Hidden costs of coal by Fundatia Greenpeace Romania

Hidden Costs of Coal The consequences of burning coal on people‘s health and the economy

Case Study Planned Coal Power Plant in Galaţi, România

September 2012

Printed on recycled paper

summary This report reveals the hidden costs of burning coal and in particular the coal fired power plant of 800 MW in the Free Trade Zone GalaĹŁi, a planned investment by the Italian utility ENEL. These costs, which will not be at sight and therefore will be avoided by those who generated them, will become unavoidable for the Romanian citizens. Supporting new coal power plants will lock the country into a pathway of unsustainable development, with negative consequences for public health, the environment and the national economy for many decades. The government should support a future energy system with high penetration of renewable energy, smart grids and supported by energy efficiency measures. This is necessary not only to drastically reduce the social and economic costs of air pollution, but also because it would lead to reduced energy dependency and to the modernization of the Romanian economy with the help of clean and efficient technologies that create more income and jobs for the people. Data on the health and economic costs of pollution are based on the methodology used in the European Environment Agency report "Revealing the costs of air pollution from industrial facilities in Europe". The scientific basis of the calculations is documented in the methodology reports of the CAFĂ&#x2030;-CBA project (CAFE-CBA 2005)1. The emission estimates for the Galati power plant are taken from the Environmental Impact Assessment submitted by the project proponent.

1 CAFE-CBA 2005, was commissioned by EEA and developed by the AEA Group. For more information: http://cafe-cba.org/reports-on-developing-the-cba-framework/

Key Findings Air pollution from the new power plant Galati is estimated to cause a premature death of approximately 40 people a year, for a total loss of 400 life-years per year.

Overall2, an estimated 45 000 days of sickness are caused per year, resulting in economic losses due to absence from work.

The total external cost from pollution caused by this single power plant to the society would amount to 235 mil â&#x201A;Ź annually, this corresponds to over 9,000 mil â&#x201A;Ź for the 40 year lifetime operation of the facility.3

Next to burning of coal, additional environmental and social costs are caused on the biodiversity, forests, water system by mining, transporting and storing of coal

New power plant does not mean clean power plant â&#x20AC;&#x201C; it still produces lots of pollutants, which will add to the existing toxic background of the city.

2 High chimneys of big capacity thermal power plants facilitate the dispersion of pollution in a manner in which 50% of the health damage will occur on a radius of 200 km from the emitter power plant. In the case of the Galati coal fired power plant, this virtual 200km circle includes the cities of Bucharest, Constanta, Tulcea, Calarasi, Ploiesti, Vaslui, Roman, Bacau and Iasi. 3 Include both CO2 and air pollution cost here as well

Introduction As a result of the air pollution, the electricity is being produced at grave cost to the local communities, the environment and the national economy. These costs are not included in the electricity bills we pay as consumers nor the energy producers pay it – it gets at the expense of our health, damaged environment and reduced performance of the national economy. This study reveals the real costs of burning coal and in particular the coal fired power plant of 800 MW in the Free Trade Zone Galaţi, a planned investment of the Italian utility ENEL.

The recent report by the European Environment Agency, "Revealing the True Cost of Air Pollution from industrial facilities in Europe,"4 is trying to express in economic terms, with a use of an updated methodology, the effects of air pollution from around 10,000 European industrial facilities on public health and the environment. The report used available data from the European Pollutant Release and Transfer Register5 and concluded that for 2009 the total cost (externalities) amounted to 102-169 billion €, or 200-330 € on average per European citizen. As expected, most of the pollution and therefore most of the economic damage (66-122 billion €), was caused by the operation of the European power plants, most of them fueled by coal and lignite. Romania is the sixth largest industrial polluter in the European Union, following Germany and Poland, which occupy the top two slots in a listing recently published by the European Environment Agency (EEA).6 The energy sector is a major contributor to environmental degradation in Romania, as a result of the use of burning fossil fuels in power stations. As of 2008, approximately 90% from the pollutant emissions in Romania are caused by the energy sector, including extraction, transport, conversion and combustion of fuels. The sector contributes to atmospheric emissions

