Monthly Archives: January 2018

Coal Related News from Around the Nation

Trump Celebrates End of Wars on ‘American Energy’ and ‘Clean Coal’

Via The Washington Examiner:

President Trump on Tuesday night celebrated his administration’s success in implementing its “energy dominance” agenda.

“We have ended the war on American energy, and we have ended the war on beautiful clean coal,” Trump declared during his first State of the Union address. “We are now proudly an exporter of energy to the world.”

The U.S. is now a net producer of natural gas because of the shale oil and natural gas boom that began during the Obama administration and has transformed the country into the world’s leading fossil fuel producer.

In addition, the U.S. is expected to experience “explosive growth” in oil production in 2018 and will surpass Saudi Arabia’s output for the first time, the International Energy Agency reported this month.

Former President Barack Obama in 2015 signed a law passed by Congress ending a 40-year-old ban on oil exports.

But the U.S. remains a net importer of crude oil. Overall, the U.S. still imports more energy than it exports, according to the Energy Information Administration.

The Trump administration has promoted “energy dominance” by taking a lighter touch to regulation, and used its first year to scrap or delay a number of Obama-era regulations targeting industry to reduce its emissions of carbon dioxide and other pollutants that most scientists say drive man-made climate change.

He has announced his intent to leave the Paris climate change agreement in 2020. His administration has also repealed the Clean Power Plan regulation on carbon emissions from existing power plants that underpinned the international climate accord.

Coal has seen its prospects improve modestly during Trump’s first year. Driven by exports, U.S. coal production increased by 6 percent last year.

There was a one percent increase in U.S. coal mining jobs last year, to more than 50,000, a response to increased demand from Asia, mostly China, for metallurgical coal used in steelmaking, experts say.

But despite the growth in exports, U.S. coal consumption declined by 2.4 percent in 2017, falling to its lowest level since 1982. Coal’s portion of the electricity generation mix, which was near 50 percent a decade ago, is projected to fall below 30 percent this year, the EIA said.

It’s unclear what Trump means when he references “clean coal.” Energy experts generally interpret it to mean coal plants that capture the carbon dioxide emitted from power plants and store it underground as a way of limiting its impact on global warming.

Carbon capture and storage technology removes carbon dioxide from a power plant’s exhaust, so as to not release it into the atmosphere. The carbon can be cooled and injected as a liquid underground. Some technologies can use the captured carbon for other energy uses.

The concept has not been widely deployed, mostly because of the high cost to retrofit a coal plant for the technology.

Experts have said the Trump administration could do more to support bipartisan legislative proposals introduced in Congress to help fund carbon capture deployment.

See the article here.

Infrastructure Package Could Mean a Win-Win for a Divided Nation

Via The Washington Examiner:

These are certainly turbulent times in Washington. But just as partisan division appears to block progress, a new political consensus could emerge on a key initiative—and one that could provide the equivalent of long-term healthcare for the economy. In President Trump’s State of the Union address tonight, we’re likely to hear him declare that a major priority of his administration will be to rebuild America’s crumbling infrastructure. With some smart strategies, a comprehensive infrastructure package could bring both parties together while improving the nation’s structural landscape.

Most Americans are painfully familiar with the deteriorating systems that make infrastructure such a pressing issue. Bridges and roads need repair, as do waterworks, highways, rail lines, and even locks and intermodal waterways. Congested highways and airports inconvenience all of us, costing the economy real money and lost productivity. It will be costly to rebuild them, but the consequences of ignoring necessary repairs could be even greater.

It’s time to start preparing for our infrastructure challenge. A good place to start would be to improve access to the vast amounts of minerals and metals we’ll need for the task ahead. From iron and steel for new bridges to copper, zinc, and other metals required for transit, Internet, and power systems, the nation’s mining industry will be busy. They will need to mine more silver for electrical and water filtration systems, and to extract molybdenum for the alloys used in large buildings. Thankfully, the United States is blessed with an estimated $6.2 trillion in minerals reserves.

But the U.S. is also burdened with one of the world’s least-efficient mine permitting processes. Delays of between seven to 10 years are now common before a major mining project is approved. The streamlining of this permit process should be an immediate priority.

While roads and bridges are the most visible part of an infrastructure rebuild, there’s also a pressing need to expand shipping ports and to improve inland waterways. If America hopes to sell more goods overseas, and to reduce its massive trade deficit, we must move our commodities to market more efficiently. This includes the deepening of export terminals and the constructing of new ones on the West Coast for better access to growing Asian markets.

The U.S. has the world’s most abundant resources of coal, along with growing supplies of other energy sources. But our potential to export coal and other energy to Asia is hampered by a lack of terminal capacity. In 2012, the American Society of Civil Engineers found that the nation’s outdated ports and inland waterways would require $30 billion in upgrades by 2020. Last year, the Journal of Commerce reported a $100 billion jump in the cost of port improvements. It’s past time to redesign and expand shipping and inland waterways so that domestic producers can bring these commodities to market.

Astonishing improvements in industrial technologies can transform the environmental and efficiency performance of our factories and power plants. But we need to build new ones—or retrofit existing facilities—with best-in-class technologies. For that, we’ll need to address existing policies that actually discourage plant upgrades and emissions reductions because of the time and uncertainty in securing federal permits.

Whether it’s bridges, rail, ports, or energy capacity, infrastructure investment could provide a win-win for Americans of all political stripes. Smart investment will reach across the mining, steelmaking, construction, and energy sectors. Rebuilding America’s infrastructure will be a big task, but the long-term, its benefits will be even bigger.

Hal Quinn is president and CEO of the National Mining Association.

See the article here.

Interior’s Regulatory Relief is Paying Dividends for Colorado

Via The Daily Sentinel: 

Growing up near Rifle, Colorado, I learned the importance of energy and mineral development on federal lands near rural communities from a young age. In towns like Rifle, when mines are needlessly shuttered, the rest of the local economy suffers. During his campaign, President Donald Trump promised that the forgotten men and women of this country would be forgotten no more. In my opinion, he was talking about those men and women in places like western Colorado, where the mining industry has taken a hit.

In 2015, when coal production in Colorado fell to a 20-year low, environmental interest groups in Washington, D.C. celebrated. Many in our permanent political class, however, have never been to the Western Slope; they cannot begin to understand the importance of the activities taking place on federal lands to entire communities. In fact, the previous administration doubled down, banning all coal leasing on federal lands in January of 2016.

As the deputy secretary of the Interior, I take my experiences from growing up in Rifle to the office with me every day. I am acutely aware of the oil shale boom and bust in Garfield County. I am so proud to serve under President Trump and Secretary of the Interior Ryan Zinke — men who understand that American innovation and exceptionalism, not paperwork and bureaucracy, made our nation great in the first place. They know that if we are going to be great again, we must return to the spirit of ingenuity that built our country. For those in Colorado and all across our nation, we have put that belief into action in Year One of the Trump presidency here at Interior, delivering regulatory relief to the forgotten man and woman.

One of Secretary Zinke’s first actions was to reverse the previous administration’s coal leasing moratorium. Instead of imposing a ban indiscriminately, we should evaluate individual energy projects for their environmental impacts, not simply issue fiats intended to stop economic activity that does not fit a political agenda. The Trump administration believes in an all-of-the-above energy strategy because the market, not the government, should pick energy’s winners and losers.

In 2017, through the Bureau of Land Management, this administration streamlined the permitting process for mines in Colorado, approving an acreage expansion of a coal lease in the southwestern part of the state while working with the U.S. Forest Service to allow an expansion of the West Elk coal mine in Gunnison County. Our action on West Elk will allow for the continued employment of 222 workers for about three years. These moves were only possible with the lifting of the coal moratorium. Members of the previous administration may scoff at 222 jobs as a drop in the bucket, but we understand that this number means a lot in rural communities. We are fighting for you.

In our first year in office, we also worked with Congress, leveraging the Congressional Review Act (CRA) to stop unneeded and burdensome regulations like the Stream Buffer Rule. With a president willing to use his authority to stand up for rural America, we delivered major victories for the working class through our collaboration with Congress on the CRA. In addition, we published the rescission or revision of many other regulations that have both hampered economic growth and added little value from an environmental or worker safety standpoint. Looking back on 2017, we cut the semi-annual regulatory agenda in half, initiating a cost savings of $4 billion over time.

