The Hidden Costs of Fossil Fuels (Coal and Natural Gas)

Oil & Natural Gas / Conventional Oil & Gas Resources / Economics

The staff of the Union of Concerned Scientists, a long-term anti-nuclear power group, have recently waxed in favor of nuclear power and renewables as the only available sources of clean energy, This article opines that the true costs of coal, natural gas, and other fossil fuels aren’t always obvious—but their impacts can be disastrous. We’ve all paid a utility bill or purchased gasoline. Those represent the direct costs of fossil fuels; money paid out of pocket for energy from coal, natural gas, and oil. But those expenses don’t reflect the total cost of fossil fuels to each of us individually or to society as a whole. Known as externalities, the hidden costs of fossil fuels aren’t represented in their market price, despite serious impacts to our health and environment.

What are fossil fuels?
Fossil fuels are rock-like, gas, or liquid resources that are burned to generate power. They include coal, natural gas, and oil, and are used as an energy source in the electricity and transportation sectors. They’re also a leading source of the world’s global warming pollution. Externalities are sometimes easy to see, such as pollution and land degradation, and sometimes less obvious, such as the costs of asthma and cancer, or the impacts of sea level rise. Many consequences are far removed from our daily lives and may only affect a minority or marginalized subset of the population.

Costs accrue at every point of the fossil fuel supply chain. Extraction processes can generate air and water pollution, and harm local communities. Transporting fuels from the mine or well can cause air pollution and lead to serious accidents and spills. When the fuels are burned, they emit toxins and global warming emissions. Even the waste products are hazardous to public health and the environment. Understanding these impacts is critical for evaluating the true cost of fossil fuels—and for informing our choices around the future of energy production.

Extracting Fossil Fuels
There are two main methods for removing fossil fuels from the ground: mining and drilling. Mining is used to extract solid fossil fuels, such as coal, by digging, scraping, or otherwise exposing buried resources. Drilling methods help extract liquid or gaseous fossil fuels that can be forced to flow to the surface, such as conventional oil and natural gas. Both processes carry serious health and environmental impacts.

Coal Mining
Over the past several decades, there has been a gradual shift from underground coal mining to surface mining in the United States. Surface mining, which is only effective for shallow deposits, often employs highly invasive techniques, including area strip mining and mountaintop removal.

Underground Mining
The most obvious and severe cost of underground coal mining is the threat it poses to the health and safety of coal miners. Many coal miners are injured, sometimes fatally, on the job each year; according to the Mine Safety and Health Administration, fatalities at underground coal mine sites in the United States totaled 77 from 2010 to 2013, including a 2010 explosion at the Upper Big Branch coal mine in West Virginia that killed 29 miners. In addition to job site accidents, coal mining can lead to chronic health disorders. Black lung disease (pneumoconiosis) continues to be a common ailment among coal miners. The disease was responsible for the deaths of approximately 10,000 former miners between 1990 and 2000, and continues today.

Adverse impacts to the environment are another significant cost of underground coal mining. Mines can collapse or gradually subside, affecting surface and subsurface water flows. Mine fires also occur, particularly in abandoned mines. And acid mine drainage at underground coal mines can be a long term environmental management issue; according to the US Environmental Protection Agency (EPA), if active and abandoned coal mines are not properly managed, water can sometimes flow through the mine and become highly acidic and rich in heavy metals. The resulting drainage water is detrimental to human, plant, and animal life [4].

Surface Mining
Surface mining involves removing the overlaying soil to access the coal below, devastating local environments. Mountaintop removal, a particularly destructive form of surface mining, involves stripping all trees and other vegetation from peaks and hilltops, and then blasting away hundreds of feet of the earth below with explosives. More than 500 mountaintop removal sites exist throughout the Appalachia region, impacting nearly 1.4 million acres of land.

The process results in both short- and long-term environmental impacts. In the short term, huge volumes of excess rock and soil are typically dumped into adjacent valleys and streams, altering their ecosystems and diverting the natural flow of streams. In the long term, coal removal sites are left with poor soil that typically only supports exotic grasses. Buried valleys are similarly slow to rebound. The EPA reports that as of 2010, mountaintop removal coal extraction had buried nearly 2,000 miles of Appalachian head-water streams, some of the most biologically diverse streams in the country.