4 ‘Revealing the costs of air pollution from industrial facilities in Europe’, November 2011, http://www.eea.europa.eu/pressroom/newsreleases/industrial-air-pollution-cost-europe 5 http://prtr.ec.europa.eu/ 6 http://energia-online.eu/2011/12/11/romania-is-the-sixth-largest-industrial-polluter-in-the-eu/

of significant quantities of sulphur dioxide, carbon monoxide, carbon dioxide, nitrogen oxides, small particles, as well as residual water discharge.7

According to the EEA, air pollution emissions from Romanian industrial facilities caused in 2009 total health and other external costs of 4,7-10,3 billion euro. The power and heat sector was responsible for 80% of the damages, and the Rovinari, Turceni and Craiova complex alone caused 1.7-3.9 billion euros in damages.8

Figures for Romania show that cleaner air resulting from the achievement of a higher European target in GHG emissions reduction (30% by 2020) would result in public health benefits of between 471 million euro and 1,358 million euro per year from 2020.9 Economists have been developing methodologies for the last few decades to quantify in monetary terms the so-called “externalities”. An externality is a cost or benefit of an economic activity that is not borne by the actors responsible for the activity and therefore not reflected in market prices. Examples include impact of polluting power plant on health and the environment (negative externality) and the beneficial impacts of a positive externality (planting a tree in front of your house, it brings benefits of less pollution and less noise for others). The main externality caused by air pollution is loss of human life. Greenpeace believes that human life has an inherent value that cannot be measured in monetary terms, and therefore it is important to discuss the external costs also in terms of the number of deaths. However, monetary valuation enables us to compare energy choices to other ways of protecting human life, and often shows that investment in cleaner sources of energy is a very cost-efficient way to improve health and life expectancy. The valuation used in this study is the EEA “value of statistical life” (VSL) method, which places a cost of two million euros on each avoidable death.

This report focuses only on the impact of the process of burning coal to produce electricity, however the damage doesn’t start and finish with the emissions caused during the very

7 ‘The Annual Report on the State of the Environment in Romania’, 2008, page 278, http://www.anpm.ro/files2/ENERGIA_200910165716890.pdf

8 Datasheet – Revealing the costs of air pollution from industrial facilities in Europe, November 2011 http://www.eea.europa.eu/publications/costof-air-pollution. “Power and heat sector” refers to the Main activity category “Energy - Thermal power stations and other combustion installations” in the E-PRTR classification. 9 ‘Climate report: How Romania could improve health and save money’ December 2010 http://www.env-health.org/IMG/pdf/ROMANIA_061210.pdf

combustions. The entire process – or chain of custody – from mining, long transport and handling and storing the coal, through combustion to waste disposal, and in some cases re-cultivation, has a direct impact on the environment, human health and the social fabric of communities living (not only) near mines. It severely disrupts ecosystems and contaminates water supplies. It emits other greenhouse gases like nitrogen oxide and methane from waste sites. Mining and combustion consume and pollute huge amounts of water – energy from coal is the most water demanding from all energy sources.

Impact of Burning Coal on people’s health

Hazardous air pollutants emitted to the atmosphere by coal-fired power plants cause a wide range of adverse health effects. As has been described e.g. by the World Health Organization10, European Environmental Agency or by Physicians for Social Responsibility11, the adverse effects include damage to eyes, skin and breathing passages, negative effects on the kidneys, lungs, and nervous system; increasing the risk of cancer; stroke; lower respiratory tract disease and asthma; adversely affect normal lung development in children; and pulmonary and cardiovascular disease. It interferes with lung development, and increases the risk of heart attacks and some neurological diseases.

Some of the air pollutants are included in the EEA analysis, which quantifies their effect on human health, buildings and crops.12 The vast majority of the damage costs estimated by the methodology stems from the loss of human life due to air pollution, and from the damages caused by climate change.

