A coal conveyor stretches over rails to a loadout facility at Arch Coal's Black Thunder mine in the southern Powder River Basin. Arch Coal and Peabody Energy propose merging their adjacent mining operations here, which make up two-thirds of all coal production in the Wyoming portion of the basin. (Dustin Bleizeffer)

Wyoming and Montana’s joint petition to the U.S. Supreme Court last week that aims to enable a west coast coal port expansion project faces an uphill legal battle, according to a University of Wyoming law professor.  

“It’s unlikely, I think, that the [U.S. Supreme Court] will accept it,” University of Wyoming law professor Sam Kalen said. “If SCOTUS agrees to hear the case, I think a lot of us A) will be shocked, and B) it will prompt a deluge of various other types of amici [legal briefs] at the Supreme Court.”

Wyoming and Montana asked the U.S. Supreme Court this month to break a regulatory roadblock erected by Washington state to a west coast coal port expansion project. The petitioners claim that Washington, motivated by state politics, is improperly using its environmental regulatory agency to stop exports of Powder River Basin coal to Asian markets.

If SCOTUS decides to take up the case, legal briefs could pour in from U.S. state and local governments that have implemented or are considering climate policies that could impact the interstate marketability and transportation of fossil fuels, according to Kalen.

However, Kalen added, whether the nation’s highest court decides to consider the case depends less on matters of fossil fuels and climate change and more about whether SCOTUS has an appetite for weighing in on the Dormant Commerce Clause of the U.S. Constitution.

A train loaded with Powder River Basin coal sat sidelined near Rozet recently. Wyoming’s Powder River Basin coal complex is served by two railroads, Union Pacific and BNSF Railway, which predominantly use 2-mile long “unit” trains to ship coal to power plants in more than 30 states. (Dustin Bleizeffer)

The Dormant Commerce Clause forbids, without direction of Congress, one state from unduly burdening interstate commerce.

“In order for Montana and Wyoming to win, they actually might need the Supreme Court to tweak — a little bit more aggressively — the Dormant Commerce Clause, which is what they’re suing on,” said Kalen, who also serves as co-director of the UW Center for Law and Energy Resources in the Rockies. 

Only SCOTUS has the authority to set the kind of precedent that Wyoming and Montana seek — one that counters existing precedent among lower courts, according to Kalen This may explain why the petitioners chose to bypass lower courts and file an original case before SCOTUS. 

“So going directly to the body that has the authority to do that, strategically, I could understand,” Kalen said. The U.S. Supreme Court, however, is usually “loathe” to take on such cases, he said.

PRB coal route to Asian markets

Mines in the coal-rich Powder River Basin straddling the Wyoming-Montana border are suffering from declining demand in the U.S. utility market. Industry advocates have long considered west coast exports to Asian markets a potential lifeline for the region. 

Although potential shipments from the PRB to Asian markets don’t measure up to the coal volumes served to the U.S. market, they could command a higher price per ton — a tantalizing prospect for operators experiencing shrinking profit margins and a shrinking thermal coal utility market at home.   

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For nearly a decade, PRB coal companies, along with the states of Wyoming and Montana, have pushed for an expansion of west coast coal ports in the U.S. Among about a half-dozen proposals, the Millennium Bulk Terminals project in Longview, Washington emerged as the most likely prospect, adding 44 million tons of annual export capacity.

The Millennium Bulk Terminals project, like other west coast coal port proposals, has, however, faced fierce opposition from conservation groups and has drawn both pro- and anti-coal port expansion interest in Washington. 

In 2017, the Washington State Department of Ecology denied a Section 401 Water Quality Certification permit required under the Clean Water Act, effectively halting the project. 

Since then, courts have backed the state’s decision as lawful, citing potential impacts to the Columbia River.

Gov. Gordon’s case for SCOTUS lawsuit 

The landlocked coal states claim Washington state misused the Clean Water Act to meddle with interstate commerce for political means. In this way, states argue, Washington violated the Dormant Commerce Clause, which guarantees states’ rights to interstate commerce and access to foreign markets. 

“It is critical that Section 401 of the Clean Water Act not be used to interfere with lawful interstate commerce,” Wyoming Gov. Mark Gordon said in a press statement. “It is not a tool to erect a trade barrier based on a fashionable political agenda.”

Nearly empty tracks at a rail yard in downtown Gillette point toward the Wyodak coal generation complex east of town. Gillette and Campbell County reap hundreds of millions of dollars from the Powder River Basin coal industry — an industry that analysts describe as “distressed.” (Dustin Bleizeffer)

Gordon addressed editors, publishers and reporters at the Wyoming Press Association’s annual convention in Casper on Friday, and reiterated that the petition to the U.S. Supreme Court — legally speaking — is about much more than just coal. Washington’s interpretation of Section 401 of the Clean Water Act could also be used to block Wyoming agricultural products, or just about any Wyoming product, he said.

“So this time, I think, that we stand up for rights that were enumerated in our Constitution [and] addressed in Federalist No. 7 by Alexander Hamilton when he said it is important that the U.S. Congress be the only arbiter of interstate and foreign commerce.”

Many of the potential impacts of the Millennium Bulk Terminal expansion — including impacts to the Columbia River — cited in Washington’s denial of the Section 401 permit could be easily addressed by building a bridge, Gordon said. Rather than build a bridge to help alleviate concerns among locals, he said, Washington seems determined to portray the entire project as a major new industrial development without options to mitigate environmental impacts.

“Let me tell you: The Millennium Bulk Terminal is not a greenfield site,” Gordon said. “There are barges that move up and down the Columbia there. There is rail infrastructure, there.” 

Wyoming-Montana legal team 

Wyoming and Montana have hired the firm Crowley Fleck to manage and possibly argue the case. The firm has extensive experience in energy and natural resource issues. It operates in several states, including from offices in both Wyoming and Montana. Lead attorneys from Crowley Fleck on the case include Dale Schowengerdt in Montana and Tim Stubson in Wyoming.

Stubson served as a Republican Representative from Casper in the Wyoming Legislature from 2008 to 2017, and earned his law degree from the University of Wyoming. He made a bid for the U.S. House in 2016, asserting “We must win local control over our resources,” according to the Cody Enterprise

While at the legislature, Stubson served on the Joint Appropriations Committee, which exerts significant control over the state budget. Like many Wyoming lawmakers, Stubson was a strong advocate for Wyoming coal, including backing efforts to boost coal technology research and to expand Wyoming’s coal markets via west coast seaports.

Wyoming Attorney General Bridget Hill declined to disclose how much money has been spent on the case so far. She said, for now, funds to support the lawsuit come from the Federal Natural Resource Policy Account.

Dustin Bleizeffer is a Report for America Corps member covering energy and climate at WyoFile. He has worked as a coal miner, an oilfield mechanic, and for 25 years as a statewide reporter and editor primarily...

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