How To Retire Early: Making Accelerated Coal Phaseout Feasible & Just
For over a century, growing presence of coal smokestacks worldwide signified economic development and progress. Coal supplied our homes with electricity and our factories with power. At the same time, this workhorse of the industrial era caused serious harm to our health and the environment. Today, the costs of continuing to operate coal-fired power plants include not only its health and environmental impacts, but also a hit to the wallets of consumers who are paying more for coal power than they would for renewables.
In a new report, Rocky Mountain Institute, the Carbon Tracker Initiative, and the Sierra Club present an analysis of nearly 2,500 coal plants around the world. This analysis shows that the cost of clean energy has fallen so far that new renewables outcompete new coal virtually everywhere. Furthermore, it is cheaper today to build new renewable energy capacity including battery storage than to continue operating 39 percent of the world’s existing coal capacity. And the competitiveness of coal is sinking rapidly elsewhere.
An analysis of nearly 2,500 coal plants around the world shows that the cost of clean energy has fallen so far that new renewables outcompete new coal virtually everywhere.
The Cost of Coal
Continuing to run uncompetitive coal plants comes at a cost to consumers and taxpayers. If we were to phase out the share of existing global capacity already uncompetitive with new renewables, we would save $39 billion in 2020. In just five years, 73 percent of the global coal fleet will be uncompetitive with new renewables plus storage, equating to a savings of $141 billion in 2025.
Though global numbers inevitably mask regional variation, our findings hold true across a diverse set of geographies. The United States could help customers save up to $10 billion annually if 79 percent of its currently uncompetitive fleet were phased out today. In other large coal power regions — Europe, China, and India — the percentage of uncompetitive coal plants is rising fast and will average over 90 percent by 2025. Savings for these three regions combined start at $30 billion per year in 2020 and more than quadruple to $136 billion per year in 2025. In a group of other developing economies with aggregate coal capacity similar to that of the United States, 51 percent of the existing coal fleet will become uncompetitive with new renewables plus storage by 2026.