Shelby Demars

Brighter outlook for coal in 2017

This past year was a rough one for the coal industry. In 2016 we saw President Barack Obama’s final push to kill coal before the end of his term. The result was a significant drop in production due to closure of power plants the state had supplied, the loss of hundreds of Montana coal jobs, and a $7.3 million dollar reduction in state coal tax revenues.

But the worst seems to be over. Already our coal industry is recovering and 2017 looks to be a strong year.

President-elect Donald Trump’s electoral upset has brought hope to many whose livelihoods depend on coal. Trump promised economic growth and job creation in the form of bolstering American coal production, and thus far his actions have followed his campaign promises.

His selection of Montana’s Rep. Ryan Zinke as secretary of the Interior and Oklahoma Attorney General Scott Pruitt as chief of the Environmental Protection Agency indicates that America’s energy future will look vastly different than it has in the past.

Throughout the Obama administration the Department of Interior and the EPA were used to implement activist policies of extreme environmental groups, and Montana has been among the states most impacted by the administration’s anti-coal agenda.

But that may all soon change. With Zinke and Pruitt at the helm of the Department of Interior and the EPA, energy producers may be looking forward to a more stable regulatory environment and new opportunities for growth.

While the incoming administration has their work cut out for them in terms of rolling back the wave of regulations pushed by the Obama administration, there are a few initiatives that should take priority to put U.S. energy production back on track.

  • Approve West Coast terminals. Asian demand for coal is skyrocketing—but the only way for the U.S. to meet this growing demand has been cut off with the politically-motivated rejection by the Obama administration of several proposed export facilities on the Pacific Coast. By failing to implement a fair, unbiased, and timely review process, the Army Corp of Engineers has made it next to impossible to obtain the permits for construction, even when all permit requirements are fulfilled. President Trump could create thousands of jobs in Montana and the Pacific Northwest by approving new export terminals.
  • Lift coal leasing moratorium. Under the Obama administration, Interior implemented a moratorium on federal coal leases. This moratorium has serious implications for Montana, which is home to over one-third of U.S. coal reserves and where approximately half of coal production occurs on federal land. If the unjustified moratorium remains in place, Montana will lose between $40 million and $50 million per biennium in royalty revenue, in addition to losing thousands of jobs.
  • Roll back regulations. Obama’s anti-coal regulations were estimated to reduce carbon emissions by a meager 1 percent at a cost of billions to our Montana economy and thousands of jobs.
  • Invest in technology. In order to make a meaningful impact on emissions, we must invest in the technology that can reduce emissions without killing jobs or damaging our economy. Solutions such as carbon capture and sequestration and super-critical boilers are viable options for reducing emissions, but they require regulatory certainty to accomplish.

Investors need to know that if they meet the environmental standards that have been set, they’re going to get a permit. If that happens, we could see new power plants with state-of-the-art technology being built in the coming years—something not possible under Obama.

Things are looking up for coal in 2017. Global demand for coal remains strong, and Montana miners are well positioned to meet that demand. And with new leadership in Washington that will balance climate change concerns with economic vitality, all Montanans should be bullish on the future.

Shelby DeMars is the spokeswoman for Count on Coal Montana