Surface mining can also directly impact the health and safety of surrounding communities. Mudslides, landslides, and flashfloods may become more common. And depending on the chemical makeup of the coal deposit, mines can pollute local drinking water sources with toxic chemicals like selenium, arsenic, manganese, lead, iron, and hydrogen sulfide. A Harvard University study, which assessed the life cycle costs and public health effects of coal from 1997 to 2005, found a link to lung, cardiovascular, and kidney diseases—such as diabetes and hypertension—and an elevated occurrence of low birth rate and preterm births associated with surface mining practices. The total cost? An estimated $74.6 billion every year, equivalent to 4.36 cents per kilowatt-hour of electricity produced—about one-third of the average electricity rate for a typical US home.

Oil and gas drilling
The environmental and health costs of onshore and offshore oil and gas drilling are also significant, and often unseen. The impacts of unconventional extraction methods, such as natural gas hydraulic fracturing (commonly called fracking) have received much attention, but all methods of oil and gas extraction carry hidden costs.

Water impact
When oil and gas are extracted, water that had been trapped in the geologic formation is brought to the surface. This “produced water” can carry with it naturally-occurring dissolved solids, heavy metals, hydrocarbons, and radioactive materials in concentrations that make it unsuitable for human consumption and difficult to dispose of safely.

When hydraulic fracturing methods are used, the total amount of waste water is amplified by the large volume of water and chemicals involved in the process. Drilling and fracking shale gas formations (like the Marcellus Shale) typically requires 3 to 6 million gallons of water per well, and an additional 15,000-60,000 gallons of chemicals, many of which are undisclosed to Federal regulators [10, 11]. One government-sponsored report found that, from 2005 to 2009, 14 oil and gas companies used 780 million gallons of hydraulic fracturing products containing 750 chemicals and other components [12]. Another study identified 632 chemicals contained in fracking products used in shale gas extraction. Researchers could track only 353 chemicals from that larger list and found that 25 percent of those chemicals cause cancer or other mutations, and about half could severely damage neurological, cardiovascular, endocrine, and immune systems [13].

Land use
A large amount of land is disturbed by the drilling wells, access roads, processing facilities, and pipelines associated with oil and gas drilling operations. In particular, noise and habitat fragmentation can harm wildlife populations. For example: one study found an 82 percent decline in the population of Powder River Basin sage grouse between 2001 and 2005, which was directly linked to the area’s coal bed methane production [14].

The advent of horizontal drilling technology, used extensively in unconventional gas production, has greatly reduced the surface footprint of drilling operations by allowing multiple wells to be drilled from a single well pad. However, much of the development of the US shale gas resources is occurring in locations where oil and gas production has not previously taken place (in some cases in wilderness areas), requiring extensive infrastructure development and land degradation. Natural gas’s climate emissions are not only generated when it’s burned as a fuel at power plants or in our homes. The full global warming impact of natural gas also includes methane emissions from drilling wells and pipeline transportation.

Methane, the main component of natural gas, is a much more potent greenhouse gas than carbon dioxide—some 34 times more effective at trapping heat over a 100-year timescale and 86 times more effective over a 20-year timescale [16]. Preliminary studies and field measurements show that these so-called “fugitive” emissions range from 1 to 9 percent of total natural gas lifecycle emissions. Methane losses must be kept below 3.2 percent for natural gas power plants to have lower lifecycle greenhouse gas emissions than coal.

Oil drilling can also produce methane. Although it can be captured and used as an energy source, the gas is often either vented (released) or flared (burned). Vented methane contributes greatly to global warming, and poses a serious safety hazard. Flaring the gas converts it from methane to carbon dioxide, which reduces its impact but still releases additional greenhouse gases to into the atmosphere. The World Bank estimates that 5.3 trillion cubic feet of natural gas, the equivalent of 25 percent of total US consumption, is flared annually worldwide, generating some 400 million tons of unnecessary carbon dioxide emissions..

Offshore drilling
Offshore oil and gas drilling poses many of the same risks as onshore drilling; however, these risks are amplified due to the remote location of offshore drilling sites and the complicated engineering required. In 2010, an explosion at the Deepwater Horizon offshore oil rig in the Gulf of Mexico killed 11 workers and led to the release of approximately 4.9 million barrels of oil over 87 days [19]. The accident was unique in terms of its scale, but environmental and safety incidents are common in the offshore oil and gas industries. Between 2008 and 2012, offshore drilling rigs experienced 34 fatalities, 1,436 injuries, and 60 oils spills of more than 50 barrels each [20].

