WOW

Oil costs 18 times as much as Coal per unit of heat energy generated!
I guess that’s why 50% of the electricity generated in the US comes from coal, while only 2% comes from petroleum?

Instead of doing useful things at work today, I did the following simple algebra:

Let’s say for simplicity of calculation that 1 short ton of coal costs about $20 in the US, depending on what state you live in, (click here for super fun coal facts)

use this super fun energy converter to figure that 1 short ton of coal generates 20,754,000 Btu’s of heat energy. Put 20,754,000 in for Btu’s in the petroleum segment and you get that it takes 3.58 barrels to generate the same amount of heat energy.

Much to the chagrin of commentators everywhere, especially those who foresee the problem of having to compete for scarce resources with China et al., the price of a barrel of oil just hit $100. $20 times 5 = $100. hence…(3.6 x 5): 1 is the monetary value of oil versus coal = 18.

Most electricity is generated by giant moving turbines, which are pushed by steam, emitting from boiling water heated by some kind of fuel. Since the temperature at which water boils is (more or less) constant, it costs 18 times as much in terms of cash money to generate a given amount of electricity with oil as opposed to coal. Craziness!

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2 Responses to “WOW”

  1. David Says:

    How about comparisons of preparation, maintenance, and clean-up of burning the coal versus burning the oil? And does burning either require special know-how? Because specialists drive labor costs up.

  2. tripinchina Says:

    Yes, a proper analysis of the real cost of coal versus oil should include an account of all the externalities involved. Your point about labor is a good one. Also, I know that the mining of coal causes the following adverse effects on the environment:

    1. Release of methane, a greenhouse gas
    2. Interference with groundwater and water table levels
    3. Rendering land unfit for the common usage of the area.
    4. Screwing up wildlife/eco-systems
    5. The release of dust

    And coal has to be mined, which is historically dangerous and bad for one’s health. Oil also has to be extracted, but it seems like this process would be less dangerous/bad for the environment than coal mining. I have no idea whether this is true though.

    I guess what struck me as really amazing about the price of coal vs. oil is why you never hear about wars being fought over coal, even though it seems way cheaper and more abundant. I suppose this is because petroleum can be refined and turned into gasoline whereas coal can’t be used for this purpose?

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