The coal industry is headed down the same path as U.S. automakers, and its future will become just as troubled and expensive for the American people if it continues pouring money into fighting the science rather than investing in cleaner technology, Congressman Ed Markey warned industry leaders Wednesday.
In a tense hearing held in the wake of last week’s deadly coal mine explosion in West Virginia, Markey questioned the business sense of the coal industry’s opposition to climate legislation — legislation that he says goes out of its way to help coal users adjust to what he considers inevitable carbon emissions reductions and to help coal itself remain a central part of the U.S. economy.
“The American auto industry claimed the technology wasn’t available, affordable or preferable,” Markey said. “Eventually, their folly became clear — customers abandoned their products.” The next stop was a multibillion-dollar taxpayer bailout.
The Massachusetts Democrat compared that to changes taking place today in electricity production, where countries, aware that carbon regulations are likely coming, are competing to become the global leader in clean energy technology and secure the jobs and economic advantages that come with it.
The response from the panel of coal executives at the hearing: The U.S. government should provide more money for U.S. companies to develop and deploy “clean coal” technology such as carbon capture and storage, and it should hold off on any regulations until that technology is up and running at scale — likely 15 to 20 years.
The hearing in Markey’s House Energy Independence and Global Warming Select Committee included the heads of the United States’ three largest coal producers — Peabody Energy, Arch Coal and Rio Tinto — and ranged across the topics, from climate change to technology to mine safety.
CCS First, Regulations Later
Markey, like President Obama and Energy Secretary Steven Chu, clearly supports carbon capture and storage technology.
The Waxman-Markey American Clean Energy and Security (ACES) bill that passed the House last year includes $10 billion for CCS research and development plus $50 billion in bonus allowances for CCS installed before 2025. The bill also would provide deep concessions for coal-using industries, such as utilities, in the form of free carbon emission allowances and a ban on the EPA regulating carbon emissions under the Clean Air Act. The Senate’s version, which could finally be unveiled by Sens. John Kerry (D-Mass.) and Lindsey Graham (R-S.C.) next week, is expected to support fossil fuels even more strongly than the House’s.
The industry wants the money being proposed for CCS and it wants the ban on EPA regulations, but without any federal requirements that limit its greenhouse gas emissions until the technology is fully deployable.
“Peabody will support the right kinds of legislation,” Peabody CEO Greg Boyce told the committee.
Boyce and Arch Coal CEO Steven Leer both pitched greater government-supported deployment of CCS as a way to reinvigorate the U.S. economy. Leer noted a National Coal Council finding that CCS through 2050 could create 800,000 permanent jobs. But, Boyce said, "More funding is needed to bring this technology to commercial scale.”
While the coal industry talks about CCS, its financial commitment to actual projects has been thin.
Between 2003 and 2008, the industry's investment came out to 2 cents for every $1 of profit the companies made, according to a 2009 American Center for Progress report. Members of the industry's American Coalition for Clean Coal Electricity (ACCCE) — which stoked controversy with its campaign questioning climate action and a series of forged letters to Congress falsely claiming certain groups opposed the climate bill — as of last year had committed to spend $3.6 billion on CCS projects in the U.S. through 2017, with taxpayers expected to kick in an additioanl $2.8 billion.
The first U.S. CCS coal plant demonstration project launched in West Virginia last year with a plan to captured just 1.5 percent of the AEP Mountaineer Plant's annual CO2 output and bury it 8,000 feet in a layer of dolomite rock.