  We study the costs of coal-fired electricity in the United States between
1882 and 2006 by decomposing it in terms of the price of coal, transportation
costs, energy density, thermal efficiency, plant construction cost, interest
rate, capacity factor, and operations and maintenance cost. The dominant
determinants of costs have been the price of coal and plant construction cost.
The price of coal appears to fluctuate more or less randomly while the
construction cost follows long-term trends, decreasing from 1902 - 1970,
increasing from 1970 - 1990, and leveling off since then. Our analysis
emphasizes the importance of using long time series and comparing electricity
generation technologies using decomposed total costs, rather than costs of
single components like capital. By taking this approach we find that the
history of coal-fired electricity costs suggests there is a fluctuating floor
to its future costs, which is determined by coal prices. Even if construction
costs resumed a decreasing trend, the cost of coal-based electricity would drop
for a while but eventually be determined by the price of coal, which fluctuates
while showing no long-term trend.

Physics and Society