The Political Economy of Clean Coal

Abstract

This dissertation investigates the nature of the political economy of Clean Coal. It begins by reviewing the literature of global warming and the current usage of coal in the United States and throughout the world. It examines the externality costs from burning coal, and reviews Clean Coal technologies. Based on the comparison of total costs of generating electricity between Clean Coal and conventional technologies, it concludes that Clean Coal technologies are more economically efficient. Based on marginal net benefit analysis, it proposes that the optimal approach to deploy Clean Coal technologies is to gradually replace existing facilities with ones equipped with Clean Coal technologies. It identifies two obstacles that prevent the large-scale deployment of Clean Coal technologies: the New Source Review program under the Clean Air Act and the regulation of greenhouse gases. It then uses a public choice framework to find that the rent-seeking activities of interest groups are the forces that created these obstacles. It concludes by making public choice compatible recommendations for policy reform that would one day make Clean Coal a reality.