Mining the truth on coal supplies


08 Sep 2010

No matter how bad coal might be for the planet, the conventional wisdom is that there is so much of it underground that the world’s leading fuel for electricity will continue to dominate the energy scene unless global action is taken on climate change.

But what if conventional wisdom is wrong?

A new study seeks to shake up the assumption that use of coal, the most carbon-intensive fossil fuel, is bound to continue its inexorable rise. In fact, the authors predict that world coal production may reach its peak as early as next year, and then begin a permanent decline.

The study, led by Tad Patzek, chairman of the Department of Petroleum and Geosystems Engineering at the University of Texas at Austin, and published in the August issue of Energy, predicts that by mid-century, the world’s coal mining will supply only half as much energy as today.

The idea that the world will face “peak coal” as soon as 2011 flies in the face of most earlier estimates and analysis.

(Related: “The High Cost of Cheap Coal”)

The London-based World Coal Institute, an industry group including the largest international coal producers, says “the use of coal will rise 60 percent over the next 20 years,” and that “coal will last us for at least 119 years.” And the U.S. Energy Information Administration, in its most recent international outlook, projects that coal consumption for electricity will grow more than 50 percent by 2035 unless policies are put in place to stop the growth of greenhouse gas emissions.

However, the Patzek study paints a far different picture—and not because people will use up the last of the coal in the ground. Rather, the world will finish off the coal that is easy to reach and high-quality—the coal that produces a large amount of energy per ton, the new study says. What remains will often be of lower quality, and progressively harder to dig up and bring to where it is used.

(Related: “Mine Tragedy Amid Push to Produce More“)

The study’s prediction for the time of the peak—actually a peak in the energy produced by global coal production—may not turn out to be exactly right, Patzek said. “I’m not saying that on July 1, 2011, there will be a peak.”

But the main thrust of the study is stark: “We are near or at the peak right now,” he said.

Economic Costs

If true, this could have a vast impact on the world economy.

Coal-fired power plants supply 40 percent of the world’s electricity, and energy for two-thirds of the world’s steel production.

“If we are right,” Patzek’s study said, “major restructuring and shrinking of the global economy will follow.”

Many countries are counting on coal to continue powering their economies for decades to come.

“The United States is the Saudi Arabia of coal,” said President Barack Obama earlier this year, referring to estimates that the United States has the largest coal reserves of any country. Citing the huge stores and the need for clean energy, Obama made the remark at the launch of a task force to study how to deploy technology to “clean up” coal, through carbon capture and storage technology, in the next 10 years.

(Related: “Lighting a Fire Under Clean Coal”)

However, Patzek argues that the reserves estimates of the United States and other countries overstate how much coal is actually practical to mine and use.

“In my study, I disregard completely these [reserve] estimates,” Patzek said. “They’re not credible.”

“The only estimate that’s credible,” he argued, “is what actually comes out of the mines, and how you project that into the future.”

For instance, the study notes that estimates of Illinois’ proven reserves are still high—second only to Montana in the United States—even though coal production has declined to a little more than half of what was produced there 20 years ago.

But there are numerous reasons for that drop, including the fact that Illinois coal is high in sulfur. Electric utilities have shifted to buying lower-sulfur coal from the Powder River Basin of Wyoming and Montana, despite its lower heat content, as a way to meet federal regulations for control of acid rain.

Other analyses that have taken the shift to lower-quality coal into account have concluded that reserves are robust, including a 2007 assessment of U.S. coal research and development needs, organized by the National Academy of Sciences (NAS). Despite what the panel admitted were “significant” uncertainties in reserve estimates, the NAS concluded there was sufficient coal to meet the nation’s needs at current rates of consumption for more than 100 years. That study said the United States had about 270 billion tons of coal reserves, plus more than 1,500 billion tons of “resources”—known deposits that are not currently economical to produce, but that may be possible to develop later.

“It is safe to conclude that the U.S. is not running out of reserves,” said Raja Ramani, a mining engineer at the University of Pennsylvania and co-author of the NAS paper. “I do not see 2011 as the peak year of coal production.”

However, the NAS admitted that its 2007 estimates of coal reserves were based upon methods and data that had not been reviewed or revised since the early 1970s. The NAS called for a coordinated government and industry initiative to determine the magnitude and characteristics of the nation’s recoverable coal reserves.

Will Coal Follow Oil Curve?

Patzek’s study uses a version of a method developed by the legendary father of “peak oil” theory, Marion King Hubbert, to analyze coal reserves. Hubbert, at the time a Shell Oil petroleum geologist, used prior production history to correctly predict 15 years in advance that U.S. oil production would peak in the early 1970s.

Hubbert’s method, a controversial one, assumes that production follows a bell-shaped curve over time.

When there are many different oil wells or coal mines operating independently, the sum of all their production tends to follow such a bell curve over time—starting off small, rising to a peak, and then dropping again as the resources are depleted.

Oil in the United States has followed this pattern, as has coal in the United Kingdom.

Patzek’s study, “A global coal production forecast with multi-Hubbert cycle analysis,” modifies Hubbert’s method to allow for several bell curves, to reflect the development of coal mines in different parts of the world and the use of different technologies.

