News agency, Cape Town, South Africa
Monday June 26th 2017

Revealed: the cost of electricity from coal

The hidden costs of generating electricity from coal have been calculated in groundbreaking research by Harvard Medical School’s Centre for Health and Global Environment.The results of the study Full Cost Accounting for the Life Cycle of Coal released this week by co-author Dr Paul Epstein in Boston reveal that the health, environmental and other costs of using coal costs the United States are 500 billion dollars per year.

The study tracks the multiple health, environmental and climate change impacts of coal from its source at the mine to its combustion at the power plant.

Epstein was reported as stating the Centre “examined the life cycle of coal production to find ‘hidden costs,’ or costs that occur when the activity of one agent affects the well-being of another agent outside of any type of market mechanism”.

The full study is expected to be published in the Annals of the New York Academy of Sciences later this month.

Although the study is restricted to the US, it has implications for South Africa, which generates over 90 percent of its electricity from coal and is in the process of setting up three new coal-fired plants at a cost of R75 billion.

Figures from the US Energy Information Administration show that the US uses just over 1 billion tons of coal per year.

South Africa uses just under 10 percent of that amount. Figures on Eskom’s website show that 90 million tons of coal per year are used to generate electricity.

Theoretically, the costs of using coal in South Africa could be a little under $50 billion, or R350 billion.

According to the study, air pollution emissions cost $187.5 billion, mercury emission impacts reach $29.3 billion, and greenhouse gas emissions (and accompanying climate change effects) from coal-fired plants costs between $61.7 and $205.8 billion.

Other costs included up to $10 billion from land disturbances, impacts from toxic spills, declines in property values, tourism loss, and crop damage,” the study noted.

Coal has always been punted as the cheapest way to produce electricity but water and environmental specialist at One World Sustainable Investments, Arthur Chapman, said: “The costs in terms of impacts on human health, environmental degradation and loss of agriculture productivity are substantial and probably run into the hundreds of millions of Rands per year, if not more.”

He said the cost of electricity from coal needed to include the costs of air pollution, water pollution such as acid mine drainage from coal waste dumps, rainfall acidification, soil acidification, the clean up of abandoned mines, among others.

He said these costs were “externalised to the general populace of South Africa” including an increased cost for personal health care and taxpayers footing the bill for cleanups.]

However, Chapman said for economic reasons, coal could not simply be abandoned overnight

We needed to move toward more efficient coal-burning technologies, improved mining methods and mine rehabilitation and closure, as well as increased oversight and policing of the environmental impacts.

But the Harvard study was “a good place to start” as “people are only driven to actions once verifiable numbers are put into play as we then can understand the cost of doing nothing”.

Greenpeace Africa senior energy campaigner Dr Rianne Teule said the study verified years of campaigning about the hidden costs of using coal and showed there was “no reason” for South Africa to be or expand its use of when there was “huge potential” for renewable energy initiatives.

Both the Department of Energy and Eskom failed to respond to questions. – Yugendree Naidoo, West Cape News

Tags: air pollution emissions, climate change effects, eskom, greenhouse gas emissions, greenpeace, harvard medical school, renewable energy

Reader Feedback

3 Responses to “Revealed: the cost of electricity from coal”

  1. Eskom Employee says:

    Good Article concerning the real cost of using Coal as a primary energy source. There are some details in your article which are unfortunately not accurate. Simply assuming that since South Africa burns a 1/10th of the coal of the USA, that our costs would be “roughly $50 billion”. We burn a coal of poorer quality than that of the USA, poorer quality means more “stone” in the coal, which just ends up as ash taken to ash dumps. This may still mean that there is increased costs, but it is not possible to draw a direct comparison between SA and USA.

    The other main concern is that you mentioned that Eskom is building 3 new Coal Power Stations at a cost of R75 billion. This is far from the truth, Eskom is building 2 new Coal Power Stations (Kusile and Medupi), at a cost far exceeding that. The 3rd Power Station in the pipeline is Ingula, which is a Hydro-electric Pumped Storage Power Station in KZN. 3 old mothballed Coal Power Stations are currently being refurbished, Camden which is complete, Grootvlei and Komati. These are all stations that were mothballed in the 1990′s due to excess capacity, and are now being brought back.

  2. admin says:

    Hi Francois.
    Thanks for your response, and for pointing out inaccuracies, which I can’t excuse but would’ve had less chance of occurring if Eskom had bothered, over two days, to reply to our questions. I agree that it is very difficult to draw direct comparisons to the situation in the US, which is why we stated ‘theoretically’ in introducing our calculations. We would have been remiss if we didn’t try offer some local comparison and given Eskom’s lack of response, had to do the best we could. The lack of response is not your fault of course (unless you’re in media liaison) but if you ever bump into the media liaison people at the water cooler, do urge them to up their game, for everyone’s sake.
    Again, thank you for your comments, they’re much appreciated.
    Best Regards,
    Ed.

  3. 140 Billion rand for Medupi for 4.2 Gw !
    80 % load facto means R 41600 per kW capacity
    There are 356 x 24 h = 8544 hours in a year.
    Hence every kWh per annum needs R 41600/8544 = R 4.87 per kW-hour

    Then add coal price cost, transmission loss, transmission cost, distribution cost, corruption cost, running cost, depreciation, decommissioning !

    Then add these environment cost. Additional coal power stations makes no sense
    and nuclear even less when compared to solar + pump storage storage !

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