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Senate shocker: Second biggest U.S. coal producer believes in global warming and strong climate action

October 29, 2009

Coal Tattoo

Ken Ward, Jr., the best journalist in West Virginia, has been following the landmark Senate climate and clean energy hearings at his blog, “Coal Tattoo:  Mining’s Mark on our World.”  I’m excerpting his latest piece.

But then there was Preston Chiaro, (above) chief executive for energy and minerals at Rio Tinto, a huge worldwide coal company and the second largest coal producer in the United States, who told lawmakers:

Unmanaged climate change is a threat to our assets, our shareholders, and our employees, and also to civil society and political institutions in many of the countries in which we operate and across the globe.

Committee Chairwoman Barbara Boxer, D-Calif., was kind enough to read into the record part of today’s Gazette story, “Climate bill adds more sweeteners for coal industry. In it, I took a first cut at trying to describe some of the changes that were added to the bill to help coal, in response to efforts by, among others, Sen. Robert C. Byrd, D-W.Va.

Coal Tattoo readers know that some folks in the coal industry — such as United Mine Workers President Cecil Roberts and American Electric Power President Michael Morris – are taking a much more progressive stance on the climate bill than others, such as Massey Energy President Don Blankenship, who wants the issue to just go away.

But Rio Tinto’s testimony was a real eye-opener …  for example, as far as the Boxer-Kerry bill’s tougher near-term emissions reductions, Chiaro said:

… Our advocacy for funding of low-carbon technologies is not an argument against the levels of the targets, which we believe are consistent with the USCAP [The business-oriented U.S. Climate Action partnership]  and are required in order to address the climate imperative. Rather, the funding of low-carbon technologies is intended to ensure we reach those targets at as low a cost as possible.

Chiaro noted that the USCAP recommendations — which he said are “fully reflected” in the Kerry-Boxer bill — include “support for carbon capture and storage (CCS) demonstration plants” that are “the best chance of transforming coal into a low-emission energy source.”

He went on:

Rio Tinto will continue to urge governments to negotiate a strong global agreement for addressing climate change … We are pleased that the market-based policy features which we have advocated, including incentives for the accelerated development and deployment of low-emissions technologies, a variety of cost-containment mechanisms, and transitional compensation for [affected industries] are largely present in the Kerry-Boxer bill.

The bottom line for Rio Tinto?

Rio Tinto believes that emissions of greenhouse gases from human activities are contributing to climate change and that avoiding human caused changes to the climate is an important international goal.

JR:  Let me add one more quote from the testimony, which is it directly aimed at those who are skeptical of market-based solutions in an era where markets have not always worked:

Some observers invariably question whether we should trust markets with such an important task. We believe that we need strong markets in place precisely because it is so important for our efforts to be successful. Markets are unparalleled in their ability to leverage and direct private sector investment, integrate all available information, and help participants to understand market expectations through price signals, share risk, and in the process minimize the marginal costs of reducing GHG emissions. As a commodity producer, we are naturally very comfortable with commodity markets and prefer this approach to government mandates. We feel that the problems with markets are largely known and can be addressed with strong oversight and market regulation. Where markets may fail to address important issues such as carbon leakage, the necessary remedies are well understood, and we stand ready to work with the chairman and the committee to explore these options.

6 Responses to “Senate shocker: Second biggest U.S. coal producer believes in global warming and strong climate action”

  1. Leif says:

    Just maybe President Obama will have a few chips for Copenhagen yet.
    Now if the news media would just wake up and start reporting in earnest, (NY Times, are you there?), perhaps we can get the population alert and energized as well. Time is short…

  2. Jeff Huggins says:

    Words From ExxonMobil

    While we are on this subject, I think the media should place much more focus on some “words” from ExxonMobil, in part to use those words to examine ExxonMobil’s present stance(s) and inconsistencies, but (also) in part to show that ExxonMobil claims to recognize the reality of the issue/problem of climate change and the human need to address it, at least in terms of what they say. What they DO is another matter, of course.

    Awhile back, a member of ExxonMobil’s own Board of Directors actually suggested that I read the transcript of a speech, given by Rex Tillerson to the Royal Institute For International Affairs on June 21, 2007, over two years ago now.

    The speech was called “meeting growing energy demand and addressing climate risks”.

    The transcript of the speech can still be found here, buried rather deep within ExxonMobil’s website:

    http://www.exxonmobil.com/ Corporate/ news_speeches_20070621_RWT.aspx

    If that link doesn’t work for you, you can find the transcript as follows: Go to the ExxonMobil website, www DOT ExxonMobil DOT com. Then, in the SEARCH box on the site, write “Tillerson, Royal Institute, Climate”. That should get you there.

