On Thursday night, environmental lawyer Robert F. Kennedy, Jr., will step onto a stage in the heart of Appalachian coal country to debate Mr. Coal himself, Massey Energy CEO and global warming skeptic Don Blankenship.
There’s little question who has the home field advantage at the University of Charleston in West Virginia.
Most of Massey’s mining sites are in West Virginia, as are many of the country’s mountaintop coal mining operations. Mining is so prevalent here that coal companies and the utilities that burn the fossil fuel account for two-thirds of the state’s business tax revenue.
When it comes to concerns about the way mountaintop mining operations degrade water quality in Appalachia, Blankenship told colleagues at a Christmas party:
“EPA stands for ‘Equal Poverty for All’. They don’t appreciate coal. In fact, they think coal is a bad thing. They’re exporting our jobs and destroying our economy and telling us not to be worried about it.”
Kennedy, president of the New York-based Waterkeeper Alliance, is equally clear about his fight to end mountaintop mining:
“Mountaintop removal has devastated, corrupted and impoverished West Virginia, but it is not just a local issue. The devastating ripples from these blasts reverberate across the country and around the world, in the form of mercury in all of our watersheds, coal ash poisoning our drinking water, ozone and particulates that sicken our citizens, and escalating global warming. There is no more important issue facing our nation than our energy future,” Kennedy said when the debate was announced.
A new report out today from a West Virginia-based consulting firm should give Kennedy more fire power on the economics of coal mining in Appalachia.
His environmental concerns were already bolstered by a recent report by a group of hydrologists, ecologists and engineers who concluded that mountaintop mining’s “impacts are pervasive and irreversible and that mitigation cannot compensate for losses,” and another last fall by Physicians for Social Responsibility that found serious health risks from coal throughout its lifecycle.
The Future of Appalachian Coal
The latest report, by Downstream Strategies of Morgantown, W.Va., charts the increasing cost of producing coal in Appalachia and the need for economic diversification to protect the region.
It warns that Appalachia’s coal industry is becoming less competitive with other coal regions, particularly Montana and Wyoming’s Powder River Basin. More U.S. power plants are now equipped to handle cheaper coal, and the cost of mining Central Appalachia’s coal is rising as the most productive coal reserves are being depleted. On top of that, the region faces more competition from other energy sources, such as natural gas, and the threat of regulation of mountaintop mining.
Even though Central Appalachia’s overall coal reserves remain large, studies suggests that mining companies will have to deal with thinner, less accessible coal seams in the coming decade.
As coal becomes harder to mine, productivity declines and production costs increase; generating energy from Central Appalachian coal will become more expensive, and utilities that burn the coal will look for other sources, write Downstream Strategies founder Evan Hansen and researcher Rory McIlmoil, both environmental science and policy experts.
“Indeed, this has already begun to happen due to a rise in the price of Central Appalachian coal since 2000,” the authors write.
“Labor productivity since 2000 has declined by 25% and 30%, respectively, for surface and underground mining. This contributed to a doubling of coal prices between 2000 and 2008 as more workers were required to produce each ton of coal. The result was a reduced competitiveness of Central Appalachian coal, as illustrated by a sharp decline in demand, and therefore production.”
“These changes will have dramatic effects on local and state economies.”
Blankenship can claim that coal has economic benefits for West Virginia — it directly employees about 37,000 workers in the Central Appalachia region and generates hundreds of millions of dollars in state tax revenue. But even without new federal regulations, estimates show Central Appalachian coal is on the decline.
The region’s coal production peaked in 1997 at 290 million tons, the report notes. By 2008, it was down to around 235 million tons. The Energy Information Agency, in its latest energy outlook report, sees no recovery in those numbers under a business-as-usual scenario through at least 2035.
The EIA anticipates Central Appalachia will be producing only around 99 million tons of coal by 2035 “as output shifts from the extensively mined, higher cost reserves of Central Appalachia to lower-cost supplies from the Interior region, South America, and the northern part of the Appalachian basin.”
Regulation and Oversight of Mountaintop Mining
New environmental regulations to protect water and air quality are also looming on the horizon, and the Obama administration’s Environmental Protection Agency is already involved.
The EPA has tightened its reviews of mountaintop mining permits under a new agreement with the U.S. Army Corps of Engineers and Department of Interior. It required changes to the recently approved Hobet 45 mine, and it is in talks over its request that the Corps modify, suspend of revoke approval for Spruce 1, which would be one of the largest mountaintop projects in West Virginia.
About half of Central Appalachia’s coal production is currently scrapped out via mountaintop mining, a cheaper mining method that employees fewer miners than underground mining because it relies more heavily on machinery. However, the method of blowing the tops off of mountains and pushing the soil and debris into valleys to get at that coal also buries streams and contaminates the water.
“State and local leaders and policy-makers should recognize the economic and regulatory realities facing the region’s coal industry, and should take steps to help diversify coalfield economies,” Downstream Strategies writes. “Only by doing so will they ensure the availability of new jobs and sources of revenue for the impacted areas.”
The consultants’ recommendations for diversification in the region: forestry products, agriculture and renewable energy industries.
According to the Appalachian Regional Commission, the four Central Appalachian states — and primary mountaintop mining states — could generate 52,000 new jobs in the renewable energy manufacturing sectors for wind, solar and biomass.
To get there, the report’s authors suggest state lawmakers set a renewable portfolio standard of 25 percent from “truly renewable” energy sources by 2025; creative incentives for investment; and provide financing through grants, tax credits, clean energy bonds, or low-interest loans for clean energy development and technology production. They also stress the importance of both energy efficiency and education and training programs to creating a skilled labor force that will attract investment.
These economic arguments and solutions are likely to surface in Thursday’s debate, along with discussion of the seriousness of the damage mountaintop mining is doing to Appalachia’s streams and environment.
The debate, scheduled for 6:30 p.m. EST, will be webcast on several sites. The University of Charleston, whose president is moderating the debate, is also accepting online questions for the panelists.