I believe our actions have helped to make a difference in Colorado. In the second quarter of 2017, for example, Colorado’s economy grew 3.8 percent, outpacing national GDP growth. Mining (including oil and gas) was the leading contributor to this growth, and although that includes state and private lands, production on Interior-managed federal lands played a part as well.

President Trump took office and regulatory relief came to Colorado and America. Year One of the Trump presidency gave rise to those forgotten men and women discussed on the campaign trail. In 2018, this administration will continue to work on behalf of the American people. The Colorado comeback story is just getting started, and so are we.

Rifle native David Bernhardt is the deputy secretary of the U.S. Department of the Interior.

See the article here. 

EPA Frees Arkansas from Obama-era Coal Restrictions

Via The Washington Examiner:

The Environmental Protection Agency announced Monday that it has scrapped limits on coal burning that the Obama administration imposed on Arkansas, which were expected to force power plants in that state to invest in costly upgrades or shut down, and instead said Arkansas was free to pursue its own plan to cut back pollution.

EPA chief Scott Pruitt said his agency was freeing Arkansas from limits that the Obama administration tried to impose on the state when it rejected Arkansas’ plan. The Obama-era plan was aimed at reducing nitrogen dioxide under the EPA’s regional haze rule, which coal-fired power plants saw as a threat.

Arkansas’ primary fuel source for electricity production is coal, although it is moving toward using more natural gas. Pruitt said Monday’s actions were aimed at assisting the state’s power plants.

The EPA said the action is the first step toward replacing the “embattled and one-size-fits-all” Federal Implementation Plan that dates back to 2012. EPA has the authority to impose federal plans on states if they are unable to meet pollution standards through their own programs. Most states seek to avoid being “FIPed,” as the process is often referred to by state regulators.

“Arkansas’ revised plan is yet another excellent example of the positive environmental outcomes we are achieving across the country from a cooperative federalism approach,” Pruitt said. “After working closely with Arkansas, this action returns power back to the rightful hands of the state and gives them the necessary flexibility to improve air quality.”

More than 50 federal plans were imposed under the Obama administration’s EPA. Twenty of the FIPs were under the Regional Haze program, according to EPA.

Under the Trump administration, Pruitt’s EPA “has turned at least one FIP” back into a state-implemented plan every month, according to the agency.

EPA said it has approved more than 200 state implementation plans since March 1, 2017.

“States are best suited to run their clean-air programs and EPA will continue to work with our state partners to make sure Clean Air Act standards are met in Arkansas and across the country,” EPA said on Monday.

See the article here.

More Electric Cars Mean More Coal And Natural Gas

Via Forbes:

Electric cars are a rapidly growing market. In 2017, sales in the U.S. were up nearly 30%, to about 200,000 units. This surge is even more impressive given that the very low gasoline prices we have seen obviously incentivize sticking with the traditional oil-based, internal-combustion-engine purchase.

There are now numerous initiatives globally to ban the sale of oil cars, mostly to clear the skies of smoggy cities. China, India, Norway, the UK, France and the Netherlands, for instance, have said they want to phase out gas and diesel vehicles within the next few decades. Government incentives influence car buyers’ attitudes, and the model for more could be Norway, where electric cars now account for 33% of all sales.

The World Economic Forum documents the countries announcing bans on sales of oil cars. Ultimately, to put them on par, the success of electric cars will depend on continued price declines, especially for batteries, and installing an adequate range where far distances can be traveled on a single charge. Bloomberg New Energy Finance confirms the future is bright:

By 2040, 54% of new car sales and 33% of the global car fleet will be electric. Falling battery prices will bring price-competitive electric vehicles to all major light-duty vehicle segments before 2030.

But there’s much more to the electric car story than what you might be hearing. The anti-fossil-fuel business tends to forget and/or ignore the fact that electric cars are, obviously, just that … powered by electricity, a secondary energy source that is mostly generated by the combustion of coal and natural gas both here in the U.S. and around the world.

Electric cars often need an entire night to recharge at home, and they can “increase a house’s power consumption by 50% or more,” The New York Times reported in 2013. A fellow FORBES contributor notes, “Adding an electric car on the grid is equivalent in some cases to adding three houses.”

There are measures to moderate new power needs when adding more electric cars to the grid, such as demand response, but the takeaway is undeniable: Both in the U.S. and around the world, for every 10 times an electric car goes to “power up,” it will be depending on coal and natural gas almost 6.5 of those times.

Electrification of the U.S. vehicle fleet is going to increase electricity demand. This is a reminder as we continue to debate the future of existing base-load power. While the U.S. Department of Energy’s proposal to reward coal and nuclear plants didn’t pass a Federal Energy Regulatory Commission review, the need for caution over losing existing capacity remains. Once these vital plants are retired, there’s no putting the genie back into the bottle.

We just saw this again during this month’s deep freeze. Testifying at a recent Senate Energy and Natural Resources Committee hearing regarding the extremely cold weather, Assistant Energy Secretary Bruce Walker pointed to the importance of base-load: “What was apparent during this weather event was the continued reliance on base-load generation.”

Globally, more electric cars are just a part of the massive increase in electricity consumption that will continue on for as far as our current models predict. Global electricity demand is expected to increase 1-3% per year, and you need just one statistic from one emerging country to see why: Although India has four times as many people, for instance, its total electricity usage is just a third of the U.S.’s.

See the article here.

Column: Coal Still a Necessary Resource

Via The Detroit News:

Recent severe weather events have brought attention to the need for a dependable supply of electricity. Lack of power for hospitals, homes, schools, and businesses creates major difficulties. Ask anyone who lives in Puerto Rico what it is like to be without power.

The United States is in the midst of a transition from primarily coal-generated electricity to natural gas, and eventually renewable energy. There are myriad reasons. The price of natural gas has fallen due to advances in horizontal drilling and fracking. The price of solar panels has also fallen substantially, and a record low price for wind power was recently set in Mexico. Over time we will be moving to a grid that is supported by a range of power supplies.

In the meantime, it is important to make sure there is a consistent source of electric power, and that coal remains part of that mix. Natural gas prices have the potential to be volatile and there is a need to expand the pipeline infrastructure for natural gas. Although battery technology is under development, there will be a need for power that is constantly available.

Coal remains the largest source of electric power in Michigan, generating 3.62 million mwh of power, as of August 2017 (latest data available). This was followed by nuclear power at 3.03 million mwh, which will be decreasing with the expected closure of the Palisades nuclear power plant within the next five years. Natural gas was the third largest supplier of electric power with 2.49 million mwh.

A major benefit of coal is that it is readily available. The U.S. Energy Information Administration’s most recent estimate is that U.S. recoverable coal reserves would last about 280 years. This is surely enough time to transition to other energy sources. Electricity from coal is not subject to intermittency and thus can serve during the transition to renewable energy, provided a way is found to store renewable electricity when it’s not being generated. It’s expected that coal will continue to be needed as a source of power to deal with unforeseen disruptions in natural gas or renewable power supply.

The prior administration burdened coal-powered electricity plants with substantial regulations that threatened their existence. It was never substantiated that the benefits from such regulation came close to exceeding the costs to the economy. Current EPA Administrator Scott Pruitt intends to reduce some of the regulatory burden on the coal industry. This will make for a more reliable electric grid and reduce the national cost of electricity production. In turn, this will reduce the cost of production of goods in the U.S., resulting in lower prices and a more competitive position for U.S. manufacturing.

As we transition to new power forms, attempts to swiftly eliminate the use of coal are ill-advised and will reduce the reliability of our electric grid as well as increase the cost of power for Michiganians.

See the article here.

The Difference After Year One

Via The Charleston Gazette-Mail:

After year one of the Trump administration, we can say this about the president’s record so far: Despite accusations of favoritism, he has been as generous to the news industry as he has been to corporations.

Especially for scribes in the Washington, D.C., Thunder Dome, President Donald Trump and his administration have provided all manner of provocations that became a rich news diet — even as reporters bite the hand that feeds them.

For coal, his regulatory reset and focus on blue-collar, heartland industries dovetailed nicely with a revival in coal demand. No sooner was conventional wisdom reading coal its last rites than prices, production and outlook sprang to life.

There’s less contradiction than meets the eye between this conventional view of coal’s demise and the signs of its revival. For those eager to cast any promise made as one broken, it’s easy to seize on coal’s decline from the prior decade when coal generated half of the nation’s electricity.