Unconventional sources
As easily-accessed sources of oil dry up, so-called “new” sources of oil are introducing new problems. For example, tar sands—an extremely viscous oil with the consistency of peanut butter—requires significantly more energy to mine and refine, emitting up to three times more greenhouse gas emissions than conventional oil in the process. These and other additional emissions mean that the dirtiest sources of oil can add as much as an extra ton of pollution per year for the average car.

Transporting fossil fuels
Depending on where fossil fuels are extracted and used, the resource itself may need to travel across long distances—but transporting fuel can generate its own pollution, and increase the potential for catastrophic accidents.

Coal
In most cases, coal is transported from mines to power plants. In 2014, approximately 68 percent of the coal used for electric power in the US was transported by rail: 13 percent was transported on river barge and another 11 percent by truck [21]. Train cars, barges, and trucks all run on diesel fuel, a major source of nitrogen dioxide and soot, which carry substantial human health risks [22]. Transporting coal can also produce coal dust, which presents serious cardiovascular and respiratory risks for communities near transportation routes [23].

Natural gas is transported over long distances by transmission pipelines, while distribution pipelines deliver gas locally to homes and businesses. But natural gas is also highly flammable, making the process of transporting it from wellhead to homes and businesses dangerous. Between 2008 and 2015, there were 5,065 significant safety incidents related to natural gas pipeline transmission and distribution, leading to 108 fatalities and 531 injuries [24].

In addition to safety concerns, natural gas leaks from transmission and distribution pipelines are a significant source of methane emissions. A recent study, which mapped urban pipeline leaks in Boston, found 3,356 separate leaks under the city streets. The study noted that Boston is not unique; other cities, like New York and Washington DC, have aging natural gas distribution infrastructures, and similar methane leaks are likely widespread [25].

Large leaks from natural gas infrastructure also occur. Beginning in 2015, the Southern California Gas Company's Aliso Canyon natural gas storage facility was the site of the largest methane leak in US history, with a total of 94,500 tons of methane was released between October 23, 2015 and February 11, 2016 [26, 27].

Liquefied Natural Gas (LNG) is natural gas that has been cooled and condensed into a liquid form. As of 2016, there were 13 LNG import/export terminals in the United States [28]. The growth in LNG shipments has provoked safety concerns, particularly where LNG terminals are situated near densely settled areas. In the wake of the Sept. 11, 2001, terrorist attacks, LNG deliveries have faced tight security and stricter regulations as policy makers have debated the risks of an attack on LNG facilities or ships [29].

Oil
Oil is transported across the ocean in supertankers, and it is moved over land by pipeline, rail, and truck. In every case, the risk of oil spills poses a serious environmental threat. The infamous 1989 Exxon Valdez oil spill released 262,000 barrels of oil into the Prince Williams Sound in Alaska, but was only the 35th largest marine oil tanker spill since 1967. While major oil spills have decreased, they still occur: three large oil spills released more than 5,000 barrels of oil each in 2013 alone [30, 31].

Spills and leaks from onshore oil pipelines also continue to be a major risk. Examples of recent pipeline spills in the US include the 2010 Enbridge spill that released approximately 20,100 barrels into Michigan’s Kalamazoo River and the 2011 ExxonMobil spill that released some 1,000 barrels of oil into Montana’s Yellowstone River [32, 33].

Burning Fossil Fuels
Some of the most significant hidden costs of fossil fuels are from the air emissions that occur when they are burned. Unlike the extraction and transport stages, in which coal, oil, and natural gas can have very different types of impacts, all fossil fuels emit carbon dioxide and other harmful air pollutants when burned. These emissions lead to a wide variety of public health and environmental costs that are borne at the local, regional, national, and global levels.

Of the many environmental and public health risks associated with burning fossil fuels, the most serious in terms of its universal and potentially irreversible consequences is global warming. In 2014, approximately 78 percent of US global warming emissions were energy-related emissions of carbon dioxide. Of this, approximately 42 percent was from oil and other liquids, 32 percent from coal, and 27 percent from natural gas [34].

Non-fossil fuel energy generation technologies, like wind, solar, and geothermal, contributed less than 1 percent of the total energy related global warming emissions. Even when considering the full lifecycle carbon emissions of all energy sources, coal, oil, and natural gas clearly stand out with significantly higher greenhouse gas emissions [35].