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Economic Feasibility of Coal to Liquids Development in Alaska

The Northern Alaska Environmental Center retained CSE to provide an independent critique of two economic studies published by the National Energy Technology Lab and Hatch, Ltd. in support of coal-to-liquids plants in the Fairbanks region. The study considered CTL development from a net public benefits perspective, and concluded that economic feasibility is highly unlikely because the net present value of public investments are likely to be well less than zero and benefit-cost ratios well less than one. CSE’s report considered all relevant public and private costs, including natural resource damages, carbon emissions, and public subsidies – costs excluded from both the NETL and Hatch reports. The CSE report also corrected inaccurate assumptions contained in the economic analysis such as 100% plant availability and coal prices significantly less than what is being quoted by the coal supplier.

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