Decline of coal driven by market forces
CHEYENNE, Wyo. — President Donald Trump says withdrawing from a global climate change agreement will boost the U.S. economy, but existing market forces have had far more of an effect on the fossil fuel industries than climate regulations.
For at least three years now, the coal industry has been reeling from growing competition from natural gas, wind and solar power. Environmental regulations enacted under President Barack Obama haven’t helped any but they’ve played a much smaller role. Most haven’t even taken effect.
In March, Trump ordered a review of the Clean Power Plan, which seeks to reduce emissions from coal power plants, and the lifting of a moratorium on the sale of coal mining leases on federal lands. So far, those moves have spurred a couple of relatively minor coal leases but no coal rush.
An industry in decline
Experts say coal’s biggest problem isn’t climate change regulations but cheap and abundant natural gas. Gas prices dropped as advances in drilling such as hydraulic fracturing, or fracking, greatly increased the amount of gas on the market. For many utilities, that’s made gas more attractive than coal.
Meanwhile, companies have gotten more efficient at extracting coal, meaning fewer workers are needed.
U.S. coal production fell to 739 million tons last year, the lowest in almost four decades. From 2011 through 2016, the coal mining industry lost about 60,000
jobs, according to preliminary Labor Department data that excludes mine office workers.
Last weekend, Environmental Protection Agency Director Scott Pruitt said Trump’s policies had created 50,000 coal jobs, including 7,000 in May alone. In fact, the coal industry nationwide accounted for a total of 51,000 jobs through May, up only about 400 jobs from the month before.
Coal subsidies?
The Obama administration blocked new coal lease sales on federal lands in January 2016 to determine if the government’s coal program was shortchanging taxpayers and exacerbating climate change by effectively subsidizing coal.
In some cases, coal companies bought leases for as little as 1 cent per ton. The program is supposed to be competitive but often involves just a single bidder.
Western reserves
About 40 percent of coal produced in the U.S. comes from federal land in Western states.
Even before the moratorium, many mining companies were going bankrupt and had delayed plans to lease tracts holding 1.5 billion tons of coal.