do poverty and unemployment rates, while educational attainment rates and household income levels decline. 

Once the health, environmental and social impacts are quantified, they are “monetized,” with a societal price tag attached to each.  For example, the study prices out the costs to society of coal’s contributions to climate change.  Using an estimate of the carbon dioxide and CO2-equivalents released from coal-derived power (including black carbon, CO2 and N2O emissions from combustion, land disturbance in MTR, and methane leakage from mines), they derive a cost of $63.9 billion dollars.

A broader examination of the costs of climate change would also encompass the potential collapse of ecosystems, such as coral reefs and widespread forest and crop losses.

Taking into account the multiple variables that they review, the study estimates the economically quantifiable costs of coal at one-third to over one-half of a trillion dollars annually.  The authors add, “These and the more difficult to quantify externalities are borne by the general public.”

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