Decoding Coal Dispatch with RMI

My Climate Journey

Joe Daniel is a Principal on the Carbon-Free Electricity Team at RMI.

Our topic today is coal, specifically the "non-economic dispatch" of coal. This phenomenon occurs when coal-fired power plants deliver power to electricity grids even when their electricity is not the most cost-effective option, thereby disrupting the "merit order" of electricity dispatch. This complex topic is explored with Joe's help, as he provides insights into this intricate issue. The US electric grid is notoriously difficult to understand, and there may be moments when the conversation becomes challenging. However, Joe and Cody consistently strive to make the concepts clear and accessible.

The complexity of the system contributes to the problems Joe highlights. Information asymmetry creates economic friction, which disadvantages renewables, despite their general economic superiority. Joe's work at RMI involves developing and deploying quantitative tools, such as RMI's Economic Dispatch Hub, which he will discuss. These tools aim to accelerate affordable and equitable utility de-carbonization pathways.

In this episode, we cover:

• [2:42] Joe's background and work at RMI
• [4:25] Seasonality and cyclical trends in coal usage
• [6:20] Operation and flexibility of coal plants
• [10:05] Merit order and prioritizing resources based on cost
• [12:25] Types of resources and their cost ranking
• [16:01] Dispatching resources and electricity sources
• [21:03] Non-economic dispatch of coal and cost impacts
• [25:02] Public utility commissions' role in regulation
• [29:23] Need for transparency and market price signals
• [33:31] Smooth energy transition and coal's future role
• [39:09] RMI's role in providing expertise and assistance
• [40:30] Cost implications and solutions for non-economic dispatch
• [43:49] Public engagement in utility commission hearings
• [46:16] Policy and local engagement in clean energy adoption

Episode recorded on July 18, 2024 (Published on Aug 4, 2024)

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