Today the Capitol welcomes 93 legislators, all actors in a classic play Wyoming has watched for years. When they leave in March, most of the cast will believe they’ve put on a marvelous show if they reject all tax increases, bash the feds while keeping their hands outstretched for more money and giving another giant boost to the wounded coal industry.

Opinion

When the curtain closes lawmakers will wait in the wings, ready to be showered with rapturous applause from a grateful audience.

But a few of us will squirm in our seats, knowing this show can’t go on forever without a massive rewrite of a worn-out script. A 0.3% surcharge for Wyoming power customers that will raise $2 million this year just to study one dubious, desperate answer to the coal industry’s problems is a harbinger of the harm that could come.

The play’s final act now relies on the introduction of an industry savior, a character that hasn’t been successful even with billions of federal dollars spent for research in Wyoming and other states: carbon capture utilization and storage to retrofit coal-fired power plants being retired.

Wyoming relies on fossil fuels to generate about 60% of state and local revenues, a tax system rooted in unfettered optimism since the early 1980s, when coal was king. There have been booms and busts, but Wyoming’s coal production peaked at 468 million short tons of coal mined in 2008.

The state’s production then plunged annually until it hit a low of 218 short tons in 2020. It was caused by cheaper, plentiful natural gas; even less expensive renewable energy, like wind and solar; and the closure of coal-fired power plants across the nation as states passed laws to reduce carbon emissions killing the planet.

A small uptick caused mostly by rising gas prices has boosted Wyoming’s mineral tax revenue, but state economic forecasters say it will only last a few more years. Wyoming must restructure its tax system and diversify the economy away from minerals, but legislators insist on only propping up coal.

Lawmakers depended on a coal export terminal in Washington state to bring Powder River Basin coal to Asian markets, but the company that planned to build it went bankrupt. Wyoming claimed other states’ vehement opposition violated the Constitution’s Commerce Clause and sued, but state and federal courts sided with defendants. In June 2021, the U.S. Supreme Court refused to hear Wyoming’s final appeal.

Public funds paid for that failed lawsuit, and state lawmakers once again want the people of Wyoming to pay to keep the coal industry on life support by studying carbon capture utilization and storage. 

CCUS has been on the drawing board for decades as a way to reduce emissions, but not a single U.S. project has been developed that’s commercially viable. That’s not likely to change, no matter how many laws Wyoming passes.

In October 2019, Rocky Mountain Power announced plans to retire units at two of its Wyoming power plants ahead of schedule. The Legislature said no, utilities must try to sell the plants and keep them operating, plus buy the electricity at whatever rate the new owner wants to charge!

Can you picture how many legislators will duck and cover to avoid irate voters who try to wave enormous electric bills in their faces?

A year later, Wyoming mandated utilities must generate at least 20% of their power from coal plants retrofitted with CCUS technology. But don’t be fooled: Lawmakers aren’t motivated to fight climate change. Their goal is to revive coal and use the captured carbon for enhanced oil recovery.

Rocky Mountain Power and Black Hills Energy told the Public Service Commission in 2022 the law would force them to significantly raise rates paid by Wyoming customers.

Rocky Mountain estimated the four units in its immediate plans would cost between $400 million and $1 billion to retrofit. Black Hills said its two units would cost a combined $980 million.

None of the costs to analyze or implement these changes can be borne by ratepayers outside the state, so Wyoming customers must absorb them. If it’s cost-prohibitive, companies may be exempted, but how much political pressure will the Legislature and one of the state’s top CCUS cheerleaders, term-limited Gov. Mark Gordon, exert on them to comply?

In March, Rocky Mountain Power told the PSC no portfolio standard for CCUS is economically feasible at this time.

Rep. Lloyd Larsen (R-Lander) is sponsoring House Bill 69 -Coal-fired facility closures litigation funding-amendments to allow the state to use $1.2 million appropriated for the Washington coal export lawsuit to fight the closure of coal-fired power plants, and keep CCUS options alive.

What happened to the free market most lawmakers claim to cherish? Why not allow supply and demand to regulate production and labor? Instead, state government is working hard to intervene when industry keeps giving reasons CCUS is a bad idea. 

Black Hills Energy stressed environmental impacts, including carbon capture operations that may negatively affect ambient air quality because they could potentially increase emission of certain pollutants.

Both Wyoming utilities said CCUS equipment could spike water use at coal plants and apply stress on existing aquifers. They’ve also determined the best coal capture technology is a version of an “amine-based solvent,” which can form toxic carcinogens as it breaks down. The White House Council on Environmental Quality warned the chemical’s release “may pose serious hazards to workers and the public near capture facilities.”