Patzek’s study is not the only one to conclude that the reserve estimates are often too high. In recent years, chemical engineers at Newcastle University in Australia, the electrical engineer David Rutledge at the California Institute of Technology, and a German nonprofit called Energy Watch Group all have estimated that coal production would most likely peak in the next couple of decades.

One of the most important questions involving the peak coal studies is what they mean for climate change policy. Patzek’s study notes that its projections would mean that carbon emissions from global coal production would decline by 50 percent by 2050. That’s significantly below most of the carbon emissions scenarios produced by the Nobel Prize-winning Intergovernmental Panel on Climate Change. Patzek’s paper opens with a swipe at the IPCC scenarios, saying they are “based on economic and policy considerations that appear to be unconstrained by geophysics.”

But the paper concludes with an appeal that climate action advocates could only applaud—a plea for using less energy and more efficient electricity generation.

“The global community should be devoting its attention to conservation and increasing efficiency of electrical power generation from coal,” the paper said. “Immediate upgrades of the existing electrical coal-fired power stations to new, ultra supercritical steam turbines that deliver [greater efficiency than current power plants] are urgently needed.”

The paper underscores the different drivers behind the push for a new path forward on energy—the call is much the same, whether the worry is too much coal or too little.

(Related: “Coal Ash Continues To Pollute Groundwater”)

© 1996-2010 National Geographic Society. All rights reserved.

3 Comments

  1. Mason Inman had this to say, on 9 September 2010 | Permalink

    This article got featured on Yale e360!
    http://j.mp/bDjhh8

    And The Oil Drum:
    http://www.theoildrum.com/node/6937

    And someone (not me) posted Patzek’s study online:
    http://j.mp/c3xawH

  2. Jonathan Callahan had this to say, on 25 September 2010 | Permalink

    Mason,

    Several of the more mathematically inclined folks on The Oil Drum have nothing but disdain for the multi-cyclic approach Patzek used in his analysis.

    Please review these threads and contact me if you want a personal explanation of what is wrong with this method and why it has no predictive value:

    http://www.theoildrum.com/node/6797/691606

    http://www.theoildrum.com/node/6937/717047

    Cheers,

    Jon

  3. Mason Inman had this to say, on 26 September 2010 | Permalink

    Hi Jon,

    Thanks for commenting (and for taking a look at my site and saying nice things about it on The Oil Drum). I’ve read about the limitations of Hubbert methods—especially multi-cyclic methods—but it was too much detail to get into in my article for National Geographic News.

    My main goals with the article were to get across the points that:

    1. there have been peaks and declines in production in many areas

    2. reserves estimates seem to vastly overestimate how much coal people will actually pull out of the ground (whatever combination of above-ground and below-ground reasons there might be)

    3. when people say things like “at current rates of production, proved coal reserves would last X years,” it’s disingenuous because it implies that we’d somehow keep use flat for a long time, rather than having production grow and then gradually decline.

    I’ve played around with Hubbert linearizations of various coal-producing regions, and it’s clear that regions can be on one trend, and then jump to another trend. This happened in the western US, in Canada, in Africa, and in China. (In China, though, the new trend isn’t established yet, but it’s clear that since 2000, they’ve departed from the old trend, as you pointed out in the first of the links above to The Oil Drum.) In Latin America and in South Asia, no clear trend has emerged yet; the production still seems to be early in the growth phase, so it’s too soon to tell. So I agree that the Hubbert methods have limited predictive power. But I wouldn’t say they have NO predictive power.

    (FYI, I’m using the regions that David Rutledge at Caltech grouped coal production into, largely because he’s put together long-term data and made it easily accessible.)

    Adam Brandt (formerly at UC Berkeley, now at Stanford) has done some work on testing how well regions fit the classic Hubbert curve, in his paper “Testing Hubbert”. He doesn’t do a historical analysis, “hindcasting” to see how well predictions in the past would have done, or looking at past predictions that were published.

    David Rutledge does do hindcasting, and I find his technique pretty persuasive. He does acknowledge, though, that current trends do not necessarily have to continue into the future. Like Patzek, he has an axe to grind with the IPCC, for what it’s worth.

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bookshelf

books I've read on failure & grace

The World Without Us
The Last Oil Shock: A Survival Guide to the Imminent Extinction of Petroleum Man
Zeitoun
A Paradise Built in Hell: The Extraordinary Communities That Arise in Disaster
Hell and High Water: Global Warming--the Solution and the Politics--and What We Should Do
The Worst Hard Time: The Untold Story of Those Who Survived the Great American Dust Bowl
The Tipping Point
Three Cups of Tea: One Man's Mission to Promote Peace... One School at a Time
The Upside of Down: Catastrophe, Creativity and the Renewal of Civilization
Out of Poverty: What Works When Traditional Approaches Fail
The Little Ice Age: How Climate Made History, 1300-1850
Confessions of an Eco-Sinner: Tracking Down the Sources of My Stuff
Deep Economy: The Wealth of Communities and the Durable Future
The Geography of Bliss: One Grump's Search for the Happiest Places in the World


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