10 World Health Organization, Air quality and health, Fact sheet N°313, September 2011 11 Coal’s Assault on Human Health, Physicians for Social Responsibility - http://www.psr.org/assets/pdfs/psr-coal-fullreport.pdf /Emissions of Hazardous AIR Pollutants from Coal-fired Power Plants, Environmental Health and Engineering, Inc., Needham, USA, 2011, http://www.lung.org/assets/documents/healthy-air/coal-fired-plant-hazards.pdf 12 ‘Revealing the costs of air pollution from industrial facilities in Europe’, November 2011, http://www.eea.europa.eu/pressroom/newsreleases/industrial-air-pollution-cost-europe

Nitrogen oxides (NOx) Nitrogen oxides are emitted from fuel combustion, such as from power plants and other industrial facilities. NOx contributes to acidification and eutrophication of waters and soils, and can lead to the formation of particulate matter and ground-level ozone. Of the chemical species that comprise NOx, it is NO2 that causes adverse effects on health; high concentrations can cause airway inflammation. Epidemiological studies have shown that symptoms of bronchitis in asthmatic children increase in association with long-term exposure to NO2. Reduced lung function growth is also linked to NO2 at concentrations currently measured (or observed) in cities of Europe and North America.

Sulphur dioxide (SO2) Sulphur dioxide is emitted when fuels containing sulphur are burned. As with NOx, SO2 contributes to acidification, with potentially significant impacts including adverse effects on aquatic ecosystems in rivers and lakes, and damage to forests. SO2 can affect the respiratory system and the functions of the lungs, and causes irritation of the eyes. High concentrations can cause inflammation of the respiratory tract, coughing, mucus secretion, aggravation of asthma and chronic bronchitis and make people more prone to infections of the respiratory tract. SO2 also contributes to the formation of particulate matter in the atmosphere.

Particulate matter (PM10) In terms of potential to harm human health, PM is one of the most important pollutants as it penetrates into sensitive regions of the respiratory system, and can cause or aggravate cardiovascular and lung diseases. The World Health Organization suggests that the effects of PM on health occur at levels of exposure currently being experienced by most urban and rural populations - chronic exposure to particles contributes to the risk of developing cardiovascular and respiratory diseases, as well as of lung cancer. PM is emitted from many sources and is a complex mixture, comprising both primary and secondary PM; primary PM is the fraction of PM that is emitted directly into the atmosphere, whereas secondary PM forms in the atmosphere following the release of precursor gases (mainly SO2, NOx, NH3 and some volatile organic compounds (VOCs).

Carbon dioxide (CO2) Carbon dioxide is emitted as a result of the combustion of fuels such as coal, oil, natural gas and biomass for industrial, domestic and transport purposes. CO2 is the most significant greenhouse gas influencing climate change.

ÂŠ Greenpeace/Jason DeCrow

Negative Impact New Galati of the

Power Plant

The people in Romania and surrounding countries already pay a high price for the current emissions by the industry and especially the coal electricity. Regardless, the politicians still want to support new coal power plants. In 2011, the Romanian government applied for an allocation of approximately 75 million tonnes of emissions allowances free of charge in the period 2013-2019. In return, the Romanian government proposed a national investment plan that includes 22 fossil fuel installations, out of a total of 24 power plants, and would result in 36 percent of the proposed new capacity coming from coal. Instead of diversifying the electricity mix and decarbonising the current system, the proposed investments would lead to maintaining, or even increasing the high share of coal in Romania's electricity production.13 The new power plant GalaĹŁi should go commercially online within 4 years from the start of construction, with the expected lifetime of 40 years. The investor projects two countries of origin of the coal for Galati â&#x20AC;&#x201C;Ukraine and South Africa. The air pollution and CO2 emissions estimated for the two options are within 0.5% of each other, and hence only the more likely option, of Ukrainian coal, was considered in this report. Proponents of coal argue that new power plants, equipped with modern pollution control technologies, will minimize environmental and health impacts. It is true that the new power plant would have lower environmental impact compared to facilities from the past. However, still the impacts are very far from being zero - the annual emissions are estimated to be 170 tons of PM10, 2,520 t NOx and 2,520 t SO2. Additionally, the plant would produce annually 4 360 000 tons of CO2 and by this contribute to dangerous climate change. Such numbers would add to already high pollution from the whole industry sector, transport and energetics.