Even though the highest-profile CCUS projects in America have been multibillion-dollar failures, many corporations keep trying their luck using readily available federal funds that have been steadily increasing. 

An IRS tax credit program known as 45Q provides a per-ton credit to companies based on how much carbon dioxide they capture. Ten claimed a total of about $1 billion over the past decade. But because the U.S. Treasury Department reported $900 million didn’t meet the EPA’s monitoring and verification guidelines, we still don’t know how much pollution was actually kept out of the atmosphere.

President Joe Biden will be roasted daily by Wyoming legislators for supposedly killing the coal industry. While former President Donald Trump vowed to save coal, it rebounded under Biden, with utilities on track to burn 23% more coal as the global energy crisis lifts demand for fossil fuels.

Biden won’t get any credit for his Infrastructure Investment and Jobs Act, which added $12.5 billion for CCUS, including $3.5 billion in expanded 45Q tax credits. That’s fine by me, because it’s the weakest part of the bill. But it’s hypocritical for Republican lawmakers to decry his record while screaming to get a bigger slice of the CCUS pie.

The hike in severance tax revenues has bailed out our state again, turning a $1.5 billion budget deficit in 2020 into a $1 billion surplus as lawmakers begin work. They will also have a record $2 billion in the “rainy day fund.”

In such fortunate times, legislators never consider raising any taxes, and 2023 won’t be any different. But now is when Wyoming desperately needs to restructure its tax system before our minerals-based economy totally crashes, and quit wasting time and money trying to get commercial CCUS retrofits to work.

Can you picture how many legislators will duck and cover to avoid irate voters who try to wave enormous electric bills in their faces? The price of pushing carbon capture belongs on the Legislature’s back and not the utility executives who tried to warn them.

Kerry Drake

Veteran Wyoming journalist Kerry Drake has covered Wyoming for more than four decades, previously as a reporter and editor for the Wyoming Tribune-Eagle and Casper Star-Tribune. He lives in Cheyenne and...

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  1. Kerry Drake seems to be confused by the political rhetoric being tossed around. Who isn’t? Up is the new down.

    Missing from most discussions is the reality that President Biden increased Wyoming’s Federal Mineral Royalties by 25%, handing Wyoming’s citizens a huge source of revenue for projects. Coal, oil, and natural gas royalties were set in 1920, but not all states get the same amount.

    Why do ND & NM get 18-3/4% (instead of the 12-1/2% that Wyoming settled for for 102 years? Why does TX get 25%? Why does Alaska get 90% of the value produced?

    Even better: Why do those “snowflakes” in CA, and the rednecks in LA get more for off-shore production than Wyoming gets from land based rigs? How did both the Republicans in 2008, and the Democrats in 2009 manage to increase the FMR for offshore production, without Wyoming getting more for our economy?

    Why is that fact so hidden in virtually all discussions of tax policy? I’m tempted to link it to the “Honor Bond” phenomenon.

    Wyoming’s population has been trained to ignore (which Toto & Dorothy refused to do in the Wizard of Oz). “the man behind the curtain.” Letting the perpetrators of the massacres, ambushes, and other attacks on the people of Johnson County go “ on their honor” (never to be seen again), has been deeply ingrained in Wyoming’s culture.

    The big fish are not held to civil standards, and the ones who serve ’em loyally will also not be held accountable. The “Honor Bond” beneficiaries were allowed to go free after spending a few weeks in hotels (as well as jail cells), during the founding period of Wyoming’s evolution from territory to statehood.

    Why did it take so long for Wyoming to get more of the wealth from resource production? Politics. Teapot Dome happened here for a reason.

    More people in Wyoming need to look at GAO-07-676R, and ask themselves “Why are highly developed countries get more for their minerals?”

    My take is that countries that invest in education, infrastructure, and the rule of law are able to get more for their minerals because the value added is real. A well educated workforce is more productive. Infrastructure investments also safe producers enormous amounts. And the rule of law protects all human rights and profits.

    Several states (including Wyoming) were willing to take the very low royalties (similar to Cameroon), instead of other developed countries (like Norway, Saudi Arabia, or even Russia). Why?

    Wyoming’s extreme deference to the wealthy is shown in maps of public lands. Sheridan County has lost more than 2x any other WY county to political manipulation and privatization. Never forget that that was the 1st agenda of the Trump Administration, that local activists defeated.

    The 1st WY State Land leased for recreational use happened in Sheridan County in 2009. That lease is paying way more than the going rate for grazing, and many oil & gas leases. Why aren’t there more leases for recreational use on state & federal lands?

    Wyoming seems to be stuck on the shoals of vested interests, in the name of protecting the status quo. We must do better.

