Energy
Strategy, Technology, and Current Issues
in the Oil Industry
Energy Overview / Current Issues in
Energy
Susan Smith Nash, Ph.D.
Issue:
Non-renewables are “dirty” and
difficult; Renewables are expensive.
Coal, nuclear, and the other non-renewable “also-rans” will
continue to meet environmental, safety, and health regulatory
issues.
In addition, the demand for coal for has declined, and the fact
that the price of natural gas has remained low in the U.S. is
dampening prices for coal in the U.S.
What is also acting as a damper on the price of coal is the fact
that environmental regulations make it difficult to construct
new coal-fired plants in the U.S. Specifically, the Obama
administration and the EPA have new issued new legislation which
limits carbon dioxide emissions, which directly affects the
ability of companies to obtain permits to construct coal-fired
plants.
The outlook for renewable or “green” energy is also bleak;
according to many analysts, it is too expensive and companies
cannot afford to use “green” energy without government
subsidies. As long as coal and natural gas are extremely cheap,
there is no marginal advantage to using green energy. Many
published studies show that the per-unit costs for renewable
energy are much higher than non-renewables, specifically fossil
fuels.
Readings:
Kawa, L. (2012) A Mining Giant Has Bad News About Coal. Business
Insider. Dec. 12, 2012.
http://www.businessinsider.com/poor-outlook-for-coal-in-2013-2012-12
Joy Global Inc. Announces Fourth Quarter and Fiscal 2012
Year-End Operating Results
http://investors.joyglobal.com/releasedetail.cfm?ReleaseID=726298
It’s Over: Why Everyone Is Losing Hope for Green Energy
http://www.businessinsider.com/people-are-losing-hope-for-green-energy-2012-11
Levitt, A. (2012) An Ever-Darker Outlook for Coal: Latest
earnings confirm it’s in the grip of a long-term squeeze.
InvestorPlace.com Aug. 15, 2012.
http://investorplace.com/2012/08/an-ever-darker-outlook-for-coal/
Guiding Questions:
How could you make a compelling argument for continued research
and development in alternative energy?
Why is the price of coal low?