I enjoy watching the Olympics and marveling at just how fast, strong, and graceful humans can train their bodies to be. I enjoy watching sports that are almost completely foreign to me and thinking about the time, effort and passion that people invest to be great at those sports. It is impressive to know that they make that investment in being great at something even when the only opportunity that they will ever have to perform in front of a large audience comes once every four years and it may last only a few seconds. And, I have to admit that I feel a strong affinity for American athletes and enjoy watching them earn medals. I am pretty sure I am not alone in tending to favor participants from my home country.
That is one reason why I think that the American Coalition for Clean Coal Electricity (ACCCE) has made a brilliant marketing move by choosing to run advertisements during the 2010 Winter Olympics. Their ad campaign is also well designed and executed – it has lots of footage of hard working, patriotic Americans engaged in a mission to supply the electricity that keeps America moving. Like many of the athletes, coal industry workers often labor in obscurity; their work is not a spectator sport that gets a lot of coverage in the business press.
The ad campaign talks about all of the investments that the coal industry has made to produce ever cleaner electricity from coal, it talks about the 200 year supply of the material (at current consumption rates), and it talks about the fact that coal provides half of all electricity used in America. The intended effect is clear, while Americans are rooting for their favorites in winter sports where we are often underdogs or “also rans”, we can root for an energy choice where America is a recognized world leader; we are the world’s best endowed country when it comes to coal.
This is not the first and will not be the last ad campaign designed to portray coal as a friendly, abundant, domestic energy source that is working hard to get cleaner. It is also not the first and will not be the last to use messages that obscure some of the real downsides to burning more than a billion tons of coal every year in the United States, nearly all of which feeds electrical power generators.
Though I cheer for those hard working Americans who do the very best job they know how to do to create what is arguably the most important product in a modern economy – electricity – continuing a path of steady or increasing coal combustion is bad for America and for the rest of the world. Please understand that I am not demonizing coal; it has been an amazing boon to mankind for centuries. It is arguably responsible for the fact that there are still dense forests in the world, for much of industrialized society, and perhaps even for the abolition of slavery in developed countries.
From a geopolitical point of view, I prefer burning American coal to being dependent upon shipments of liquified natural gas or oil from unstable or despotically governed countries. However, coal comes with a large burden of external costs that come from extracting, moving, and burning more than a billion tons of material in a manner that produces billions of tons of waste products with varying degrees of toxicity.
It is time to continue the long interrupted transition to a better, more abundant, and arguably, just as American source of power, nuclear fission. As I watch the commercials in the context of Olympic competition and almost hear the patriotic music playing in the background, I think about the efforts that the coal industry has undertaken over the years to handicap an energy source that started out as its American teammate.
Nuclear energy could have been welcomed as an up and coming young star whose characteristics were recognized as an improvement on its respected, but aging predecessor. The coal industry could have gracefully accepted a lesser role in American energy production and shared some helpful tips with its teammate.
Of course, graceful acceptance of a reduced role does not come easy to some athletes and it certainly did not come easy to an industry that was once one of the largest and most important industries in the country. Even though its role in American society is far less visible than it was in 1865, 1902, 1918, or during WWII, coal producers still retain a certain nostalgia for the days when they were known as King Coal. Like athletes who feel like they cannot break through in the US, nuclear energy producers have taken advantage of multiple citizenship to hone tehir skils and prosper in places where the established competitors were not as strong.
In the spirit of the Olympic competition and the coal industry advertising messages, it is time to welcome back the prodigal energy source that has been developing its skills in the international circuit. It is time for the coal industry to recognize that one of the basic parts of its message is demonstrably false; coal is not America’s most abundant fuel; uranium and thorium are. It will be Americans who build, operate and maintain the nuclear power plants that will be reducing our need to burn coal, so the appeal to patriotism as a way to accumulate loyal fans is simply misplaced.
I recently came across a document titled Coal Industry Review that was published in the Sept-Oct 1964 issue of the Financial Analysts Journal. (One of the amazing things about modern living is our ability to locate obscure documents that provide interesting bits of history.) Here are some excerpts from the “Investment Summary” of that document that provide a clear indications that the trading and financial portion of the coal industry recognized the market threat from nuclear energy at a very early stage in the technology deployment:
To these considerations must now be added nuclear power which has become a recognized competitive factor in the future electrical power generation market. As discussed subsequently, nuclear power’s initial impact (itself a few years away) is expected to be felt in areas of the country not predominantly served by the midwestern producers.
. . .
Increased competition from nuclear power will admittedly create pressures of future delivered utility coal prices, but this should be at least partially offset by the industry’s proven ability to reduce production costs through mechanization of mining equipment and continued expected transportation cost reductions.
By the end of 1964, the industry will have compiled three straight years of increased production and, for most leading companies, higher earnings; and prospects for further growth at least over the next few years appear to be clearly stronger than has been the case until the fairly recent past. Coal stocks, however, have performed relatively poorly so far this year in contrast to a sharp rise in 1963. (For example, the Standard and Poor’s Index of Bituminous Coal Stocks is currently about 4% below its year-end 1963 level.) Reasons for this probably include: the so-called breakthrough in nuclear power costs as a result of the Oyster Creek announcement. . .
Initial concern over the Oyster Creek nuclear generating plant many now have subsided somewhat. Nevertheless, the threat of nuclear power will probably remain a definite investment consideration from now on.
PS: I also want to provide you with a link to a 1991 New York Times article by Matthew Wald titled Pro-Coal Ad Campaign Disputes Warming Idea. It is interesting to read that article nearly 20 years after it was published and think about the way that energy history has unfolded in ways that were not predictable then.