Why report that we’ve stopped the hemorrhaging of coal jobs over the past eight years — however newsworthy — and risk giving the president credit for honoring his promises to help the industry brought low by his predecessor and a merciless market?

But this misses the reasons for the brighter view held by mine operators who survived the past decade. From 2009 through 2016, they endured the retirement of more than 200 coal-based power plants and the loss of about 70,000 jobs — roughly half the workforce. Some 800 mines closed.

A year ago in November, their future looked no better. Few believed public policy would change after the widely expected ordination of Trump’s opponent.

But after an election that surprised most everyone, including possibly the winner, the industry’s fortunes and outlook dramatically improved this year.

Honest people can disagree over how much credit the president gets for this revival, but there it is. Some CEOs describe a “light switch” effect, darkness turning to light. The back of the hand suddenly became a helping hand.

In Trump’s first year, coal production rose by 6 percent, with most major producing states seeing an increase. In the first three quarters of 2017, coal employment climbed by 11.7 percent. To foreign buyers, U.S. coal became the new black.

From January through last November, total coal exports jumped by 67 percent. High value metallurgical coal exports rose by 38 percent and steam coal exports more than doubled from the year earlier. Coal shipments to the European Union — which we know “doesn’t use coal” — were up 35 percent. Wonder what they’re doing with it?

Critics view coal’s future as daunting — carbon reduction, a market awash in natural gas, and renewables on the rise aren’t going away in the new year, they say. But the contrarian view sees coal’s production costs falling, advanced coal technologies developing, more efficient producers thriving, liquified natural gas markets opening, and electric vehicles rolling.

Judge coal’s current conditions against the administration’s rhetoric after year one and progress may seem wanting.

But those behind an industry that survived the past decade — and still provides 30 percent of America’s power — see light up ahead rather than the darkness of the tunnel.

See the article here.

Still Fighting

Via The Bluefield Daily Telegraph:

West Virginia Attorney General Patrick Morrisey believes the authority to manage energy resources should come from the individual states, and not the federal government. That’s why he has actively fought for the elimination of the controversial Obama-era Clean Power Plan.

Morrisey, working with a coalition of 26 states, is now seeking to permanently abolish the job-killing measure, a move that would appear to be a foregone conclusion given the stated desire of the Trump administration, and EPA Administrator Scott Pruitt, to do the same.

During a stop last fall in the coal-producing state of Kentucky, Pruitt declared the war on coal is over. He correctly argued that no federal agency “should ever use its authority” to “declare war on any sector of our economy.”

Still, until this Obama-era rule is officially eliminated, the states must continue their fight. And that’s what they are doing.

The bipartisan 26-state coalition has filed its public comment letter as part of the Environmental Protection Agency’s proposed repeal of the Power Plan. The letter encourages the EPA to eliminate the overreaching Obama-era rule and to return authority to manage energy resources to the states.

West Virginia submitted the letter with attorney generals from Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Michigan, Missouri, Montana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, Wisconsin and Wyoming, along with the Louisiana Public Service Commission, the Mississippi Department of Environmental Quality and the Mississippi Public Service Commission.

“I am pleased to work with President Trump’s EPA in reviewing the devastating effects of this job-killing rule,” Morrisey, a Republican, said. “Permanently abolishing the Power Plan will provide a much anticipated feeling of relief among West Virginia coal miners and their families.”

We agree. But there is a process that officials must go through before this Obama-era rule can be officially rescinded. And nothing moves fast when it comes to the federal government, shutdown or not.

Still, the sooner the Clean Power Plan is officially scrapped, the better for the southern West Virginia coalfields.

See the article here.

Tax Cuts and Coal’s Rebound Warm Winter’s Chill

Via The Tribune-Democrat:

After a rocky start, Congress and the president saved their best for last in 2017. 

The historic tax cut that closed out the Trump administration’s first year defied a conventional wisdom that as recently as last summer gave Congress no chance to pass a major tax bill. A fractious Republican party, a controversial president and a toxic partisan atmosphere was thought to doom any major rate cut in 2017.

Washington may have surprised itself.

More important for household and businesses is that ushering in historically low tax rates should add muscle to an already powerful economic recovery. Lower taxes should stimulate additional investment in U.S. industries that support more high-wage jobs – jobs that Pennsylvania needs. 

New equipment and technologies will make our industries better able to complete with Asian and European companies. Putting bigger paychecks in the hands of American workers will boost demand and help households reduce debt.

Even after the tax bill passed into law, critics doubted its long-term advantage. A stimulus the economy didn’t need, they said. But with marginal tax rates lowered for both individuals and companies, economists now see more comprehensive benefits. 

“Cutting income taxes on individuals will power economic growth in the short run, and reforming them for businesses will do the same over the long haul,” said Harvard University economist Robert Barro. Naysayers also dismissed the tax cuts as a gift to the wealthy. But the Tax Policy Center finds that the bill as signed by the president will lower marginal rates this year for taxpayers across the income spectrum.

Industries important to western Pennsylvania will also get a boost, and none more so than coal mining. As surprising as the tax bill was last year, an even bigger surprise arose in the nation’s coal fields. From West Virginia to Wyoming, coal mining made a comeback, defying many who had read the industry its last rites throughout the year.

Instead, coal slowly emerged from a steep downturn that from 2009 to 2016 cost the industry roughly 54,000 jobs, shut down some 800 coal mines and closed 210 coal-based power plants. Battered by a combination of low natural gas prices and federal regulations targeting coal, the industry struggled as its share of nationwide power generation fell from roughly half to less than a third.

Then, during the past 12 months, coal responded to strong medicine that included a dose of regulatory relief from the Trump administration and a worldwide rebound in coal demand from growing economies. Last year coal exports soared by 67 percent.

Europe and Japan, having abruptly abandoned nuclear power, need U.S. steam coal to generate electricity. Exports of higher value coal used in steelmaking nursed other coal producers back to health. Meanwhile, here at home, a brutally cold winter throughout much of the U.S. has dramatized the value of coal. Frigid temperatures boosted reliance on coal-fired power plants in the first week in January, when coal supplied almost 40 percent of the power in the nation’s largest region, surpassing gas and renewable fuels.

The 2017 tax cuts should add further impetus to coal’s recovery and bolster other basic industries in Pennsylvania that rely on low-cost capital investment and low-cost energy. It took a while, but finally public policy is helping economic growth instead of fighting it.

See the article here.

OPINION: EPA Should Support Repeal of the ‘Clean Power Plan’

Via The Pagosa Daily Post:

On Thursday, the U.S. Environmental Protection Agency (EPA) announced that it is holding three public listening sessions on the proposed repeal of the Obama administration’s Clean Power Plan (CPP). The sessions will be held on February 21 in Kansas City, February 28 in San Francisco, and March 27 in Gillette, Wyoming.

If the listening sessions are anything like the EPA’s public hearing on the CPP on November 28 – 29 in Charleston, West Virginia, then we can expect anti-coal activists to be out in force. After all, coal-fired power plants are a major emitter of carbon dioxide (CO2), which alarmists blame for causing climate change. CO2 is the only gas restricted under the CPP.

All climate scientists know that the CPP would have utterly negligible effect on climate, even in the more extreme scenarios in climate models. Obama-era EPA Administrator Gina McCarthy repeatedly admitted this before Congressional hearings, but testified on September 18, 2013 that CPP is worthwhile because it “is part of an overall strategy that is positioning the U.S. for leadership in an international discussion, because climate change requires a global effort.” It’s all about polishing our image.

Setting a good example would make sense if it were known that developing nations, especially major CO2 emitters China and India, were likely to follow our lead, and that a man-made climate crisis was imminent. Neither is true.
For example, developing countries have made it clear that that they have no intention of limiting their development for ‘climate protection’ purposes. They understand that they need to build coal-fired plants to meet their growing power needs. The New York Times reported (“As Beijing Joins Climate Fight, Chinese Companies Build Coal Plants,” July 1, 2017):

“Chinese corporations are building or planning to build more than 700 new coal plants at home and around the world, some in countries that today burn little or no coal, according to tallies compiled by Urgewald, an environmental group based in Berlin… Over all, 1,600 coal plants are planned or under construction in 62 countries, according to Urgewald’s tally, which uses data from the Global Coal Plant Tracker portal. The new plants would expand the world’s coal-fired power capacity by 43 percent.”