    The speech is no longer shown where it was once shown on the site. Earlier, an interested party could see it by going to the site, going into the “News” section, and selecting “Speeches”. But, the speeches shown in the list only include those given within the last two years, apparently, and earlier speeches seem to fall off the list.

    I urge anyone interested in the relationship between ExxonMobil and climate change to read that speech. It (apparently) expresses Tillerson’s views at that time, at least those that he was comfortable expressing to this particular group of leaders. He comments on the various policy approaches to address the problem, as they were being discussed back then. He even quotes Bertrand Russell about our human responsibility to care about the wellbeing of future generations!

    I’d urge people to read it. And, I wonder why the media don’t use words like this to challenge some of these folks (e.g., ExxonMobil) about their present actions and inactions, as well as about the confusions that they still seem to be spreading.

    Indeed, it might be an interesting idea to cover and examine that speech here on CP, a “two years later” type of thing. Tillerson said X, Y, and Z over two years ago: What are they saying and doing TODAY, over two years later? That sort of thing.

    Be Well,

    Jeff

  3. nic says:

    Also a few months back Preston Chiaro co-penned this op-ed with Farmers Union President Roger Johnson. It ran the Grand Forks Herald in North Dakota.

    Published June 25 2009
    Roger Johnson and Preston Chiaro, Washington, column: Farming, coal mining and climate change
    WASHINGTON — On Monday and Tuesday, the world is coming to Bismarck.

    At the International Climate Stewardship Solutions Conference, regional and international energy experts will convene to discuss how coal and agricultural states can take the lead in building a smart, clean, energy-independent foundation for a better tomorrow.

    The world is now watching us. There is little doubt there will be consumer costs to making the transition to a lower carbon economy, but the costs are manageable and far less than what we currently pay for insurance, health care or defense.

    Yet, the price tag for ignoring global climate change is daunting, both in terms of lost economic activity and damage to our environment.

    Fortunately, we are in a good position thanks to abundant domestic renewable and low-carbon energy sources, such as wind and biofuels, and the chance to use coal more responsibly with advanced technologies that capture and store carbon dioxide.

    Agriculture and coal are both vital parts of the U.S. economy, especially in the Midwest and northern Plains, and they can — in fact, must — be driving forces in the new energy economy and our energy security.

    America’s farmers and ranchers stand ready, willing and able to help in the fight against climate change, and the National Farmers Union is committed to helping Congress adopt smart climate policy that addresses agriculture’s unique role.

    A cap-and-trade program could give farmers and ranchers the chance to be part of the climate change solution by using soil carbon sequestration and methane from certain livestock projects. The Environmental Protection Agency estimates that carbon sequestration by forests and agricultural lands offsets about 12 percent of annual greenhouse gas emissions, and they have the capacity to offset 20 percent of greenhouse gas emissions from all sectors of the economy.

    Farmers Union believes the flexibility of a cap-and-trade program holds the most potential for achieving actual greenhouse gas emissions reductions, while mitigating increased costs.

    Since its launch in 2006, the Farmers Union Carbon Credit Program has enrolled more than 5 million acres across 31 states. The organization is now the largest aggregator of agriculture carbon credits on the Chicago Climate Exchange.

    Likewise, coal will remain pivotal in the coming decades, even as we aggressively expand renewable energy. Industry must commit to delivering carbon capture and storage with coal to achieve deep cuts in long-term CO2 emissions and a secure, reliable and affordable energy supply.

    And while carbon capture and storage often is portrayed as an emerging and unproven technology, important large-scale commercial applications are already successfully and safely deployed around the world.

    Dakota Gasification at Beulah, N.D., leads the world in coal with carbon capture and storage, capturing nearly 3 million tons of CO2 annually. The CO2 is piped to Saskatchewan and injected into an aging oilfield. This forces otherwise unrecoverable oil to the surface in a safe, decades-old commercial process called enhanced oil recovery, thus providing domestic petroleum at a much lower CO2 footprint than imported alternatives.

    The time to make the right strategic decisions for the future is now. We are ready to work with business and agricultural leaders to put the policy, infrastructure, resources and human capital to work and speed the transition to the new energy economy, and we must do so now.

    The timing couldn’t be better. We have the technology; we have the opportunity. We need congressional support, business support and Herald readers’ support.

    Let’s take this chance to create a better for world for our children and grandchildren.

