The coal lobby has itself to blame

The coal lobby has itself to blame

American coal’s biggest obstacle isn’t President Obama and his administration. It’s its own refusal to come to the table to negotiate a plan for reducing greenhouse gas emissions from power plants.

“We have not done that, as you know,” Wyoming Mining Association executive director Marion Loomis told WyoFile in February. Instead, the coal lobby’s decades-old insistence is to allow electric utilities to figure out a commercially viable scenario for carbon capture and sequestration (CCS) to reduce greenhouse gas emissions without ANY policy pressure from the government.

But not everyone is holding their breath for that to happen.

This week, the U.S. Environmental Protection Agency (EPA) issued a new rule limiting the volume of carbon dioxide (CO2) emissions from new power plants. CO2 is the main greenhouse gas responsible for climate change, according to the world’s top scientists.

The rule (now under a 60-day public comment period) effectively sets a CO2 standard at a level that maintains natural gas as a viable feedstock (1,000 pounds per megawatt hour), but it knocks out coal — unless that coal is gasified and the CO2 byproduct is sequestered underground.

According to the EPA:

— Plants that install and operate CCS right away would have the flexibility to emit more CO2 in the early years as they learn how to best optimize the controls.

— A company could build a coal-fired plant and add CCS later. For example, a new power plant could emit more CO2 for the first 10 years and then emit less for the next 20 years, as long as the average of those emissions met the standard. 

The reaction in Wyoming was best summed up in a headline in the Gillette News-Record this week, “EPA rules don’t go over well in Wyo.”

“It’s another attack on the coal industry,” Loomis told the Gillette News-Record. “It certainly could have a major impact on plants that we will need as our economy recovers. It will be a major deterrent in construction of any new coal-fired power plants.”

Sen. John Barrasso (R-Wyoming) issued this press statement; “The Obama Administration just took another step to fulfill the President’s plan to make electricity ‘skyrocket’ and ‘bankrupt’ America’s coal industry. … It is a slap in the face to American workers and a high five to extreme environmentalists.”

To be fair, some Wyomingites are delighted with EPA’s new rule — although they are the minority here in coal country. Wyoming is America’s coal powerhouse, supplying more than 40 percent of the nation’s coal.

The U.S. Supreme Court already weighed in on this matter, and greenhouse gas regulation is the law of the land. If EPA’s new rule limiting CO2 emissions from new power plants spells the beginning of the end for coal, it will be the coal lobby’s own fault for not negotiating an emissions reduction schedule and not pushing hard enough on carbon capture and sequestration efforts.

Curbing greenhouse gas emissions from coal is not a new policy ambition, and neither is the effect of the coal lobby’s refusal to negotiate. For many years now, American utilities have conducted what many would consider a smart reaction to the political uncertainty created by the coal lobby and has pulled coal from its planning.

In fact, publicly-regulated utilities — utilities which are required by law to deliver power based on the most affordable and reliable options available — have run away from the coal lobby’s dangerous game of chicken. And every rate increase brought by Wyoming’s coal-heavy public utilities in recent years have pointed to the rising cost of coal as a major factor in their rate increase justification — long before any enforceable limits of CO2 emissions came into play. Even without greenhouse gas regulation, coal will only become more expensive. Yes, adding controls to the existing coal fleet to curb other toxins such as mercury and sulfur dioxides has added costs, but the cost of mining coal is also on the rise. The cheap and easy stuff has already been gotten.

Wyoming lawmakers should be credited for at least preparing to regulate greenhouse gases under the federal Clean Air Act. This past legislative session, lawmakers passed a bill allowing the Wyoming Department of Environmental Quality (DEQ) to draft rules and regulation of greenhouse gases in anticipation of EPA’s gradual implementation of greenhouse gas emission standards — an action that utilities implored Wyoming to take. That would put the day-to-day duties of permitting and regulating in the hands of Wyoming DEQ rather than EPA.

But instead of spending $10 million on a road to nowhere (or what one day might be the site of DKRW Advanced Fuels’ Medicine Bow coal-to-liquids plant in Carbon County), and instead of helping to finance $100 million or more of that project, Wyoming would likely make a better return on its money by investing in west coast coal ports under the de facto energy policy the U.S. is left with today. Wyoming lawmakers are eager to spend millions of taxpayer dollars on what might bear one or two advanced coal facilities in Wyoming, while their years of railing against a federal climate policy has helped to effectively negate what might be a national and international CCS market.

If carbon capture and sequestration technologies (supposedly the lubricant to squeeze coal under greenhouse gas limits) are lagging, Big Coal should ask itself if it has put enough of its own money and resources behind these efforts.

Instead of shouting down efforts to draft a climate and energy policy in Washington D.C., Wyoming’s leaders would have done better by our coal economy to negotiate an emissions schedule and to work harder to champion efforts to bring CCS closer to the commercial market. China leads the world in those endeavors, however. Not the U.S.

If anybody had the juice to convince Wyoming’s major coal players to come to the table and negotiate a climate policy on Capitol Hill, it might have been Wyoming’s former governor Dave Freudenthal who had a cunning command over the politically powerful fossil fuels industry during his eight-year tenure in Wyoming’s highest office. He didn’t — or at least not successfully. Instead, upon leaving the governor’s post, Freudenthal accepted a position on Arch Coal Inc’s board of directors and he now flies to St. Louis on a regular basis to help that company figure out how to ship more of Wyoming’s red, white and blue coal to China.

Contact Dustin Bleizeffer at 307-577-6069 or dustin@wyofile.com.

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