Arcwire - Grassroots Journalism for a Green Future
 
  Home arrow Energy arrow Record-Breaking Fine spells Trouble for Coal Industry
 
  Monday, 13 October 2008
Topics
Home
Energy
Green Building
Transportation
Business & Policy
Science & Nature
Sections
Features
Breaking News
About Us
What We Do
Who We Are
Services
Contact Us
Resources
Links
Events List
Current Articles Index
All Current Articles
Energy
Building
Transportation
Business & Policy
Science & Nature
Features
Columns & Interviews
Breaking News
Search
Login





Lost Password?
No account yet? Register
RSS
 

Record-Breaking Fine spells Trouble for Coal Industry PDF Print E-mail
By Andy Mannle and Alison Loomis | Tuesday, 22 January 2008

Image
The coal industry has seen a series of blows in the past year, but none quite as messy as yesterday’s record-breaking penalty against Massey Energy Co. for violating the Clean Water Act.

Massey Energy Co., the nation's fourth-largest coal producer, was fined $20 million in civil penalties, the largest civil penalty ever levied by the federal government for a pollution violation of this type under the Clean Water Act.  In addition, Massey must invest $10 million in pollution control at its 44 coal mines and processing facilities.

While Massey can well afford the costs, they point to larger signs of trouble for the embattled coal industry.

Massey is a multi-billion dollar company, and the largest coal producer in Appalachia, with 19 mining complexes in southern Virginia, southern West Virginia and eastern Kentucky. The company’s long-controversial coal-mining procedure in southern Appalachia removes mountaintops for easy access to the coal.  Unfortunately, this procedure is done at enormous environmental expense, danger to human health, and significant contributions global warming.  In this lawsuit, considered long overdue, nearly 4,500 occasions of polluting hundreds of streams and waterways in West Virginia and Kentucky between 2000 and 2006 were reported.

Nor is this the first time Massey will pay the largest fine on record. The New York Times reports:

"The largest coal producer in Appalachia, Massey was fined $1.5 million last March by the federal Mine Safety and Health Administration. The fine, which stemmed from the deaths of two miners in a January 2006 fire at the Aracoma Alma No. 1 Mine in Logan County, W.Va., was the largest ever assessed by the agency for a coal mine accident. That accident is also the subject of a federal criminal investigation."

For a company with profits of nearly $100 million in 2007 alone, the $1.5 million fine may seem an insignificant price to pay for two lives. But the current, $20 million fine is also a small price to settle on considering Massey could have seen fines up to
$2.4 billion according to the EPA.

Massey has also been the subject of controversy after it was revealed that Massey President and Chairman Don Blankenship had a close relationship with Elliott E. Maynard, the chief justice of the West Virginia Supreme Court of Appeals. The judges' deciding vote reversed a judgment of $76.3 million against Massey in a dispute with rival coal company Harman Mining.

But when pictures surfaced of the men vacationing together in the Mediterranean months earlier, the judgement was called into question by Harman's lawyers. The judges hadn't argued Massey's misconduct in seizing a lucrative coal contract, but rather that they didn't have jurisdiction because the case should have been tried in Virginia. Under  public and political pressure, Maynard has just recused himself from the appeal of that decision, a motion the court will hear on Thursday.

Troubling Times for Coal

“We’re pleasantly surprised that E.P.A. is taking the first steps to correct the coal industry’s most flagrant abuses,” said Joe Lovett, a lawyer with the Appalachian Center for the Economy and the Environment, in Lewisburg, W.Va. Although Massey need not worry about bankruptcy and letting down their top investors, the coal industry is nonetheless beginning to experience a series of setbacks from the government and the economy.

Soaring construction and energy prices have increased costs in building new plants and transporting coal. Cleaning silted-up Great Lakes shipping channels and making railway improvements for transporting coal out of Powder River Basin in Wyoming and Montana, where 40% of U.S. coal comes from, is calculated to be in the billions.

The political unpopularity of greenhouse gas emissions, environmental degradation, and the noxious, dangerous conditions miners are subject to, make coal a hard cause to support publicly, especially in an election year. Meanwhile wind power is increasingly out-competing coal directly, with other renewables following fast behind.

The coal demographics initially began to shift after the Democrats won control of both chambers of Congress last year, prompting expectations of CO2 controls (like carbon caps) within a few years.  Initially, there was a rush to build coal-fired plants, hoping their plants would be grandfathered, and exempt from emission restrictions by the soon to come global warming bill, according to environmentalists.

The LA Times reports that Barbara Boxer of California and Jeff Bingaman of New Mexico --  chairs, respectively, of the environment and energy committees -- authored an article last January warning that even existing power plants would be held to any new laws aimed at reducing carbon dioxide emissions.

A recent study by the industry-funded Electric Power Research Institute projects that coal power will cost more than nuclear power or natural gas by 2030 if coal's carbon dioxide problem is solved by the unproven method of separating and pumping smokestack CO2 to underground reserves. Efforts to build a FutureGen plant in Illinois to investigate the possibility of coal sequestration have drawn criticism from the Department of Energy after the proposed costs doubled to $1.8 billion. 

For the first time, last fall, the Kansas Department of Health and Environment cited greenhouse gas emissions and the threat to public health in denying permits to two power companies, saying their proposed coal-fired plants would violate the Clean Air Act. Plants were cancelled or postponed in Washington, Colorado, Nevada, Utah, Florida, and Tennessee.  Altogether, 53 coal-fired plants were canceled or delayed in 2007, according to Global Energy Decisions, a private consulting firm that tracks power plants for the Department of Energy.

The Next Generation?

Meanwhile, new ones are being built in New Mexico, Mississippi and Indiana. According to spokeswoman Jennifer Crow, of Rainforest Action Network, 121 new coal powered power plants are under consideration.

Speaking of the urgency of environmental reforms at a press conference in San Francisco, she said, "This is going to install the next generation of dirty, polluting infrastructure in the US which is going to prevent us from doing what we need to do, which is reverse the course of climate change, and start building a green energy future. These projects are being supported by Federal government. They're being supported by private industry, and finance institutions like Citigroup and BofA."

Whilst the politics and economics of coal are beginning to change in the U.S., the race is on for improvements and expansion of  clean energies worldwide. Nevertheless, coal, which provides nearly half our country's electricity, in 600 plants across the country, is a mainstay of our energy and economy.
Despite conservation efforts, our energy needs keep rising, and we will continue to rely on companies like Massey and others to keep our lights on.

Even so, Energy regulators confronting prospects of reduced production of coal are raising the question of shortages, and price spikes. The solutions to these supply problems are increasingly more likely to be found, not in more coal, but in cleaner, cheaper forms of energy. Only by truly out-competing coal globally, will we be able to provide a cleaner model that rapidly growing economies, such as China and India, can follow.

To the extent we're able to hold companies accountable for their social and environmental malpractice, we can begin shifting the scales toward a day when Massey’s mountaintop removal will finally come to an end.


< Prev. Topic Item   Next Topic Item >
 
Related Items
Spotlight
Popular News

The richest woman in the world is a Chinese billionaire whose fortune dwarfs Oprah...
A lot of people are scratching their heads right now as we watch bank after bank melt down. Huge...

Nevada Senator Harry Reid organized the National Clean Energy Summit along with the...
West Coast Green is back!Moving to San Jose this year to bring the worlds of clean-tech and green...
Go to top of page  Home | What We Do | Services | Contact Us |