Coal Company Closures and the Future of Energy

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By: Vanessa Rogers, Staff Member

Many utility companies have switched from coal to natural gas.[1]  More than 100 of the 500 coal-burning power plants in the United States are expected to close in the next few years.[2]  “Power plants that burn coal produce more than 90 times as much sulfur dioxide, five times as much nitrogen oxide and twice as much carbon dioxide as those that run on natural gas.”[3]   Sulfur dioxide causes acid rain; nitrogen oxides cause smog; and carbon dioxide traps heat in the atmosphere.”[4] Natural gas plants, on the other hand, emit almost no harmful toxins.[5]  Many blame the switch to environmental friendly energy on the tough environmental regulations that have been implemented.[6] However, the Environmental Protection Agency (EPA) said that coal is still expected to generate more of the country’s electricity than any other fuel source.[7]

Despite the dispute over why coal companies are shutting down, one thing is for certain, coal company closures caused many to lose their jobs.[8]  A month ago one of the world’s largest coal producers, Arch Coal Inc., said it would lay off about 750 workers in Kentucky, Virginia, and West Virginia coalfields.[9]  Almost 600 of those cuts are in Kentucky.[10]  Perry County has estimated a loss of about 30% of its mining jobs in the last year.[11]  There are predictions that the share of U.S. electricity coming from coal will fall below 40% for the year, the lowest since the forecasts that the government began collecting data in 1949.[12] 

So what does all of this mean for the future of energy?  “One of the big issues with the EPA rules is that with all these coal plants coming off-line in 2015, even if natural gas prices are reasonable we just don’t have the pipeline capacity to get it where you need it,” said Jeffrey R. Holmstead, a former assistant administrator for the U.S. EPA and current head of the Environmental Strategies Group of Bracewell-Giuliani, which advocates for the coal industry.[13]  Because natural gas has a much lower carbon emissions, it  can meet the recently-announced EPA proposed greenhouse gas standards while conventional coal plants could not, if the proposal passes.[14]  In addition, coal companies may take their businesses overseas.  Some coal producers, such as Arch Coal Inc., have already done so.  Overseas, coal power plants are being built faster than they are being abandoned in the United States.[15]

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[1] Bruce Schreiner, Mine Layoffs latest sign of Coal Industry’s Decline, LJWorld.com (June 22, 2012), http://m.ljworld.com/news/2012/jun/22mine-layoffs-latest-sign-coal-industrys-decline/.

[2] Erik Lipton, Even in Coal Country, the Fight for an Industry, NY Times (May 29, 2012), http://www.nytimes.com/2012/05/30/business/energy-environment/even-in-kentucky-coal-industry-is-under-siege.html?pagewanted=all.

[3] Schreiner, supra note 1.

[4] Id.

[5] Kari Lydersen, Is Natural Gas Killing Coal? Midwest Energy News(April 17, 2012),  http://www.midwestenergynews.com/2012/04/17/is-natural-gas-killing-coal/.

[6] Schreiner, supra note 1.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Bruce Schreiner, Mine Layoffs latest sign of Coal Industry’s Decline, LJWorld.com, http://m.ljworld.com/news/2012/jun/22mine-layoffs-latest-sign-coal-industrys-decline/ (June 22, 2012).

[13] Lydersen, supra note 5.

[14] Id.

[15] Lipton, supra note 2.

EPA Exceeds Its Authority By Revoking Mountaintop Removal Permit

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By: Raabia Wazir, Staff Member

Environmentalist cheered in January 2011 when the U.S. Environmental Protection Agency (EPA) revoked one of the largest mountaintop removal permits ever authorized in Appalachia on grounds that the mine would result in unacceptable damage to streams and wildlife and violate the Clean Water Act.[1] The US Army Corps of Engineers originally issued the §404 permit for the Spruce No. 1 mine project in Logan County, W.V., in January 2007 and the Mingo Logan Coal Company (a subsidiary of Arch Coal, Inc.) began construction shortly thereafter.[2] The permit covered 2,278 acres and allowed for the burial of approximately 7.48 miles of streams beneath 110 million cubic yards of excess spoil.[3]

The revocation of the permit by the EPA marked the first crackdown by the Obama administration to limit mountaintop removal mining by retroactively vetoing old permits. It is also only the second time that the agency has canceled a water permit for a project of any kind after it was issued since the Clean Water Act was passed by Congress in 1972.[4] The decision led to an uproar from the industry and its supporters, many expressing fear that all mine sites were now vulnerable to losing their permits.[5]

In March 2012, the Federal District Court of District of Columbia ruled that the agency exceeded its authority under the Clean Water Act by revoking the permit. Judge Amy Bergman Jackson wrote in her opinion, “The EPA resorts to magical thinking. It posits a scenario involving the automatic self-destruction of a written permit issued by an entirely separate federal agency after years of study and

consideration. Poof!”[6] She further argued that permit revocation is unreasonable because it “[sows] a lack of certainty into a system that was expressly intended to provide finality." The Judge continued, "Every construction project involving waterways could be subject to an open-ended risk of cancellation.”[7]

The agency has yet to announce whether they plan to appeal the ruling.

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[1] Kate Sheppard, EPA Halts "Destructive and Unsustainable" Mining Operation, Blue Marble, Jan. 13, 2011, http://motherjones.com/blue-marble/2011/01/epa-rejects-spruce-no-1-permit.

[2] Spruce No. 1 Mine , U.S. Environmental Protection Agency. (April 2, 2012, 5:00 PM), http://www.epa.gov/region03/mtntop/spruce1.html

[3] Final Determination of the U.S. Environmental Protection Agency Pursuant to § 404(c) of the Clean Water Act  Concerning the Spruce No. 1 Mine, Logan County, West Virginia (2011), available at: http://water.epa.gov/lawsregs/guidance/cwa/dredgdis/upload/Spruce_No-_1_Mine_Final_Determination_011311_signed.pdf

[4] Stephen Power & Kris Maher, EPA Blasted as It Revokes Mine's Permit, Wall Street Journal, Jan. 14, 2011, available at: http://online.wsj.com/article/SB10001424052748703583404576079792048919286.html.

[5] Erik Eckholm, Project’s Fate May Predict the Future of Mining, N.Y. Times, July 14, 2010, available at:  http://www.nytimes.com/2010/07/15/us/15mining.html.

[6] Mingo Logan Coal Co. Inc. v. U.S. E.P.A., No. 10–0541, 2012 WL 975880 (D.D.C. March 23, 2012), available at: http://wvgazette.com/static/coal%20tattoo/SpruceMineRuling.pdf

[7] Id.