The June 16, 2017 report, “Energizing India,” by National Institute for Transforming India (NTTI) and the Institute of Energy Economic Japan (IEEJ) shows that coal is forecast to rise from its current (2012) 46% of India’s total energy mix to 50% in 2047 in a Business as Usual scenario. Even if the use of renewables in India quadruples (the “ambitious” scenario), coal is still forecast to account for 42% of India’s energy mix in 2047.

“India would like to use its abundant coal reserves as it provides a cheap source of energy and ensures energy security as well,” the authors of the NTTI/IEEJ report state.

As to impending climate disaster, many scientists question CO2’s role in climate change. The climate models on which climate change concerns are based consistently predict far greater temperature rises than are actually observed. They are ‘tuned’ to give the results desired for political purposes, as University of Delaware climatology professor Dr. David Legates told the November 9 America First Energy Conference, in Houston, Texas. Legates concluded, “This is not science!”

Many scientists appear to share his point of view. On January 10, Breitbart News Network reported that “Author Kenneth Richard found that during the course of the year 2017, at least 485 scientific papers were published that in some way questioned the supposed consensus regarding the perils of human CO2 emissions or the efficacy of climate models to predict the future…”

Furthermore, the benefits of increasing CO2 levels are obvious. After all, CO2 is plant food. Dr. Craig Idso of the Center for the Study of Carbon Dioxide and Global Change told the America First Energy Conference, “the whole of the terrestrial biosphere is reaping incredible benefits from ~40% increase in atmospheric CO2 since the beginning of the Industrial Revolution.”

American anti-coal activists can complain all they want about the expected withdrawal of the Clean Power Plan, but, in the real world, the world in which people must heat and cool their homes, cook their food, and run their schools, hospitals, and factories, coal is invaluable. And the climate will continue to change as it always has, independent of what we do.

See the article here.

Coal Rallied in 2017, and Began to Confront the Challenges that Remain Ahead

Via The Casper Star-Tribune:

The Energy Journal newsletter is on hiatus this week to allow the energy reporter a holiday vacation.

As Wyoming enters a new year, here’s a round up of some of the most interesting coal stories of 2017. The newsletter will be back next week, with a podcast about the oil and gas fields around Douglas that people are watching with hope and trepidation in the coming year.

A year in Wyoming coal

Early last year, the Energy Information Administration reported that without the Clean Power Plan, and dependent on some other factors, Wyoming coal could return to pre-bust norms by 2030.

Coal certainly rallied in 2017, particularly for the post-bankruptcy companies like Peabody who were operating without the debt load of the previous years.

A fraction of the lost mining jobs returned and reports of renewed industry discipline improved confidence in the sectors ability to weather the continuing risk to Wyoming coal. A year after layoffs, the Campbell County region was showing signs of relief and optimism.

Good news for coal came from federal decision after the election of President Donald Trump.

The EPA began its dismantling of the controversial Clean Power Plan.

Meanwhile the Trump Administration repealed the coal moratorium that many had fought in Wyoming, despite the market declines that have depressed new leasing attempts from Powder River Basin coal firms.

But coal’s other concerns have been dragged front and center despite the rally. With the federal walk back on regulations that were often referred to as a war on coal, challenges like retiring coal plants became more pressing concerns.

Companies say the plant closures, and the continual competition offered by cheap natural gas, are real troubles, but are accounted for in their business plans. Coal can still compete, they argue, in the new normal of coal that settled over the PRB in 2017.

See the article here.

US Energy Official Says ‘War on Coal’ Has Put Nation at Risk

Via The Atlantic Council:

US Deputy Secretary of Energy, Dan Brouillette, on January 13 lashed out at what he described as the “war on coal” in the United States which, he said, had thwarted the construction of clean power plants, discouraged investments in new mining operations, and, as a result, put the nation at risk.

Noting that coal and nuclear account for more than half of the total grid energy in the United States, Brouillette said: “When a crisis strikes our grid these two fuels are some of the most reliable that we have. They are available 24×7 to keep the lights on and disaster away.”

“So, clearly, fewer coal and nuclear plants mean that the lights will go out and stay out when we face our next emergency. From the functioning of our hospitals to the maintenance of our military assets, the results could be catastrophic,” he warned.

Brouillette spoke on the second and final day of the Atlantic Council’s Global Energy Forum in Abu Dhabi. He was introduced by retired Gen. James L. Jones, Jr., interim chairman of the Atlantic Council.

Brouillette said that the “regulatory war” on coal and nuclear fuels “has been long and tough and it has distorted the marketplace for both coal and nuclear in the United States.”

Past US leaders and policymakers, he said, had imposed price controls on oil and gas that led to production declines and artificial shortages. Furthermore, he said, “in the name of protecting the environment, they played energy favorites—subsidizing some sources while burying coal and nuclear under an avalanche of regulation.”

“They chose to regulate rather than innovate their way out of America’s energy dilemmas,” he said. US President Donald J. Trump’s determination to include coal and nuclear in his “all-of-the-above strategy” will help reduce the risk posed by past policies, he added.

Trump, Brouillette pointed out, has signed off on the construction of several new energy pipelines, halted “draconian” oil and gas regulations, signed legislation repealing the rule that hindered coal development, and is working to reinvigorate the nuclear energy sector.

Early in January, the Republican-controlled Federal Energy Regulatory Commission (FERC) dealt a setback to Trump’s plans to boost the coal industry when it rejected the administration’s goal of bolstering coal-fired and nuclear power plants.

FERC also noted in its decision that despite claims by the Trump administration to the contrary, there is no evidence that any past or planned shutdowns of coal-fired power plants posed a threat to the nation’s electric grid.

While Brouillette did not address FERC’s decision in his remarks on January 13, in a panel discussion at the Global Energy Forum on January 12 he said he did not view the decision as a setback. As a matter of fact, he said, FERC had pledged to conduct its own review of grid resiliency.

Brouillette, meanwhile, cited a report produced last year by the Department of Energy on America’s grid and its power supplies that he said found “coal and nuclear power plants were being retired at a disturbing rate.”

The US energy revolution

The United States has become a leading global energy exporter as a result of an energy revolution in the country. This has turned the domestic energy paradigm on its head and caused ripple effects in international oil and gas markets as well as in the security paradigms of this century, said Jones.

Brouillette recalled the Unites States’ remarkable journey to becoming a global energy player and said it was now on its way to achieving what Trump describes as energy dominance.

“Why is America suddenly emerging as an energy player beyond its borders? The reason is this: after a long drawn out battle between innovation and regulation in my country, innovation is finally winning,” he said.

Innovation has spurred a technology revolution which has led to an “astonishing renaissance” in American energy, he added.

Brouillette rejected the notion that a nation can only benefit at another nation’s expense. “So, when you do business with America on energy know that we will use our energy resources to advance our shared aspirations and goals,” he told the audience that included global energy policymakers.

The most important lesson to be learned from the United States’ experience is: “for any nation that seeks to produce energy cleaner, more abundantly, more affordably, more efficiently, and in more diverse forms, it must allow innovation to work its magic,” he said.

There is one critical piece of the energy puzzle necessary for any nation to achieve energy security, he added. “That final piece is reliability.”

See the article here.

NMA President and CEO Responding to FERC Grid Resilience Announcement

“Today’s disappointing lack of action from the Federal Energy Regulatory Commission (FERC) follows a week in which the value of coal to Americans could not have been more clearly illustrated.”

“With a surge in demand, coal was the leading electricity supplier in many of the markets subjected to the deep freeze, providing a critical measure of reliability and resiliency to the nation’s grid operators. That coal-powered electricity came from many plants that will no longer be available if retirements continue at the pace expected.”

“While FERC has agreed to conduct further examinations of the grid vulnerability to such events, vital coal and nuclear powerplant retirements continue. It is now incumbent upon grid overseers to adopt significant measures to safeguard the American people and economy from serious disruptions in future power supply.”

See the release here.

National View: Energy Favoritism is Clear in all the Hype for Renewables

Via The Duluth News Tribune:

Energy favoritism now has become a bonafide topic of conversation in Washington, D.C. Where else but in our nation’s capital could energy subsidies and government intervention become a heated topic at New Year’s parties?