Alternatives to the new coal power plant, in the form of energy efficiency, renewable energy or gas, do all produce lower or, in case of energy efficiency and most renewables, nearly zero air pollution.

Investing in a new coal-fired power plant would commit the country to the energy technology with the highest air pollution and CO2 emissions for another 40 years, at a time when better alternatives have become widely available.

13 http://bankwatch.org/publications/comments-romanias-application-transitional-allocation-free-emission-allowances

Annual emissions of Galaţi power plant, compared to available technologies (tons)

800 MW coal power plant, Galaţi Natural gas combined cycle power plant with the same annual electric output14 Wind

PM₁₀

NOx

SO₂

CO₂

170

2.520

4.360.000

Negligible

156

Negligible

1.500.000

CO2 – Carbon Dioxide SO2 – Sulphur Dioxide NOx – Nitrogen Oxides PM10 – Particulate Matter (particles with diameters under 10 microns) Moreover, a recent assessment15 commissioned by the organization CEE Bankwatch Network is indicates that the proposed technology and expected emissions (in the EIA documentation) are by far not achieving Best Available Technology standards, and that the expected emissions are close to values of a 30 year old power plant in the Netherlands, as is shown in the following table:

Comparative table of toxic emissions from coal power plants ENEL-Galați power plant, according to the EIA

BREF 2006 (under review and expected to become tighter)

E.ON power plant in Rotterdam, operating since 1983

Appropriate ELV for ENEL-Galați

NOx

150

90-150

200

SO₂

150

20-150

189

127

20-40

Dust

5-10

Mercury

2,9

To be assessed

Fluorides

1-5

0,5

0,3-0,5

Monthly average

Daily average

Yearly average

Daily average

(as HF)

Although EEA estimated the deaths and chronic diseases caused by pollution in order to arrive at an economic cost, it did not release those estimates. Greenpeace, using available data on emissions and with the use of the EEA CAFE-ECB 2005 methodology, estimated the consequences to public health, such as deaths, chronic diseases and hospital admissions,

14 U.S. National Energy Technology Laboratory 2010, p. 458: Cost and Performance Baseline for Fossil Energy Plants. Volume 1: Bituminous Coal and Natural Gas to Electricity. Revision 2, November 2010. U.S. Department of Energy. http://www.netl.doe.gov/energyanalyses/pubs/BitBase_FinRep_Rev2.pdf

15 Assessment of the EIA report on the Galati Free Trade Zone Power Plant 800 MWe, commissioned by Bankwatch in June 2012.

resulting from the operation of concerned power stations. Greenpeace used EEA's methodology CAFE-CBA 2005 in order to assess - with the same criteria - the burden to public health and to the national economy from the operation of this new power plant that will stay in operation for at least 40 years. Using the above data to the CAFE-CBA model, we drew the following conclusions:

Annual consequences to the public health and the economy from the operation of the coal power plant Total health impacts (cases per year) Deaths

Life-years lost

Chronic bronchitis

Hospital admissions

Sickness days

398

44.700

The table shows that approximately 40 people every year would lose prematurely their lives as a result of the air pollution from the operation of the thermal power plant in Galaţi, while approximately 17 would suffer from chronic respiratory diseases. A different perspective for understanding the impact on the national economy from the burdened public health is the calculation of sickness days (restricted activity days of working population) as a result of population morbidity from air pollution. The following estimates were obtained by day to day correlation between pollution levels and sick leaves. This is another staggering result, since a total of approximately 44 700 working days annually would be lost because of the effects of air pollution from the Galaţi coal power plant on public health. Crop damages: 610.000 euro External costs of air pollution caused by Galati power plant (euro per year): 89.000.000 External costs of CO2 – caused by climate change (euro per year): 146.000.000 Total external costs (euro per year): 235.000.000