  2. I read this in the comments and posting instructions:
    “WyoFile does not fact check every comment but, when noticed, submissions containing clear misinformation, demonstrably false statements of fact or links to sites trafficking in such will not be posted.”

    I only wish WyoFile would use the same standards and diligence when accepting columns and opinion pieces from favorite contributors.

    There are in this column questionable statements presented as fact –
    • even less expensive renewable energy, like wind and solar; What?? Those can only be presently construed as less expensive by choosing to ignore the subsidies provided from taxpayers’ pockets and ignoring the total cost picture for producing and disposing of the equipment, plus the real environmental impacts being ignored.

    • as states passed laws to reduce carbon emissions “killing the planet” – hardly proven and in greater dispute daily.

    •  “may pose serious hazards to workers and the public near capture facilities.” Typical fear-promoting conjecture which adds nothing substantial to the discussion.

    •  it rebounded under Biden, with utilities on track to burn 23% more coal as the global energy crisis lifts demand for fossil fuels. No sources cited, but read closely – IF it has rebounded 23% – Biden did nothing – “the global energy crisis lifts demand for fossil fuels”.

    I see nothing more here than a load of misinformation intended to influence my opinion. I reserve the right to form my own opinion based what I am able to ascertain is the truth. The less obvious implication is that I am not able or incapable of doing that. I am wondering how Wyofile determines misinformation?

  3. Housebill 69 sponsored by Rep L Larsen is one of the dumbest ideas I’ve heard about in a long long time. Does this man and others who support this fantasy read reports from experts who have “boots on the ground” who clearly understand it doesn’t work and will cause more problems?
    Why isn’t the legislature more concerned about HELPING our communities thrive with opportunities that support children, families, Medicaid expansion, education, housing, the aging and our environment? No wonder our population is decreasing and leaving WY leaving with mostly old folks left behind. Mr. Larsen, quit beating a dead horse expecting it to rise up and win the Kentucky Derby.

  4. I love when Drake says “What happened to the free market most lawmakers claim to cherish? Why not allow supply and demand to regulate production and labor?”
    He never discussed the government subsidies for the “Green Economy”. Democrats use taxpayer’s money to destroy the coal industry. Try to be honest

    1. Subsidies is what has propped oil, gas, coal and Wyoming farm/ranches for decades.

      Natural gas killed coal. Repubs use tax payer money for tax breaks for corporations and the ultra wealthy. Try to be honest.

  5. Stunning that most of the elected representatives and senators keep doing the same thing and expect a different result year after year.

  6. Things aren’t much better in Montana. The hope for power from Small Modular Nuclear Reactors is fading fast. But every highway seems to have the large blades for wind power generators maneuvering through the traffic. And, the good news, geothermal heat pumps are becoming a “hot” topic.

  7. Well-written. Wyoming legislative history is filled recently with what they “won’t do” instead of what the HAVE accomplished. Republicans stand for no values at all. Traditional values include “progress” and “reform.”

  8. It takes guts to tell it like it is, thank you Mr Drake. Under Biden 23% more Wyoming coal is being sold than under Trump. Money speaks, future electric bills will scream. This is an excellent article . 5 stars!
    (I grew up in Wyoming but I haven’t been a resident for decades, however I still consider Wyoming special and my home)

  9. First, my sympathy for you having to cover the upcoming legislature. 40 days of torture. I hope you get hazard pay.

    Second, I am glad I got solar power installed in my house.

    Lastly, this legislature will adjourn, the people of Wyoming will give it a grade of F, which it seems to always get and then unfortunately they will elect the same people next election cycle.

    WAKE UP PEOPLE

  10. This session will be worse than any other session in history and having a governor who just refuses to do what is right for our state and our citizens makes it even worse. The question is why can’t we elect people with an education, an interest in the state and the citizens who live here. No we elect political hacks with a one line hook to get elected and then they sit and do nothing productive. They refuse to learn anything and are easily purchased or vote only their self indulgence. I don’t believe this state will ever recover from what the GOP has done to it. The number of these hacks that have moved here from out of state to throw their hand in the political ring because we are stupid enough to elect them is increasing by leaps and bounds. We will be the worse state in the nation in all facets within 10 years. We will have horrible education for children, no income, no taxes, no hospitals, no physicians and it will be a desert of idiots with guns.

  11. When you keep poring money down a rat hole it eventually fills up. Then you just have to find another rat hole. A very smart man once said insanity is doing the same thing over and over and expecting a different result.
    His name was Albert Einstein

  12. Excellent detailed reporting, Kerry. I’m wondering what the ripple-down effects of this unwise, expensive, blind-sided plan will be on the overall economy, the average person’s ability to access goods and services, on the strapped educational system, and on medical care.