But it has, energized by two potentially significant events breaking simultaneously. First are the federal tax bills that may or may not reduce subsidies to some energy producers. And second is that the Federal Energy Regulatory Commission has roughly a week to weigh the merits of Energy Secretary Rick Perry’s proposal for a new way to capture the value of coal and nuclear plants in making America’s electricity supply more reliable.

There is a case to be made for public support of every fuel source — and advocates feverishly make the case to Congress and the administration based on the varied contributions their energy sector contributes to the public good. As such, environmental benefits stem from carbon-free wind and solar; conversely, reliable and affordable power comes from coal. Nothing un-American about any of this. We subsidize everything from homeownership and business gatherings to the cost of living and raising kids in high-tax states.

The problem arises when those who condemn subsidies as a sin are themselves sinners. A recent example: the unusual barrage of protests from wind and solar advocates indignant over what they claimed was Secretary Perry’s crass meddling to revalue the reliability of some power plants. Given the production tax credits and mandated market shares larded on renewable-energy producers, this protest rang a trifle hollow.

Greentech Media recently revealed that production and investment tax credits now account for at least half the cost of an average wind farm and up to half the cost for a typical solar project.

Ignoring these subsidies creates a deeper, more obstinate problem, a sort of Potemkin Village effect that magnifies public enthusiasm for the green revolution. This leads advocates to overstate the public’s desire for green living, in some cases creating an aura of religious fervor around consumer demand for electric vehicles, rooftop solar panels, and wind turbines.

But the impressive growth of renewable power requires an asterisk — that subsidies are largely responsible for it. A billion-dollar net worth is less impressive if the first $900 million is inherited. And even with such lavish subsidies, wind and solar power still account for only 7 percent of total U.S. electricity generation.

That’s why a candid quote this month from General Motors CEO Mary Barra, a renewable-energy advocate, offered a welcome reminder of the real world. Barra criticized congressional attempts to reduce tax subsidies for electric vehicles by underscoring their importance as a selling point to consumers: “Repealing that (tax) credit will have an impact because it changes the equation that determines whether people want an electric vehicle,” Barra said.

What a revelation: Subsidies not only influence but may determine consumer demand for green products and services. Of course that won’t be news to businesses that manufacture wind turbines and solar panels. They know the score. But the fact that subsidies are what juices demand for green energy will come as a shock to many activists.

As Warren Buffett famously said, “We get a tax credit if we build a lot of wind farms. That’s the only reason to build them.”

An emissions-free lifestyle is costly. Unless it comes with a deep discount, debt-laden consumers are unwilling to pay for it. Let’s stop pretending otherwise. As we learn in economics 101, whatever you incentivize, you get more of. The reverse can also be true: the absence of incentives kills demand.

It’s one thing to assert the need for green products; it’s quite another to hype their demand.

See the article here.

Can America’s Power Grid Withstand a Brutal Winter?

Via The Washington Examiner:

Maybe you have to live in the Northeast — or even Southeast United States — to get the full effect. But right now, much of the country is struggling through brutally cold weather. It’s not uncommon to see temperatures down in the teens across much of the South. And record sub-zero temperatures in the North have many recalling the “polar vortex” of 2014.

Home heating bills will surely be climbing this month as the mercury plunges. But there’s a more troubling problem emerging. As Bloomberg News is reporting, the nation’s electric grid has begun to show signs of “fatigue” as power plants churn in overdrive to meet heavy demand. Oil burning power plants in New England are running short on fuel. And some of these plants may reach end-use limits due to emissions restrictions.

New England faces the added challenge of lacking sufficient natural gas pipeline capacity to cover increased electricity usage during the latest cold snap. In contrast, however, some areas of the country have been able to ramp up more successfully — thanks to robust coal capacity. PJM Markets reports that coal cranked out 47,000 megawatts of electricity this past weekend, compared to only 21,000 MW for natural gas. And nuclear power also exceeded gas-fired power generation, delivering roughly 35,000 MW. Notably, wind turbines offered only a paltry 3,000 MW.

Coal and nuclear plants have long anchored baseload power generation in the United States. And clearly, during the current chill they are proving their mettle — with all of America’s 99 nuclear power stations in operation right now to help keep the grid intact.

There’s an important lesson here — akin to the old adage “You don’t miss your water until your well runs dry.” The renewable energy crowd that haughtily lobbies for a wide-eyed transition to wind and solar believes the nation can simply close down coal plants and make a bold leap into “green energy.” But as the latest round of frigid weather demonstrates, it’s a very good thing to have sturdy, baseload power on hand when it’s suddenly needed.

All of this doubly matters because America has lost an unprecedented amount of baseload capacity in recent years. Since 2010, more than 60 gigawatts of coal capacity has disappeared — enough electricity to power 40 million homes. And by 2020, an estimated 80 gigawatts of coal capacity will have been shut down.

Thankfully, Energy Secretary Rick Perry has identified this pressing concern for the nation’s power sector. And in response, he has proposed that the Federal Energy Regulatory Commission give added weight to baseload coal and nuclear plants that maintain on-site fuel supplies — and thus can run independently and long-term to shoulder the weight of a heavily taxed power grid.

In a week, FERC is slated to make a decision on Perry’s proposal. But as the current, harsh winter demonstrates, Americans need to appreciate the importance of baseload power plants that are keeping them warm and safe right now. Coal and nuclear plants still produce 50 percent of the nation’s electricity, and they are indeed working overtime right now to keep the grid afloat. Thus, Secretary Perry is wise to take a real-world approach to future energy use.

Polling shows that 70 percent of voters favor a diverse mix of fuel sources to maintain grid reliability and affordable power. And so, coal and nuclear power must continue to serve as sturdy twin pillars of a reliable, national electric grid. And with the population of the United States continually growing, it makes sense to upgrade existing baseload plants over the long term — to ensure that the nation can continue to keep its lights on and its homes, schools, and hospitals warm.

See the article here.

Cold Snap Arrives at Key Moment for Coal, Nuclear Power

Via The Hill:

The coal and nuclear industries are pointing to the cold snap sweeping the eastern United States as Exhibit A for why the federal government should help their power plants.

Those industries and their allies hope that the record-setting winter weather will give a boost to a proposal from Energy Secretary Rick Perrythat would require electric grid operators to pay higher prices to coal and nuclear plants.

Prior to the cold snap, Perry and other supporters of the idea had cited the 2014 polar vortex as a key argument for propping up unprofitable plants that are under pressure to close. At that time, power grids in the Northeast were strained due to plants unexpectedly closing and natural gas prices spiking, lead to some power outages.

Despite that freeze four years ago, Perry’s proposal is facing considerable opposition.

Natural gas and renewable energy companies, conservative think tanks, environmentalists and others argue that Perry’s proposal is a solution in search of a problem aimed only at boosting the fortunes of coal and nuclear power.

But with the Federal Energy Regulatory Commission (FERC) due to make a decision on Perry’s plan next week, the chill is coming over the eastern part of the country at just the right time.

The nation’s nuclear plants have mostly been running reliably, and many utilities are running coal plants that they usually keep offline. The Pilgrim Nuclear Power Station went offline Thursday due to a transmission line that stopped working, which owner Entergy Corp. emphasized was not a problem with the plant itself.

“As the last expert tut-tutted the secretary, an historic deep freeze grips the Eastern half of the country from Nebraska to New England, giving new credence to Perry’s cautious assessment of the grid’s ability to withstand disruptive events,” the National Mining Association wrote in a post on its Count on Coal blog, referring disparagingly to experts who said Perry’s proposal is unnecessary.

“Attention FERC commissioners: coal shines when temperatures plunge,” the group said, dubbing the cold snap “Polar Vortex 2.0.”

“The grid’s experience is that pipelines max out, coal piles can freeze, other forms of generation are much more weather-vulnerable than nuclear. Nuclear does not shut down because of cold,” Nuclear Energy Institute spokesman Matt Wald told The Hill.

“In cold weather you really want to have a good amount of nuclear on the grid.”

Perry labels his plan a Grid Resiliency proposal. Supporters of the initiative say that with coal and nuclear plants closing due to cheap competitors and regulations, the electric grid is threatened, particularly when demand peaks at times like extreme weather.

Under the plan proposed in September, some independent organizations that operate electric grids would have to pay coal and nuclear plants for their costs plus a reasonable profit, even if competing sources like wind or gas would be cheaper.

