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The energy economy is changing

The marketplace is changing the energy picture in the region and the United States more quickly than anticipated. Carbon credits, CO2 sequestration and new technologies for fuel production are creating a marketplace in which economics and environ...

The marketplace is changing the energy picture in the region and the United States more quickly than anticipated. Carbon credits, CO2 sequestration and new technologies for fuel production are creating a marketplace in which economics and environmental concerns are coming together in ways that just a few years ago seemed unlikely.

The energy landscape in North Dakota is but one example of the change. Putting aside for a moment the explosion of non-polluting wind energy, the state is rapidly becoming a pioneer in clean technologies for the use of traditional fuels: coal and oil. The energy future looks to be a melding of old and new energy technologies, and North Dakota is uniquely positioned to take full advantage of the trends.

North Dakota has lignite reserves for hundreds of years at current consumption rates. The question has been: How to use lignite coal to minimize pollution and maximize its energy value. One way is conversion of coal to synthetic gas, a process that is not new, but which has been refined to make it far more efficient and cleaner than ever before. A proposed plant and mine near South Heart, N.D., for example, will capture more than 90 percent of the CO2 generated in the coal-to-gas conversion process. Moreover, there's a market for captured CO2 in nearby oil fields.

Carbon sequestration incentives (taxes, markets, cap-and-trade formulas) factor into an economic model that makes sense for the energy industry. Without a sound economic model, the resistance to reducing greenhouse gases from energy production would be fierce. It's still significant, but the change in industry's view of carbon capture and sequestration is changing the economics for the better.

"For the better" will have different meanings for the various links in the energy chain. For example, one big regional wholesaler of electric power estimates that the wholesale per-kilowatt hour cost of electricity will double when new carbon reduction regulations are in place. Those costs will be pushed down the chain to the consumer in the form of higher electric power bills.

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But there is money to be made from good environmental technology and even money to be saved for taxpayers. The city of Fargo, for example, is earning hundreds of thousands of dollars by capturing methane gas from its landfill, using it to power some vehicles and selling it to a nearby agricultural processor. City officials anticipate carbon cap-and-trade incentives will generate money for the city.

Of course, there are some utopian environmentalists out there who want nothing to do with coal or any other fossil fuel. They sincerely - if mistakenly - believe no new project that uses coal in any form should be approved. That's not realistic, and won't be for a long time.

Generating clean energy at a price consumers can afford is no easy challenge these days. But the marketplace has recognized legitimate environmental priorities and is responding.

Forum editorials represent the opinion of Forum

management and the newspaper's Editorial Board.

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