Shortly after Senator Mitch McConnell (R-KY) was reelected to Congress, he told the press that his top priority while in office would be to “do whatever I can to get the EPA reined in.”
Love him or hate him, it’s not hard to understand why McConnell has declared war on the EPA. McConnell represents the state of Kentucky, the third-largest producer of coal in America. Kentucky derives roughly 93 percent of its electricity from coal-fired power plants, which is why the Environmental Protection Agency’s proposal to cut carbon emissions by 30 percent has coal-friendly senators like McConnell screaming for the agency’s blood.
Coal is the cheapest power – not only in the U.S. but the world – and it’s also good business. In West Virginia, the coal industry employs about 21,000 workers and added about $5.9 billion to the state’s GDP in 2008. According to the Washington Post, it also generated $670 million in taxes, or 15 percent of the state’s budget.
States like Kentucky and West Virginia have a significant stake in whether coal lives or dies in America, and their political representatives have made it their mission to cut back the environmental regulations that they claim are hurting the economy. And while they have reason to fear the EPA, the EPA’s regulations are not the only thing hurting the coal industry.
Despite blame hurled at President Obama and the EPA, coal jobs in Central Appalachia (comprising West Virginia and Kentucky’s mines) have been in decline since Reagan was in the White House in 1983.
The reason involves a combination of factors, such as the shale gas boom, the closure of coal plants, the automation of the industry, the rise of cheaper western coal and the dwindling reserves of Appalachian coal.
According to the Energy Information Administration (EIA), this year coal production in Central Appalachia is forecast to be half of what it was in 2008, down to 112 million tons. At the same time, some 27 gigawatts’ worth of coal-fired capacity are scheduled for retirement by 2016.
The EPA has certainly played its part in the decline. According to a 2013 study, up to 65 percent of U.S. coal has been threatened by stricter air pollution regulations as well as the availability of cheaper natural gas.
A bad export strategy is also to blame. In the last six years, the U.S. has reduced its coal consumption by 195 million tons, but 20 percent of that is still being shipped overseas. This has allowed the domestic coal industry to offset some of the regulatory impact, but the relief may not last for long.
For years China has been the biggest polluter on the planet, a prime consumer of coal in its rush to industrialize. Much of America’s surplus coal has been heading to China, but nowadays China is becoming more climate consciousness – the government even declared a “war on pollution.” With a national cap-and-trade program planned for 2016 and the planet’s biggest investment in solar power development, China is expected to shrug off American coal as the years advance. Goldman Sachs predicts that the average annual growth of America’s seaborne coal market will decline to just one percent by 2017, down from seven percent between 2007-2012.
There is plenty of potential for Central Appalachia to transition away from coal and into clean and renewable energies but, as the Washington Post points out, “it’d be a mistake to gloss over how disruptive — and painful — that transition could be.”