Thread by @laurimyllyvirta

Thoughts on a new study finding that fossil power plants and other infra will emit far more CO2 than we can afford under agreed climate targets THREAD
rdcu.be/bIiws

I of course agree with the top-line conclusion - no new fossil fuel power plants or other infrastructure should be built, and existing infrastructure must be rapidly closed down or converted to run on clean energy. So TL;DR: close dirty power plants and don't build new ones.

However, the paper takes the concept of "lifetime" of power plants etc. as if it is some kind of economic fundamental, which perpetuates lazy thinking that is in fact very harmful for getting these plants closed down, and avoiding new ones being built.

Fossil fuel power plants are value-destroying machines. The cost of running them, including fuel, costs from air pollution and costs imposed by climate change far exceed their economic value. The sooner we can close them down while keeping the lights on, the more money we save.

Fossil power plants have no "economic life". Every year they're used instead of clean energy makes us worse off economically, regardless of money spent to build them. Let's not treat misguided investor expectations of lifetime as inviolable fundamentals.

The "committed emissions" estimated by the authors are based on assuming a lifetime of 40 years and constant utilization rates. That might sound ok until you realize the vast majority of the plants is in China, where coal plants have so far closed down closer to 25 than 40 years.

Now plants built in 2000s are starting to close as they're losing money.
reuters.com/article/us-chi…

Similarly, the utilization rates of coal and other fossil power plants have been falling globally, and the fall will continue or accelerate, as it becomes cheaper to reduce fuel costs by building more renewables. This is pure private economics, not assuming any climate policy.

One reason fossil plants still get built is that investors use same lazy thinking that the authors do - if only you can get a new plant built, it will make money for decades, until the end of its "economic life", and gov't can't do much b/c that'd carry a steep economic cost.

I would argue that a more useful way to communicate this would be that existing fossil power plants and other infra have to be retired at an average age of 26 years as seen from this chart - much faster than financiers and execs have tended to assume.