    History is calling us.

    Johnson, North Dakota’s former agriculture secretary, is president of the National Farmers Union. Chiaro is CEO of energy and minerals for the London-based Rio Tinto, one of the world’s largest mining and exploration companies.

  4. mc says:

    It reminds me that we are 12 years on since Kyoto (and almost 20 since Rio) and almost nothing was done. I wonder how much of this is due to the instinct of trying taking down big business – with some special hatred by oil companies – by the green radicals. Had some part of this political energy been spent on advocating more money on clean energy research and we could be on a different position today. As I’m aware today, even oil companies are willing to accept a carbon tax…

  5. Leland Palmer says:

    Well, I think it is technologically possible to transform the coal fired power plants into carbon negative BECCS (Bio-Energy with Carbon Capture and Storage) power plants, and so change the biggest climate problem into the most radically effective solution.

    I also think that if we rely on the market to do this, it will likely come too late to head off runaway, truly catastrophic global warming, leading to a methane catastrophe.

    So, as I’ve posted many times before, what I think we need to do is simply seize the coal fired power plants, and transform them into enhanced efficiency oxyfuel combustion power plants, with an IFCC (Indirectly Fired Combined Cycle) topping cycle. Such power plants could be carbon negative, and could pay for their CCS with enhanced efficiency.

    The Clinton administration was very interested in several concepts that the subsequent Bush administration killed. The Clinton hybrid supercar program was killed by the hydrogen fuel cell car, for example. Many of us suspect that this was a deliberate plan to replace a workable hybrid car program for an unworkable hydrogen car program, and so protect the profits of Big Oil.

    Another idea that the Bush administration killed was the idea of IFCC (aka HIPPS) topping cycles for coal fired power plants, substituting the very complex and probably unworkable Nextgen clean coal program for it. I suspect that the Bush administration did this as a favor for the coal industry, to kill the IFCC (aka HIPPS) ideas, which I think are very simple and practical. Such topping cycles use an externally fired gas turbine run by high temperature pressurized air produced by a high temperature heat exchanger to increase the efficiency of coal fired power plants from about 30 percent to almost 50 percent. Both IFCC and oxyfuel combustion can be retrofitted fairly easily to existing coal fired power plants.

    Adding an IFCC topping cycle to oxyfuel combustion could pay for the parasitic losses incurred by oxyfuel combustion and compression of the subsequent steam of CO2 for deep injection, and give us essentially free CCS, I am convinced.

    Most coal fired power plants are located on rivers or lakes for cooling water, and these and lakes constitute a natural gravity assisted transport system to transport biomass or biochar produced anywhere upstream on the watershed to the power plants.

    It can all be done, I am convinced.

    If we allow private industry to do it, it will happen too late, I think.

    We need to seize the coal fired power plants, and convert them to enhanced efficiency carbon negative BECCS power plants, and lead the world into a carbon negative future.

    Markets make things more efficient, I guess, and that’s generally a good thing.

    But wee don’t have time to convince a bunch of bankers and executives with a financial interest in the status quo of the reality of probable runaway global warming, probably leading to a methane catastrophe.

    So, markets are great, but we can’t wait, we need to start massively making this conversion right now. Cost and efficiency are less important, right now, than achieving a transformation of these power plants within the next few years.

    Every scrap of yard waste and combustible urban waste and most dead trees in the forests should be carbonized into biochar and transported to these power plants. Much of the combustible undergrowth and trees contained in firebreaks, all of the beetle killed trees, a lot of the standing dead wood after wildfires, half or more of all agricultural waste, all the dried sewage sludge we can get also needs to go to these power plants. Massive biomass production from biomass plantations planted upstream of the power plants needs to be carbonized into biochar and burned in these BECCS power plants, too. The subsequent captured CO2 should be deep injected into deep saline aquifers or deep basalt layers for storage or in-situ mineral carbonation.

    There is enough biomass to run this scheme. This Oak Ridge Nationl Labs study found a billion tons per year of biomass available in the U.S., just from urban, forest, and agricultural waste. This is roughly eqivalent to about 250 million tons of coal in heating value, and the study does not include biomass plantations, beetle killed trees, or biomass plantations.

    http://www1.eere.energy.gov/ biomass/ pdfs/ final_billionton_vision_report2.pdf

  6. Leland Palmer says:

    Whoops, on ecit, in the last sentence, make that “the study does not include biomass plantations, beetle killed trees, biochar transportation of biomass, or gravity assisted river transport of biomass or biochar.”