Further

Critical Notes Apart from the above calculated negative impacts, there are several more severe impacts connected to the project. European non-governmental organization CEE Bankwatch network is publicly criticising the fact that the Galati power plant is planned to be constructed in the Galati tax free zone, which initially wasn't designed to incorporate industrial activities. On Enel's request, however, Romanian authorities changed the spatial plan, allowing Enel to import coal (from Ukraine and South Africa) without paying duties.16

Secondly, the thermal power plant would neighbour the „Lunca Joasă a Prutului Inferior” natural park. Parks limits coincide with those of other two protected areas: park of community importance ROSCI0105 “Lunca Joasă a Prutului” and the site of bird and fauna importance ROSPA0070 “Lunca Prutului – Vlădești – Frumușița”. Along with the fact that the power plant would also border the Danube, these environment related matters raised several negative reactions of the general public, opposing the project.

16 http://bankwatch.org/news-media/blog/many-faces-coal-subsidies-glance-romania

Energy Efficiency

and Renewables

- a way to a sustainable energy future

The construction of new coal plants, however, is neither necessary nor beneficial. In fact, building new units that produce inflexible base-load output and their operation for many decades will cause serious obstacles to the large penetration of renewables and to a more efficient use of energy, due to the incompatibility of technologies. To this end, the European Network of Transmission System Operators for Electricity will soon submit a ten-year plan that is expected to be "driven directly or indirectly by renewable integration concerns”.17

In its Energy Roadmap 205018 report, the European Commission presented several possible pathways for EU’s future energy mix. According to this report, all scenarios – regardless of their technological orientation – involve a great share of renewable energy. Furthermore, the economical analysis of scenarios points out that the cost differences between scenarios will be negligible.

17 http://www.euractiv.com/specialreport-europes-electricity-grid/eus-10-year-power-grid-plan-driven-renewables-news-510679 18 http://ec.europa.eu/energy/energy2020/roadmap/index_en.htm

The 800 MW Coal Fired

Power Plant of Braila Less than 35 km from the city of Galati, neighboring the city of Braila, a twin power plant of the same kind, is planned to talke shape. This second power plant will have the same 800 MW capacity, will use the same imported brown coal with the one in Galati. Given the immediate vicinity of the two and their technical similarities, the health effects presented in the current report so far can be extrapolated, with little margin of error, to the Braila power plant. To conclude, if the two power plants would come into being, they will bring serious pollution to the Braila-Galati area, for 40 years, with severe health effects. Moreover, it’s not only the population from Braila and Galati who will suffer, but the pollution from the two power plants during the 40 years of operation will affect all the other cities on a radius of 200 km from outside the Carpathian Arch.

Greenpeace is an independent global campaigning organisation that acts to change attitudes and behaviour, to protect and conserve the environment and to promote peace. It comprises 28 independent national/regional offices in over 40 countries across Europe, the Americas, Africa, Asia and the Pacific, as well as a co-ordinating body, Greenpeace International. Greenpeace uses non-violent, creative confrontation to expose global environmental problems and to drive solutions for a green and peaceful future. Greenpeace is independently funded and does not accept donations from governments, the EU, corporations or political parties.

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HIDDEN COSTS of COAL The consequences of burning coal on people‘s health and the economy CASE STUDY: Planned Coal Power Plant in Galaţi, România Authors: Ionuț Cepraga - Energy Campaigner, Greenpeace CEE Romania; Jiri Jerabek - Energy Campaigner, Greenpeace CEE; Lauri Myllyvirta - Energy Campaigner, Greenpeace International. Cover: © Greenpeace/Adrian Ţuchendrea Greenpeace CEE Romania www.greenpeace.ro info@greenpeace.ro