The beneficiaries of that plan say the current cold snap vindicates them.

“The extreme cold illustrates the importance of having a diverse generation portfolio, and the vulnerabilities that could come if we relied on any one type of fuel source too heavily,” said Jennifer Young, spokeswoman for FirstEnergy Corp. The company operates power plants, including many coal and nuclear plants, in the mid-Atlantic, and stands to be a key beneficiary of the Perry proposal if it is enacted.

“This is exactly why we need a rule to ensure that these units stay in operation,” she said. “Absent these plants that have secure fuel supplies and can operate in all weather, we could be looking at a condition where there was a shortage of fuel for one reason or another.”

See the article here.

Winter Storm to Test Northeast Grid as FERC Tees Up Decision on DOE Grid Rule

Via Utility Dive:

Frigid conditions in the Northeast U.S. are stepping up demands on the power grid as federal regulators prepare to act on a controversial coal and nuclear subsidy rule from the Trump administration.

Meteorologists expect Winter Storm Grayson to bring heavy snow, winds and coastal flooding to New England and the Eastern seaboard Thursday into Friday, followed by bitter cold air that could set record low temperatures.

The storm could recreate conditions similar to 2014’s Polar Vortex — an extended cold snap that pushed the PJM grid to the limit, disrupting gas flow to generators and freezing coal supplies at plants.

That episode is frequently used as justification by the Department of Energy for its proposed grid resilience rule, which would provide cost recovery to plants that keep 90 days of fuel supplies onsite. The Federal Energy Regulatory Commission is set to act on the controversial proposal on Jan. 10, and supporters of the rule say it would help ensure the grid can endure or bounce back from outages in extreme scenarios.

Critics, however, say the rule would do little to enhance the reliability or resilience of the power grid, particularly in the Northeast, where the coldest weather is forecasted this week. Grid operators have put major reliability reforms in place since the 2014 Vortex, and the cold weather is likely to reveal more about those policies’ effectiveness than the validity of the DOE’s proposal.

The Polar Vortex argument

Secretary of Energy Rick Perry and some of his key deputies have used the 2014 Polar Vortex to justify their controversial grid rule.

In October, Perry repeatedly referenced the Vortex at a House committee meeting on the DOE proposal, telling lawmakers the cost of his plan should be “secondary” to keeping the lights on in emergencies.

“We’re probably going to have another one,” Perry said of the Vortex. “And if we are, shouldn’t it be our responsibility to make sure that when your constituents turn the lights on that they’re not having to make the decision between staying warm and having light?”

Central to that argument is the assumption that coal and nuclear plants — which would be the chief beneficiaries of the DOE proposal — performed better during the Vortex than gas generators and other resources. Sean Cunningham, a former coal lobbyist who now heads DOE’s Office of Energy Policy and Systems Analysis, made that point in a speech before state utility regulators this fall.

“What if they weren’t there?” Cunningham said of the baseload plants. “The loss of generation could have been catastrophic.”

Coal and nuclear interests took up that line of argument this week, saying their generators will help ensure reliable service during this cold snap. “Attention FERC Commissioners: Coal shines when the temperature drops,” the National Mining Association wrote in a blog post.

Critics say the DOE argument overstates the contribution of coal generators, which also saw service interruptions due to frozen fuel supplies and mechanical difficulties. A review of the event from the North American Electric Reliability Corporation (NERC) found that 55% of forced outages during the Vortex affected gas generators and 26% involved coal plants.

Critics point out that a number of other resources performed better in that episode. Nuclear outages were low during the Vortex, and other resources stepped in to fill the gap left by other outages.

“When coal piles froze and extreme cold temperatures caused unexpected mechanical failures in power plants, it was wind power and demand response that kept the lights on,” Arvin Ganesan, a former Obama EPA official now at trade group Advanced Energy Economy, wrote in Utility Divethis fall.

Analysts also point out that generator outages of any type are rarely the cause of power interruptions to customers — and those that are typically don’t involve the fuel supply issue targeted by the DOE proposal. An Oct. 3 analysis from the Rhodium Group found 0.00007% of the total customer outage hours between 2012 and 2016 were due to fuel supply issues — and most of those stemmed from a coal generator. Coal plants also saw problems during last year’s hurricane season, with two generators in Texas switching to gas when their coal piles were flooded.

The posturing over coal generation is unlikely to have much credence for the current cold snap, however. While coal burn was up this week in PJM’s Mid-Atlantic electricity market, the resource has all but disappeared from the regions expected to be hit hardest by the storm. In New York and New England, a different set of resources will be put to the test — with different implications for the DOE proposal.

Read the full article here.

Coal, Oil Get a Boost from Northern Cold Snap

Via Utility Dive:

Brutal cold weather across portions of the country is altering the power mix for some electric grids, with oil leading over gas in ISO New England and coal doing the same in PJM. Despite the cold, there have not been any difficulties in continuing to supply fuel to power plants or electricity to customers.

In ISO New England, a third of generation is coming from fuel oil today. According to Commonwealth Magazine, typically it’s closer to 1% but spiking gas costs have forced dual-fuel facilities to switch. Bloomberg reports coal is once again the lead fuel in PJM.

Today, PJM expects a morning peak of 134,500 MW and an evening peak of 132,000 MW. The operator’s highest winter peak load was 143,129 MW, which occurred in February 2015.

“Currently sufficient power supplies and reserves are available, and PJM does not expect issues,” the operator said in a statement.

The weather pattern is similar to the polar vortex, which in 2014 brought frigid temperatures that forced generators offline and caused PJM to put in place more stringent reliability standards.

A U.S. Department of Energy proposed rulemaking would reward power plants that have 90 days of fuel supply onsite. Primarily aimed at struggling coal and nuclear plants, support for the rule could see a boost if the nation’s power grid is tested.

See the article here.

Barry Butterfield: Energy Diversity Still Needed

Via The Omaha World-Herald:

The Nebraska Public Service Commission’s recent approval of a Keystone XL pipeline route across Nebraska has revived concerns about energy production and its environmental impact.

Nevertheless, nuclear and coal still matter. In 2015, these two sources accounted for 87 percent of the energy generated in Nebraska. Nationally, they supply over half of our electricity.

As ever, there are important caveats. Because of fracking, there is an abundance of cheap natural gas. Consequently, many nuclear and coal plants can’t compete with natural gas and are financially distressed. Some nuclear reactors, such as the Omaha Public Power District’s Fort Calhoun Nuclear Station north of Omaha, have been shut down, and scores of coal plants are no longer operating.

If this trend continues, we could have an overreliance on natural gas and renewables and a possible loss of electrical grid reliability and resiliency.

Simply put, the United States cannot remain at the mercy of the electricity market for base-load power. What if the cost of natural gas were to jump suddenly? We would be stuck with high electricity prices and a possible loss of power that would jeopardize our energy security. Something must be done to save struggling base-load nuclear and coal plants, for several reasons.

First, the U.S. electricity sector is quickly losing one of its major strengths — fuel and technology diversity. A diverse mix of generating options is an essential characteristic of a robust and resilient system. If the current trend of shuttering nuclear and coal plants continues, that diversity is at serious risk.

Second, just as natural gas consumption in the electricity sector is increasing, so is demand for natural gas in the industrial sector, for home heating and cooking and for exports of liquefied natural gas. An overdependence on natural gas for electricity production could expose consumers to price volatility and loss of reliability leading to blackouts and brownouts, especially if efforts to abolish fracking lead to a reduction in gas supplies.

Third, the merchant markets serving large parts of the United States in deregulated states are not functioning as they should. In a number of cases, they are not providing the price signals necessary to stimulate investment in new generating capacity, nor are they providing the prices necessary to support continued operation of existing power plants.

The United States has approximately one million megawatts of generating capacity. Some 400,000 megawatts of that is coal and nuclear, but a substantial share of the base-load generating capacity is nearing retirement. Yet less than 10,000 megawatts of new coal and nuclear power is under construction. Since 1995, natural gas has accounted for about 90 percent of supply additions. Moreover, natural gas plants running at base load consume prodigious volumes of natural gas.

There is a solution to these escalating supply concerns, one that would boost both America’s security outlook and the economy: Compensate coal and nuclear plants for the reliability and resiliency they offer the electrical grid, at least as an interim step, until the Federal Energy Regulatory Commission completes its assessment of grid vulnerabilities. That’s the plan FERC Chairman Neil Chatterjee has proposed, and it’s a logical and responsible step for FERC to take.

