Coal train coming 

Plans to ship millions of tons of coal across Montana have fueled new debate over an old industry

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Kinskey could be described as an economic-development agnostic: He doesn't revere coal any more than he does yoga studios or wind farms, as long as it brings jobs to Sheridan. From his high plains perch in the foothills of the Big Horn Mountains, he thinks America could use a little more of that kind of pragmatism. "I tell people, if we want energy, somebody's going to have to get dirty, whether it's mining coal or a guy drilling a well or a guy making steel for a wind turbine," he says by phone.

But he's also not waiting for coal to come back for his town's fortunes to return, with good reason.

This time last year, the Sierra Club celebrated the announcement that the Fisk and Crawford coal-fired power plants in Chicago had been slated for retirement, bringing the number of shuttered U.S. coal-fired plants to 100. Dozens more closings have since been announced. With a lack of new plants opening, Wyoming saw coal production drop 8.7 percent in 2011 from the prior year. Another proposed rail line, from the Powder River Basin to South Dakota, was mothballed late last year due to subpar demand.

One reason for the decreased domestic demand for coal is the down economy, which has reduced electricity use across the board. But some major economic forces bear down specifically on coal.

Northam, whose school proudly displays the logos of major mining and drilling companies as "partners," says America's piecemeal regulation of the coal industry and the specter of a carbon tax or other CO2 regulation has a lot to do with the U.S. coal industry's woes. But he says an equal foe is natural gas. Before Matt Damon's Promised Land made fracking a topic of Hollywood buzz, it was creating hell for coal companies by driving down the price of natural gas. Energy utilities have been opening natural gas-fired power plants instead of coal-fired ones. In a strange way, environmentalists and fracking unwittingly partnered to deal the coal industry a serious blow.

NPR even declared earlier this month that coal had lost its crown as America's energy king, usurped by natural gas. No one will argue that point in five years when, the government's Energy Information Administration says, 27 gigawatts of coal-fired power will be retired from the nation's grid—an 8.5 percent drop from 2011 levels.


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Even three years ago, coal companies were fairly muted in their excitement about shipping their wares to another continent. In 2009, Arch Coal, which now has mining rights to millions of tons of coal in Montana's Otter Creek area, would only go as far as to say that there was "growing interest" in coal exports on the West Coast. But by 2011, Arch said it intended to double its seaborne coal exports by 2020, most of which will go to Asia.

click to enlarge Today, 44 percent of America’s coal comes from Wyoming and Montana, while West Virginia, Kentucky and Pennsylvania combined produce less than 20 percent. - PHOTO COURTESY OF COMMERCE.MT.GOV
  • Photo courtesy of Commerce.mt.gov
  • Today, 44 percent of America’s coal comes from Wyoming and Montana, while West Virginia, Kentucky and Pennsylvania combined produce less than 20 percent.

Of course, that has as much to do with Asian demand as with the lack thereof in America. Most notable in this regard is China, which contains a fifth of the world's proven coal reserves, yet in 2009 became a net importer of coal. By 2010, China was consuming nearly half the world's coal as it continued to ramp up its blisteringly fast industrialization. But U.S. coal companies have been missing out on that party. Consider: While the U.S. produces three times the amount of coal Indonesia does, Indonesia exports three times as much as the U.S.

Enter the new route through Montana to Washington and Oregon.

"I just don't see the U.S. as being a source of new demand for coal," says Adele Morris, a Brookings Institution fellow and the policy director for the Climate and Energy Economics Project. "It just doesn't look like a booming industry ... You guys are bearing the brunt of this trend."

Speaking of a recent coal-industry confab in Wyoming, Northam says exports were on everyone's mind. "Nobody at the meeting thought the coal industry would disappear, but they are facing some years of hard times if international markets don't open up for them."

At the Decker Mine, 75 miners are still facing the prospect of losing their jobs, but in December the owners dangled the possibility of bringing them back on, with one catch: They'll need to send 5.5 million tons of coal to South Korea annually via the Pacific Northwest's Columbia River Basin.

Otter Creek, Decker, Longview, Bellingham: Through connecting rail lines, these locations and others in coal country and along the Washington and Oregon coasts could see 175 million tons of coal exported by 2022, based on permitting requests analyzed by Democratic U.S. Rep. Jim McDermott's office. By contrast, in 2011, Oregon and Washington exported just 5.9 million tons of coal.

The overarching environmental concern with shipping more coal to Asia is carbon emissions: The 1.2 billion tons of coal that could be extracted from the Otter Creek tracts alone would produce 3.12 billion tons of carbon dioxide. Yet a fairly unexamined issue—coal dust—has become the rallying point for coal-export opposition. As opponents would have it, coal trains will spew black dust across the Montana landscape; downtown Spokane and Sandpoint, Idaho; over the foot of Queen Anne Hill; and into homes in Bellingham—a galvanizing image that has united opponents across a swath of America that's been prone to send climate change skeptics to Congress.

But is it accurate?

Around the world, as coal has become more and more an international commodity, residents and government officials have grappled with contrary reports: some that show increased asthma attacks and bad air along rail corridors, others that seem to show that coal transportation has little impact.

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