Repealing Measures to Control Pollution Won’t Bring Back Coal
A recent report from the Columbia Center on Global Energy Policy has found that Trump Administration efforts to repeal rules designed to clean the air and reduce the pollution that cause climate change will not bring back the coal industry or coal jobs. This is because market forces, not regulations, are largely responsible for the decline of the coal industry.
The study reinforces that it is in the best interests of our economy, as well as habitat and wildlife which suffers greatly from coal related pollution, to invest in a just and rapid transition to clean energy, spurring job growth and unlocking American innovation.
Why Coal is Declining
According to the report, market forces both at home and abroad are leading to a record decline in coal that has been occurring with some ups and downs for decades now, but has fallen sharply in the past few years. Contrary to some rhetoric, measures designed to limit pollution from coal plants and coal mines are not causing a significant decline in coal.
As the report lays out, the primary reasons for the decline in coal are: low natural gas prices (responsible for 49% of the decline); reduced demand related to efficiency and other factors (responsible for 26% of the decline); and the growth of renewable energy (responsible for 18% of the decline). Other factors, including pollution control measures, accounted for the remaining 7%.
Additionally, more than half the decline in coal company revenue was due to international factors. Recent troubles and coal company bankruptcies can be tied to international factors and poor company investments, with slumping domestic demand a secondary factor.
A Rapidly Shifting Market
The history of King Coal has been volatile, but its trajectory has been decline as other forms of energy have pushed it aside. As the report lays out, in 1920, coal accounted for 73% of total U.S. energy and about 800,000 jobs. But by 1970, it had already declined to 18% of total U.S. energy and provided about 145,000 jobs. By 2000, coal jobs had leveled out at about 100,000, and mechanization had permanently replaced many jobs.
The period between 2011 and 2016 – before many of the measures Trump is targeting to roll back or repeal went into effect – coal production plummeted 27% and domestic demand dropped 30%. During this same period, due to this decline and poor business decisions based on projected demand for coal in China that did not materialize, three of the four major coal companies declared bankruptcy.
In the meantime, other market forces were at play. Natural gas prices dropped dramatically, out-competing coal. But efficiency and renewable energy gains combined have been almost equally responsible for the change in coal demand.
For instance, in 2016, efficiency gains meant that the U.S. consumed less energy than it did in 2007 despite a 12% growth in the economy from 2007 to 2016.
Meanwhile, renewable energy costs have come way down. Onshore wind energy costs declined 36% between 2008 and 2016 resulting in a three-fold increase in wind energy production over that period. Solar photovoltaic prices fell an incredible 85% between 2008 and 2016 and solar generation expanded 40 times during that time. And, now, the first offshore wind turbines have started spinning off U.S. shores, promising to bring on line another abundant source of clean, affordable energy. These technologies are still rapidly evolving and costs will continue to fall, making renewable energy more affordable and making it harder and harder for coal to compete – especially if the real pollution costs of coal are factored in.
Cancelling Pollution Protections Won’t Bring Back Coal
The report finds that if natural gas prices significantly increase, Trump administration rollbacks could potentially bump coal production modestly up to 2013 levels, which are well below historic highs. Continued lower prices for other energy sources will mean further coal declines even if all of Trump’s planned pollution control repeals are put in place. Under all scenarios, coal jobs remain at relatively low numbers.
As the report concludes:
In the best case scenario for US coal consumption under President Trump in which natural gas prices more than double from current levels, demand would plateau at 19 percent below 2007 levels. In the worst-case scenario, coal consumption could drop below levels currently projected under Obama administration policies in 2025 and rival those levels in 2030.
In short, coal is declining because the market is changing, not because of policies that are seeking to protect the public from its pollution.
The Path Ahead
Coal’s decline has resulted in impacts to communities that have been reliant on the coal industry that are hard and cannot be discounted. These include job losses and a shrinking tax base for schools and other public investments.
But allowing coal producers and coal fired generators to pollute the environment is not going to provide lasting solutions for these communities. However, it will add to the sad legacy of coal pollution that harms the health, wildlife and outdoor economy of these and other communities while making it harder to keep a lid on runaway climate change that will cost us all.
We need sensible policies that help coal communities transition to a just, clean economy while protecting the natural resources, wildlife and outdoor economy that will be vital to long term prosperity. We also need policies that avert the worst impacts of climate change.
Fair minded policies can unlock American innovation by speeding the growth of renewables, reducing carbon pollution emissions at the scale and rate needed, helping impacted coal communities transition, and protecting wildlife and communities from harms like coal ash spills, mercury pollution, acid rain, and other ills. A key policy needed to achieve progress is a price on carbon that will fairly account for the true costs of energy generation while providing additional revenue.
Looking backwards is not the way forward. China and other countries are not slowing down. Between 2011 and 2015 China added more solar to the grid that any other country and almost as much wind as the rest of the world.
We have a chance to chart a prosperous way forward protects people and wildlife. We need to seize it.