There should be policy discussions now about how we intend to replace 100 gigawatts of nuclear power that will be retired by about 2040. As Thomas Farrell, chief executive officer of Virginia-based Dominion Resources, has pointed out, “100 gigawatts can power 25 million typical households. Can we realistically expect natural gas and renewables to fill that void? As a practical matter, the answer is no.”

Clearly, the United States needs base-load power. But unless steps are taken to keep large power plants operating, we will become increasingly reliant on one fuel for electricity production: natural gas. What lies ahead for Nebraska and our nation will depend on what action FERC takes to save struggling nuclear and coal plants.

See the article here.

Coal Mining Remains Significant Source of Revenue for Montana

Via The Independent Record:

Although coal mining and the production from coal-fired power plants has declined in Montana, taxes on coal still remain a significant source of revenue for the state, bringing in $81 million to state and local governments in 2016.

A report produced for the Environmental Quality Council, which is made up of lawmakers and members of the public, examined the fiscal impacts of coal in Montana. The report calls coal a “significant source of revenue,” despite decreases from historical highs in years past.

The council is studying the economic and ecological impacts of the reduction or elimination of the mining and burning of coal, as called for by a Senate Joint Resolution passed during the last regular legislative session.

Several Montana lawmakers have also called for examining the state’s tax structure and reliance on natural resources, in light of a state budget crisis this fall. Despite revenues still being up over last year, they did not increase as much as expected in a projection adopted by lawmakers and used to craft the state’s $10.8 billion biennial budget.

Of the natural resource taxes, the coal severance tax has been one of the most steady for the Department of Revenue, according to a 2016 report.

The state brought in $60.4 million from the severance tax in fiscal year 2016, and it has hovered between $52.7 million and $60.4 million since 2011.

During the same time, the oil and gas production tax peaked at $135.7 million in 2014 and dropped to $45.5 million in 2016. Total state general fund revenues for fiscal year 2016 were $2.12 billion, with 56 percent coming from individual income taxes, 12 percent from property taxes and 3 percent from natural resource taxes.

Coal mines that produce more than 50,000 tons of coal a year pay the quarterly state severance tax on all production in excess of 20,000 tons. Smaller mines are exempt from the tax.

The state severance tax rates depend on the heat content of the coal and how the coal is extracted. The value of the coal on which the tax is applied is based on the contract sales price, minus what the mine is required to pay in other taxes.

The tax payment is divided among several different accounts, such as the coal trust fund, the long-rang building program, an account that provides for basic library services, a coal natural resources account and other places.

The federal government also collects royalties on every ton of coal mined on federal lands. About half of the royalty revenues are forwarded to the state of Montana. That money goes into the state’s general fund, with 25 percent going to a minimal impact account dedicated to local governments. In fiscal year 2016, Montana mines paid $20.9 million in federal royalties.

There’s also a gross proceeds tax, which is a 5 percent yearly flat tax imposed on coal gross proceeds. This tax is collected by the local county treasurer and distributed proportionally to the taxing jurisdictions where production occurred. In fiscal year 2016 this tax generated $20.8 million.

Coal-fired power plants pay an electrical energy producer’s license tax, which generated an estimated $2.62 million in fiscal year 2016, as well as a wholesale energy generation tax that generated $1.8 million.

The report notes it does not take into account corporate income tax paid by mine operators and individual income taxes paid by employees.

The report also does not specifically calculate property tax paid by coal mines and power plants because it does not break down data that specifically. Northwestern Energy, which owns 30 percent of a unit in Colstrip, pays $136 million in property taxes annually.

Coal production in Montana has dropped from 45 million tons in 2008 to 32 million tons in 2016, according to a report from the Legislative Services Division’s Legislative Environmental Policy Office.

The drop is blamed on weak economic markets for coal in the U.S. and internationally, as well as a decline in electricity coming from from coal-fired plants as cheaper natural gas and other renewable options come on the market, according to the report. The report also cites air quality regulations as a reason for the decline of coal.

Three-quarters of the coal mined in Montana is shipped by rail to out-of-state utilities and, according to the report, increasingly to foreign nations. The rest is consumed in Montana.

Montana has about 2,289 megawatts of coal-fired generating capacity, or about 37 percent of the state’s generating capacity, which is down 55 percent from 2015.

The J.E. Corette coal-fired power plant in Billings closed in 2015. In November the owner of the coal-fired power plant in Hardin announced it will close the facility if it can’t find a seller by early 2018. Two of the four units at the coal-fired power plant in Colstrip will close by July 2022.

The state has six coal mines in Big Horn, Musselshell, Richland and Rosebud counties. Three mines are owned by Westmoreland.

Montana has four coal-fired power plants, including Colstrip, the Hardin Generating station, the Lewis and Clark station on the Montana-North Dakota border and the Rosebud power plant.

The report will be discussed at the Jan. 17 meeting of the Environmental Quality Council in Helena.

See the article here.

They Said Trump Couldn’t Reinvigorate Coal Industry – Did He?

Via Conservative Daily News:

Experts said that President Donald Trump could not reinvigorate the coal industry with his deregulatory agenda – they were wrong.

The Economist tweeted that “There is no reason to expect that Donald Trump’s decision will invigorate coal mining, as he claims it will”

“Hogwash. These actions won’t save coal or help business,” Diane Regas wrote. “On the contrary, they represent a war on all Americans, threatening both the environment and the economy.”

The outcries were primarily levied at President Trump’s decision to end the war on coal. On Oct. 10, EPA Administrator Scott Pruitt signed an order to rescind President Obama’s signature Clean Power Plan, which was designed to fight climate change by reducing carbon emissions from U.S. power plants. “The war on coal is over,” Pruitt said.

A Reuters commentary in October said that the repeal of burdensome regulations “won’t get Trump what he wants.”

“Republicans say that deregulating carbon pollution will revive the coal industry, but it won’t,” Ben Adler wrote in the article.

So now, just a few short months after Pruitt took the actions ordered by Trump, how are things going for the coal industry?

The U.S. Energy Information Administration announced that coal production for the most recent period is up 3.2% year-over-year and that coal production for 2017 was up 6.4% when compared to 2016. Even more important is the coal region most positively impacted was Appalachia – the area hardest hit by former President Obama’s attacks on the industry.

As the United States experiences its coldest winter in recent memory, coal plants have had to take up the slack as renewable power generation and gas plants are unable to keep pace with America’s energy needs.

Coal-fired power plants are king again as sub-zero temperatures sent demand for heating and electricity soaring on the East Coast Friday in the largest energy market in the nation.

Coal outpaced both natural gas and nuclear power plants in the PJM market, which extends from the Midwest to Washington, according to real-time updates provided by the grid operator PJM Interconnection.

The coal industry Obama fought a war against is on the rebound and a proposal by Energy Secretary Rick Perry could put coal back on a level playing field with gas and renewables – who are predictably fighting it.

The proposal is being considered by the Federal Energy Regulatory Commission, which intends to vote on the proposal in January. The proposal was supposed to be approved this month, but the commission’s newly appointed chairman, Kevin McIntyre, said he required an additional 30 days. The plan is being adamantly opposed by scores of industry groups from the oil sector to renewables.

The haters keep on hating, but the coal industry is seeing a continuing uptrend in hiring for the first time since Obama began his war on coal in earnest in 2012.

Through October 2017, the most recent period with non-preliminary numbers, the coal industry has added 1,700 jobs. The new numbers are in sharp contrast to 2012 when 10,000 industry jobs were lost and 2016 where another 5,800 coal industry workers ended up in the unemployment line. The reversal is a welcome comfort to those that Obama forgot.

Exports tell an even more promising story. The U.S. exported 9.16 million short tons of coal in October 2017 up from 6.55 million in November 2016. With a chart this positive, 2018 is set to be amazing for those working coal and a not so great for those betting against it.

See the article here.

Under Trump, Things Looking up for Coal Industry

Via The Free-Lance Star:

THERE IS no question that the future is brighter for our nation’s coal industry.

Changes in policy, regulations and markets are contributing to a stronger domestic coal industry. The U.S. economy is growing again. Global economic activity is increasing. The business prospects of other countries that use our coal for electricity, steel-making, and other industrial purposes are better. U.S. coal exports were up a whopping 70 percent year-to-date through September 2017.

