Actual Cost of Coal


When coal prices are determined, many of the associated negative effects related to impacts on the environment and human health are not taken into account. These “hidden costs”  are termed “externalities.”  In the absence of government intervention, the externalities associated with energy production and use are generally not taken into account in decision making.

External costs of coal mining and power generation include the following:

  • Reduction in life expectancy
  • Respiratory hospital admissions
  • Congestive heart failure
  • Non-fatal cancer, osteroporosia, ataxia, renal dysfunction
  • Chronic bronchitis, asthma attacks, etc.
  • Loss of memory
  • Degradation and soiling of buildings
  • Reduction of crop yields
  • Global warming
  • Ecosystem loss and degradation

For More Information:

1. Full Cost Accounting for the Life Cycle of Coal by Dr. Paul Epstein, a physician and associate director of the Center for Health and the Global Environment at Harvard Medical School, and eleven co-authors, including Clean Energy Action’s Research Director, Leslie Glustrom.  The study tracks the multiple human health and environmental impacts of coal from mining to transport to combustion in coal power plants and the waste stream that results. The team used peer-reviewed studies already in the literature to assign costs to the various impacts.The Harvard paper estimates that “the life cycle effects of coal and the waste stream generated are costing the U.S. public a third to over one-half of a trillion dollars annually.”

2. Hidden Costs of Energy: Unpriced Consequences of Energy Production and Use.  In 2009 the National Research Council released a report on the “external costs of coal” caused by various energy sources over their entire life cycle, from extraction to production to use and emissions, effects not factored into the market cost of the fuels. The committee estimated the use of fossil fuels had a hidden cost to the U.S. public of $120 billion in 2005, a number that reflects primarily health damages from air pollution associated with electricity generation and motor vehicle transportation. The estimate was derived from monetizing the damage of major air pollutants — sulfur dioxide,nitrogen oxidesozone, and particulate matter – on human health, grain crop and timber yields, buildings, and recreation.

The figure does not include damages from climate change, harm to ecosystems, effects of some air pollutants such as mercury, and risks to national security, which the report examines but does not monetize.

3. Burning Coal, Burning Cash (2010) – Ranking the States That Import the Most Coal by Jeff Deyette and Barbara Freese, for the Union of Concerned Scientists

“The cost of importing coal is a major drain on the economies of many states that rely heavily on coal-fired power. Thirty-eight states were net importers of coal in 2008—from other states and, increasingly, other nations. Burning Coal, Burning Cash shows the scale of this annual drain on state economies, and suggests how they can keep more of those funds in-state through investments in energy efficiency and homegrown renewable energy.”

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