The war has been waged on several fronts for nearly a decade, and the aggressors are poised to declare victory over the wounded U.S. coal industry.
After powering the Industrial Revolution and helping to turn the U.S. into the world’s top economic power, coal now seems to be drowning in what environmentalists call a “deadly cocktail” — a rabid, politically potent anti-fossil fuels movement, the rise of cheap, abundant, relatively clean domestic natural gas and an Obama administration that freely admits it wants to decrease coal use in America through a host of new rules.
That near-perfect storm is taking its toll.
Some of the nation’s top utilities say they’re planning to drastically reduce their coal portfolios over the next five years. Financial giants such as Bank of America no longer are willing to invest in coal projects. Researchers say traditional coal states such as West Virginia will see massive coal production declines and job losses over the next decade.
Federal agencies predict coal consumption in the power-generation sector will fall by 6 percent this year. The Environmental Protection Agency says coal’s share of U.S. power generation will drop by nearly 25 percent over the next 15 years if proposed regulations go into effect as scheduled.
Symbolizing coal’s decline across the country, Pennsylvania’s last standing coal breaker, the St. Nicholas breaker in the heart of anthracite coal country, now is being torn down. The breaker wasn’t operational, but its demise still is a powerful reminder of how far coal has fallen.
While coal still has powerful political allies in Washington and across the country — including Democrats from Appalachia and elsewhere who are frantically trying to pave a path forward for the fuel — die-hard coal opponents say the decline is gaining momentum and cannot be reversed.
For those who have embraced the “war on coal,” victory looks inevitable.
“It’s a pretty deadly cocktail for the coal industry. The coal industry has a business model that’s incompatible with the future. Every major industrial country, if it hasn’t already, will start to scale back its use of coal power,” said Kelly Mitchell, the climate and energy director at Greenpeace, one of several leading environmental groups that has waged war on coal for years. “There’s no way the tide is going to turn in the opposite direction.”
Greenpeace has been a leader in the anti-coal movement around the world. In the U.S., the Sierra Club’s Beyond Coal campaign has been highly successful in galvanizing grass-roots opposition to proposed coal plants across the country and mounting legal challenges to new coal projects.
“I believe the activism on the ground in these communities has been a primary driver of this trend,” said Mary Anne Hitt, director of the Beyond Coal campaign.
But environmentalists also have been getting an unprecedented level of help from the federal government, as President Obama implements the most ambitious climate change agenda in American history and openly talks about how the U.S. must wean itself off of coal.
Coal still provides nearly 40 percent of the nation’s power, but the EPA says that will fall to 30 percent by 2030 after the agency’s new limits on carbon emissions go into effect. The regulations will greatly limit pollution from power plants, and specialists say it will be virtually impossible for coal plant operators to meet the standards with today’s commercially available, affordable technology.
The final version of the agency’s so-called Clean Power Plan, which will affect existing plants, will be released this summer and is expected to call for a 30 percent reduction in carbon emissions by 2030. The agency already has proposed rules for new coal-fired facilities.
The EPA has imposed other stringent standards on the coal industry, such as new regulations on mercury, among others.
The EPA’s political foes argue the rules will lead to job losses in the coal industry and associated sectors. While it’s unclear just how great a role government regulations are playing, there is no denying that those job losses are beginning to pile up.
A recent Duke University study found that between 2008 and 2012, the coal industry lost about 49,000 jobs, and the trend is continuing.
Murray Energy Corp., an Ohio-based company leading the legal fight against new EPA regulations, last month announced it would lay off more than 1,500 employees across West Virginia, Ohio and Illinois.
Patriot Coal Corp. last month again filed for chapter 11 bankruptcy protection, not even two years after coming out of its previous bankruptcy declaration.
Meanwhile, utilities are fleeing coal.
American Electric Power, one of the nation’s leading utilities, has closed at least 12 coal-fueled generation facilities over the past three years. It intends to close several more in 2016.
In 2005, 74 percent of the company’s power generation came from coal. Today, it’s about 60 percent, and by 2020 will fall to 49 percent.
Late last month, the company permanently retired about 6,000 megawatts of coal-generated power, according to Melissa McHenry, American Electric Power’s director of external communications.
“That coal generation is gone, and it’s not coming back,” she said. “The economics [of coal] don’t work” in today’s energy landscape.
Financial leaders and governments seem to be coming to the same conclusion.
Bank of America last month announced it would cut all financing for coal-extraction projects, a clear indication Wall Street believes coal’s best, most profitable days are behind it.
