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Hidden Costs of Energy: Unpriced Consequences of Energy Production and Use
An approach similar to that used for coal allowed the committee to estimate criteria-pollutant-related damages for 498 facilities in 2005 that generated electricity from natural gas in the contiguous 48 states. These facilities represented 71% of the country’s electricity from natural gas. Again, as with coal, the overall averages masked some major differences among plants, which varied widely in terms of pollution generation.
Damages Unrelated to Climate Change Damages from gas-fueled plants tend to be much lower than those from coal plants. The sample of 498 gas facilities produced $740 million in aggregate damages from emissions of SO2, NOx, and PM. Average annual damages per plant were $1.49 million, which reflected not only lower damages per kWh at gas plants but smaller plant sizes as well; net generation at the median coal plant was more than six times larger than that of the median gas facility. After sorting the gas plants according to damages, we found that the 50% with the lowest damages accounted for only 4% of aggregate damages. By contrast, the 10% of plants with the largest damages produced 65% of the air-pollution damages from all 498 plants (see Figure S-2). Each group of plants accounted for approximately one-quarter of the sample’s net generation of electricity.
Mean damages per kWh were 0.16 cents when natural-gas-fired plants were weighted by the amount of electricity they generated. However, the distribution of damages per kWh had a large variance and was highly skewed. The 5th percentile of damages per kWh is less than 5/100 of a cent, and the 95th percentile of damages is about 1 cent.6
Although overall electricity production from natural gas in 2030 is predicted to increase by 9% from 2005 levels, the average pollution intensity for natural-gas facilities is expected to decrease, though not as dramatically as for coal plants. Pounds of NOx emitted per MWh are estimated to fall, on average, by 19%, and emissions of PM per MWh are estimated to fall by about 32%. The expected net effect of these changes is a decrease in the aggregate damages related to the 498 gas facilities from $740 million in 2005 to $650 million in 2030. Their average damage per kWh is expected to fall from 0.16 cents to 0.11 cents over that same period.
The 104 U.S. nuclear reactors currently account for almost 20% of the nation’s electrical generation. Overall, other studies have found that
When damages per kWh are weighted by electricity generation, the 5th and 95th percentiles are 0.001 and 0.55 cents; the unweighted figures are .0044 and 1.7 cents per kWh.