Some new U.S. coal mines have opened and others are expanding, adding good jobs and tax revenue for states and localities. According to the Department of Energy’s Energy Information Administration, year-to-date 2017 U.S. coal production has increased by about 8 percent over 2016. Coal-mining employment is trending similarly. It has risen every quarter of 2017, and was up 7 percent for the most recent period, per analysis by S&P Global Coal Market Intelligence.

The path for coal’s comeback is driven by President Trump’s dramatically different vision for the development and use of our nation’s energy resources. These riches are seen as a strength, not something to be kept in the ground. They are viewed as a means to achieve energy independence and provide energy security. The energy policy differences between the current administration and the prior one are most striking when it comes to coal, which the United States has more of than any other country.

The Trump administration started early this year to restore balance and fairness to the federal regulatory process, support job creation and strengthen energy independence. Actions by Congress and the president in February and March initiated the process of eliminating, rescinding or changing many federal regulations affecting coal production and use.

Having been pushed through under the various guises of environmental benefits, regulatory streamlining and business planning certainty, they were simply sweeping bureaucratic maneuvers to increase the cost of coal and make it less competitive in the marketplace. Thus, the foundation has begun to be laid to rebuild and sustain our nation’s vital coal industry.

One regulation currently proposed for repeal by Environmental Protection Agency administrator Scott Pruitt is the EPA’s rule for carbon-dioxide emissions reductions from the power sector, dubbed the Clean Power Plan by the prior administration.

EIA’s “Annual Energy Outlook 2017” analysis shows that 240 million tons of annual coal production will be maintained without the Clean Power Plan. The National Mining Association estimated that nearly 28,000 high-wage mining jobs and about 100,000 jobs throughout the supply chain will be saved without the Clean Power Plan.

Both Pruitt and Energy Secretary Rick Perry have been vocal about the need for fuel diversity in the power sector. Perry’s recently proposed rule to the Federal Energy Regulatory Commission urges appropriately valuing our nation’s important baseload generating resources, including coal, in wholesale electricity markets.

Many years of policy incentives for building wind and solar generation have increased the number of these less efficient, intermittent electricity sources in our nation. FERC must act to counter this trend, which is likely to expose consumers to diminished electricity system reliability and resilience and higher electricity prices in the absence of its action. Coal is a key fuel resource with proven reliability and resilience attributes. The price level and price stability of coal over time have been integral to affordable electricity in America.

In addition to these policy and regulatory changes on the domestic front, facilitating U.S. coal exports to the global marketplace is important to coal’s continuing recovery. International use of coal is growing as global electrification and urbanization increase.

Preserving traditional export markets and finding ways to increase U.S. competitiveness to expanding markets has important corollary benefits, including enhancing our nation’s balance of trade and sustaining jobs in coal mining, transportation, and shipping. A good example would be adding new port/terminal capacity on the West Coast, which can ensure long-term U.S. participation in the Asian markets.

Our coal is mined, shipped and consumed under the most stringent environmental and safety standards in the world. With the appropriate and overdue leveling of the playing field for coal in the federal policy and regulatory arenas, the rebound our industry is experiencing will continue. That will benefit both Americans and those beyond our borders.

See the article here.

Trump’s Energy Success

Via The American Thinker:

Just six months ago, the Trump administration was attacked for its “slow start.”  It was said to be “in disarray,” in “chaos,” “at war” with itself, and incapable of governing.  Now the list of successes has piled up, making it clear that, if the trend continues, President Trump will become one of our more important presidents.  Far from being a do-nothing administration, the Trump team is a White House on steroids.

One of the president’s major successes is in the area of energy policy.  Along with energy secretary Rick Perry, the president is overseeing the recovery of the American energy sector from the low point it hit under the Obama administration.  By a combination of executive orders totally restrictiong drilling on federal lands and EPA assaults on fracking and coal-mining, including a total ban on mountaintop-mining, Obama prosecuted a “war” not just on coal, but on fossil fuels generally.

Now America has become the largest producer of oil and gas and a major exporter of natural gas.  The U.S. now produces significantly more hydrocarbons than second-place Russia and twice as much as Saudi Arabia.  As coal-mining is restored, pipelines are laid, and new wells are drilled, hundreds of thousands of jobs are being created across the economy, not just in drilling and mining, but in support services.

The effect on the economy is already being felt.  According to, a leading employment recruitment site, oil jobs are making a “huge comeback,” with “100,000 new jobs by 2018.”  And these are high paying jobs: “the average pay of the oil and gas industry is 85% higher than the national average.”  Each new job in the energy field creates others in areas like steel production, rig technology, transportation, and general services.  And the money earned in these high paying fields circulates through the economy.

With the passage of a provision in the Tax Cuts and Jobs Act allowing oil exploration in ANWR, the president has another success.  The Arctic National Wildlife Refuge contains vast reserves of recoverable oil currently estimated at 10.4 billion barrels.  Development has been blocked by misguided and ill informed opposition from environmental groups.  Now, with great care for the environment, oil companies will have the opportunity to produce vast amounts of energy while drilling only 3% of ANWR.

According to a report from the House Committee on Natural Resources, “total governmental revenue” from ANWR drilling will run $440 billion.  ANWR alone will create between 55,000 and 130,000 new high paying jobs.

It is not just ANWR.  By removing unnecessary restrictions on fracking and by opening other federal lands to drilling, President Trump is promoting energy independence rather than standing in its way.  He has opened federal lands for drilling, including land in two national monuments in southern Utah.  Vast federal lands in the Western U.S. offer other opportunities.

In April, the president signed an executive order reversing Obama’s ban on new offshore drilling in the Arctic and Atlantic.  Current estimates show that almost 90 billion barrels of oil and 327 trillion cubic feet of natural gas lie under the U.S. Outer Continental Shelf.  Those estimates have a way of being revised upward, especially for regions such as these that have not been explored with modern technology due to past restrictions.  Offshore drilling has the potential to produce ten times the number of jobs and government revenue projected for ANWR.  At the high end, that would be 1,300,000 high paying jobs and $4.4 trillion in state and federal revenue.

Under President Obama, American coal-mining suffered a near-death experience.  Now, under EPA director Scott Pruitt, the Trump administration is taking steps to restore coal to its rightful place in America’s energy supply mix.  Though it will take years to complete, the reversal of Obama’s Clean Power Plan that began back in October will take government out of the frame of “picking winners and losers.”  Coal will still have to compete with natural gas, but at least it will be allowed to compete.

The president’s accomplishments in the field of energy policy are not limited to fossil fuels.  His Energy Department recently committed $100 million to promoting Transformative Energy Projects intended to spur early-stage innovators.  The department continues to promote alternative energy sources and energy conservation, important contributors to energy independence.  Energy conservation in particular can go a long way toward making America energy-independent.

With the opening of new lands to fracking and conventional drilling and the restoration of mining in the Appalachian region, the energy sector has gone from moribund to robust practically overnight.  One of the president’s first actions was the elimination of the Steam Protection Rule, which imposed crippling burdens of regulation on the industry.  As a result, production has begun to increase.

As the U.S. Energy Information Agency’s annual “Outlook” makes clear, the future for American energy production is bright.  The Outlook models future production across a wide range of different scenarios, and it concludes that the U.S. “is projected to become a net energy exporter by 2026” in its Reference Case projections but that it may do so earlier under three side cases.  After 2026, the scale of exports expands rapidly in all cases.

Perhaps the most consequential of the president’s actions in the field of energy is his decision to withdraw from the Paris climate accord.  While withdrawal from the accord does not have significant immediate consequences, its long-term effect is great.  Its most important effect will be to reduce the possibility of a deluge of environmental lawsuits based largely on the agreement signed by President Obama.  These lawsuits would have blocked American energy production to gratify a self-appointed global environmental elite – at the expense of the American people.

The president’s accomplishments are many, but energy stands out.  America is now the world’s premiere producer of fossil fuels.  In just one year, we have gone from a dismal future, in which the government planned to shut down fossil fuels almost entirely by mid-century, to a nation on the cusp of total energy independence.  “Make America Great Again” was not just a clever campaign slogan; it is a reality in the field of energy production, as in so many other areas under President Trump.

See the article here.