The government of Norway recently said it would divest its largest pension fund from coal, dealing another financial and symbolic blow to the already-beleaguered sector.
Still, analysts caution against assuming coal is dead. Some experts believe technological innovation could be coal’s saving grace and say it is foolish to believe the fuel can be eliminated from the U.S. energy mix anytime soon.
“I’m 74 years old. I’ve seen a lot of these ‘it ain’t coming back’ things,” said Dr. Richard Bajura, director of the National Research Center for Coal and Energy at West Virginia University. “This war on coal business — we as a nation have found it easy to pick on coal as a big carbon polluter, which it is . Five years from now, we’ll be asking the same question about natural gas. Once they get rid of coal, natural gas is next. If we abandon coal, we can never go back.”
Mr. Bajura stressed that he’s a firm believer in the concept of “clean coal,” a concept that centers on carbon capture and sequestration (CCS) technology. CCS allows plants to trap carbon pollution before it can be released into the atmosphere and safely store it underground. The EPA regulations establish a de facto mandate to use CCS since coal-fired plants simply cannot meet the federal guidelines without such technology.
But so far it’s been a rocky road for clean coal.
Despite billions of dollars in investment from this administration — mostly from Mr. Obama’s 2009 stimulus package — clean coal projects have struggled to get off the ground.
After repeated delays and problems securing private investment, the FutureGen clean coal project in Illinois now has been suspended after the Department of Energy pulled all federal funding.
It was once held up as a blueprint for future coal power facilities.
Another leading clean coal project, the Kemper County power plant in Mississippi, also is far behind schedule and last month ran into its own funding problems when the South Mississippi Electric Power Association backed out of a deal to buy 15 percent of the $6.2 billion project.
Project leaders say they’re evaluating the path forward for Kemper, which has been hailed as a first-of-its-kind endeavor that could lay the foundation for clean coal facilities in the future.
Despite the setbacks, there are strong clean coal supporters who say the federal government cannot give up on the technology. Some of those supporters reside in the Democratic party and believe groups such as Greenpeace and the Sierra Club are making a grave error in trying to force a choice between confronting climate change and using coal.
“We tell people we’re both coal advocates and also climate action advocates . Here’s the key: if you look at the realities of global energy supply and demand, coal and other fossil fuels are going to be with us for decades to come. If you’re concerned about climate change, there is no realistic way for us to reduce global CO2 emissions without low-carbon coal,” said Jon Wood, president of the Coal Blue Project, a coalition of Democrats seeking common ground between the coal industry and the climate change movement.
The organization’s co-chairs include former Democratic Reps. Nick Rahall of West Virginia and Bill Enyart of Illinois. Mr. Wood served more than a decade as a top staffer for the late Sen. Robert Byrd, West Virginia Democrat.
Coal Blue stresses that EPA’s own data — such as the projection that coal still will provide 30 percent of American power in 2030 — confirm that coal isn’t going away and justify new government investments in clean coal technology. Mr. Wood said that so-called “climate dreamers” who push for a coal-free world simply aren’t realistic, and that the nation should pursue clean coal as strongly as it pushes wind, solar and other renewable fuels.
“We need to develop carbon-mitigating technology for fossil fuels, and right now that is largely carbon capture and storage. We’re not even coming close to what we need to be doing . The point is this, and this is our message to climate advocates: CCS is an essential technology for any climate strategy. We should be making the same commitments to that technology that we are to spurring renewable energy,” Mr. Wood said.
Mr. Wood says the EPA is missing the mark with its upcoming proposal, which will accelerate the decline of coal and also will drive up electricity prices, according to the federal Energy Information Administration.
A recent EIA report said that, by 2020, the EPA regulations will double the amount of coal-fired power generation scheduled to go offline. The regulations also will drive up electricity prices by 4.9 percent, the study says.
On the utility side, some worry the phaseout of coal could lead to reliability problems with the nation’s electric grid. Ms. McHenry pointed out that coal plants typically keep at least 30 days’ worth of fuel on-site, which would be especially valuable in the event of a major disaster.
Natural gas-fired facilities, on the other hand, rely on pipelines that can be disrupted by extreme weather or other incidents, specialists say.
But environmentalists dispute that argument and say grid reliability won’t decrease as coal facilities are taken offline.
“I think reliability concerns are more of a red herring put up by the other side. We have a lot of layers of regulators in this country [that] are primarily focused on making sure the lights stay on,” Ms. Hitt said.